FENTON, Mich., Feb. 27, 2019 (GLOBE NEWSWIRE) -- Fentura Financial, Inc. (OTCQX: FETM) announces another year of record earnings with net income of $2,009 and $10,114 for the three and twelve month periods ended December 31, 2018, respectively.
- YTD net income increased by 16.57%
- YTD adjusted net income from operations increased by 22.00%
- 10.88% increase in earnings per share over 2017
- 12.50% total return to shareholders in 2018
- YTD return on average assets of 1.20%
- Total loans increased by 14.82%
- Total deposits increased 13.31%
Ronald L. Justice, President and CEO said, “I am extremely proud of our team and their ability to consistently execute our community focused growth strategies. This was another record year for Fentura and I am excited to continue this momentum into 2019.”
Total Shareholder Return
| 12/31/18 | 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | ||||||||||||||||
| Closing Stock Price | $ | 21.00 | $ | 21.15 | $ | 21.10 | $ | 19.75 | $ | 18.88 | ||||||||||
| QTD Cash Dividends Per Share | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.05 | ||||||||||
| FETM QTD Total Return to Shareholders (Annualized) | ||||||||||||||||||||
| 12/31/18 | 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | ||||||||||||||||
| Increase (Decrease) in Price | (2.84 | )% | 0.95 | % | 27.34 | % | 18.43 | % | 9.32 | % | ||||||||||
| Cash Dividends | 1.13 | % | 1.14 | % | 1.22 | % | 1.27 | % | 1.08 | % | ||||||||||
| Total Return | (1.70 | )% | 2.09 | % | 28.56 | % | 19.70 | % | 10.41 | % | ||||||||||
| 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||
| Closing Stock Price | $ | 21.00 | $ | 18.88 | $ | 16.00 | $ | 13.86 | $ | 9.90 | ||||||||||
| YTD Cash Dividends Per Share | $ | 0.24 | $ | 0.20 | $ | 0.40 | $ | 0.12 | $ | 0.09 | ||||||||||
| FETM Annual Total Return to Shareholders | ||||||||||||||||||||
| 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||
| Increase (Decrease) in Price | 11.23 | % | 18.00 | % | 15.44 | % | 40.00 | % | 42.04 | % | ||||||||||
| Cash Dividends | 1.27 | % | 1.25 | % | 2.89 | % | 1.21 | % | 1.29 | % | ||||||||||
| Total Return | 12.50 | % | 19.25 | % | 18.33 | % | 41.21 | % | 43.33 | % | ||||||||||
Income Statement Breakdown and Analysis
| Quarter to Date | ||||||||||||||||||||
| 12/31/18 | 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | ||||||||||||||||
| Interest and dividend income | ||||||||||||||||||||
| Loans, including fees | $ | 9,132 | $ | 8,768 | $ | 8,433 | $ | 8,038 | $ | 8,524 | ||||||||||
| Investments | 799 | 543 | 296 | 341 | 341 | |||||||||||||||
| Total interest and dividend income | 9,931 | 9,311 | 8,729 | 8,379 | 8,865 | |||||||||||||||
| Total interest expense | 1,926 | 1,638 | 1,232 | 1,031 | 939 | |||||||||||||||
| Net interest income | 8,005 | 7,673 | 7,497 | 7,348 | 7,926 | |||||||||||||||
| Provision for loan losses | 290 | 191 | 301 | 275 | 348 | |||||||||||||||
| Net interest income, after provision for loan losses | 7,715 | 7,482 | 7,196 | 7,073 | 7,578 | |||||||||||||||
| Total noninterest income | 1,703 | 2,760 | 2,013 | 1,801 | 2,220 | |||||||||||||||
| Total noninterest expenses | 6,907 | 6,075 | 6,049 | 6,279 | 7,400 | |||||||||||||||
| Income before federal income taxes | 2,511 | 4,167 | 3,160 | 2,595 | 2,398 | |||||||||||||||
| Federal income taxes | 502 | 654 | 642 | 521 | 236 | |||||||||||||||
