Loan benefits

InsCorp quarterly earnings reflect benefits of balance sheet strategies

NashvilleA grassroots lender increases its half-yearly dividend by 25%

NASHVILLE, Tenn., May 3, 2022 /PRNewswire/ — InsCorp, the parent company of INSBANK (OTCQX: IBTN) today announced earnings of $3,204,000or $1.12 per share, an increase of 149% compared to the same quarter of the previous year. At the bank level, net interest income was $5,078,000, an increase of 15% over the previous year. Pre-tax operating profit was $1,973,000an augmentation of $489,000 in Q1 2021. In addition to operating income, realized and unrealized gains on interest rate caps of $1,887,000net of tax, were a driver of earnings, which was a record for the company in a single quarter.

(PRNewsfoto/INSBANK)

“During the pandemic, we executed hedging strategies to protect margin from increased volatility in 2021 as we reprice maturing deposits,” said Jim Rieniets, President and CEO of INSBANK. “Fortunately, these liabilities were repriced prior to the recent volatility seen in the first quarter of this year, which provided an opportunity to enhance our capital base with gains on these interest rate caps,” said Rieniets continued.

Base deposits increased by $27,000,000 during the quarter to $511,000,000while core lending (excluding Paycheck Protection Program lending) increased $4,500,000. Total new loan commitments entered into during the quarter were approximately $40,000,000while funding under these commitments was approximately $25,000,000. Net loan growth was driven by repayments primarily from customers selling commercial real estate and other assets. “While net loan growth was ultimately weaker than expected, our loan pipeline both expanded and grew during the quarter,” Rieniets said. “Activity in our market remains very vibrant and our team is busy managing the pipeline of opportunities before us, both in our core commercial banking unit and in our Medquity healthcare silos,” continued Nothings.

The Board of Directors also recently approved the payment of a semi-annual dividend. Registered shareholders of InsCorp as of May 20, 2022will receive a $0.15 dividend payable on June 10, 2022. This is a 25% increase over the company’s last semi-annual dividend. “With the earnings trajectory our team has established, we are pleased to be able to further improve our total shareholder return with an increased dividend,” said Michael QuallsPresident of InsCorp.

Quarterly and year-over-year highlights include

  • Total assets increased $88 million i.e. 13.9% at March 31, 2022 compared to March 31, 2021.

  • Non-interest bearing deposits increased $11.3 million i.e. 15.6% over the 12 months ended March 31, 2022.

  • Deferred loan fees for PPP loans are approximately $185,000 on March 31, 2022.

  • Non-interest expense to total average assets was 1.79% for the quarter ended March 31, 2022slightly higher than 1.70% for the same period in 2021 and compares favorably to the bank’s FDIC peer group average of 2.32%.

  • The cost of all interest bearing financing was 0.69% for the three months ended March 31, 2022 down from 1.33% for the same period in 2021.

  • Assets per employee remained high at $15.05 millioncompared to the FDIC peer group of $6.91 million.

  • The bank‘s Tier 1 capital ratio was 12.27%, while total risk capital was 13.52%.

  • The provision for loan and lease losses was 1.50% excluding PPP loan balances.

  • Earnings per share for the first quarter of 2022 were $1.12.

  • Tangible book value brought to $19.89 on March 31, 2022 from $17.69 to March 31, 2021.

  • The percentage of delinquent and unaccounted for loans to gross loans was 0.47%, which compares favorably to the comparison of 0.76%.

  • There was $23,000 in net recoveries for the quarter ended March 31, 2022.

  • Accumulated other comprehensive income (AOCI) reflects a loss on the securities portfolio offset by gains on interest rate swaps held by the bank for interest rate risk purposes, which resulted in a 0.9% decrease in AOCI for the quarter ended March 31, 2022.

About INSBANK

Since 2000, INSBANK has been offering its clients a highly personalized service provided by experienced relationship managers, while positioning itself as an innovator, using technologies to provide these services in an efficient and convenient manner. In addition to its business activities, INSBANK operates three divisions, Medquity, TMA Medical Banking and INSBANK Online. Medquity provides healthcare banking solutions to individuals nationwide whether still in residence, practicing, or retired, while TMA Medical Banking provides banking services specifically to members of the Tennessee Medical Association. INSBANK Online offers virtual private client services available nationwide for interest bearing deposits. INSBANK is owned by InsCorp, Inc., a Tennessee bank holding company. The bank is headquartered in Nashville at 2106 Crestmoor Road, and has an office at Brentwood at 5614 Franklin Pike Circle. For more information, visit www.insbank.com

InsCorp, Inc.

Consolidated balance sheets

(in thousands)

(unaudited)

March, 31st,

The 31st of December,

March, 31st,

2022

2021

2021

Assets

Cash and cash equivalents

$17,258

$16,680

$15,561

Interest-bearing deposits

90 288

73,746

32,268

Securities

27,545

21,606

12,747

Loans

552 473

551 463

543 178

Allowance for loan losses

(8,193)

(8,025)

(7,515)

Net loans

544,280

543 438

535,663

Premises and equipment, net

13,275

13,345

13,519

Bank-owned life insurance

13,477

13,398

10,176

Restricted equity securities

9,225

9,054

8,147

Goodwill and related intangible assets, net

1,091

1,091

1,091

other assets

8,490

8,247

7,549

Total assets

$724,929

$700,605

$636,721

Liabilities and equity

Passives

Deposits

Not bearing interest

$84,190

$79,929

$72,858

Interest bearing

529,316

504 781

432 295

Total deposits

613 506

584 710

505 153

Federal bank advances on home loans

30,000

32,000

45,000

Paycheck Protection Program Liquidity Fund

322

1,404

15,485

Subordinated debentures

17,500

17,500

15,000

Federal funds purchased

4,000

Notes payable

2,500

2,500

Other liabilities

2,885

3,278

3,117

Total responsibilities

666 713

645 392

583,755

Equity

Ordinary actions

32,241

32,087

31,325

Own shares

(3,150)

(3,150)

(681)

Accumulated retained earnings

28,543

25,689

21,652

Accumulated other comprehensive income

582

587

670

Full shareholder equity

58,216

55,213

52,966

Total Liabilities and Equity

$724,929

$700,605

$636,721

Tangible book value

$19.89

$18.90

$17.69

InsCorp, Inc.

Consolidated Statements of Income

(in thousands)

(Unaudited)

Three months completed

Twelve month period ended

Three months completed

March 31, 2022

December 31, 2021

March 31, 2021

interest income

$6,013

$24,901

$5,876

Interest charges

935

4,690

1,431

Net interest income

5,078

20 211

4,445

Allowance for loan losses

145

1,850

650

Non-interest income

Service charges on deposit accounts

57

240

59

Bank-owned life insurance

79

283

60

Gain on security sales

62

62

Other

221

1,114

237

Non-interest charges

Salaries and benefits

2,035

7,332

1,654

Occupancy and equipment

433

1,347

325

Data processing

154

597

147

Marketing and Advertising

128

574

100

Other

567

2,373

503

Net operating income

1,973

7,837

1,484

Gain in interest rate hedges

2,516

748

443

Interest expense – Subordinated debt

233

992

239

income before taxes

4,256

7,593

1,688

income tax expense

(1,052)

(1,564)

(398)

Net revenue

$3,204

$6,029

$1,290

Weighted average common stock yield

$1.12

$2.06

$0.44

Quote

Quote

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SOURCE IN BANK