DUBLIN, Ga., Feb. 12, 2021 (GLOBE NEWSWIRE) – Morris State Bancshares, Inc. (OTCQX: MBLU) (the “Company”), the parent company of Morris Bank, today announced net income of $ 17.4 million ended December 31, 2020, an increase of $ 3.8 million, or 27.80%, over net income of $ 13.6 million for the year ended December 31, 2019. The company also announced diluted earnings per share of $ 8.30 for 2020, which is 20.82%. Up from diluted earnings per share of $ 6.87 for 2019. Earnings resulted from disciplined fund management costs and strong fee income from the SBA Paycheck Protection Program (PPP) and strong mortgage production.
“We are very pleased with the company's financial performance in 2020. It has been a year of significant changes and challenges with the pandemic. Our team has worked to strengthen partnerships with our customers in unprecedented economic conditions, ”said Spence Mullis, President and CEO. “We continued to create significant value for our shareholders as we increased core deposits by over 37% to $ 896 million. Interest-free deposit growth was $ 87.7 million, or 45% of total core deposit growth. "
The company's total equity increased 16.15% to $ 129 million as of December 31, 2020, compared to $ 111 million as of December 31, 2019. The tangible book value per share increased to $ 56.04 as of December 31, 2020, which is an increase of 18.78%, or $ 8.86 per share as of December 31, 2019. On January 27, 2021, the Board of Directors approved an increase in its dividend for the first quarter to $ 0.38 per share on or about March 15, 2021 is payable to all registered shareholders by February 28, 20. 2021.
Net interest income for the years ended December 31, 2020 and 2019 was $ 48.8 million and $ 38.9 million, respectively, an increase of $ 9.8 million, or 25.23%. With lots of moving parts in 2020, the bank's net interest margin ended at 4.53% as of December 31, 2020, the same level as on December 31, 2019. The bank has been an active participant in PPP, booked over $ 86 million in loans and booked fee income of $ 2.2 million in 2020. The persistence of the margin resulted from careful fund management costs, which were able to offset a moderate decline in returns. Our return on earnings decreased from 5.47% for 2019 to 5.00% for the year ended December 31, 2020, a decrease of 47 basis points. Our financing costs decreased from 1.02% for 2019 to 0.52% for the year ended December 31, 2020, a reduction of 50 basis points. We anticipate that margin will continue to come under pressure in the future as it will be difficult to cut our financing costs significantly while competition for good credit remains.
The provision for credit losses was $ 3.6 million for the fiscal year ended December 31, 2020 compared to $ 1.7 million for the fiscal year ended December 31, 2019. Our provision as a percentage of total loans was 1.39% when PPP – Loans as of December offset total loans as of December 31, 2020, down from 1.31% as of December 31, 2019. Our unfavorably classified coverage ratio was 8.75% as of December 31, 2020 versus 14.49% as of December 31, 2019. Our stake in other property owners (ORE) decreased to $ 131,000 as of December 31, 2020 from $ 384,000 as of December 31, 2019. This level of problem assets and ORE is the lowest the bank has held in over ten years.
Noninterest expense increased 9.62%, or $ 2.46 million, to $ 28.1 million for the fiscal year ended December 31, 2020, compared to $ 25.6 million as of December 31, 2019. Most of that increase was on Salaries and employee benefits.
Forward-Looking Statements
Certain statements in this press release may not be based on historical facts and are forward-looking statements. These forward-looking statements may be identified by reference to one or more future periods or by the use of forward-looking terminology such as "anticipate", "believe", "estimate", "expect", "may", "may", "will", "would", "could" or "intend". We caution you not to place undue reliance on the forward-looking statements contained in this press release because actual results could differ materially from those expressed in such forward-looking statements due to a number of factors, including but not limited to. the business and economic conditions; Risks associated with the integration of acquired companies and future acquisitions; Changes in management staff; Interest rate risk; Ability to implement planned expansion and organic growth; Credit risk and concentrations related to the company's credit portfolio; Quality of assets and write-offs on loans; Inaccuracy in the assumptions and estimates that company management makes in establishing provisions for probable credit losses and other estimates; Lack of liquidity; Impairment of securities, goodwill or other intangible assets; the company's risk management strategies; increased competition; System errors or failures to prevent breaches of our network security; Changes to federal tax law or tax policy; the impact of recent and future legislative and regulatory changes; and increasing capital requirements. We assume no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this press release.