| Net income | $ | 2,009 | $ | 3,513 | $ | 2,518 | $ | 2,074 | $ | 2,162 | ||||||||||
| Quarter to Date | ||||||||||||||||||||
| 12/31/18 | 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | ||||||||||||||||
| Based on GAAP net income | ||||||||||||||||||||
| Average Total Assets | $ | 917,242 | $ | 866,253 | $ | 805,794 | $ | 789,391 | $ | 779,000 | ||||||||||
| Average Earning Assets | $ | 864,581 | $ | 813,867 | $ | 757,481 | $ | 737,712 | $ | 693,951 | ||||||||||
| Average Int. Bearing Liabilities | $ | 592,878 | $ | 565,908 | $ | 514,012 | $ | 505,174 | $ | 457,937 | ||||||||||
| Average Total Equity | $ | 80,781 | $ | 65,541 | $ | 62,333 | $ | 60,107 | $ | 60,034 | ||||||||||
| Average Tangible Equity | $ | 72,742 | $ | 57,419 | $ | 54,254 | $ | 51,962 | $ | 52,001 | ||||||||||
| Return on Average Assets | 0.88 | % | 1.62 | % | 1.25 | % | 1.05 | % | 1.11 | % | ||||||||||
| Return on Average Equity | 9.95 | % | 21.44 | % | 16.16 | % | 13.80 | % | 14.41 | % | ||||||||||
| Return on Average Tangible Equity | 11.05 | % | 24.47 | % | 18.56 | % | 15.97 | % | 16.63 | % | ||||||||||
| Efficiency Ratio | 71.15 | % | 58.23 | % | 63.61 | % | 68.63 | % | 72.94 | % | ||||||||||
| Earnings Per Share | $ | 0.43 | $ | 0.96 | $ | 0.69 | $ | 0.57 | $ | 0.60 | ||||||||||
| Yield on Earning Assets | 4.60 | % | 4.58 | % | 4.62 | % | 4.55 | % | 5.13 | % | ||||||||||
| Rate on Int. Bearing Liabilities | 1.30 | % | 1.16 | % | 0.96 | % | 0.82 | % | 0.82 | % | ||||||||||
| Net Interest Margin to Earning Assets | 3.71 | % | 3.78 | % | 3.97 | % | 3.99 | % | 4.59 | % | ||||||||||
| Quarter to Date | ||||||||||||||||||||
| 12/31/18 | 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | ||||||||||||||||
| GAAP net income | $ | 2,009 | $ | 3,513 | $ | 2,518 | $ | 2,074 | $ | 2,162 | ||||||||||
| Provision for loan losses (net of tax) | 229 | 151 | 238 | 217 | 229 | |||||||||||||||
| Acquisition related items (net of tax) | ||||||||||||||||||||
| Accretion on purchased loans | (168 | ) | (116 | ) | (255 | ) | (250 | ) | (676 | ) | ||||||||||
| Amortization of core deposit intangible | 107 | 107 | 107 | 107 | 105 | |||||||||||||||
| Acquisition related expenses | — | — | — | — | 296 | |||||||||||||||
| Accretion on acquired OREO | — | — | — | — | — | |||||||||||||||
| Amortization on acquired time deposits | 9 | 9 | 9 | 9 | 10 | |||||||||||||||
| Amortization on purchased MSRs | 6 | 6 | 6 | 6 | 8 | |||||||||||||||
| Total acquisition related items (net of tax) | (46 | ) | 6 | (133 | ) | (128 | ) | (257 | ) | |||||||||||
| One-time and other items (net of tax) | ||||||||||||||||||||
| Net gain from BOLI death benefit | — | (933 | ) | — | — | — | ||||||||||||||
| Re-valuation of net deferred tax liabilities | — | — | — | — | (489 | ) | ||||||||||||||
| Net gain from note receivable | — | — | — | — | — | |||||||||||||||
| Impact of The Tax Cuts and Jobs Act | (394 | ) | (405 | ) | (397 | ) | (323 | ) | — | |||||||||||
| Total one-time and other items (net of tax) | (394 | ) | (1,338 | ) | (397 | ) | (323 | ) | (489 | ) | ||||||||||
| Adjusted net income from operations | $ | 1,798 | $ | 2,332 | $ | 2,226 | $ | 1,840 | $ | 1,645 | ||||||||||
| GAAP net interest income | $ | 8,005 | $ | 7,673 | $ | 7,497 | $ | 7,348 | $ | 7,926 | ||||||||||
