IF Bancorp(US:IROQ)2023-09-13 16:31Financial Position - As of June 30, 2023, consolidated assets were $849.0 million, a decrease from $857.6 million in 2022, while consolidated deposits decreased from $752.0 million to $735.3 million[15]. - The company’s total loans, net of allowance for credit losses, were $587.5 million as of June 30, 2023, compared to $518.9 million in 2022[34]. - Total deposits amounted to $683.7 million as of June 30, 2023, with an average interest rate of 1.17%, compared to $660.7 million and 0.31% in 2022[141]. - The aggregate amount of uninsured deposits was $312.3 million at June 30, 2023, down from $333.9 million in 2022[141]. - Iroquois Federal's capital exceeded all applicable requirements as of June 30, 2023[164]. - As of June 30, 2023, Iroquois Federal was classified as "well-capitalized" with a total risk-based capital ratio exceeding 10.0%[179]. Loan Portfolio Composition - The loan portfolio composition as of June 30, 2023, included one- to four-family residential loans at $163.9 million (27.57%), multi-family loans at $89.6 million (15.08%), and commercial loans at $193.7 million (32.59%)[34]. - As of June 30, 2023, one- to four-family residential mortgage loans accounted for $163.9 million, or 27.6% of the total loan portfolio[40]. - Commercial real estate loans comprised $193.7 million, or 32.6% of the loan portfolio, while multi-family loans accounted for $89.6 million, or 15.1%[52]. - At June 30, 2023, commercial business loans outstanding were $79.7 million, representing 13.4% of the total loan portfolio, with $44.9 million in unfunded commitments[62]. - Construction loans made up $51.0 million, or 8.6% of the total loan portfolio, secured by various real estate properties[66]. Loan Performance and Credit Quality - Non-performing loans to total loans ratio improved to 0.02% at June 30, 2023, compared to 0.22% at June 30, 2022[82]. - Non-performing loans decreased to $117,000 at June 30, 2023, down from $1.2 million at June 30, 2022[122]. - Total delinquent loans decreased by $1.1 million to $202,000 at June 30, 2023, from $1.3 million at June 30, 2022[90]. - Troubled debt restructurings amounted to approximately $215,000 at June 30, 2023, down from $998,000 at June 30, 2022[86]. - The allowance for credit losses increased by $87,000 to $7.1 million at June 30, 2023, compared to $7.1 million at June 30, 2022[114]. Regulatory Compliance and Capital Requirements - The risk-based capital standards require a minimum common equity Tier 1 capital ratio of 4.5%, Tier 1 capital ratio of 6%, and total capital ratio of 8%[158]. - Iroquois Federal opted into the community bank leverage ratio framework effective March 31, 2020, with a required leverage ratio of 9%[163][162]. - The company has sufficient capital to increase purchases of loan participations, which totaled $46.1 million at June 30, 2023, up from $30.0 million at June 30, 2022[74]. - The company’s loan approval limits allow for one- to four-family residential mortgage loans up to $100,000 by loan officers and up to $2 million by the Loan Committee[76]. - The company is required to hold shares of capital stock in the Federal Home Loan Bank, and it was in compliance with this requirement as of June 30, 2023[187]. Market Position and Competition - The company ranked second in Iroquois County with a 19.95% deposit market share and first in Vermilion County with a 25.86% deposit market share as of June 30, 2022[28]. - The primary lending market includes counties with a population decline, except for Champaign County, which saw a 2.7% increase since April 2010[24]. - The company emphasizes the origination of commercial loans, which generally carry higher risks compared to residential real estate loans[202]. Operational Risks and Challenges - The company may face increased cybersecurity risks if employees are required to work remotely due to health crises, potentially disrupting business operations[213]. - The company’s financial condition may be adversely affected by epidemics or pandemics, impacting general commercial activity and economic conditions[212]. - Management's involvement is crucial for resolving non-performing assets, which can distract from overall operations and income-generating activities[208]. Investment and Funding - The company held $3.4 million in municipal securities, all issued by local governments and school districts within its market area[130]. - The company had $3.1 million in Federal Home Loan Bank of Chicago common stock related to borrowing activities totaling $19.5 million as of June 30, 2023[131]. - At June 30, 2023, the company invested $14.8 million in bank-owned life insurance, which was 16.2% of its Tier 1 capital plus allowance for credit losses[132]. - The company is increasingly dependent on external funding sources, which may affect financial flexibility and profitability if access to these sources is constrained[203].