NewzIntel.com

Category: Banking

  • MIL-OSI Europe: Germany: EIB supports affordable housing in Bremen

    Source: European Investment Bank

    • Housing company GEWOBA is building almost 500 new rental flats and is investing to decarbonise its existing housing stock.
    • The EIB is providing €125 million in co-financing for the project to increase the supply of affordable housing that meets energy efficiency standards.

    The European Investment Bank (EIB) is granting a €125 million loan to housing-company GEWOBA AG Wohnen und Bauen in Bremen. The loan supports an extensive €500 million building and renovation project to increase the supply of affordable and climate-friendly housing in Bremen and Bremerhaven by the company that is majority-owned by the two municipalities. The flats will meet the high energy efficiency standards set out by the European Union and at least meet the German energy standard of KfW Efficiency House 55.

    According to the current plans, almost 500 new flats will be built, most of which will be accessible for people with reduced mobility. As part of the project, there will be a new kindergarten for around 60 children, as well as assisted-living communities and a day centre for 15 elderly people. In addition, over 2 000 existing flats will undergo energy-related renovation works. The price of rent per square metre for the new flats may not exceed €6.80 for subsidised flats and €9.00 for rent-capped flats.

    Bremen is a growing city, with its population expected to rise from today`s 685 000 inhabitants to 705 000 by 2035. Although the state of Bremen is in good economic shape overall, it has the highest unemployment rate of all federal states of Germany at 10%, and a high proportion of its residents earn low incomes.

    As in many cities in Germany, rent prices have increased in recent years. As the biggest rental housing provider in Bremen and Bremerhaven, GEWOBA is steering away from this trend, charging an average rent price of €6.94 per square metre (excluding bills) and an average of €7.94 per square metre for new rental contracts in existing flats.

    “The project is helping to ensure that a vibrant city can continue to grow and be liveable for families with children and the elderly”, says EIB Vice-President Nicola Beer. “Together with our partner GEWOBA, we are facing up to the social challenge in German and European cities and continuing to create affordable and climate-friendly housing.”

    The new flats are set to be highly energy efficient and will contribute to the European Union’s climate and environmental sustainability goals. They will help to reduce the amount of CO2 emitted from buildings and will support Bremen on its path to climate neutrality. They will also encourage social inclusion, as demonstrated by the emphasis on accessibility, and will create more housing options in the city for people on low and moderate incomes.

    “We are pleased to have a partner at our side in the form of the EIB, which is pursuing the same climate and social objectives as we are,” said Member of the Executive Board of GEWOBA Anja Passlack.

    Background information

    The EIB Group is the long-term lending institution of the European Union. It finances sound investments that contribute to EU policy objectives and works closely with other EU institutions and bodies to advance shared priorities such as equitable growth and a just transition towards climate neutrality. The EIB Group, which also includes the European Investment Fund (EIF), signed a total of €88 billion in new financing in 2023, of which €8.6 billion in Germany.

    The EIB Group has been providing financing and advisory services to the housing sector for 25 years. In the last five years alone, it has provided around €13.4 billion to support sustainable urban development and modernisation projects. Together with the European Commission, the EIB will increase its commitment to affordable housing in the coming years.

    GEWOBA AG Wohnen und Bauen in Bremen was founded in 1924 with the aim of making decent housing available for broad sections of the population – a mission that is still enshrined in its statute today. With around 43 000 rental apartments, GEWOBA is the largest rental housing provider in the state of Bremen and is majority-owned by the municipality. Its core business is value-based management and looking to the future to further develop its diverse housing portfolio. For decades, it has invested in extensive maintenance and modernisation projects, and expands its portfolio with new, high-quality buildings when required.

    MIL OSI Europe News –

  • MIL-OSI USA: Administrator Samantha Power at a Swearing-in Ceremony for Emily Coffman-Krunic as Mission Director for Bosnia and Herzegovina

    Source: USAID

    ADMINISTRATOR SAMANTHA POWER: Dobro jutro [good morning], here. Dobar dan [good evening], there. 

    It’s really great to be part of this event. Jim [Hope], really lovely to hear from your perspective. Jim has most recently been our Mission Director in Ukraine, and this is the first ceremony that I’ve had the chance to hear him emcee. But, it’s great to hear from a fellow Mission Director what these ceremonies mean. Certainly, they mean the world to us. 

    Ambassador [Michael] Murphy, as much as you think you know about Emily, you are about to learn much more. You will have a lot more ammo to use in various interagency deliberations. But, I want to thank you for joining and doing so in the spirit you did, I’ve actually – we haven’t had the chance to meet in person – but I devour your cables and your tweets. But above all, I have the greatest respect for just how you have not taken the easy path there and really stood. I think, very strongly in the face of an awful lot of resistance and many many headwinds – for not only American values but ultimately for the dignity of the people of the country and of the region. Really, really grateful to you for that. I’ve admired you from afar for a long time. 

    I do want to recognize – and Emily and I just talked about the tragedy of the historic floods that have really besieged really small communities in Bosnia and Herzegovina, very specifically Jablanica and Konjic. I know that Ambassador Murphy and Emily are already working with affected communities to support recovery efforts and even visited and met with the affected people. That means the world, I’m sure, to them, that someone has their back. But, our thoughts, of course, go out to those communities. There’s a lot coming at the people of Bosnia and Herzegovina, and when the floods pile on, it must be very overwhelming. So again, just a reflection of how much the American people care about the people of the country, and you all are incredible ambassadors for that. 

    Emily has a full house here today, in person and online, and maybe breaking some records if we add up all the miles traveled for each of the family members. But, we have her father Daniel and her mother Blanche, beaming in on the screen. And, here in the audience, we have her sisters Elizabeth, Ginny, and Julie. Ginny flew in all the way from England, and, incredibly, Julie has made the time to be here today after spending the past few weeks helping hurricane recovery efforts in western North Carolina. 

    And again, the parallel between what happens in Bosnia and the extremity of that and what happens here is just a reminder of the universality, sadly, of these challenges these days. 

    Thank you to the sisters, you seem like an incredibly close-knit group. I was like, “Are you thinking of visiting?” And they were like, “Ah, we’ve been there many times, you know!” So, I know Emily is incredibly lucky to have you in her corner. 

    We’re also joined by Emily’s children, of course – by Adrian, who studies engineering at the University of North Florida, and Emily’s daughter Stella, who began her own studies recently in anthropology in Amsterdam. I know that through your lives you’ve had to make big changes often to accommodate mom’s spirit of public service – leaving schools, and friends, and communities. So, thank you for your own sacrifices. You are the reason your mom does everything she does. So, thank you. 

    Alright, this is your life portion. 

    Emily was born in Jacksonville, Florida, to two parents we just got to see, who instilled in her the value of helping others. Her mom was a nurse before becoming a great caretaker for her four daughters, and then her mom worked at a local school. Emily’s dad was a pilot in the Navy and then a lawyer. 

    As a child, Emily was a go-getter who loved adventure, apparently. Although she was not the oldest, I’m told that she was the one who always directed the games among the girls. Emily went on to earn her degree in philosophy from Texas Christian University, before working at Merrill Lynch, where she saved up enough money to keep fueling her adventures. 

    She went to Guatemala for three months to learn Spanish and to Chile for six months to teach English to children of the indigenous Mapuche people, where she caught the spark, I guess, for international development work. Emily went on to earn her master’s in international peace and conflict resolution at American University, while also volunteering at the International Rescue Committee. 

    One day, Emily heard that the Organization for Security and Cooperation in Europe, OSCE, was looking for people to support Bosnia and Herzegovina’s very first municipal elections since the war. The country, as all of you know, had emerged from a horrific conflict with the signing of the U.S.-brokered Dayton Accords just the year before, and tensions were high as elections neared – with the question of whether the Dayton agreement could result in lasting peace and whether democracy really could be meaningfully ushered in. 

    Emily still had two months left in her degree program, but everyone she talked to, including the professors whose classes she would be skipping out on, said, “You have to do this. This is too important not to do.” 

    But, she was conflicted, because she was clearly a better student than I was. And so, she called her dad, and he was the last person she just had to make sure that she wasn’t doing something crazy. Her dad, Dan, of course, was worried about her going to war-torn Bosnia – again, the bullets had barely ceased firing, and this election was really soon after the war had ended.

    But, Emily asked him, and he expressed some reluctance, you know, given that the headlines had recently been very grim. But, Emily asked him, “Dad, what exactly were you doing when you were 27?”

    And his answer was, “I guess I was flying jets off aircraft carriers in the ocean…”

    So, Emily went on, booked her ticket with everybody’s full support. As you heard, she went on to work in Bosnia and Herzegovina for eight years, eventually joining the World Conference of Religions for Peace, one of USAID’s partners in Bosnia and Herzegovina as the Chief of Party.