| Accretion on purchased loans | (211 | ) | (147 | ) | (323 | ) | (317 | ) | (1,021 | ) | ||||||||||
| Amortization on acquired time deposits | 11 | 12 | 11 | 12 | 15 | |||||||||||||||
| Adjusted net interest income | $ | 7,805 | $ | 7,538 | $ | 7,185 | $ | 7,043 | $ | 6,920 | ||||||||||
| Based on adjusted net income from operations | ||||||||||||||||||||
| Return on Average Assets | 0.78 | % | 1.08 | % | 1.10 | % | 0.93 | % | 0.84 | % | ||||||||||
| Return on Average Equity | 8.90 | % | 14.23 | % | 14.28 | % | 12.24 | % | 10.96 | % | ||||||||||
| Return on Average Tangible Equity | 9.89 | % | 16.25 | % | 16.41 | % | 14.16 | % | 12.65 | % | ||||||||||
| Efficiency Ratio | 71.15 | % | 63.37 | % | 64.24 | % | 69.41 | % | 74.22 | % | ||||||||||
| Earnings Per Share | 0.41 | 0.64 | 0.61 | 0.51 | 0.45 | |||||||||||||||
| Based on adjusted net interest income | ||||||||||||||||||||
| Yield on Earning Assets | 4.50 | % | 4.51 | % | 4.45 | % | 4.38 | % | 4.54 | % | ||||||||||
| Rate on Int. Bearing Liabilities | 1.31 | % | 1.17 | % | 0.97 | % | 0.83 | % | 0.83 | % | ||||||||||
| Net Interest Margin to Earning Assets | 3.62 | % | 3.71 | % | 3.80 | % | 3.83 | % | 4.01 | % | ||||||||||
| Year to Date December 31 | Variance | ||||||||||||||
| 2018 | 2017 | $ | % | ||||||||||||
| Interest and dividend income | |||||||||||||||
| Loans, including fees | $ | 34,371 | $ | 28,765 | $ | 5,606 | 19.49 | % | |||||||
| Investments | 1,979 | 1,346 | 633 | 47.03 | % | ||||||||||
| Total interest and dividend income | 36,350 | 30,111 | 6,239 | 20.72 | % | ||||||||||
| Total interest expense | 5,827 | 3,120 | 2,707 | 86.76 | % | ||||||||||
| Net interest income | 30,523 | 26,991 | 3,532 | 13.09 | % | ||||||||||
| Provision for loan losses | 1,057 | 609 | 448 | 73.56 | % | ||||||||||
| Net interest income, after provision for loan losses | 29,466 | 26,382 | 3,084 | 11.69 | % | ||||||||||
| Total noninterest income | 8,277 | 8,988 | (711 | ) | (7.91 | )% | |||||||||
| Total noninterest expenses | 25,310 | 23,818 | 1,492 | 6.26 | % | ||||||||||
| Income before federal income taxes | 12,433 | 11,552 | 881 | 7.63 | % | ||||||||||
| Federal income taxes | 2,319 | 2,876 | (557 | ) | (19.37 | )% | |||||||||
| Net income | $ | 10,114 | $ | 8,676 | $ | 1,438 | 16.57 | % | |||||||
| Year to Date December 31 | Variance | ||||||||||||||
| 2018 | 2017 | $ | % | ||||||||||||
| Based on GAAP net income | |||||||||||||||
| Average Total Assets | $ | 844,551 | $ | 730,974 | $ | 113,577 | 15.54 | % | |||||||
| Average Earning Assets | $ | 793,411 | $ | 698,753 | $ | 94,658 | 13.55 | % | |||||||
| Average Int. Bearing Liabilities | $ | 544,344 | $ | 485,522 | $ | 58,822 | 12.12 | % | |||||||
| Average Total Equity | $ | 67,192 | $ | 56,429 | $ | 10,763 | 19.07 | % | |||||||
| Average Tangible Equity | $ | 59,096 | $ | 48,282 | $ | 10,814 | 22.40 | % | |||||||
| Return on Average Assets | 1.20 | % | 1.19 | % | 0.01 | % | |||||||||
| Return on Average Equity | 15.05 | % | 15.38 | % | (0.32 | )% | |||||||||
| Return on Tangible Equity | 17.11 | % | 17.97 | % | (0.85 | )% | |||||||||
| Efficiency Ratio | 65.23 | % | 66.20 | % | (0.97 | )% | |||||||||
| Earnings Per Share | $ | 2.65 | $ | 2.39 | $ | 0.26 | 10.88 | % | |||||||
| Yield on Earning Assets | 4.59 | % | 4.33 | % | 0.26 | % | |||||||||
| Rate on Int. Bearing Liabilities | 1.07 | % | 0.64 | % | 0.43 | % | |||||||||
