Lewis & Clark Bancorp Announces 2020 Fourth Quarter and Year to Date Results

OREGON CITY, Ore.–(BUSINESS WIRE)–Lewis & Clark Bancorp (OTC Pink: LWCL) announces 2020 fourth quarter and year to date consolidated results. As a result of the Lewis & Clark Bancorp holding company reorganization and merger effective as of July 31, 2020, the current period financial discussion and summary balance sheet and income statement in this release reflect Lewis & Clark Bancorp consolidated, while the comparative prior year periods are Lewis & Clark Bank only. As the results presented are substantially the performance of Lewis & Clark Bank, management believes there is not a material difference related to disclosing the current and comparative results as presented.

Quarter to date net income totaled $734,000 for the three months ended December 31, 2020, an increase of $188,000 compared to $546,000 for the same period last year. Earnings per share were $0.65 for the current year quarter, compared to $0.48 for the prior year quarter.

The increased earnings in the current year quarter were due to an increase in noninterest income, and decreases in both noninterest expense, and the provision for income taxes, partially offset by a decrease in net interest income, compared to the same period one year ago. The increase in noninterest income was primarily due to an increase in interchange fees related to an increase in debit cards and a more favorable fee structure. The decrease in noninterest expense was due to declines in data processing, intangible amortization, travel, and occupancy expense, partially offset by an increase in compensation and employee benefits. The decrease in the provision for income taxes was due to both a state tax refund from final return for Clatsop Community Bank and also adjustments recorded in the prior year quarter related to nondeductible merger expenses. The decrease in net interest income is due to decreased interest and fees on loans and investments, partially offset by a decrease in interest expense as a result of Management’s decision to lower the rates paid on deposits to reflect current market conditions.

Year to date net income totaled $1,796,000, or $1.58 per share, compared to $2,287,000, or $2.25 per share for the same period last year. Year to date pre-tax income, excluding the provision for loan losses, was $3,417,000 for the current year period compared to $3,190,000 for the prior year period.

The decreased earnings in the current year period were due to an increase in the provision for loan losses and noninterest expense, partially offset by increases in both net interest income and noninterest income compared to the same period one year ago. The increased provision for loan losses was based on Management’s assessment of risk factors related to the ongoing COVID-19 pandemic. The increase in noninterest expense was due to an increase in salaries and employee benefits due to an increase in staffing levels and a year of combined operations as a result of the merger with Clatsop Community Bank effective during the second quarter in the prior year period. In addition to this increase, data processing costs increased due to the core conversion in the first quarter of this year, as well as a full year of combined operations, and core deposit intangible amortization increased, primarily due to having a full year of amortization in the current year period. The increase in net interest income is due to an increase in interest and fees on loans, as well as a decrease in interest expense compared to the prior year period. The increase in noninterest income was due to realizing a gain on the liquidation of the investment portfolio, as well as increased interchange income as previously discussed.

Jeffrey Sumpter, President and CEO, commented, “Although it has been a challenging year, with unprecedented economic uncertainty, we are pleased to close the year with increased earnings during the fourth quarter and a strong balance sheet with more reserves, improved liquidity, and increased deposits. Sumpter continued, “As we transition into a new year, we expect that the economic uncertainty that we faced in 2020, will continue to be present in 2021. Our mission going forward, as it has been in the past, is to continue serving both our customers and the communities we serve to help navigate through the challenges that lie ahead.”

As of December 31, 2020, total consolidated assets were $346.5 million, an increase of $64.5 million, or 22.9.%, compared to December 31, 2019. This increase was primarily due to increases in cash, gross loans, total deposits, borrowings, and long-term debt, partially offset by a decline in investment securities compared to the balances reported at December 31, 2019. Total gross loans increased $55.9 million substantially due to a $61.5 million increase related to SBA Paycheck Protection Program (PPP) Loans partially offset by $5.7 million in principal reductions and payoffs. Total deposits increased $49.7 million primarily due to increases in noninterest-bearing and interest-bearing demand deposits, related to the PPP Loans, as well as money market and savings deposits, partially offset by a decline in time deposits. The decrease in time deposits is due to depositor’s preference to hold their balances in liquid accounts as well as adjusting deposit rates to reflect current market conditions and allowing higher rate deposits to transition out. Borrowings increased $5.9 million and are solely due to funding via the Federal Reserve’s Paycheck Protection Program Liquidity Facility. Long-term debt increased by $6.9 million related to the Company completing a $7.0 million subordinated debt offering during the current year. Investment securities decreased $15.5 million due to substantially liquidating the portfolio to reduce the Company’s risk exposure. Shareholders equity totaled $37.1 million at December 31, 2020, an increase of $1,382,000, or 3.9% compared to $35.7 million at December 31, 2019.