    Emily knew that for development efforts to be effective there, after such vicious inter-ethnic conflict, there needed to be enhanced communication and cooperation. The demonization across lines had been very, very intense.

    Muslims, Croats, Bosnian Serbs, Orthodox Christians, Catholics, Jews – everyone kind of had to come together in dialogue. So, as you heard again from Ambassador Murphy, she and her team founded this inter-religious council of Bosnia and Herzegovina, and it really has, over the years, worked to mobilize faith leaders, faith communities, in service of reconciliation and rebuilding. 

    The work has never been easy. The demons, not only from the wars of the 1990s, but dating even further back, loom large. The misinformation which really impedes, you know, the ability to sustain, sometimes, that trust that those encounters can breed – all of that makes it immensely challenging.

    But, Emily continued to help the council members establish common ground and find productive ways to work together. Over these last decades, this Council has played an important role on everything from organizing youth reconciliation, to addressing gender-based violence, to facilitating the protection of holy sites for all groups.

    I think this shows a characteristic that has defined Emily’s work over the years. Even in incredibly difficult environments where the odds seem low of succeeding, she has managed to help people see that there is a path forward, if they can come together.

    In Rwanda, Emily arrived at a time when the democracy team’s funding had been nearly zeroed out for two years in a row. The Mission was actually considering stopping all democracy and governance programming. But, Emily understood that supporting democracy, again as Ambassador Murphy reinforced, was, in fact, fundamental to advancing development. 

    To make enduring progress on any front, developmentally, citizens have to be empowered to demand and work toward the change that they want in their own communities. They also have to be able to, through raising their voice at the ballot, be able to get rid of leaders who are corrupt or governing poorly and in a way that isn’t bettering the lives of citizens. 

    In the words of Joseph Rurangwa, an FSN in Rwanda, Emily “fought for DG’s identity” – fought for democracy and governance’s identity. Apparently, she worked day and night to convince partners, donors, and colleagues that democracy and governance was worth the investment. 

    Emily went to battle, and Emily won. The Mission in Rwanda didn’t just revitalize the small democracy team that Emily had come to lead. It created an entirely new standalone democracy and governance office. The office went from having two activities in other portfolios to an entire portfolio of 13 democracy and governance activities: from training journalists, to hosting election roundtables for citizens and human rights training for Rwandan youth, to even creating the Mission’s first-ever activity supporting the LGBTQI+ community in Rwanda. Joseph says, “Emily steered the boat in troubled waters, and with her at the helm, 800,000 flowers bloomed all at once.” 

    In Jordan, where Emily started as the Democracy, Rights, and Governance Office Director and ultimately became the Deputy Mission Director, she helped manage a portfolio completely unknown to her: water. Water is a huge, huge issue, as everyone knows. For Jordan, specifically, the country is the third most water scarce country in the entire world. And, while a country is considered to face water scarcity when it has less than 500 cubic meters of water per person per year, Jordan has just one-fifth of that. Just to give you a sense of the magnitude of this challenge. And water, as we know, again, all of us, from our own lives, is necessary for just about everything. 

    Jordan’s water portfolio is the largest budget for any single portfolio for USAID, and it is also a country – one of the few countries in the world – where USAID finances large infrastructure projects. So, it was a huge task, and though Emily had no formal background in water, she quickly became fluent in everything from project finance to major infrastructure construction. One colleague at the time says, “Emily came to the job with so much humility and curiosity. It really inspired all of us to feel like we were all in this together.”

    Emily led the team as they took on two tasks. First, while Jordan had an existing water sharing agreement with its neighbor Israel, Emily knew that in spite of the complex relationship between the countries, they could and should share more water. 

    So, she and the team helped negotiate an agreement in which the two countries agreed to double the volume of water that they shared. This was a historic agreement that spared further water rationing in Jordan. But, Emily also knew that to meet the scale of need, Jordan needed to develop its own desalination ability, turning saltwater into drinkable water. So, she oversaw the design and procurement of the third-largest desalination project in the world, leading it through political negotiations, financial hurdles, and technical discussions, as donors, partners, diplomats, and elected officials came together to achieve a workable plan. Emily’s efforts paid off. 

    USAID was able to catalyze nearly $3 billion against our $300 million pledge from donors like the Development Finance Corporation, the European Union, and the Islamic Development Bank. When construction is complete, slated to be in about five years, the project will pump newly desalinated water from the south of Jordan, 280 miles uphill, to the population centers of Jordan, who need the water for daily life – through pipes that are so big that you can actually drive a car through them. This single desalination project will meet a full 40 percent of Jordan’s water needs, transforming its water security.

    Emily has spent the past year, of course, applying the skills that she honed leading these kinds of ambitious projects in difficult environments in the Mission in Bosnia and Herzegovina, where she returned to serve as Deputy Mission Director. We are told that the first two weeks that Emily was back on the ground in Bosnia and Herzegovina, she met every single person at the Mission, from the Ambassador to the Foreign Service Officers to the Foreign Service Nationals to the cleaning staff, to get to know all of those who are part of her new team.

    When it was announced that she was going to be the new Mission Director, her predecessor, Courtney Chubb – an extraordinary Mission Director in her own right – but as Courtney described it, when word went out that she was going to be promoted, the Ambassador was completely overjoyed. And, as Courtney put it, “I’ve never seen so many smiles on the faces of our Mission staff.”

    And just to say a word about that Mission staff and having a chance to engage you all directly, you’re extraordinary. Our Foreign Service Nationals – as Courtney and I discussed when I was on the ground there on a visit, and Emily and I just discussed – you all are really some of the leading lights in the world. The amount you know, the amount you have achieved, the amount you have circumnavigated, all that stands in your way to make the peace enduring and to try to strengthen checks and balances and institutions. Many of our FSNs in Bosnia and Herzegovina have been there more than 20 years, some more than 30 years. It’s just an incredible team. And to have as a Mission Director, as you do, someone who so values you and recognizes how much she has to learn from you every day, that’s the best kind of teamwork that can be expected.

    So, there is no better person, I think, in something of a returning home, second home really, to Emily but for Emily Coffman-Krunic to be taking the helm as the Mission Director in Bosnia and Herzegovina.

    Bosnia and Herzegovina is a special place. It is a country whose people continue to experience incredible hardship. I talked earlier about the flooding, but there’s a lot of man-made disasters happening in Bosnia and Herzegovina, because so many elected leaders do not put their people first. Some do, and they are extraordinary, what they put up with as well.

    But, when institutions don’t work always on behalf of the people, it makes what the people do to make development happen even more impressive. And, the efforts that the people of Bosnia and Herzegovina have made, initially, to rebuild, to revitalize, to grow, really speak just to the resilience of all communities, and it’s an inspiration for those of us who only get to visit every now and then. 

    Since 1996, the U.S. government has provided more than $2 billion, including $1.5 billion from USAID alone, in assistance in efforts to support, again, those on the ground who are building a democratic and inclusive European country. One of the most complicated government structures in the world, makes things very, very challenging. It is hard, often, for leaders to agree on the kinds of basic policies or basic initiatives that the people really expect from them. When they agree, it can be very challenging to operationalize those efforts. But nonetheless, again, there is so much good that is happening on the ground. 

    The virulent nationalism that lives on, usually most vocally in those who don’t know how to or don’t care to deliver basic services for the citizens of the country, continues to threaten the progress that has been made. We see the direct targeting of NGOs and development partners. We see attacks on independent media. We see, basically, threats to this effort to build a strong, independent, and vibrant European country, which is so clearly what young people in the country want. 

    USAID has an incredibly important role to play in support of the whole country team’s effort to push back against these challenges. We are working to counter harmful nationalistic rhetoric and narrative, with the goal of strengthening the security and the dignity for individuals and for communities within the country. We are expanding our work with independent media, with civil society, with investigative journalists. We are working to contribute to economic development, to help the private sector drive growth, and to include all groups like LGBTQI+ communities, women and Roma populations, in the progress that the people of Bosnia and Herzegovina are trying to drive. 

    Now, Emily, I want to end these remarks on something your son Adrian told us. We asked Adrian what it was like to grow up and to travel the world with you. And Adrian said, “I always knew that what my mom did was helping people. It made me want to be a better person.” 

    So, Emily, I think it’s safe to say you’ve made so many of us here want to be better people, even I, just listening to your journey, but also seeing what you’ve been doing on the grounds in Bosnia and Herzegovina, and in Jordan, just during my time here. And, what I love about your spirit is you never give up. You don’t care about the odds. You just invest body and soul, bring questions and not answers in the first instance, empower your teams, and you have one of the best teams in the world there, as you well know, and you do it all with an eye to future generations and what would mean the most. 

    So, we are thrilled that you’re our Mission Director in Bosnia and Herzegovina, and I look forward to making it official and swearing you in. Congratulations.