| Net Interest Margin to Earning Assets | 3.86 | % | 3.88 | % | (0.02 | )% | |||||||||
| Year to Date December 31 | Variance | ||||||||||||||
| 2018 | 2017 | $ | % | ||||||||||||
| GAAP net income | $ | 10,114 | $ | 8,676 | $ | 1,438 | 16.57 | % | |||||||
| Provision for loan losses (net of tax) | 835 | 402 | 433 | 107.71 | % | ||||||||||
| Acquisition related items (net of tax) | |||||||||||||||
| Accretion on purchased loans | (788 | ) | (1,203 | ) | 415 | (34.50 | )% | ||||||||
| Amortization of core deposit intangible | 428 | 417 | 11 | 2.64 | % | ||||||||||
| Acquisition related expenses | — | 296 | (296 | ) | (100.00 | )% | |||||||||
| Accretion on acquired OREO | — | (53 | ) | 53 | (100.00 | )% | |||||||||
| Amortization on acquired time deposits | 36 | 38 | (2 | ) | (5.26 | )% | |||||||||
| Amortization on purchased MSRs | 24 | 30 | (6 | ) | (20.00 | )% | |||||||||
| Total acquisition related items (net of tax) | (300 | ) | (475 | ) | 175 | (36.84 | )% | ||||||||
| One-time and other items (net of tax) | |||||||||||||||
| Net gain from BOLI death benefit | (933 | ) | (1,155 | ) | 222 | (19.22 | )% | ||||||||
| Re-valuation of net deferred tax liabilities | — | (489 | ) | 489 | (100.00 | )% | |||||||||
| Net gain from note receivable | — | (172 | ) | 172 | (100.00 | )% | |||||||||
| Impact of The Tax Cuts and Jobs Act | (1,436 | ) | — | (1,436 | ) | N/M | |||||||||
| Total one-time and other items (net of tax) | (2,369 | ) | (1,816 | ) | (553 | ) | 30.45 | % | |||||||
| Adjusted net income from operations | $ | 8,280 | $ | 6,787 | $ | 1,493 | 22.00 | % | |||||||
| GAAP net interest income | $ | 30,523 | $ | 26,991 | $ | 3,532 | 13.09 | % | |||||||
| Accretion on purchased loans | (998 | ) | (1,822 | ) | 824 | (45.23 | )% | ||||||||
| Amortization on acquired time deposits | 46 | 58 | (12 | ) | (20.69 | )% | |||||||||
| Adjusted net interest income | $ | 29,571 | $ | 25,227 | $ | 4,344 | 17.22 | % | |||||||
| Based on adjusted net income from operations | |||||||||||||||
| Return on Average Assets | 0.98 | % | 0.93 | % | 0.05 | % | |||||||||
| Return on Average Equity | 12.32 | % | 12.03 | % | 0.30 | % | |||||||||
| Return on Tangible Equity | 14.01 | % | 14.06 | % | (0.05 | )% | |||||||||
| Efficiency Ratio | 67.04 | % | 66.20 | % | 0.84 | % | |||||||||
| Earnings Per Share | $ | 2.17 | $ | 1.87 | $ | 0.30 | 16.04 | % | |||||||
| Based on adjusted net interest income | |||||||||||||||
| Yield on Earning Assets | 4.46 | % | 4.07 | % | 0.40 | % | |||||||||
| Rate on Int. Bearing Liabilities | 1.08 | % | 0.65 | % | 0.42 | % | |||||||||
| Net Interest Margin to Earning Assets | 3.74 | % | 3.63 | % | 0.11 | % | |||||||||
To effectively compare core operating results from period to period, the impact of the provision for loan losses, acquisition related items, and one-time and other items have been isolated.
As outlined in the preceding tables, the Corporation has been able to generate strong net income and adjusted net income from operations. While a portion of the increase in net income was driven by the Tax Cuts and Jobs Act of 2017, which reduced the Corporation’s Federal income tax rate from 34% to 21%, adjusted net income from operations, which excludes the impact of the reduction in tax rates, increased by 22.00% while adjusted earnings per share increased by 16.04%.