About Lewis & Clark Bancorp

Headquartered in Oregon City, Oregon, Lewis & Clark Bancorp is the holding company for Lewis & Clark Bank, a state-chartered full-service commercial bank. Partnering with people and businesses throughout Oregon and SW Washington, the Bank believes that being an integral part of the community it serves, helps promote both growth and success.

For more information about Lewis & Clark Bank, visit www.lewisandclarkbank.com.

Summary Balance Sheet

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2020

December 31, 2019

$$ Change

%% Change

ASSETS

Cash

$

73,171

 

$

49,084

 

$

24,087

 

 

49.1

%

Equity Securities

 

702

 

 

715

 

 

(13

)

 

-1.8

%

Investment Securities

 

1,515

 

 

16,965

 

 

(15,450

)

 

-91.1

%

Gross loans

 

256,232

 

 

200,284

 

 

55,948

 

 

27.9

%

Allowance for loan losses

 

(3,043

)

 

(2,040

)

 

(1,003

)

 

49.2

%

Net loans

 

253,189

 

 

198,244

 

 

54,945

 

 

27.7

%

Fixed Assets

 

7,705

 

 

7,415

 

 

290

 

 

3.9

%

Other Assets

 

10,221

 

 

9,536

 

 

685

 

 

7.2

%

Total Assets

$

346,503

 

$

281,959

 

$

64,544

 

 

22.9

%

 

LIABILITIES AND EQUITY

Deposits:

Noninterest-bearing

$

86,191

 

$

62,928

 

$

23,263

 

 

37.0

%

Interest-bearing demand

 

16,791

 

 

7,805

 

 

8,986

 

 

115.1

%

Money market and savings

 

149,915

 

 

121,683

 

 

28,232

 

 

23.2

%

Time deposits

 

42,082

 

 

52,841

 

 

(10,759

)

 

-20.4

%

Total deposits

 

294,979

 

 

245,257

 

 

49,722

 

 

20.3

%

Borrowings

 

5,873

 

 

 

 

5,873

 

 

100.0

%

Long-term debt

 

6,880

 

 

 

 

6,880

 

 

100.0

%

Other liabilities

 

1,680

 

 

993

 

 

687

 

 

69.2

%

Total liabilities

 

309,412

 

 

246,250

 

 

63,162

 

 

25.6

%

Equity

 

37,091

 

 

35,709

 

 

1,382

 

 

3.9

%

Total Liabilities and Equity

$

346,503

 

$

281,959

 

$

64,544

 

 

22.9

%

 
 

Summary Income Statement

(dollars in thousands)

 

 

 

 

 

 

 

 

 

Three months ended December 31,

Full year ended December 31,

2020

2019

2020

2019

 

Interest and fees on loans and investments

 

$

3,193

 

$

3,413

 

$

12,699

 

$

12,493

 

Interest expense

 

375

 

 

534

 

 

1,523

 

 

2,116

 

Net interest income

 

2,818

 

 

2,879

 

 

11,176

 

 

10,377

 

Provision for loan losses

 

 

 

 

 

1,055

 

 

 

Net interest income after provision

 

2,818

 

 

2,879

 

 

10,121

 

 

10,377

 

Noninterest income

 

219

 

 

144

 

 

957

 

 

471

 

Noninterest expense

 

2,087

 

 

2,202

 

 

8,715

 

 

7,658

 

Pre-tax income

 

950

 

 

821

 

 

2,363

 

 

3,190

 

Provision for income taxes

 

216

 

 

275

 

 

567

 

 

903

 

Net income

$

734

 

$

546

 

$

1,796

 

$

2,287

 

 

Contacts

Jeffrey Sumpter – President and Chief Executive Officer

Phone: (503) 212-3107

John Lende – Executive Vice President and Chief Financial Officer

Phone: (503) 212-3141

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