    MIL OSI USA News –

  • MIL-OSI Economics: 43rd Half Yearly Report on Management of Foreign Exchange Reserves: April – September 2024

    Source: Reserve Bank of India

    The Reserve Bank of India has today released the 43rd half-yearly report on management of foreign exchange reserves with reference to end-September 2024.

    The position of foreign exchange reserves as on October 18, 2024 is as under:

    US $ Billion
    Foreign Exchange Reserves (i+ii+iii+iv)* 688.27
    i. Foreign Currency Assets (FCA) 598.24
    ii. Gold 67.44
    iii. Special Drawing Rights (SDRs) 18.27
    iv. Reserve Tranche Position (RTP) 4.32
    * Difference, if any, is due to rounding-off.

    It may be recalled that in February 2004, the Reserve Bank had started a process of compiling half yearly reports and placing them in the public domain for bringing about more transparency and enhancing the level of disclosure in relation to management of the country’s foreign exchange reserves.

    (Puneet Pancholy)  
    Chief General Manager

    Press Release: 2024-2025/1391

    MIL OSI Economics –

  • MIL-OSI Economics: Euro area economic and financial developments by institutional sector: second quarter of 2024

    Source: European Central Bank

    29 October 2024

    • As of October 2024, ECB quarterly financial accounts provide more details on loans by counterpart sector granted by other financial institutions (OFIs) and information on debt securities issuance of non-financial corporations (NFCs) via financing conduits. OFIs are creditors of 23% of loans granted to NFCs by financial sector
    • Euro area net saving increased to €795 billion in four quarters to second quarter of 2024, compared with €787 billion one quarter earlier
    • Household debt-to-income ratio decreased to 83.4% in second quarter of 2024 from 87.8% one year earlier
    • NFCs’ debt-to-GDP ratio (consolidated measure) decreased to 69.3% in second quarter of 2024 from 71.8% one year earlier

    New details on other financial institutions and the financing of other sectors

    As of October 2024, the quarterly sector accounts published by the ECB provide more detailed financial accounts data on OFIs, which constitute the second largest financial sector in the euro area after monetary financial institutions (MFIs).[1] OFIs mainly provide financing to NFCs and to a lesser extent to households and other sectors. They also channel funds to and from the rest of the world.

    This new release provides counterpart sector data, such as loans granted by the OFI subsectors to NFCs (Chart 1). The release also includes new data on euro area NFC financing conduits which are captive financial institutions that raise funds by issuing debt securities to be used by their parent corporation.[2]

    Chart 1

    Loans to NFCs by financial subsector

    (outstanding amounts at the of end of the second quarter of 2024, as percentages of financial sector loans to NFCs)

    Source: ECB.

    * Loans from NFC financing conduits to NFCs are estimated based on the financing conduits’ issuance of debt securities.

    Total euro area economy

    Euro area net saving increased to €795 billion (6.7% of euro area net disposable income) in the four quarters to the second quarter of 2024, compared with €787 billion in the four quarters to the previous quarter. Euro area net non-financial investment decreased to €440 billion (3.7% of net disposable income), mainly due to decreased investment by NFCs (Chart 2 and Table 1 in the Annex).

    Euro area net lending to the rest of the world increased to €388 billion (from €336 billion previously) reflecting the increased net saving and decreased net non-financial investment. Household net lending increased to €549 billion (4.6% of net disposable income) from €501 billion. Net lending of NFCs (€233 billion, 2.0% of net disposable income) and that of financial corporations (€124 billion, 1.0% of net disposable income) were broadly unchanged. Government net borrowing stood broadly unchanged at €517 billion, contributing negatively (-4.3% of net disposable income) to euro area net lending.

    Chart 2

    Euro area saving, investment and net lending to the rest of the world

    (EUR billions, four-quarter sums)

    Sources: ECB and Eurostat.

    * Net saving minus net capital transfers to the rest of the world (equals change in net worth due to transactions).

    Data for euro area saving, investment and net lending to the rest of the world (Chart 2)

    Households

    Household financial investment increased at a higher annual rate of 2.3% in the second quarter of 2024 (after 2.0% in the previous quarter). Among its components, investment in currency and deposits (2.3%, after 1.6%) and investment in shares and other equity (0.8%, after 0.4%) grew at higher rates due to investment fund shares, while investment in debt securities increased at a lower rate (27.9%, after 38.5%).

    Households continued to directly buy, in net terms, mainly debt securities issued by general government and MFIs. Households were overall net sellers of listed shares, selling predominantly listed shares of non-financial corporations, while buying listed shares issued by the rest of the world (i.e. shares issued by non-euro area residents) and MFIs (Table 1 below and Table 2.2 in the Annex).

    The household debt-to-income ratio[3] decreased to 83.4% in the second quarter of 2024 from 87.8% in the second quarter of 2023. The household debt-to-GDP ratio declined, to 52.2% in the second quarter of 2024 from 54.4% in the second quarter of 2023 (Chart 3).

    Table 1

    Financial investment and financing of households, main items

    (annual growth rates)

    Financial transactions

    2023 Q2

    2023 Q3

    2023 Q4

    2024 Q1

    2024 Q2

    Financial investment*

    2.0

    1.8

    1.9

    2.0

    2.3

    Currency and deposits

    1.3

    0.3

    0.8

    1.6

    2.3

    Debt securities

    48.6

    56.9

    54.3

    38.5

    27.9

    Shares and other equity**

    1.3

    1.1

    0.4

    0.4

    0.8

    Life insurance

    -0.2

    -0.7

    -0.6

    -0.2

    0.0

    Pension schemes

    2.4

    2.4

    2.2

    2.3

    2.3

    Financing***

    2.4

    1.6

    0.9

    1.1

    1.4

    Loans

    1.8

    1.0

    0.5

    0.6

    0.6

    Source: ECB.

    * Items not shown include: loans granted, prepayments of insurance premiums and reserves for outstanding claims and other accounts receivable.

    ** Includes investment fund shares.

    *** Items not shown include: financial derivatives’ net liabilities, pension schemes and other accounts payable.

    Data for financial investment and financing of households (Table 1)

    Chart 3

    Debt ratios of households and NFCs

    (percentages of GDP)

    Sources: ECB and Eurostat.

    * Outstanding amount of loans, debt securities, trade credits and pension scheme liabilities.
    ** Outstanding amount of loans and debt securities, excluding debt positions between NFCs
    *** Outstanding amount of loan liabilities.

    Data for debt ratios of households and NFCs (Chart 3)

    Non-financial corporations

    Financial transactions

    2023 Q2

    2023 Q3

    2023 Q4

    2024 Q1

    2024 Q2

    Financing*

    1.7

    1.2

    0.8

    0.8

    1.0

    Debt securities

    0.7

    1.5

    1.3

    1.9

    2.9

    Loans

    3.8

    1.9

    1.7

    1.4

    1.3

    Shares and other equity

    -0.0

    0.4

    0.3

    0.4

    0.8

    Trade credits and advances

    5.2

    2.2

    1.2

    0.6

    1.8

    Financial investment**

    2.9

    2.4

    1.8

    1.9

    2.1

    Currency and deposits

    -0.6

    -1.2

    -1.2

    0.5

    2.9

    Debt securities

    23.3

    27.9

    23.0

    10.6

    7.8

    Loans

    5.9

    5.2

    5.1

    4.4

    4.5

    Shares and other equity

    1.2

    1.2

    1.0

    1.4

    1.3

    MIL OSI Economics –

  • MIL-OSI Economics: Frank Elderson: Transcript of video recording for Finance and Biodiversity Day of 16th United Nations Conference on Biological Diversity (COP16)

    Source: European Central Bank

    Contribution by Frank Elderson, Member of the Executive Board of the ECB and Vice-Chair of the Supervisory Board of the European Central Bank (ECB), 16th meeting of the Conference of the Parties to the Convention on Biological Diversity – Finance and Biodiversity Day

    Cali, 28 October 2024

    The global economy and finance need nature to survive. Analysis by the ECB shows that the economy depends critically on nature: 72% of non-financial businesses in the euro area – around 4.2 million individual companies – would experience significant problems as a result of ecosystem degradation. These businesses rely on ecosystem services like fertile soils, timber and clean water. And 75% of bank loans are tied to these businesses. So, if they run into trouble, the banks that finance them will too. This interdependence underscores why the ECB made nature one of the focus areas of its climate and nature plan for 2024 and 2025. It is also why we push banks under our supervision to manage all material nature-related risks.

    The ECB does not stand alone in recognising this threat. The value of nature for the economy is acknowledged by the global Network of Central Banks and Supervisors for Greening the Financial System, which has 141 members worldwide. Additionally, a recent stocktake by the Financial Stability Board showed that a growing number of policy authorities around the world are considering the potential implications of nature-related risks for financial stability.