The Corporation has also been successful at consistently increasing adjusted net interest income. This increase continues to be primarily driven through increases in loans while maintaining relatively strong interest margins. As the Corporation expects to grow its loan portfolio through 2019, net interest income is expected to continue to increase. While net interest income is expected to continue to increase, net interest margin to earning assets is expected to decrease as the rates paid on interest bearing liabilities are expected to increase faster than those earned on interest earning assets.
Noninterest Income
| Quarter to Date | ||||||||||||||||||||
| 12/31/2018 | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | ||||||||||||||||
| Service charges on deposit accounts | $ | 259 | $ | 273 | $ | 253 | $ | 259 | $ | 307 | ||||||||||
| ATM and debit card income | 397 | 386 | 388 | 354 | 373 | |||||||||||||||
| Net gain on sales of mortgage loans | 162 | 277 | 187 | 215 | 333 | |||||||||||||||
| Net gain on sales of commercial loans | — | — | 368 | 150 | — | |||||||||||||||
| Trust and investment services | 372 | 444 | 392 | 383 | 330 | |||||||||||||||
| Other income and fees | 513 | 1,380 | 425 | 440 | 877 | |||||||||||||||
| Total noninterest income | $ | 1,703 | $ | 2,760 | $ | 2,013 | $ | 1,801 | $ | 2,220 | ||||||||||
| Year to Date December 31 | Variance | ||||||||||||||
| 2018 | 2017 | $ | % | ||||||||||||
| Service charges on deposit accounts | $ | 1,044 | $ | 1,217 | $ | (173 | ) | (14.22 | )% | ||||||
| ATM and debit card income | 1,525 | 1,474 | 51 | 3.46 | % | ||||||||||
| Net gain on sales of mortgage loans | 841 | 1,231 | (390 | ) | (31.68 | )% | |||||||||
| Net gain on sales of commercial loans | 518 | — | 518 | N/M | |||||||||||
| Trust and investment services | 1,591 | 1,424 | 167 | 11.73 | % | ||||||||||
| Other income and fees | 2,758 | 3,642 | (884 | ) | (24.27 | )% | |||||||||
| Total noninterest income | $ | 8,277 | $ | 8,988 | $ | (711 | ) | (7.91 | )% | ||||||
As shown in the preceding tables, the Corporation has experienced a decline in year to date noninterest income. The declines in service charges on deposit accounts are a result of declines in NSF fees as well as a shift of customer demand toward deposit accounts with no or reduced service charges. The declines in other income and fees was primarily the result of the net gain from BOLI death benefit being less in 2018 than 2017. The remainder of the decline in other income and fees is spread across a variety of accounts. Partially offsetting these declines were increases in ATM and debit card income, net gain on sales of loans, and trust and investment services. Total noninterest income is expected to increase modestly through 2019.
Noninterest Expenses
| Quarter to Date | ||||||||||||||||||||
| 12/31/2018 | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | ||||||||||||||||
| Compensation | $ | 3,429 | $ | 3,359 | $ | 3,316 | $ | 3,317 | $ | 3,689 | ||||||||||
| Professional services | 1,030 | 545 | 531 | 649 | 1,014 | |||||||||||||||
| Furniture and equipment | 508 | 486 | 441 | 463 | 372 | |||||||||||||||
| Occupancy | 416 | 379 | 417 | 427 | 379 | |||||||||||||||
| Loan and collection | 134 | 135 | 139 | 129 | 202 | |||||||||||||||
| Advertising and promotional | 198 | 177 | 219 | 124 | 166 | |||||||||||||||
| Telephone and communication | 107 | 106 | 105 | 95 | 109 | |||||||||||||||
| Acquisition related | — | — | — | — | 449 | |||||||||||||||
| Other general and administrative | 1,085 | 888 | 881 | 1,075 | 1,020 | |||||||||||||||
| Total noninterest expenses | $ | 6,907 | $ | 6,075 | $ | 6,049 | $ | 6,279 | $ | 7,400 | ||||||||||
| Year to Date December 31 | Variance | ||||||||||||||
| 2018 | 2017 | $ | % | ||||||||||||
| Compensation | $ | 13,421 | $ | 12,437 | $ | 984 | 7.91 | % | |||||||
| Professional services | 2,755 | 2,533 | 222 | 8.76 | % | ||||||||||
| Furniture and equipment | 1,898 | 1,706 | 192 | 11.25 | % | ||||||||||
| Occupancy | 1,639 | 1,569 | 70 | 4.46 | % | ||||||||||
| Loan and collection | 537 | 548 | (11 | ) | (2.01 | )% | |||||||||
| Advertising and promotional | 718 | 598 | 120 | 20.07 | % | ||||||||||
| Telephone and communication | 413 | 433 | (20 | ) | (4.62 | )% | |||||||||
| Acquisition related | — | 646 | (646 | ) | (100.00 | )% | |||||||||
| Other general and administrative | 3,929 | 3,348 | 581 | 17.35 | % | ||||||||||
| Total noninterest expenses | $ | 25,310 | $ | 23,818 | $ | 1,492 | 6.26 | % | |||||||
Total noninterest expenses have increased during 2018 primarily as a result of the increase in size and complexity of the Corporation. The Corporation anticipates total noninterest expenses to increase modestly in 2019.
