C&F Financial (US:CFFI)2022-11-07 16:00Financial Performance - Consolidated net income for 2022 was $19.063 million, a decrease of 17.5% compared to $23.082 million in 2021[153]. - Community banking segment net income increased to $13.754 million in 2022, up 26.5% from $10.884 million in 2021[153]. - Net income for the three months ended September 30, 2022, was $6,545,000, a decrease of 16.4% compared to $7,827,000 for the same period in 2021[322]. - The company reported a net income attributable to C&F Financial Corporation of $6,555,000 for the three months ended September 30, 2022, compared to $7,753,000 for the same period in 2021, reflecting a decrease of 15.5%[322]. Loan and Deposit Growth - Consumer finance segment loans grew by $28.6 million or 26.2% annualized in Q3 2022 compared to Q2 2022[159]. - Average loans increased by $94.6 million to $1.58 billion for Q3 2022, and by $18.8 million to $1.53 billion for the first nine months of 2022 compared to the same periods in 2021[194]. - Total loans reached $1,526,238 thousand, with a net interest income of $67,890 thousand for the period[187]. - Total loans increased to $1,567,202,000 as of September 30, 2022, from $1,410,060,000 as of December 31, 2021, representing a growth of 11.1%[254]. - Total loans in the Community Banking Segment reached $1,095,367,000 as of September 30, 2022, compared to $1,032,477,000 as of December 31, 2021, marking an increase of 6.1%[257]. - Total loans in the consumer finance segment was $465,713,000 as of September 30, 2022, showing a stable performance in the segment[250]. Interest Income and Margin - Consolidated annualized net interest margin was 4.37% in Q3 2022, up from 4.25% in Q3 2021[159]. - Net interest income for the third quarter of 2022 was $24,531 thousand, up from $21,749 thousand in the same period of 2021, indicating an increase of about 12.93%[184]. - The yield on total loans for the third quarter of 2022 was 5.82%, compared to 5.91% in the third quarter of 2021, showing a slight decrease of 0.09 percentage points[184]. - The interest rate spread for the third quarter of 2022 was 4.19%, an increase from 4.06% in the same quarter of the previous year[184]. - The average yield on community banking segment loans was 4.20% for the third quarter of 2022, down from 4.57% in the same quarter of 2021[181]. - The Corporation expects net interest margin to continue to expand despite rising deposit costs due to higher average yields on earning assets[202]. Noninterest Income and Expenses - Total noninterest income decreased by $5.6 million, or 47.9%, for Q3 2022, and by $20.2 million, or 52.1%, for the first nine months of 2022 compared to the same periods in 2021[204]. - Total noninterest expenses decreased by $1.8 million, or 7.9%, in Q3 2022, and by $12.2 million, or 16.8%, in the first nine months of 2022 compared to the same periods in 2021[208]. - Noninterest income for the community banking segment increased due to higher service charges on deposit accounts and debit card interchange income[219]. Capital and Equity - Total equity decreased to $185.4 million at September 30, 2022, down from $211.0 million at December 31, 2021[160]. - The Corporation's tier 1 capital ratio was 12.8% at September 30, 2022, compared to 13.0% at December 31, 2021[160]. - The Corporation's total risk-based capital ratio is 15.4% as of September 30, 2022, exceeding the minimum requirement of 8.0%[312]. - The Tier 1 risk-based capital ratio stands at 12.8%, well above the minimum requirement of 6.0%[312]. - Common Equity Tier 1 capital ratio is reported at 11.4%, surpassing the minimum requirement of 4.5%[312]. Asset and Liability Management - The Corporation's total assets increased to $2,336,456 thousand as of September 30, 2022, compared to $2,178,742 thousand in the previous year, reflecting a growth of approximately 7.25%[184]. - Total interest-bearing deposits amounted to $1,376,407 thousand in the third quarter of 2022, compared to $1,274,640 thousand in the same quarter of 2021, representing an increase of approximately 8.00%[184]. - The Corporation maintains overall liquidity sufficient to satisfy its operational requirements and contractual obligations[307]. Loan Losses and Charge-offs - The Corporation's allowance for loan losses was $40,976 thousand as of September 30, 2022, compared to $39,215 thousand in the previous year, indicating a slight increase in reserves[184]. - The provision for loan losses in the consumer finance segment increased to $1,200 for Q3 2022 from $400 in Q3 2021, reflecting significant loan growth[235]. - The ratio of annualized net charge-offs to average loans for the consumer finance segment was 0.22% for the first nine months of 2022[241]. - Nonaccrual loans decreased to $2,304,000 as of September 30, 2022, compared to $2,924,000 as of December 31, 2021, indicating a reduction of 21.2%[254]. Market and Economic Conditions - The company expects future operations to be influenced by interest rate fluctuations and general economic conditions, including inflation and unemployment levels[326]. - Recent increases in interest rates have affected the Corporation's sensitivity to interest rate risk[330].