    In recognition of the vital importance of nature for the economy, international fora must ensure that nature considerations are fully integrated into regulation and supervision, alongside ongoing efforts to account for climate-related considerations. This starts with identifying exposures and vulnerabilities to nature-related risks.

    While central banks and supervisors are not nature policymakers, we must take nature into account to fulfil our mandate of price stability and safe and sound banks. Otherwise, we risk failing to deliver on our mandate.

    My message on this Finance and Biodiversity Day is clear: if you destroy nature, you destroy the economy. The right conditions must be established for nature – and consequently the economy – to thrive. The economy needs nature to survive. Financial stability needs nature to survive. To deliver on our mandate, we need nature to survive. And the survival of nature requires financing. Therefore, your success here in Cali is vitally important.

    Thank you. Buena suerte.

    MIL OSI Economics –

  • MIL-OSI Economics: Luis de Guindos: Interview with ANSA

    Source: European Central Bank

    Interview with Luis de Guindos, Vice-President of the ECB, conducted by Domenico Conti

    29 October 2024

    At the latest press conference, President Lagarde spoke of a series of economic indicators pointing lower and of downside risks to growth. The Survey of Professional Forecasters published by the ECB foresees inflation of 1.9% in 2025, compared with 2.2% in the projections by ECB experts. In this context, will the Governing Council have the option to make back-to-back interest rate cuts, as occurred in September and October?

    In short, on the current economic situation, we don’t have good news with respect to growth but we do have good news with respect to inflation.

    On growth, we have revised down our projections twice – before the summer and in September. We see that the downside risks that we identified are crystallising, mainly because consumption is not recovering as expected. Even though real disposable income has increased because wages are catching up with past inflation, households are not increasing their spending. This could be due to structural factors, including a lack of confidence owing to past inflation, the pandemic or geopolitical risks. But it is clear that the recovery in consumption is not happening at the pace we had previously projected.

    On inflation, we have the opposite happening. The latest figures are good, in terms of both headline inflation and underlying inflation. Most measures of underlying inflation are declining, and we are confident that we will be able to reach our 2% target over the medium term in the course of 2025.

    Regarding possible future cuts, we have been very clear that we will keep all options open at forthcoming meetings, both in terms of the number of cuts and the size of these cuts. But what is most relevant for the transmission of monetary policy and the impact of financial conditions on aggregate demand is the medium-term trajectory, which is evidently that of an easing cycle. Fine-tuning monetary policy is very complex and the important signal is the medium-term trajectory.

    Geopolitical risks will play a role in the forthcoming monetary policy decisions. To what extent are the risks associated with the conflicts in the Middle East and the risks of a further escalation in trade tariffs pushing the ECB to take a prudent approach in reducing interest rates?

    Geopolitical factors play a very important role in our analysis. For example, the conflict in the Middle East has an impact on energy prices and upcoming elections could have an impact on international trade, global growth and inflation. This is one reason why we have to be very prudent with our decisions. When you are in a dark room full of uncertainty, for example because of geopolitical risks that you cannot control, you have to take very careful steps.

    Another important element is fiscal policy. Governments are now submitting their medium-term budgetary plans to the European Commission. This will give us more clarity on the fiscal outlook, which is an element that we take into consideration in our analysis and decision-making. So geopolitical risks, the possibility of distortions in international trade plus what will happen with fiscal policy will all feed into our decisions in the near future.

    In its new operational framework that came into force in September 2024, the ECB anticipates that a substantial contribution to providing liquidity to the banking sector will come from a structural portfolio of securities and from new longer-term refinancing operations, under conditions to be defined at a later date. What point has the discussion reached and what guidance is there?

    The operational framework has to be used to implement our monetary policy, it cannot condition it. And we have said very clearly that all monetary policy instruments in our toolkit remain available to us. This will include, for example, non-conventional measures, such as targeted longer-term refinancing operations and quantitative easing.

    Right now, we are in a situation of ample liquidity, which we are gradually reducing by discontinuing reinvestments, which will come to a complete halt at the beginning of next year. Once that liquidity has been significantly reduced, a combination of the monetary policy instruments at our disposal will help us deliver enough liquidity to the banking system.

    In my view, when we discuss the structural portfolio, we will need to take into account the actual liquidity situation of the banks and look not only at the average, but also at the dispersion in the banking sector. We have not decided on the size of the structural portfolio, but it will need to be large enough to deliver sufficient liquidity to the banking system.

    The latest monetary policy strategy review in 2021 took place at a time of strong deflationary pressures linked to various factors, including digitalisation and globalisation. Since then the landscape has changed. We find ourselves in a fragmented geopolitical context with the return of inflationary shocks. How will all this be reflected in the coming monetary policy strategy review? When will the discussion begin and what topics will it cover?

    We have established a couple of workstreams at the technical level to examine these factors, namely how the landscape has changed, how the new environment could have an impact on inflation, and our evolving policy toolkit. But this will not be discussed by the Governing Council until next year, with conclusions expected in the second half of 2025.

    What is crystal clear is that the definition of price stability as 2% inflation over the medium term will not be up for debate. And several other elements, such as the importance of financial stability considerations or accounting for climate change in our work, are already established. Instead, this review will mostly be an assessment of the previous strategy review while considering new elements, such as the changed economic and inflation environment, the possibility of deglobalisation and other structural elements that could affect the inflation outlook.

    Importantly, we will look at the consequences of measures we have used in the past. For every monetary policy decision, we need to look not only at short-term effects but also further ahead at possible unwanted effects. Quantitative easing, for example, is an instrument that proved to be very useful to fight deflation and the impact of the pandemic, but it also caused some side effects. In that respect, now that we have started the opposite process of quantitative tightening, we have much more information on the potential consequences of quantitative easing.

    Are you referring to fiscal side effects?

    No. I’m referring, for instance, to the impact on financial stability or on national central banks’ profit and loss accounts. These are side effects that can be better taken into consideration and that were not obvious at the time.

    Italy has seen inflation fall to below 2% from a high of close to 12% two years ago, and its growth rate is in line with the European average. While real disposable income is improving, investment is feeling the effects of a still restrictive monetary policy and politicians have criticised the ECB’s cautious stance in the last few months. How would you explain to Italian politicians and households the need for a cautious approach in reducing interest rates, and how do you plan to reassure them about the current transition from still restrictive interest rates to a more neutral stance?

    Above all else, we listen to all opinions carefully and with an open mind. The ECB and central banks are independent institutions, meaning that they need to display an additional level of responsibility and accountability.

    What I would say to Italian and European citizens is that it’s important to be cautious and prudent. We have reduced interest rates and the trajectory of our monetary policy is very clear, but there is a huge amount of uncertainty and we cannot make mistakes. That’s why a gradual approach to implementing monetary policy is essential.

    That being said, I’d like to reassure them that things are moving in the right direction. Inflation has fallen significantly. Most people look more closely at price levels than at inflation, but at the end of the day, current price levels are a consequence of past inflation. We can’t claim victory yet, but we have made good progress so far. And despite an economic slowdown, we have so far managed to reduce inflation without causing a recession in the euro area. When you look at the labour market, the situation remains positive. So I hope that in the medium term it will become more evident that we are on the right track.

    In its draft budget, the Italian government is seeking a contribution of around €3.5 billion from the banking sector by targeting deferred tax assets (DTAs). Has the ECB been consulted on the merits of this approach and what guidance is being formulated on this measure?

    In general, our assessment of banking sector taxes is quite clear from the legal opinions we have issued on proposals by several countries. Our view is that such taxes should not impair banks’ solvency or the transmission of monetary policy in terms of hampering the flow of credit to the real economy.

    In this specific case, we don’t have the definitive version of the tax yet, so it’s difficult to form an opinion about it. But I hope that solvency will be one of the items taken into consideration, which would be positive from our perspective.

    In my view, the design of the previous version of the tax was balanced, for example, because it made tax revenues and bank solvency compatible. Of the many approaches taken by other European countries that imposed taxes on the banking sector, I believe this was the most balanced one.

    Completing the banking union is one of the most urgent objectives that will make Europe more resilient and more competitive. Despite this, a cross-border merger like the potential merger between Unicredit and Commerzbank currently under discussion is treated as a national matter in both countries. What lessons can we learn from this and why is a cross-border merger between European banks still hitting the headlines in Europe in 2024?

    Given the importance of banks’ funding for the real economy, completing the banking union should be the number one priority on the European Union’s economic agenda. I acknowledge that there are political hurdles to achieving that, but it will be very difficult to have a real economic and monetary union without a banking union. Greater coordination of fiscal policy, for example through a common fiscal instrument or progress towards the capital markets union, would also be important.

    If you want a single banking market, you need to have genuine pan-European banks. This is why cross-border consolidation of the banking sector is important. I don’t discuss the merits of individual cases, but in my view, a European approach should prevail over a national one. That’s the way forward for European integration.