CONTACT:
Morris State Bancshares
Chris Bond
CFO
478-272-5202
| MORRIS STATE BANCSHARES, INC. | |||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||
| Consolidation of the income statement | |||||||||||||||
| December 31, 2020 | |||||||||||||||
| 2020 | 2019 | change | % Change | ||||||||||||
| (Unchecked) | |||||||||||||||
| Interest and dividend income: | |||||||||||||||
| Interest and fees on loans | $ | 50,465,805 | $ | 43,205,235 | $ | 7,260,570 | 16.80 | %. | |||||||
| Interest income from securities | 4,015,455 | 2,885,821 | 1,129,634 | 39.14 | %. | ||||||||||
| Income from sold federal funds | 103.208 | 513.422 | (410.214 | ) | -79.90 | %. | |||||||||
| Income from time deposits with other banks | 286,418 | 925.860 | (639,442 | ) | -69.06 | %. | |||||||||
| Other interest and dividend income | 59,919 | 137.457 | (77,538 | ) | -56.41 | %. | |||||||||
| Total interest and dividend income | 54.930.805 | 47,667,795 | 7,263,010 | 15.24 | %. | ||||||||||
| Interest expenses: | |||||||||||||||
| insoles | 5,037,818 | 7,963,852 | $ | (2,926,034 | ) | -36.74 | %. | ||||||||
| Interest on other borrowed funds | 1,091,607 | 733,330 | 358.277 | 48.86 | %. | ||||||||||
| Interest on Federal Funds Purchased | 72 | 151 | (79 | ) | -52.32 | %. | |||||||||
| Total interest expense | 6,129,497 | 8,697,333 | (2,567,836 | ) | -29.52 | %. | |||||||||
| Net interest income before risk provisioning | 48,801,308 | 38,970,462 | 9,830,846 | 25.23 | %. | ||||||||||
| Less provision for loan losses | 3,635,000 | 1,650,000 | 1,985,000 | 120.30 | %. | ||||||||||
| Net interest income after risk provisioning | 45,166,308 | 37.320.462 | 7,845,846 | 02/21 | %. | ||||||||||
| Non-interest income: | |||||||||||||||
| Service fees on deposit accounts | 1,951,399 | 2,303,415 | (352.016 | ) | -15.28 | %. | |||||||||
| Other service fees, commissions and fees | 1,282,853 | 828.467 | 454.386 | 54.85 | %. | ||||||||||
| Profit from the sale of loans | 187.006 | 263.029 | (76.023 | ) | -28.90 | %. | |||||||||
| Increase in life insurance CSV | 372.060 | 213,246 | 158.814 | 74.47 | %. | ||||||||||
| Different income | 366,850 | 401,956 | (35, 106 | ) | -8.73 | %. | |||||||||
| Total interest-free income | 4,160,168 | 4,010,113 | 150,055 | 3.74 | %. | ||||||||||
| Non-interest-related costs: | |||||||||||||||
| Salaries and employee benefits | 16,656,208 | 14,358,637 | 2,297,571 | 4 p.m. | %. | ||||||||||
| Occupancy and equipment costs, net | 2,650,008 | 2,372,548 | 277,460 | 11.69 | %. | ||||||||||
| (Profit) loss from sales and retrieval of securities | (46.323 | ) | 24,471 | (70, 794 | ) | -289.30 | %. | ||||||||
| Loss (profit) on the sale of foreclosed assets and other real estate | 74.094 | (270.572 | ) | 344.666 | -127.38 | %. | |||||||||
| Profit from the sale of premises and equipment | (4,000 | ) | (1,000 | ) | (3,000 | ) | 300.00 | %. | |||||||
| Other issues | 8,732,695 | 9,116,832 | (384.137 | ) | -4.21 | %. | |||||||||
| Total interest-independent expense | 28,062,682 | 25,600,916 | 2,461,766 | 9.62 | %. | ||||||||||
| Pre-tax income | 21,263,794 | 15,729,659 | 5,534,135 | 35.18 | %. | ||||||||||
