Penns Woods Bancorp(US:PWOD)2024-04-25 14:14Financial Performance - Net income for the three months ended March 31, 2024, was $3.8 million, down from $4.7 million for the same period in 2023, resulting in basic and diluted earnings per share of $0.51 compared to $0.66 and $0.64, respectively [2][4]. - Core earnings for the same period were $3.8 million, a decrease from $4.7 million in 2023, with annualized core return on average assets at 0.69% and core return on average equity at 8.09%, down from 0.93% and 11.19% in 2023 [4]. - Net income available to common shareholders decreased by 18.25% to $3,808, with diluted earnings per share falling by 20.31% to $0.51 [21]. - Net income for Q1 2024 was $3,808,000, a decrease of 18.3% from $4,658,000 in Q1 2023 [26]. - Basic earnings per share (EPS) for Q1 2024 was $0.51, a decrease of 22.7% compared to $0.66 in Q1 2023 [29]. Asset and Loan Growth - Total assets increased to $2.2 billion, up $145 million from March 31, 2023, with net loans rising by $155.5 million to $1.8 billion [8]. - Total assets increased by 7.02% to $2,210,116, compared to $2,065,143 in 2023 [19]. - Loans held for sale rose significantly by 97.07% to $3,360, while total loans increased by 9.14% to $1,855,347 [19]. - The average loan portfolio balance increased by $185.5 million, with a corresponding increase in taxable equivalent interest income of $5.9 million [7]. Non-Performing Loans and Credit Quality - Non-performing loans increased to $8.0 million, resulting in a non-performing loans to total loans ratio of 0.43%, up from 0.28% in the previous year [9]. - The provision for credit losses increased to $138,000 from $71,000 in the prior year, primarily due to a loan relationship moving to nonaccrual status [5]. - The provision for credit losses increased by 94.37% to $138, suggesting a more cautious outlook on credit quality [21]. - Non-performing loans increased to $7,958,000, representing 0.36% of total assets, up from 0.23% in Q1 2023 [27]. Deposits and Liabilities - Deposits decreased by $20.3 million to $1.6 billion, with noninterest-bearing deposits down $30.9 million, while interest-bearing deposits increased by $10.6 million [10]. - Total deposits rose to $1,618,562,000 in Q1 2024, compared to $1,638,835,000 in Q1 2023, reflecting a decrease of 1.2% [27]. - Total liabilities rose by 6.63% to $2,016,599, with long-term borrowings increasing by 97.21% to $261,770 [19]. Shareholders' Equity - Shareholders' equity rose by $19.5 million to $193.5 million, with a book value per share of $25.72, up from $24.64 in 2023 [11][12]. - Shareholders' equity increased to $193,517,000 in Q1 2024, compared to $173,970,000 in Q1 2023, marking an increase of 11.2% [27]. - Shareholders' equity increased by 11.24% to $193,517, reflecting a rise in additional paid-in capital by 14.01% [19]. Interest Income and Expense - The net interest margin decreased to 2.69% for the three months ended March 31, 2024, from 3.10% in the same period of 2023, primarily due to a 156 basis point increase in the rate paid on interest-bearing liabilities [5]. - Total interest and dividend income grew by 32.05% to $26,230, driven by a 32.52% increase in loans including fees [21]. - Interest expense surged by 124.29% to $12,484, primarily due to a 136.15% increase in deposits [21]. - Net interest income for Q1 2024 was $13,746,000, down from $14,298,000 in Q1 2023, reflecting a decline of 3.9% [26]. Operational Efficiency - The efficiency ratio for Q1 2024 was 71.41%, up from 65.46% in Q1 2023, indicating a decline in operational efficiency [26]. - The interest rate spread decreased to 1.84% from 2.60% in the previous year, indicating tighter margins [24]. Strategic Focus - The company continues to focus on increasing electronic deposit banking utilization among customers as part of its core deposit gathering efforts [10].