    In any case, our assessment of any merger and acquisition transaction is always based exclusively on prudential and solvency criteria. This is the guiding principle for us, based on European regulation.

    The Italian government has voiced its support for the merger between Unicredit and Commerzbank, which would strengthen European banking consolidation. At the same time, Italy is the only Member State that hasn’t ratified the treaty to reform the European Stability Mechanism (ESM), which is an important element in completing the banking union. How important will it be to remove this obstacle?

    In my previous answer, I referred to how important it is for a European approach to prevail over a national one. But this principle has to be consistent from all angles and in all kinds of situations. In my opinion, a pro-European approach to the integration of the economy, the banking system and the capital markets should be the one that prevails for all the items under discussion, including ESM reform. Ratifying the reformed ESM Treaty would be a clear pro-European decision.

    MIL OSI Economics –

  • MIL-OSI China: Announcement on Open Market Business No.7 [2024]

    Source: Peoples Bank of China

    Announcement on Open Market Business No.7 [2024]

    (Open Market Operations Office, October 28, 2024)

    To keep liquidity in the banking system adequate at a reasonable level and to further enrich the monetary policy toolkit of the central bank, the People’s Bank of China (PBOC) decided to use the instrument of outright reverse repo operations on the open market as of today. Open to primary dealers of open market operations, it is to be conducted on a monthly basis in principle with a tenor of not more than one year. The operations adopt variable-rate tender with a fixed quantity and multi-price auction, trading central government bonds, local government bonds, financial bonds and unsecured corporate bonds. The result of operations will be released under relevant columns on the PBOC official website.

    The notice is hereby released. 

    Date of last update Nov. 29 2018

    2024年10月28日

    MIL OSI China News –

  • MIL-OSI China: Announcement on Open Market Operations No.213 [2024]

    Source: Peoples Bank of China

    Announcement on Open Market Operations No.213 [2024]

    (Open Market Operations Office, October 29, 2024)

    In order to keep liquidity adequate at a reasonable level in the banking system at month-end, the People’s Bank of China conducted reverse repo operations in the amount of RMB382.8 billion through quantity bidding at a fixed interest rate on October 29, 2024.

    Details of the Reverse Repo Operations

    Maturity

    Volume

    Rate

    7 days

    RMB382.8 billion

    1.50%

    Date of last update Nov. 29 2018

    2024年10月29日

    MIL OSI China News –

  • MIL-OSI Russia: There will be no problems with payments – banks of China and Vietnam will open branches in Russia

    Translation. Region: Russian Federation –

    Source: Mainfin Bank –

    Why do Chinese banks want to work in Russia?

    The desire of foreign banks from countries conducting trade and economic activities with Russian partners to open structural divisions in the Russian Federation is explained by a number of reasons:

    the risk of secondary sanctions for working with individuals subject to restrictions in China and other countries; blocking sanctions imposed on most domestic financial institutions; difficulties with international payments – Chinese banks are increasingly refusing to make payments to Russians.

    In fact, the volume of trade between Russia and China continues to increase, but it is becoming increasingly difficult for the parties to conduct settlement operations. Opening offices of Chinese banks in the Russian Federation would solve the problem that has arisen due to the pressure of sanctions.

    What operations are available to foreign banks in Russia?

    Pursuit banks from China and Vietnam to open offices on Russian territory is also connected with the approval in 2024 of a bill allowing foreign credit institutions to operate in the Russian Federation. Thus, the document allows foreign banks after opening a branch:

    provide banking services to businesses; make payments and transfers between legal entities; collect cash and other payment documents; open accounts for entrepreneurs.

    “Small banks from China and Vietnam are ready to come to Russia and start working – the signals are coming against the backdrop of the development of economic relations: companies want to ensure settlements in international trade,” the State Duma stated.

    Uninterrupted payments are one of the development areas agreed upon by Beijing and Moscow: the parties previously agreed to develop the settlement infrastructure, including by opening offices and divisions of credit institutions.

    13:10 10/29/2024

    Source:

    Please note: This information is raw content directly from the source of the information. It is exactly what the source states and does not reflect the position of MIL-OSI or its clients.

    Please note; This information is raw content directly from the information source. It is accurate to what the source is stating and does not reflect the position of MIL-OSI or its clients.

    https://mainfin.ru/news/problems-with-payments-there will be-no-banks-of-China-and-Vietnam-will-open-branches-in-Russia

    MIL OSI Russia News –

  • MIL-OSI USA: Acting Deputy Administrator Michele Sumilas During the World Bank Annual Meetings

    Source: USAID

    The below is attributable to Deputy Spokesperson Shejal Pulivarti:‎

    From October 23 through 25, Acting Deputy Administrator Michele Sumilas participated in various engagements during the World Bank Annual Meetings. Throughout the week, she engaged USAID’s partners on shared priorities, including boosting food security and climate action, as well as collaborating on humanitarian assistance.

    On Wednesday, Acting Deputy Administrator Sumilas represented USAID at a signing ceremony, where Secretary of the Treasury Janet L. Yellen and Ukrainian Minister of Finance Sergii Marchenko marked the intention of the United States to join G7 efforts to make lending available to Ukraine, and provide a $20 billion U.S. loan to Ukraine that will be repaid by proceeds derived from Russia’s frozen assets. 

    Acting Deputy Administrator Sumilas then participated in a roundtable hosted by the Coalition on Disaster Resilient Infrastructure (CDRI), which featured Ministers from Angola, Bhutan, Chad, Comoros, India, Nigeria, and Madagascar. The roundtable provided an opportunity for participants to discuss how the Coalition can be responsive to infrastructure needs in Africa. 

    On Thursday, Acting Deputy Administrator Sumilas met with Denmark’s State Secretary for Development Policy Lotte Machon to discuss cooperation on food security, climate action, advancing democracy, and joint efforts on humanitarian assistance in Gaza and Ukraine. 

    The Acting Deputy Administrator also participated in a fireside chat, along with Norway’s Minister of International Development Anne Beathe Tvinnereim and Investisseurs & Partenaires (I&P’s) Jean-Michel Severino, Chair of the Supervisory Board, at the Financing for Agricultural Small-and-Medium Enterprises in Africa (FASA) Fund Launch, hosted by the Embassy of Norway. USAID and Norway announced that the United Kingdom and Republic of Korea have joined USAID as partners in the FASA Fund, which will help unlock additional commercial capital. In addition, Norway and USAID announced that Investisseurs and Partenaires (I&P) – a pioneering impact investment group dedicated to financing and supporting African entrepreneurs while strengthening entrepreneurial ecosystems across the African continent – was competitively selected as the FASA fund manager. 

    On Friday, Acting Deputy Administrator Sumilas met with the United Kingdom’s Second Permanent Under-Secretary Nick Dyer to discuss U.S.-UK shared priorities. She also met Brazil’s Ambassador to the United States Maria Luiza Viotti to discuss key development priorities of Brazil’s G20 presidency, including the Global Alliance Against Hunger and Poverty to include recognition of Brazil’s support for their role in Multi-National Security Support Missions in Haiti, and continued efforts to aid Venezuelan migrants and refugees in Brazil. 

    MIL OSI USA News –

  • MIL-OSI: Šiaulių Bankas invitation to Q3 2024 Financial Results webinar

    Source: GlobeNewswire (MIL-OSI)

    Šiaulių Bankas (SAB1L) invites shareholders, investors, analysts and other stakeholders to join its Investors Webinar for Q3 2024 Financial Results and highlights scheduled on 31 October, 2024 at 8:30 am (EET). The presentation will be held online in English.

    The webinar will be hosted by Vytautas Sinius, CEO, Tomas Varenbergas, Head of Investment Management Division and Tautvydas Mėdžius, Strategy Partner, who will discuss the bank’s financial results for the third quarter of 2024, recent developments, and will take questions from participants.

    Please send your questions in advance to investors@sb.lt   

    How to join the webinar?

    To join the webinar, please register via following link https://sb.zoomtv.lt. After successful registration You will be provided with the webinar link. The webinar will be recorded and available online for everyone at Šiaulių Bankas website www.sb.lt/en/investors 

    Additional information:
    Tomas Varenbergas
    Head of Investment Management Division
    tomas.varenbergas@sb.lt

    The MIL Network –

  • MIL-OSI: Anchor Peabody Signals Growth, Expansion with Slate of New Hires

    Source: GlobeNewswire (MIL-OSI)

    DELRAY BEACH, Fla., Oct. 28, 2024 (GLOBE NEWSWIRE) — Anchor Peabody, a leading investment banking firm for the building products and services industry, has expanded its team of senior executives and banking professionals as part of its ongoing strategy to build the leading M&A advisory team in the building, construction and home services industries.