| Provision for income taxes | 3,855,806 | 2,108,705 | 1,747,101 | 82.85 | %. | ||||||||||
| Net result | $ | 17,407,988 | $ | 13,620,954 | $ | 3,787,034 | 27.80 | %. | |||||||
| Earnings per common share: | |||||||||||||||
| basic | $ | 8.30 | $ | 6.87 | $ | 1.43 | 20.82 | %. | |||||||
| Diluted | $ | 8.30 | $ | 6.87 | $ | 1.43 | 20.82 | %. | |||||||
| MORRIS STATE BANCSHARES, INC. | |||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||
| Consolidation of the balance sheet | |||||||||||||||
| December 31, 2020 | |||||||||||||||
| 2020 | 2019 | change | % Change | ||||||||||||
| (Unchecked) | |||||||||||||||
| FINANCIAL ASSETS | |||||||||||||||
| Cash and due from banks | $ | 56,290,263 | $ | 77,696,887 | $ | (21.406.624 | ) | -27.55 | %. | ||||||
| Federal funds sold | 93.200.409 | 16,293,628 | 76.906.781 | 472.01 | %. | ||||||||||
| Sum of cash and cash equivalents | 149.490.672 | 93.990.515 | 55.500.157 | 59.05 | %. | ||||||||||
| Interest-bearing time deposits with other banks | 350,000 | 1,350,000 | (1,000,000 | ) | -74.07 | %. | |||||||||
| Available-for-sale securities at fair value | 205.427.671 | 124,315,098 | 81,112,573 | 65.25 | %. | ||||||||||
| Securities held to maturity at cost | 12,730,837 | 4,752,384 | 7,978,453 | 167.88 | %. | ||||||||||
| Federal Home Loan Bank shares, restricted, at cost | 899,700 | 842,900 | 56,800 | 6.74 | %. | ||||||||||
| Loans less unearned income | 837,333,161 | 738,886,405 | 98,446,756 | 13.32 | %. | ||||||||||
| Less allowance for credit losses | (10,781,434 | ) | (9,716,060 | ) | (1.065.374 | ) | 10.97 | %. | |||||||
| Loans, net | 826.551.727 | 729,170,345 | 97,381,382 | 13.36 | %. | ||||||||||
| Bank rooms and equipment, net | 15,348,697 | 15,618,198 | (269.501 | ) | -1.73 | %. | |||||||||
| Operating lease ROU assets, net | 641.008 | 519,601 | 121,407 | 23.37 | %. | ||||||||||
| Goodwill | 9,361,770 | 9,361,770 | – – | 0.00 | %. | ||||||||||
| Intangible assets, net | 2,717,311 | 3,067,075 | (349.764 | ) | -11.40 | %. | |||||||||
| Other real estate and excluded assets | 141.255 | 396,486 | (255.231 | ) | -64.37 | %. | |||||||||
| Accrued interest claims | 4,763,849 | 3,962,808 | 801.041 | 20.21 | %. | ||||||||||
| Surrender value of life insurance | 13,620,443 | 13,248,384 | 372.059 | 2.81 | %. | ||||||||||
| Other assets | 7,370,992 | 6,352,407 | 1,018,585 | 16.03 | %. | ||||||||||
| Total assets | $ | 1,249,415,932 | $ | 1,006,947,971 | $ | 242,467,961 | 08/24 | %. | |||||||
| LIABILITY AND EQUITY OF THE SHAREHOLDERS | |||||||||||||||
| Insoles: | |||||||||||||||
| Not interest-bearing | $ | 282,746,775 | $ | 195.016.772 | $ | 87.730.003 | 44.99 | %. | |||||||
| Interest-bearing | 804,440,237 | 682,509,497 | 121.930.740 | 17.87 | %. | ||||||||||
| 1,087,187,012 | 877,526,269 | 209.660.743 | 23.89 | %. | |||||||||||
| Other borrowed funds | 28,677,477 | 14,483,605 | 14,193,872 | 98.00 | %. | ||||||||||
| Lease liability for operating leases | 641.008 | 519,601 | 121,407 | 23.37 | %. | ||||||||||
| Accrued interest | 269,880 | 537,598 | (267.718 | ) | -49.80 | %. | |||||||||