Balance Sheet Breakdown and Analysis
| 12/31/2018 | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | ||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and cash equivalents | $ | 23,412 | $ | 63,469 | $ | 44,280 | $ | 15,154 | $ | 15,928 | ||||||||||
| Total securities | 94,721 | 79,531 | 49,110 | 49,608 | 55,323 | |||||||||||||||
| Loans held for sale | 903 | 2,021 | 4,936 | 4,980 | 2,067 | |||||||||||||||
| Gross loans | 772,227 | 728,302 | 707,364 | 686,140 | 672,530 | |||||||||||||||
| Less allowance for loan losses | 4,488 | 4,146 | 4,033 | 3,725 | 3,603 | |||||||||||||||
| Net loans | 767,739 | 724,156 | 703,331 | 682,415 | 668,927 | |||||||||||||||
| All other assets | 39,675 | 40,724 | 39,802 | 37,786 | 39,198 | |||||||||||||||
| Total assets | $ | 926,450 | $ | 909,901 | $ | 841,459 | $ | 789,943 | $ | 781,443 | ||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
| Total deposits | $ | 763,124 | $ | 766,587 | $ | 702,035 | $ | 683,775 | $ | 673,505 | ||||||||||
| Total borrowed funds | 69,000 | 74,000 | 74,000 | 44,600 | 46,000 | |||||||||||||||
| Accrued interest and other liabilities | 4,810 | 2,974 | 2,346 | 947 | 2,491 | |||||||||||||||
| Total liabilities | 836,934 | 843,561 | 778,381 | 729,322 | 721,996 | |||||||||||||||
| Total shareholders' equity | 89,516 | 66,340 | 63,078 | 60,621 | 59,447 | |||||||||||||||
| Total liabilities and shareholders' equity | $ | 926,450 | $ | 909,901 | $ | 841,459 | $ | 789,943 | $ | 781,443 | ||||||||||
| Selected Ratios | ||||||||||||||||||||
| Net loans to total deposits | 100.60 | % | 94.46 | % | 100.18 | % | 99.80 | % | 99.32 | % | ||||||||||
| ALLL to gross loans | 0.58 | % | 0.57 | % | 0.57 | % | 0.54 | % | 0.54 | % | ||||||||||
| Book value per share | $ | 19.31 | $ | 18.20 | $ | 17.33 | $ | 16.68 | $ | 16.35 | ||||||||||
| Tangible book value per share | $ | 18.32 | $ | 16.91 | $ | 16.00 | $ | 15.31 | $ | 14.95 | ||||||||||
| Total capital to risk weighted assets* | 12.76 | % | 10.80 | % | 10.70 | % | 10.61 | % | 10.46 | % | ||||||||||
| Tier 1 capital to risk weighted assets* | 12.15 | % | 10.22 | % | 10.11 | % | 10.06 | % | 9.91 | % | ||||||||||
| CET1 capital to risk weighted assets* | 12.15 | % | 10.22 | % | 10.11 | % | 10.06 | % | 9.91 | % | ||||||||||
| Tier 1 capital to average assets* | 9.90 | % | 8.48 | % | 8.70 | % | 8.65 | % | 8.57 | % | ||||||||||
| *The State Bank | ||||||||||||||||||||
| 12/31/2018 vs 9/30/2018 | 12/31/2018 vs 12/31/2017 | |||||||||||||
| $ Variance | % Variance | $ Variance | % Variance | |||||||||||
| ASSETS | ||||||||||||||
| Cash and cash equivalents | $ | (40,057 | ) | (63.11 | )% | $ | 7,484 | 46.99 | % | |||||
| Total securities | 15,190 | 19.10 | % | 39,398 | 71.21 | % | ||||||||
| Loans held for sale | (1,118 | ) | (55.32 | )% | (1,164 | ) | (56.31 | )% | ||||||
| Gross loans | 43,925 | 6.03 | % | 99,697 | 14.82 | % | ||||||||
| Less allowance for loan losses | 342 | 8.25 | % | 885 | 24.56 | % | ||||||||
| Net loans | 43,583 | 6.02 | % | 98,812 | 14.77 | % | ||||||||
| All other assets | (1,049 | ) | (2.58 | )% | 477 | 1.22 | % | |||||||
| Total assets | $ | 16,549 | 1.82 | % | $ | 145,007 | 18.56 | % | ||||||
| LIABILITIES AND | ||||||||||||||
