Rhinebeck Bancorp(RBKB) - 2023 Q2 - Quarterly Report

Financial Position - Total assets increased by $1.2 million, or 0.1%, to $1.337 billion at June 30, 2023, compared to $1.336 billion at December 31, 2022[164] - Total liabilities increased by $1.8 million, or 0.2%, to $1.230 billion at June 30, 2023, mainly due to a $48.7 million increase in advances from the Federal Home Loan Bank[169] - Stockholders' equity decreased by $669,000, or 0.6%, to $107.5 million at June 30, 2023, primarily due to stock repurchases and valuation changes in available-for-sale securities[173] - The ratio of stockholders' equity to total assets was 8.04% at June 30, 2023, down from 8.09% at December 31, 2022[173] - Total assets increased to $1,340,720 thousand as of June 30, 2023, compared to $1,281,058 thousand in 2022, reflecting a growth of 4.6%[195] Cash and Liquidity - Cash and cash equivalents rose by $22.6 million, or 71.9%, to $53.9 million at June 30, 2023, primarily due to increased deposits at the Federal Home Loan Bank of New York[165] - Cash flows from operating activities were $4.4 million for the six months ended June 30, 2023, down from $10.2 million in 2022, reflecting changes in cash receipts and disbursements[209] - Cash provided by investing activities was $19.5 million in the first half of 2023, a significant improvement compared to a cash outflow of $62.1 million in the same period of 2022[209] - As of June 30, 2023, the total available sources of funds amounted to $441,260,000, which includes cash and cash equivalents of $53,948,000 and unencumbered securities of $127,317,000[210] - The Bank has access to a preapproved secured line of credit with the FHLB totaling $668,477,000 as of June 30, 2023, which is not included in the readily accessible funds[210] Loans and Credit - Net loans decreased by $7.3 million, or 0.7%, to $987.0 million at June 30, 2023, with a notable reduction in the indirect automobile portfolio by $39.3 million, or 8.6%[167] - The average balance of loans increased by $121.3 million for the six months ended June 30, 2023, while the average balance of available for sale securities decreased by $58.5 million[179] - The provision for credit losses on loans decreased by $798,000, resulting in a credit of $452,000 for the quarter ended June 30, 2023[183] - Net charge-offs increased by $745,000, resulting in net charge-offs of $622,000 for the second quarter of 2023[185] Income and Expenses - Net income for the three months ended June 30, 2023, decreased by $598,000, or 29.5%, to $1.4 million, or $0.13 per diluted share[174] - Net interest income for the three months ended June 30, 2023, decreased by $1.6 million, or 14.4%, to $9.3 million compared to the same period in 2022[176] - Interest income increased by $3.2 million, or 27.3%, to $14.9 million for the three months ended June 30, 2023, driven by rising yields in the interest rate environment[178] - Non-interest income totaled $1.4 million for the three months ended June 30, 2023, a decrease of $145,000, or 9.6%, from the prior year[186] - Year-to-date non-interest income decreased by $480,000, or 14.9%, totaling $2.7 million for the six months ended June 30, 2023[187] - Non-interest expense for the second quarter of 2023 totaled $9.3 million, a decrease of $196,000, or 2.1%, compared to the same period in 2022[188] Interest Rates and Yields - Interest income increased by $6.8 million, or 30.1%, to $29.5 million for the six months ended June 30, 2023, compared to $22.7 million for the same period in 2022[179] - Interest expense rose by $4.8 million, or 546.7%, to $5.6 million for the quarter ended June 30, 2023, from $872,000 for the same quarter in 2022[181] - The overall average yield of interest-earning assets increased by 94 basis points to 4.76% for the six months ended June 30, 2023[179] - The interest rate spread decreased to 2.51% for the six months ended June 30, 2023, down from 3.40% in the prior year[195] Economic and Market Conditions - The estimated net economic value (EVE) decreased by 25.1% to $129,269 thousand with a 400 basis point increase in interest rates, indicating significant interest rate risk exposure[204] - The impact of inflation has increased operational costs, but the company's assets and liabilities are primarily monetary, making them more sensitive to changes in market interest rates[214] Regulatory and Compliance - There were no changes in the Company's internal controls over financial reporting during the quarter ended June 30, 2023, that materially affected the internal control[216] - The company is not currently involved in any legal proceedings that would materially affect its financial condition or results of operations[218] Contractual Obligations - Total contractual obligations as of June 30, 2023, were $409,427,000, with $334,164,000 due within one year[212] - Federal Home Loan Bank advances accounted for $106,450,000 of the total contractual obligations, with $60,000,000 due within one year[212] - Operating lease agreements totaled $7,673,000, with $762,000 due within one year[212]