    Chobun Hieblinger has joined Anchor Peabody as Managing Director. Mr. Hieblinger has over 17 years of financial advisory and investment banking experience, the bulk of which is in building products, including roles with the Lehman Brothers (now Barclays Investment Bank) and RBC Capital Markets. Most recently, Mr. Hieblinger was Managing Director and Head of Building Products at B. Riley Securities in Los Angeles.

    “After two years of slower demand due to higher interest rate and post-COVID dynamics, the building industry is poised for strong growth, driven by favorable demographic trends, aging housing stock, and years of under-building,” said Hieblinger. “With deep relationships, particularly in the tile and stone space, I look forward to helping owners and operators capitalize on this very positive M&A dynamic.”

    Greg Hicks has joined Anchor Peabody as Business Development Director. Mr. Hicks has nearly 20 years of investment banking, principal investing, and corporate development experience, having focused primarily on building products and general industrials. He began his professional career with Lincoln International in Chicago, with stints in Frankfurt and London.  Following Lincoln, he helped found Desco Capital, a private equity / family office. Mr. Hicks then ran Alesco Holdings, an outsourced business development firm, and most recently led M&A for W.W. Williams, one of the nation’s largest industrial distribution, repair and service companies.

    “I’m excited to align myself with Anchor Peabody, where secular tailwinds are expected to produce a robust M&A environment in the home services space for the foreseeable future. I look forward to providing thought-leadership and advice tailored to the HVAC, plumbing and electrical market and its participants,” said Hicks. “The HVAC, plumbing, and electrical M&A market is normalizing after a surge in 2021-2022, with deal volumes returning to more sustainable levels.  Private equity and strategic buyers remain active, with a focus on service-based businesses with recurring revenue streams.”

    About Anchor Peabody
    Anchor Peabody is an investment banking firm comprised of former owners, operators and investors in the building products and services industry. The firm combines over 100 years of capital and mergers & acquisition experience with a modern approach to banking to align with client objectives and eliminate banker burnout from the industry model. For more information, visit www.anchorpeabody.com.

    The MIL Network –

  • MIL-OSI: Pipe Launches Embedded Business Card for Software and Payment Companies, Expanding Their Suite of Embedded Financial Solutions

    Source: GlobeNewswire (MIL-OSI)

    SAN FRANCISCO, Oct. 28, 2024 (GLOBE NEWSWIRE) — Pipe, a fintech company partnering with software platforms to deliver embedded financial solutions for SMBs, today announced it has expanded its suite of products with the launch of Pipe Business Card1. With the Pipe Business Card, software and payments companies can now launch a new business card program for their customers without managing underwriting, capital markets, fraud, or credit risk on their own.

    77% of SMBs are concerned about capital access2 and 55% of them have reported putting business-related expenses on a personal credit card just to get by3. SMBs need spend management solutions just like mid-market and enterprise businesses have access to today.

    The Pipe Business Card is designed specifically for small to medium-sized businesses and is available as an embedded offering for Pipe’s software partners. It’s an SMB-friendly business card with up to 1.5% unlimited cash back4, up to 45 days to pay for day-to-day business expenses, and no annual fees. No personal guarantees or credit checks are required to apply for the card.

    A growing number of small businesses are obtaining capital in minutes through Pipe and its partners, based on their business performance, without the traditional lengthy and arduous application process. The launch of the Pipe Business Card is part of Pipe’s commitment to making capital and financial tools more accessible to SMBs that need them. The Pipe Business Card utilizes the same underwriting model as Pipe Capital, which is based on a customer’s revenue. It integrates directly into the software and payment applications SMBs use day-to-day. Pipe intends to roll out additional services through its partners over the next 12 to 18 months, such as spend management solutions for SMBs.

    Pipe offers software companies numerous advantages when launching the Pipe Business Card to their customers, including:

    • Speed to market – Pipe can help partners rapidly launch an embedded card program in days, not months.
    • Tailored underwriting models – Pipe’s customized underwriting models can be calibrated for partners based on revenue data from their customer base to provide optimal access to capital.
    • Comprehensive support – Pipe’s US-based customer success team handles all dispute management and resolution for partners.

    “In the six months since we launched our embedded Capital, Pipe, and its partners, have helped to finance the dreams of tens of thousands of small businesses. We will continue to develop innovative products that remove the friction from their business,” said Luke Voiles, Chief Executive Officer, Pipe. “The Pipe Business Card is the logical expansion of our suite of capital services, and we expect it to have a meaningful impact on our customers, partners, and the overall SMB market.”

    _______________
    1 Pipe Business Cards are issued by First Internet Bank of Indiana, Member FDIC, pursuant to a license from Visa ® Inc. and may be used everywhere Visa credit cards are accepted. The Pipe Business Card will be a pay-in-full charge card. Your Statement Balance must be paid in full 15 days after the close of your statement period. Any outstanding statement balance will be automatically debited from your designated payment due date. If a payment fails, your card will be locked and a percentage of your daily sales will be collected until your balance has been repaid in full.
    2Goldman Sachs 10,000 Voices Survey, January 2024.
    3WalletHub, Small Business Survey, April 2024.
    4 Cash Back refers to rewards earned as a percentage discount on eligible purchases.

    About Pipe
    Pipe makes customer-friendly capital and smart financial tools accessible to growing businesses inside the software they use every day. Our embedded solutions are built to scale and give business builders across industries the power to grow on their own terms. To learn more, visit www.pipe.com or follow us on X @pipe.

    Media Contact
    For Pipe
    Merrill Freund
    merrill@freundpr.com

    The MIL Network –

  • MIL-OSI: Legible Releases FrankensteinAI with Spellbinding AI Chat Feature Just in Time for Halloween

    Source: GlobeNewswire (MIL-OSI)

    VANCOUVER, British Columbia, Oct. 28, 2024 (GLOBE NEWSWIRE) — Legible (CSE: READ) (OTCQB: LEBGF) (FSE: D0T) (“Legible or “the Company”), a pioneer in mobile-centric eBook and audiobook entertainment, is thrilled to announce the release of FrankensteinAI, the third in its groundbreaking AI Classics series. This innovative “Living Book” seamlessly blends Mary Shelley’s iconic novel with state-of-the-art technology, offering readers an unparalleled interactive experience. The classic horror tale releases in three volumes beginning October 28th.

    FrankensteinAI breathes new life into Shelley’s masterpiece through stunning interactive artwork by renowned digital artist Mr. Remo Camerota. Each animated illustration is a dynamic fusion of Camerota’s vivid imagination and advanced AI technology, capturing the eerie atmosphere of Victor Frankenstein’s creation and enhancing the storytelling in a visually captivating manner. Mr. Camerota’s collaboration with AI technology results in visuals that not only complement but also elevate the storytelling, making every image an integral part of the narrative journey.

    FrankensteinAI also introduces a revolutionary AI chat feature that allows readers to engage in real-time conversations with the novel’s characters. Victor Frankenstein and his Creature serve as AI-driven guides, enabling readers to delve deeper into their fears, desires, and motivations as they explore the narrative. This unique interactive feature allows readers to ask questions, unravel plot intricacies, and explore themes in a way that traditional reading cannot, blending classic literature with modern technology for a uniquely immersive experience.

    “Legible has meticulously preserved the essence of Mary Shelley’s Frankenstein, ensuring that the original text remains intact and true to Shelley’s intentions. Our goal with FrankensteinAI is to honor the original narrative while enhancing the reader’s experience through technology,” stated Kaleeg Hainsworth, CEO of Legible. “By integrating interactive AI features and Remo Camerota’s mesmeric artwork, we’ve created a Living Book that remains true to Shelley’s vision while offering a fresh, immersive way to engage with this classic tale.”

    Remo Camerota commented, “My vision for FrankensteinAI was to complement Mary Shelley’s original narrative with artwork that feels alive, echoing the Creature’s journey of discovery and isolation. Through the power of AI, these illustrations become part of the reader’s journey, evolving alongside their experience with the text.” Camerota further commented, “I am looking forward to further collaborations with Legible on bringing literature to life with my art.”

    In addition to FrankensteinAI, Legible’s other AI Classics and groundbreaking original publications, such as the My Model Kitchen Living Cookbooks by former supermodel and NYT-bestselling author Ms. Cristina Ferrare, with their embedded Sous Chef AI, are exclusively available to Legible Unbound members. Join now and gain access to these innovations plus millions of eBooks and audiobooks for only US$9.99 per month, unlocking a new world of enriched reading experiences.

    About Legible
    Legible is a trailblazing, mobile-centric global company specializing in eBook and audiobook entertainment. Through extensive partnerships with four of the Big 5 Publishers, the world’s largest eBook distributors, and outstanding publishers of all sizes, Legible delivers millions of eBooks and audiobooks, transforming any smart device into a source of cutting-edge infotainment.