| SHAREHOLDERS' EQUITY | ||||||||||||||
| Total deposits | $ | (3,463 | ) | (0.45 | )% | $ | 89,619 | 13.31 | % | |||||
| Total borrowed funds | (5,000 | ) | (6.76 | )% | 23,000 | 50.00 | % | |||||||
| Accrued interest and other liabilities | 1,836 | 61.74 | % | 2,319 | 93.10 | % | ||||||||
| Total liabilities | (6,627 | ) | (0.79 | )% | 114,938 | 15.92 | % | |||||||
| Total shareholders' equity | 23,176 | 34.94 | % | 30,069 | 50.58 | % | ||||||||
| Total liabilities and | ||||||||||||||
| shareholders' equity | $ | 16,549 | 1.82 | % | $ | 145,007 | 18.56 | % | ||||||
| Selected Ratios | ||||||||||||||
| Net loans to total deposits | 6.14 | % | 1.28 | % | ||||||||||
| ALLL to gross loans | 0.01 | % | 0.04 | % | ||||||||||
| Book value per share | $ | 1.11 | 6.10 | % | $ | 2.96 | 18.10 | % | ||||||
| Tangible book value per share | $ | 1.41 | 8.34 | % | $ | 3.37 | 22.54 | % | ||||||
| Total capital to risk weighted assets* | 1.96 | % | 2.30 | % | ||||||||||
| Tier 1 capital to risk weighted assets* | 1.93 | % | 2.24 | % | ||||||||||
| CET1 capital to risk weighted assets* | 1.93 | % | 2.24 | % | ||||||||||
| Tier 1 capital to average assets* | 1.42 | % | 1.34 | % | ||||||||||
| *The State Bank | ||||||||||||||
The following tables outline the composition and changes in the loan portfolio as of:
| 12/31/2018 | 9/30/2018 | 6/30/2018 | 3/31/2018 | 12/31/2017 | ||||||||||||||||
| Commercial | $ | 56,583 | $ | 48,594 | $ | 49,776 | $ | 47,812 | $ | 51,278 | ||||||||||
| Commercial real estate | 369,043 | 351,739 | 344,658 | 343,265 | 330,309 | |||||||||||||||
| Residential real estate | 293,271 | 274,035 | 257,776 | 237,677 | 234,047 | |||||||||||||||
| Home equity | 43,597 | 41,136 | 41,736 | 42,879 | 44,602 | |||||||||||||||
| Installment | 9,733 | 12,798 | 13,418 | 14,507 | 12,294 | |||||||||||||||
| Total Loans | $ | 772,227 | $ | 728,302 | $ | 707,364 | $ | 686,140 | $ | 672,530 | ||||||||||
| 12/31/2018 vs 9/30/2018 | 12/31/2018 vs 12/31/2017 | |||||||||||||||||||
| $ Variance | % Variance | $ Variance | % Variance | |||||||||||||||||
| Commercial | $ | 7,989 | 16.44 | % | $ | 5,305 | 10.35 | % | ||||||||||||
| Commercial real estate | 17,304 | 4.92 | % | 38,734 | 11.73 | % | ||||||||||||||
| Residential real estate | 19,236 | 7.02 | % | 59,224 | 25.30 | % | ||||||||||||||
| Home equity | 2,461 | 5.98 | % | (1,005 | ) | (2.25 | )% | |||||||||||||
| Installment | (3,065 | ) | (23.95 | )% | (2,561 | ) | (20.83 | )% | ||||||||||||
| Total Loans | $ | 43,925 | 6.03 | % | $ | 99,697 | 14.82 | % | ||||||||||||
The following tables outline the composition and changes in the deposit portfolio as of:
| 12/31/18 | 9/30/18 | 6/30/18 | 3/31/18 | 12/31/17 | ||||||||||||||||
| Demand | $ | 233,954 | $ | 235,208 | $ | 236,899 | $ | 224,486 | $ | 216,607 | ||||||||||
| Savings | 223,728 | 221,028 | 218,512 | 227,987 | 224,558 | |||||||||||||||
| Money market demand | 61,369 | 60,836 | 53,654 | 59,370 | 67,387 | |||||||||||||||
| NOW | 10,234 | 8,952 | 6,346 | 2,984 | 2,253 | |||||||||||||||
| Time Deposits | 233,839 | 240,563 | 186,624 | 168,948 | 162,700 | |||||||||||||||
| Total deposits | $ | 763,124 | $ | 766,587 | $ | 702,035 | $ | 683,775 | $ | 673,505 | ||||||||||
