Norwood Financial (US:NWFL)2024-05-09 13:02Financial Position - Total assets increased to $2.260 billion as of March 31, 2024, from $2.201 billion as of December 31, 2023, driven by a $45.8 million increase in cash and cash equivalents and an $18.0 million increase in loans outstanding [104]. - Total deposits increased by $43.8 million, mainly due to a $49.0 million rise in certificates of deposit, while other deposit categories decreased by $5.2 million [111]. - Total stockholders' equity was $181.2 million as of March 31, 2024, reflecting a $4.4 million increase due to net income, offset by dividends declared and a decrease in the fair value of securities [115]. - Total liquidity as of March 31, 2024, was $510.3 million, representing 22.6% of total assets, an increase from $472.4 million and 21.5% of total assets as of December 31, 2023 [123]. - The maximum borrowing capacity with the Federal Home Loan Bank was approximately $675,110,000 as of March 31, 2024, with $91,179,000 outstanding [125]. Loan Performance - Loans receivable rose to $1.603 billion, with a $16.6 million increase in commercial real estate loans and a $3.4 million increase in commercial loans, partially offset by a $9.1 million decrease in residential, agricultural, and construction loans [106]. - Non-performing loans decreased to $3.735 million, or 0.23% of total loans, compared to $7.622 million, or 0.48% at December 31, 2023, primarily due to a decrease in commercial loans [108]. - The allowance for credit losses was $18.02 million, representing 1.11% of total loans outstanding, down from 1.18% at the end of 2023, with net charge-offs of $323,000 for the three months ended March 31, 2024 [107]. - The provision for credit losses released $624,000 during the three months ended March 31, 2024, compared to a provision of $300,000 for the same period in 2023 [139]. Income and Earnings - For the three months ended March 31, 2024, net income was $4,433,000, down from $5,782,000 for the same period in 2023, representing a decrease of 23.3% [134]. - Earnings per share for the three months ended March 31, 2024, were $0.55, compared to $0.71 for the same period in 2023, reflecting a decline of 22.5% [134]. - Net income for the three months ended March 31, 2024, was $4,433,000, a decrease of 23.4% from $5,782,000 for the same period in 2023 [135]. - Other income totaled $2,006,000 for the three months ended March 31, 2024, an increase of 4.9% from $1,912,000 for the same period in 2023 [141]. Interest Income and Expenses - Net interest income decreased by $1,383,000, contributing to the overall decline in net income [134]. - Interest income (fte) increased to $27,133,000 with a yield on average earning assets of 5.08%, compared to $21,893,000 and 4.37% for the same period in 2023 [137]. - Interest expense for the three months ended March 31, 2024, was $12,228,000, reflecting an increase of 117.5% from $5,618,000 in the same period of 2023 [138]. - The net interest margin (tax equivalent basis) for the three months ended March 31, 2024, was 2.79%, down from 3.25% in the same period of 2023 [128]. - Net interest income (fte) for the three months ended March 31, 2024, totaled $14,905,000, down $1,370,000 or 8.4% from the comparable period in 2023 [136]. Operational Metrics - The annualized return on average assets for the three months ended March 31, 2024, was 0.80%, down from 1.13% in the same period of 2023 [134]. - The annualized return on average equity for the three months ended March 31, 2024, was 9.79%, compared to 13.61% for the same period in 2023 [134]. - Other expenses increased by $1,296,000 or 12.4% to $11,732,000 for the three months ended March 31, 2024, primarily due to increases in salaries, professional fees, and data processing expenses [142]. - The effective tax rate for the three months ended March 31, 2024, was 21.0%, compared to 20.5% for the same period in 2023 [143]. Capital Ratios - Tier 1 Capital to average assets ratio was 8.95% as of March 31, 2024, slightly down from 9.00% at the end of 2023, while Total Capital to risk-weighted assets ratio was 12.99% [117]. - As of March 31, 2024, the Company had a positive 90-day interest sensitivity gap of $57.4 million, indicating that rate-sensitive assets exceeded rate-sensitive liabilities [147].