    Recent releases include My Model Kitchen – Vol. 2: Vegetables – The Garden of Earthly Delights, the second of 15 video-enriched Living Cookbooks by former supermodel, bestselling author, TV host, and celebrity chef Cristina Ferrare, featuring an AI Sous Chef for each recipe. The Living Cookbooks and Ms. Ferrare have been featured in various major media outlets including twice on the very popular Drew Barrymore Show, where she dazzles viewers with her culinary expertise while utilizing the AI Sous Chef interactive component.

    As a first mover in the rapidly expanding automotive infotainment market, Legible has partnered with media providers Faurecia Aptoide, Harman Ignite, LiveOne, and Visteon. Legible boasts the only Android Automotive app that can deliver both audiobooks and eBooks to drivers and passengers in tens of millions of vehicles worldwide, positioning the Company at the forefront of in-car infotainment experiences.

    Legible won the 2024 EdTech Breakthrough Award for eLearning Innovation of the Year. Committed to reshaping the digital publishing landscape, Legible is poised to gain significant market share through its innovative 21st-century publishing solutions and enriched reading experiences. Visit www.legible.com to explore how eBooks come to life.

    About Remo Camerota
    Remo Camerota is a world-renowned multidisciplinary artist blending art, pop culture, and technology through a unique visual style. Recognized as one of the top 200 digital artists globally by Lürzer’s Archive Magazine (2020-2023) and with works exhibited alongside icons like Banksy, he’s earned acclaim as a leading NFT artist, generating over $6 million in revenue in 2021-2022. Over 30 years, he’s worked across various media, winning hundreds of awards for campaigns with brands like MTV, Nikon, and Toyota and collaborating with notable figures, including Val Kilmer and Scott Page. His company, Npact, has also supported charitable projects, such as raising funds for 2,000 computers for children in need. With exhibitions in renowned venues like the Louvre and Tate, his passion for boundless creativity and storytelling continues to impact global audiences.

    Contacts

    Legible Inc.
    Ms. Deborah Harford, EVP, Global Strategic Partnerships
    Tel.: +1-604-283-2028
    Email: invest@legible.com
    Website: https://invest.legible.com

    Krupp Kommunications, Inc.
    Ms. Kathy Giaconia, VP Media Relations
    Tel.: +1-213-324-5665
    Email: kgiaconia@kruppagency.com
    Website: www.KruppAgency.com

    Cautionary Note Regarding Forward Looking Information

    This Press Release contains certain statements which constitute forward-looking statements or information (“forward-looking statements”), including statements regarding Legible’s business. Such forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Legible’s control, including the impact of general economic conditions, industry conditions, currency fluctuations, the lack of availability of qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Although Legible believes that the expectations in its forward-looking statements are reasonable, they are based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward- looking information. As such, readers are cautioned not to place undue reliance on the forward- looking information, as no assurance can be provided as to future results, levels of activity or achievements. The forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Legible does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

    A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/98d32341-a97e-4b8c-b43a-c970ae023d46

    The MIL Network –

  • MIL-OSI Africa: Afreximbank Announces Investment Conference in Kisumu, Kenya to Strengthen Sub-Sovereign Participation in Intra-African Trade

    Source: Africa Press Organisation – English (2) – Report:

    CAIRO, Egypt, October 28, 2024/APO Group/ —

    In a bid to strengthen the role of Africa’s sub-sovereign governments in driving intra-African trade and investment, and the successful implementation of the African Continental Free Trade Area (AfCFTA), African Export-Import Bank (Afreximbank) (www.Afreximbank.com), in collaboration with the County Government of Kisumu and the United Cities and Local Governments of Africa (UCLG Africa) is organising  the fourth edition of the African Sub-Sovereign Governments Network (AfSNET) Conference.

    The Conference will take place in Kisumu City, Kenya, from 25 to 27 November, under the theme ‘Leveraging the AfCFTA for Sustainable Trade and Investment: A Development Pathway for African Sub-Sovereigns.’ A key feature of the event will be an exhibition aimed at promoting trade at a local level, to be preceded by an investment promotion training on the first day.

    One of the key objectives of the conference is to foster greater collaboration in promoting trade, development and investment initiatives among African sub-sovereigns, aligned with AfCFTA’s goals.

    Mrs. Kanayo Awani, Executive Vice President Intra African Trade and Export Development, Afreximbank who will be speaking at the Investment Conference noted:

    “Afreximbank partnered with the Forum of Regions of Africa (FORAF), an organ of the UCLG Africa under the AfSNET initiative to ensure its products and interventions for trade and investment promotion are accessible both at the local and sub-sovereign level. This resulted in the announcement of US$ 2 billion in financing to tackle the pressing financing challenges faced by sub-sovereigns and businesses.”

    Mrs. Awani explained that Afreximbank will be leveraging the successes of the third AfSNET Investment Conference held during the Intra Africa Trade Fair (IATF2023) in

    Cairo, Egypt offering sub-sovereign governments the opportunity to showcase investment projects to potential investors and financiers, further strengthening the Bank’s commitment to facilitating impactful investments across the continent.

    While inviting delegates to participate in the forum, Kisumu County Governor H.E. Prof. Peter Anyang’ Nyong’o said:

    “Africa’s economic renaissance is hinged on unbridling the developmental capacity of local governments and increasing decentralization. Despite the gains made in decentralization in recent decades, African local governments still have low administrative and fiscal capacity to realize the much-needed local economic development. AfSNET, an innovative tool of the Afreximbank, therefore comes in handy to bridge that gap and allow sub sovereigns to accelerate and improve the quality of economic growth in Africa. Its vision aligns with the aspirations of the African Sub Sovereigns umbrella organisation UCLG Africa to support  decentralised governments access and participation in continental and international financial markets while also supporting the development of their fiscal capacities. As the Governor of Kisumu, it gives me great pleasure to warmly invite all the delegates to come and interact and share in the social and cultural passion of Kisumu and to experience our boundless economic opportunities.”

    Mr. Jean Pierre Elong Mbassi, Secretary General, United Cities and Local Governments of Africa while outlining UCLG’s mandate remarked:

    “Among the mandates of UCLG Africa is to assist its members to attract investments in sub-national and local governments so as to improve the living conditions of the populations, economic activities and businesses established within their territories. UCLG Africa supports its members in adopting local economic development policies and strategies that investment plans derive from, and that gives impetus to public and private business development.”

     The fourth AfSNET conference will provide Kisumu County Government and the Lake Victoria region economic block an opportunity to present their development strategies and projects for consideration to investors attending the Conference.

    The inaugural AfSNET conference, held in Durban, South Africa, on the margins of the second Intra-African Trade Fair (IATF2021) in 2021, attracted more than 80 delegates while the second, organised in collaboration with the Nigeria Governors’ Forum in Abuja in September 2022, drew more than 150 delegates.

    The third conference, co-hosted with UCLG Africa in November 2023 on the sidelines IATF2023 in Cairo, had more than 250 participants and resulted in deals valued at more than USD$1.5 billion being signed.

    AfSNET was established by Afreximbank as a platform for promoting intra-African trade and investment, educational and cultural exchanges and the fostering of effective engagement among sub-sovereigns in Africa’s development and prosperity in the context of the AfCFTA.

    MIL OSI Africa –

  • MIL-OSI: Purpose Investments Inc. Announces Final October 2024 Distribution Rate for Purpose High Interest Savings Fund, Purpose US Cash Fund, Purpose Cash Management Fund, and Purpose USD Cash Management Fund

    Source: GlobeNewswire (MIL-OSI)

    TORONTO, Oct. 28, 2024 (GLOBE NEWSWIRE) — Purpose Investments Inc. announced today the final October 2024 distribution rates for Purpose High Interest Savings Fund, Purpose US Cash Fund, Purpose Cash Management Fund, and Purpose USD Cash Management Fund.

    Due to the recent interest rate cut by the Bank of Canada, the distribution levels for our Canadian cash funds have been proportionately reduced to align with this adjustment.

    The following table reflects the final distribution amounts for the month of October. Ex-distribution date is October 29, 2024.

    Open-End Fund Ticker
    Symbol    		 Final distribution
    per unit    		 Record Date Payable Date Distribution
    Frequency
    Purpose USD Cash Management Fund – ETF Units MNU.U US $ 0.4473 10/29/2024 11/04/2024 Monthly
    Purpose Cash Management Fund – ETF Units MNY $ 0.3914 10/29/2024 11/04/2024 Monthly
    Purpose High Interest Savings Fund – ETF Units PSA $ 0.1822 10/29/2024 11/04/2024 Monthly
    Purpose US Cash Fund – ETF Units PSU.U US $ 0.4275 10/29/2024 11/04/2024 Monthly


    About Purpose Investments Inc.
    Purpose Investments Inc. is an asset management company with more than $21 billion in assets under management. Purpose Investments has an unrelenting focus on client-centric innovation, and offers a range of managed and quantitative investment products. Purpose Investments is led by well-known entrepreneur Som Seif and is a division of Purpose Unlimited, an independent technology-driven financial services company.

