Marathon Bancorp Inc(US:MBBC)2023-11-14 21:30Financial Position - Total assets decreased by $3.2 million, or 1.3%, to $235.6 million at September 30, 2023, from $238.8 million at June 30, 2023 [151]. - Total deposits decreased by $8.6 million, or 4.4%, to $188.6 million at September 30, 2023, from $197.2 million at June 30, 2023 [155]. - Total stockholders' equity increased by $178,000, or 0.6%, to $31.5 million at September 30, 2023, from $31.3 million at June 30, 2023 [157]. - Federal Home Loan Bank (FHLB) advances increased by $5.0 million to $13.0 million at September 30, 2023, compared to $8.0 million at June 30, 2023 [156]. - The company was classified as "well capitalized" for regulatory capital purposes as of September 30, 2023 [206]. Loan Portfolio - Loans decreased by $180,000, or 0.09%, to $199.7 million at September 30, 2023, with a notable decrease in consumer loans by $1.0 million, or 35.7% [154]. - Commercial real estate loans increased by $489,000, or 0.6%, to $85.1 million at September 30, 2023 [154]. - The allowance for credit losses at September 30, 2023, reflects the company's current estimate of lifetime credit losses expected from its loan portfolio [143]. - The allowance for credit losses was $2.0 million, or 1.01% of loans outstanding at September 30, 2023, down from $2.1 million, or 1.05%, at September 30, 2022 [174]. - The provision for credit losses for the three months ended September 30, 2023, was $41,000, while total charge-offs amounted to $137,000, resulting in net charge-offs of $136,000 [199]. Income and Expenses - Net income decreased by $425,000, or 83.1%, to $86,000 for the three months ended September 30, 2023, from $511,000 for the same period in 2022 [164]. - Interest income increased by $378,000, or 18.7%, to $2.4 million for the three months ended September 30, 2023, compared to $2.0 million for the same period in 2022 [165]. - Loan interest income increased by $269,000, or 14.1%, to $2.2 million for the three months ended September 30, 2023, from $1.9 million for the same period in 2022 [166]. - Interest expense increased by $528,000, or 167.9%, to $842,000 for the three months ended September 30, 2023, from $314,000 for the same period in 2022 [169]. - Net interest income decreased by $150,000, or 8.7%, to $1.6 million for the three months ended September 30, 2023, from $1.7 million for the same period in 2022 [172]. - Non-interest income decreased by $132,000 to $228,000 for the three months ended September 30, 2023, primarily due to a $173,000 gain on life insurance proceeds recorded in the prior year [177]. - Total non-interest expenses increased to $1.5 million for the three months ended September 30, 2023, compared to $1.4 million in the same period of 2022, driven by a $59,000 increase in other expenses [179]. - Income tax expense rose to $201,000 for the three months ended September 30, 2023, an increase of $84,000 from $117,000 in the prior year, due to a change in the effective tax rate [180]. - The effective tax rate increased to 70.0% for the three months ended September 30, 2023, compared to 18.6% in the prior year, influenced by changes in Wisconsin tax law [182]. Asset Quality - Total non-performing assets were $2.3 million at September 30, 2023, consistent with the previous quarter, primarily related to real estate owned from a construction loan foreclosure [188]. - The total non-performing assets to total assets ratio was 0.98% at September 30, 2023, compared to 0.97% at June 30, 2023 [187]. - Management's estimates of expected credit losses are based on historical loan losses and current economic conditions, with adjustments for qualitative factors [194]. - The company assesses the allowance for credit losses on a quarterly basis, with potential adjustments based on regulatory reviews and changes in economic conditions [175]. Cash Flow - Net cash provided by operating activities was $367,000 for the three months ended September 30, 2023, compared to $1.5 million for the same period in 2022, indicating a significant decrease [204]. - Net cash used in investing activities was $1.4 million for the three months ended September 30, 2023, down from $5.7 million in the same period of 2022 [204]. - The company had outstanding commitments to originate loans of $7.2 million and $1.2 million in commitments to sell loans as of September 30, 2023 [207]. - Time deposits scheduled to mature in one year or less totaled $53.4 million, including $4.2 million in brokered certificates of deposit [207]. - The company anticipates retaining a substantial portion of maturing time deposits, which may mitigate the need for additional borrowings [205].