| Provisions and other liabilities | 3,221,471 | 2,455,266 | 766.205 | 31.21 | %. | ||||||||||
| Total liabilities | 1,119,996,848 | 895.522.339 | 224,474,509 | 25.07 | %. | ||||||||||
| Equity: | |||||||||||||||
| Common stock | 2,144,766 | 2,144,766 | – – | 0.00 | %. | ||||||||||
| Paid in excess of capital | 39,292,064 | 39,292,064 | – – | 0.00 | %. | ||||||||||
| Retained earnings | 65,858,082 | 55.916.996 | 9,941,086 | 17.78 | %. | ||||||||||
| Result of the current year | 17,407,988 | 13,620,954 | 3,787,034 | 27.80 | %. | ||||||||||
| Cumulative other comprehensive income (loss) | 6,381,381 | 1,830,484 | 4,550,897 | 248.62 | %. | ||||||||||
| Treasury shares priced at 50,927 in 2020 and 46,517 shares in 2019 | (1,665,197 | ) | (1,379,632 | ) | (285,565 | ) | 20.70 | %. | |||||||
| Total equity | 129,419,084 | 111,425,632 | 17,993,452 | 16.15 | %. | ||||||||||
| Total liabilities and equity | $ | 1,249,415,932 | $ | 1,006,947,971 | 242,467,961 | 08/24 | %. | ||||||||
| MORRIS STATE BANCSHARES, INC. | |||||||||||||||||||||||||||
| AND SUBSIDIARIES | |||||||||||||||||||||||||||
| Selected financial information | |||||||||||||||||||||||||||
| end of year | Quarter ended | ||||||||||||||||||||||||||
| December 31, | December 31, | December 31, | 30. September | June 30th | March 31, | December 31, | |||||||||||||||||||||
| 2020 | 2019 | 2020 | 2020 | 2020 | 2020 | 2019 | |||||||||||||||||||||
| (Dollars in thousands, excluding data per share) | (Unchecked) | (Unchecked) | (Unchecked) | (Unchecked) | (Unchecked) | (Unchecked) | |||||||||||||||||||||
| Data per share | |||||||||||||||||||||||||||
| Basic income per common share | $ | 8.30 | $ | 6.87 | $ | 2.64 | $ | 1.95 | $ | 0.95 | $ | 2.50 | $ | 1.48 | |||||||||||||
| Diluted earnings per common share | 8.30 | 6.87 | 2.64 | 1.95 | 0.95 | 2.50 | 1.48 | ||||||||||||||||||||
| Dividends per common share | 1.75 | 0.93 | – – | – – | – – | 1.02 | – – | ||||||||||||||||||||
| Book value per common share | 61.81 | 53.11 | 61.81 | 51.87 | 49.78 | 46.71 | 53.11 | ||||||||||||||||||||
| Material value per ordinary share | 56.04 | 47.18 | 56.04 | 45.91 | 43.62 | 45.18 | 47.18 | ||||||||||||||||||||
| Average Diluted Shares Outstanding | 2,095,633 | 1,997,735 | 2,095,185 | 2,058,039 | 1,988,231 | 1,840,764 | 2,100,395 | ||||||||||||||||||||
| End of period common stock outstanding | 2,093,839 | 2,098,250 | 2,093,839 | 2,100,842 | 2,057,568 | 1,840,980 | 2,098,250 | ||||||||||||||||||||
| Annualized KPIs (Bank only) | |||||||||||||||||||||||||||
| Return on average wealth | 1.78% | 1.63% | 2.05% | 1.74% | 1.51% | 1.75% | 1.49% | ||||||||||||||||||||
| Return on average equity | 14.38% | 14.56% | 16.31% | 14.07% | 11.82% | 14.46% | 12.37% | ||||||||||||||||||||
| Equity / Assets | 11.98% | 11.81% | 11.98% | 12.48% | 2.00% | 11.88% | 11.65% | ||||||||||||||||||||
| Cost of funds | 0.52% | 1.03% | 0.31% | 0.40% | 0.57% | 0.84% | 0.91% | ||||||||||||||||||||
| Net interest margin | 4.53% | 4.53% | 4.44% | 4.40% | 4.70% | 4.59% | 4.41% | ||||||||||||||||||||
| Efficiency ratio | 51.52% | 57.80% | 51.45% | 51.38% | 50.56% | 53.26% | 54.88% | ||||||||||||||||||||