CF Bankshares (US:CFBK)2022-11-08 16:00Financial Performance - Net income for the three months ended September 30, 2022, totaled $4.2 million, an increase of $173,000, or 4.2%, compared to $4.1 million for the same period in 2021[202]. - Net income for the nine months ended September 30, 2022 was $13.5 million, a decrease of $493,000, or 3.5%, compared to $14.0 million for the same period in 2021[213]. - Net interest income for the quarter ended September 30, 2022, totaled $13.3 million, an increase of $2.9 million, or 27.9%, compared to $10.4 million for the same quarter in 2021[203]. - Net interest income for the nine months ended September 30, 2022 was $35.6 million, an increase of $4.5 million, or 14.7%, compared to $31.1 million for the same period in 2021[215]. - Noninterest income for Q3 2022 was $705,000, a decrease of $1.4 million, or 66.1%, from $2.1 million in Q3 2021, primarily due to a $1.9 million decrease in gain on sale of deposits[209]. Asset and Liability Management - Total assets increased to $1.8 billion as of September 30, 2022, representing an 18.0% increase from $1.5 billion at December 31, 2021[173]. - Total liabilities rose to $1,527,385 thousand in 2022, up from $1,257,855 thousand in 2021, indicating a growth of approximately 21%[226]. - Deposits totaled $1.5 billion at September 30, 2022, an increase of $243.6 million, or 19.6%, compared to $1.2 billion at December 31, 2021[193]. - Total criticized and classified loans decreased by $2.8 million, or 44.8%, during the nine months ended September 30, 2022[186]. - Total past due loans decreased by $2.3 million, totaling $1.3 million at September 30, 2022, compared to $3.6 million at December 31, 2021[188]. Loan and Lease Performance - Net loans and leases reached $1.5 billion, up $259.7 million or 21.4% from $1.2 billion at December 31, 2021, driven by increases in various loan categories[175]. - The allowance for loan and lease losses (ALLL) totaled $15.7 million, a slight increase of $179,000 or 1.2% from $15.5 million at December 31, 2021[177]. - Nonperforming loans totaled $1.0 million, with a ratio of 0.07% to total loans, compared to 0.08% at December 31, 2021[181]. - Individually evaluated impaired loans decreased to $203,000, down $2.8 million or 93.2% from $3.0 million at December 31, 2021[179]. - Interest income increased by $5.3 million, or 41.7%, totaling $18.0 million for the quarter ended September 30, 2022, compared to $12.7 million for the same period in 2021[204]. Capital and Equity - Stockholders' equity increased by $9.6 million, or 7.6%, totaling $134.9 million at September 30, 2022, compared to $125.3 million at December 31, 2021[199]. - The average yield on loans and leases was 4.74% in 2022, up from 4.05% in 2021, indicating an increase of 69 basis points[226]. - The net interest margin for the nine months ended September 30, 2022 was 3.17%, an increase of 23 basis points from 2.94% in 2021[215]. - Net interest margin improved to 3.36% in 2022, compared to 3.21% in 2021, showing an increase of 15 basis points[226]. Operational Changes and Strategy - The company exited the direct-to-consumer mortgage business in favor of portfolio lending, which has become the primary driver of earnings[170]. - CFBank originated approximately $126 million in Paycheck Protection Program (PPP) loans during Q2 2020, benefiting over 550 borrowers[168]. - The company opened two new banking offices in Ohio City (Cleveland) and Red Bank (Cincinnati) in October 2022, expanding its market presence[167]. Liquidity and Funding - Total cash available from liquid assets and borrowing capacity was $534.7 million at September 30, 2022, compared to $419.2 million at December 31, 2021[242]. - Additional borrowing capacity at the FHLB increased by $49.0 million, or 43.3%, to $162.1 million at September 30, 2022, compared to $113.1 million at December 31, 2021[243]. - CFBank's liquidity management is a daily and long-term responsibility, adjusting investments based on expected loan demand and deposit flows[239]. - The Holding Company had adequate funds and sources of liquidity at September 30, 2022, to meet current and anticipated operating needs[247]. Regulatory and Compliance - The principal executive officer and principal financial officer concluded that the disclosure controls and procedures were effective as of the quarter ended September 30, 2022[257]. - No changes were made in internal controls over financial reporting in Q3 2022 that materially affected the internal control over financial reporting[257]. - The company is not involved in any pending legal proceedings that management believes would have a material adverse effect on its financial condition or results of operations[260].