| 12/31/18 vs 9/30/18 | 12/31/18 vs 12/31/17 | |||||||||||||||||||
| $ Variance | % Variance | $ Variance | % Variance | |||||||||||||||||
| Demand | $ | (1,254 | ) | (0.53 | )% | $ | 17,347 | 8.01 | % | |||||||||||
| Savings | 2,700 | 1.22 | % | (830 | ) | (0.37 | )% | |||||||||||||
| Money market demand | 533 | 0.88 | % | (6,018 | ) | (8.93 | )% | |||||||||||||
| NOW | 1,282 | 14.32 | % | 7,981 | 354.24 | % | ||||||||||||||
| Time Deposits | (6,724 | ) | (2.80 | )% | 71,139 | 43.72 | % | |||||||||||||
| Total deposits | $ | (3,463 | ) | (0.45 | )% | $ | 89,619 | 13.31 | % | |||||||||||
Total deposits decreased slightly from September 30, 2018, but increased by $89,619 since December 31, 2017. The increase in time deposits year over year was the direct result of an initiative to enhance our municipal deposits in local markets. This strategy, as well as several other deposit growth initiatives, are expected to continue to help provide organic funding to meet loan demand in 2019.
About Fentura Financial, Inc. and The State Bank
Fentura Financial, Inc. is the holding company for The State Bank. It was formed in 1987 and is traded on the OTCQX exchange under the symbol FETM, and was recognized as one of the Top 50 performing stocks in 2016 and 2018 on that exchange.
The State Bank is a full-service, 4-Star Bauer Financial rated commercial, retail and trust bank headquartered in Fenton, Michigan. It currently operates 15 full-service branches in Genesee, Livingston, Oakland, Saginaw, and Shiawassee Counties and a loan production office in Saginaw County. The State Bank was ranked #41 by S&P Global in terms of 2017 performance for banks under $1 billion in assets. The State Bank’s commercial department provides a complete array of products including lines of credit, term loans, commercial mortgages, SBA loans and a full-suite of cash management products. The retail department offers personal checking, savings, time and IRA deposit accounts and a wide array of loan products including home equity, auto and personal loans. The residential loan department offers construction, purchase and refinance residential mortgage loans. The wealth management department offers a full-service suite of trust and portfolio management services. The aim of The State Bank is to become and remain “Your Financial Partner for Life.” More information can be found at www.thestatebank.com or www.fentura.com.
Cautionary Statement: This press release contains certain forward-looking statements that involve risks and uncertainties. Forward-looking statements include, but are not limited to, statements concerning future growth in earning assets and net income. Such statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, economic, competitive, governmental and technological factors affecting the Company's operations, markets, products, services, interest rates and fees for services. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.
| Contacts: | Ronald L. Justice President & CEO Fentura Financial, Inc. 810.714.3902 ronj@thestatebank.com | Aaron D. Wirsing Chief Financial Officer Fentura Financial, Inc. 810.714.3925 aaronw@thestatebank.com |