Peoples Bancorp (US:PEBO)2021-04-29 20:01Financial Performance - Total interest income decreased to $38,962,000 in Q1 2021 from $40,862,000 in Q1 2020, a decline of 4.66%[138] - Net income for Q1 2021 was $15,463,000, compared to a net loss of $765,000 in Q1 2020, representing a significant turnaround[138] - Non-interest income excluding net gains and losses rose to $17,266,000 in Q1 2021, up from $15,505,000 in Q1 2020, a growth of 11.35%[138] - Return on average stockholders' equity improved to 10.86% in Q1 2021 from a negative 0.52% in Q1 2020[139] - Net interest income was $35.6 million for Q1 2021, a 4% increase from $34.3 million in Q4 2020, and a 3% increase from $34.6 million in Q1 2020[158] - Net income for Q1 2021 was $15.463 million, down from $20.573 million in Q4 2020 and a loss of $0.765 million in Q1 2020[228] Loan and Asset Growth - Total loans increased to $3,409,676,000 in Q1 2021 from $2,911,437,000 in Q1 2020, an increase of 17.06%[138] - Total assets increased to $5.14 billion as of March 31, 2021, an 8% increase from $4.76 billion at December 31, 2020[165] - Total originated loans reached $2,946.9 million as of March 31, 2021, an increase from $2,881.5 million at December 31, 2020, primarily due to growth in commercial real estate and consumer indirect loans[239] - The total loan balance increased by $6.7 million from December 31, 2020, with commercial real estate balances rising by $35.4 million and commercial and industrial loans increasing by $8.1 million, excluding PPP loans[240] Credit Losses and Allowance - The allowance for credit losses increased to $44,897,000 in Q1 2021 from $42,833,000 in Q1 2020, reflecting a rise of 4.82%[138] - Peoples recorded a recovery of credit losses of $4.7 million in Q1 2021, compared to a recovery of $7.3 million in the previous quarter and a provision for credit losses of $17.0 million in Q1 2020[154] - The allowance for credit losses at March 31, 2021, was $44.9 million, representing 1.32% of total loans[256] - Net charge-offs for Q1 2021 were $1,051,000, representing 0.13% of average total loans on an annualized basis[262] Non-Interest Income and Expenses - Total non-interest income increased by $402,000, or 2%, compared to Q4 2020, and by $1.2 million, or 7%, compared to Q1 2020[161] - Total non-interest expense rose by $4.7 million, or 14%, compared to Q4 2020, and by $3.7 million, or 11%, compared to Q1 2020[162] - Total non-interest expense for Q1 2021 was $37,987,000, up 14% from Q4 2020[223] - Core non-interest expense for Q1 2021 was $35,235,000, reflecting a 9% increase from Q4 2020[223] Capital and Equity - The common equity tier 1 capital ratio decreased to 12.42% in Q1 2021 from 13.91% in Q1 2020[139] - The total stockholders' equity at the end of Q1 2021 was $578,893,000, down from $583,721,000 at the end of Q1 2020[138] - Tangible book value per common share increased to $20.12 as of March 31, 2021, up from $19.99 at December 31, 2020, primarily due to net income exceeding declared dividends[284] Mergers and Acquisitions - Peoples signed a definitive agreement to acquire Premier Financial Bancorp in an all-stock merger valued at approximately $292.3 million, expected to close in Q3 2021[154] - Peoples Bank acquired NS Leasing's equipment finance business for approximately $116.6 million, with an additional potential earnout of up to $3.1 million[154] Regulatory and Operational Aspects - The company is subject to regulation by various financial authorities, including the Federal Reserve and the FDIC[151] - Peoples operates 88 locations and 85 ATMs across multiple states, offering a range of financial products and services[151] Deposit and Liquidity Management - As of March 31, 2021, total deposits increased by $393.8 million, or 10%, compared to December 31, 2020, and by $905.8 million, or 27%, compared to March 31, 2020[272] - Non-interest-bearing deposits reached $1,206.0 million, up from $997.3 million at December 31, 2020, reflecting higher customer balances due to PPP loan proceeds and fiscal stimulus payments[271][272] - The company maintained $120.0 million in excess cash reserves at the FRB of Cleveland as of March 31, 2021, compared to $25.1 million at December 31, 2020[234] Interest Rate and Economic Sensitivity - The interest rate spread increased to 3.13%, up from 3.00% in the previous quarter, indicating better profitability on interest-earning assets[174] - Estimated increase in net interest income for a 300 basis point increase in interest rates is $20,996 thousand, representing a 15.8% increase from December 31, 2020[291] COVID-19 Impact and Relief Measures - Peoples provided relief solutions to borrowers during the COVID-19 pandemic, including forbearance and modifications[154] - At March 31, 2021, approximately $13.0 million of deferments were outstanding, with commercial loan deferments comprising about $12.0 million[254]