Auburn National Bancorporation, Inc. Reports Fourth Quarter and Full Year Results

Core Points - Auburn National Bancorporation reported a net loss of $4.0 million, or $1.14 per share, for Q4 2023, primarily due to the sale of $117.6 million in available-for-sale securities, resulting in an after-tax loss of $4.7 million [1][3] - The company's balance sheet repositioning strategy is expected to improve future earnings and interest rate risk profile, with an estimated earn-back period of approximately 2.3 years [1][2] Financial Performance - Net earnings for the full year 2023 were $1.4 million, or $0.40 per share, down from $10.3 million, or $2.95 per share, in 2022 [3] - Excluding the loss on securities sale, net earnings for 2023 would have been $6.1 million, or $1.75 per share, compared to $6.7 million, or $1.92 per share in 2022 [3] - Net interest income for Q4 2023 was $6.2 million, a decrease of 19% from $7.6 million in Q4 2022, attributed to a decline in net interest margin [4] Asset Quality - Nonperforming assets decreased to $0.9 million, or 0.09% of total assets, at December 31, 2023, down from $2.7 million, or 0.27% of total assets, at December 31, 2022 [5] - The allowance for credit losses was $6.9 million, or 1.23% of total loans, at December 31, 2023, compared to $5.8 million, or 1.14% at the same time last year [6] Noninterest Income and Expenses - Noninterest income recorded a loss of $5.4 million in Q4 2023, compared to a gain of $3.9 million in Q4 2022; excluding the pre-tax securities loss, noninterest income would have been $0.9 million [8] - Noninterest expense increased to $5.8 million in Q4 2023 from $4.4 million in Q4 2022, primarily due to increases in professional fees [9] Tax and Equity - The provision for income taxes was a credit of $1.5 million for Q4 2023, resulting in an effective tax rate of (27.53)%, compared to a tax expense of $1.5 million and an effective rate of 24.56% in Q4 2022 [10] - Total stockholders' equity increased to $76.5 million, or $21.90 per share, at December 31, 2023, up from $68.0 million, or $19.42 per share, at December 31, 2022 [12] Regulatory Capital - The total equity to total assets ratio improved to 7.84% at December 31, 2023, compared to 6.65% at December 31, 2022 [13] - The company maintained strong capital and liquidity positions, with no brokered deposits or wholesale borrowings outstanding at December 31, 2023 [11]