    For further information please contact:
    Keera Hart
    Keera.Hart@kaiserpartners.com
    905-580-1257

    Commissions, trailing commissions, management fees and expenses all may be associated with investment fund investments. Please read the prospectus and other disclosure documents before investing. Investment funds are not covered by the Canada Deposit Insurance Corporation or any other government deposit insurer. There can be no assurance that the full amount of your investment in a fund will be returned to you. If the securities are purchased or sold on a stock exchange, you may pay more or receive less than the current net asset value. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.

    The MIL Network –

  • MIL-OSI: Territorial Bancorp Inc. Announces Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    • The Company’s tier one leverage and risk-based capital ratios were 11.57% and 29.07%, respectively, and the Company is considered to be “well-capitalized” at September 30, 2024.
    • Ratio of non-performing assets to total assets of 0.11% at September 30, 2024.

    HONOLULU, Oct. 28, 2024 (GLOBE NEWSWIRE) — Territorial Bancorp Inc. (NASDAQ: TBNK) (the Company), headquartered in Honolulu, Hawaii, the holding company parent of Territorial Savings Bank, reported a net loss of $1,318,000, or $0.15 per diluted share, for the three months ended September 30, 2024.

    The Board of Directors approved a dividend of $0.01 per share. The dividend is expected to be paid on November 22, 2024, to stockholders of record as of November 8, 2024.

    Hope Bancorp, Inc. Merger Agreement

    As previously announced in a joint news release issued April 29, 2024, Hope Bancorp, Inc. (NASDAQ: HOPE) (Hope Bancorp) and the Company signed a definitive merger agreement. Under the terms of the merger agreement, Company stockholders will receive a fixed exchange ratio of 0.8048 share of Hope Bancorp common stock in exchange for each share of Company common stock they own, in a 100% stock-for-stock transaction valued at approximately $78.60 million, based on the closing price of Hope Bancorp’s common stock on April 26, 2024. The transaction is intended to qualify as a tax-free reorganization for Territorial stockholders.

    Upon completion of the transaction, Hope Bancorp intends to maintain the Territorial franchise in Hawaii and preserve the 100-plus year legacy of the Territorial Savings Bank brand name, culture and commitment to the local communities. The branches will continue to do business under the Territorial Savings Bank brand, as a trade name of Bank of Hope.

    The transaction is subject to regulatory approvals, the approval of Territorial stockholders, and the satisfaction of other customary closing conditions.

    Interest Income

    Net interest income decreased by $2.55 million for the three months ended September 30, 2024, compared to the three months ended September 30, 2023. Total interest income was $18.31 million for the three months ended September 30, 2024, compared to $17.38 million for the three months ended September 30, 2023. The $929,000 increase in total interest income was primarily due to an $850,000 increase in interest earned on other investments and a $343,000 increase in interest earned on loans. The increase in interest income on other investments is primarily due to a $58.03 million increase in the average cash balance with the Federal Reserve Bank of San Francisco (FRB) and a 30 basis point increase in the average interest rate paid on cash balances. The $343,000 increase in interest income on loans resulted from a 15 basis point increase in the average loan yield, partially offset by a $14.74 million decrease in the average loan balance. The increases in interest income on other investments and loans during the quarter were partially offset by a $264,000 decrease in interest on investment securities, which occurred because of a $41.07 million decrease in the average securities balance.

    Interest Expense

    As a result of prolonged increases in short-term interest rates, total interest expense increased by $3.48 million for the three months ended September 30, 2024, compared to the three months ended September 30, 2023. Interest expense on deposits increased by $3.06 million for the three months ended September 30, 2024, primarily due to an increase in interest expense on certificates of deposit (CD) and savings accounts. Interest expense on CDs rose by $2.01 million for the three months ended September 30, 2024, due to a 66 basis point increase in the average cost of CDs and a $107.30 million increase in the average CD balance. The increase in the average cost of CDs and savings accounts occurred as interest rates were raised in response to the increases in market interest rates over that period. Interest expense on savings accounts rose by $1.06 million for the three months ended September 30, 2024, due to a 65 basis point increase in the average cost of savings accounts which was partially offset by a $82.46 million decrease in the average savings account balance. The increase in the average balance of CDs and the decrease in the average balance of savings accounts occurred as customers transferred balances from lower rate savings accounts to higher rate CDs. Interest expense on FRB borrowings rose by $600,000 for the three months ended September 30, 2024, as the Company obtained a $50.00 million advance from the FRB in the fourth quarter of 2023. FRB advances were obtained in 2023 to enhance the Company’s liquidity and to fund deposit withdrawals.

    Noninterest Expense

    Noninterest expense increased by $333,000 for the three months ended September 30, 2024, compared to the three months ended September 30, 2023, primarily due to a $398,000 increase in general and administrative expenses. General and administrative expenses included $324,000 of merger-related legal and consulting expenses and the write off of $135,000 of currency destroyed in the Lahaina wildfire. Federal Deposit Insurance Corporation (FDIC) premium expense rose by $146,000 for the quarter because of an increase in the FDIC insurance premium rates. The increase in other general and administrative expenses and FDIC premiums was offset by a $277,000 decrease in salaries and employee benefits during the quarter. The decrease in salaries and employee benefits occurred primarily because of decreases in compensation expense, supplemental executive retirement plan benefits, Employee Stock Ownership Plan (ESOP) expenses, health insurance and payroll taxes. The decrease in compensation expenses, payroll taxes and health insurance expenses is primarily due to a decrease in the number of employees. The decrease in ESOP expenses is primarily due to a decline in the Company’s share price which is used to calculate the accrual. The decrease in these compensation and employee benefit expenses was partially offset by a decrease in deferred salary expense for originating new loans as fewer loans were originated during the three months ended September 30, 2024, compared to the three months ended September 30, 2023.

    Income Taxes

    Income tax benefit for the three months ended September 30, 2024 was $611,000 with an effective tax rate of (31.67)% compared to income tax expense of $335,000 with an effective tax rate of 27.57% for the three months ended September 30, 2023. The decrease in income tax expense was primarily due to a $3.14 million decrease in income before income taxes during the quarter.

    Balance Sheet

    Total assets were $2.20 billion at September 30, 2024 and $2.24 billion at December 31, 2023. Investment securities, including available for sale securities, decreased by $31.63 million to $674.27 million at September 30, 2024 from $705.90 million at December 31, 2023. The decrease in investment securities occurred because of principal repayments on mortgage-backed securities. Loans receivable decreased by $20.86 million to $1.29 billion at September 30, 2024 from $1.31 billion at December 31, 2023. The decrease in loans receivable occurred as loan repayments and sales exceeded new loan originations. Cash and cash equivalents increased by $16.47 million to $143.13 million at September 30, 2024 from $126.66 million at December 31, 2023 due to increases in deposits and principal repayments on mortgage-backed securities and on loans receivable.

    Deposits increased by $33.68 million from $1.64 billion at December 31, 2023 to $1.67 billion at September 30, 2024. The increase in deposits is primarily due to deposits from state and local governments. The increase in deposits was used with principal repayments on mortgage-backed securities and loans receivable to pay off $65.00 million of maturing Federal Home Loan Bank (FHLB) advances during the quarter. FHLB advances decreased by $65.00 million to $177.00 million at September 30, 2024 from $242.00 million at December 31, 2023.

    Asset Quality

    Credit quality continues to be extremely important as the Bank adheres to its strict underwriting standards. The Company had no delinquent mortgage loans 90 days or more past due at September 30, 2024, compared to $227,000 at December 31, 2023. Non-performing assets totaled $2.34 million at September 30, 2024, compared to $2.26 million at December 31, 2023. The ratio of non-performing assets to total assets was 0.11% at September 30, 2024, compared to 0.10% at December 31, 2023. The allowance for credit losses was $5.06 million at September 30, 2024, compared to $5.12 million at December 31, 2023, representing 0.39% of total loans for both periods. The ratio of the allowance for credit losses to non-performing loans was 216.12% at September 30, 2024, compared to 226.59% at December 31, 2023.

    About Us

    Territorial Bancorp Inc., headquartered in Honolulu, Hawaii, is the stock holding company for Territorial Savings Bank. Territorial Savings Bank is a state-chartered savings bank which was originally chartered in 1921 by the Territory of Hawaii. Territorial Savings Bank conducts business from its headquarters in Honolulu, Hawaii and has 28 branch offices in the state of Hawaii. For additional information, please visit the Company’s website at: https://www.tsbhawaii.bank.

    Additional Information and Where to Find it

    In connection with the proposed merger, Hope Bancorp, Inc. filed with the Securities and Exchange Commission (“SEC”) a Registration Statement on Form S-4 on June 21, 2024, which included a Proxy Statement of Territorial Bancorp Inc. that also constitutes a prospectus of Hope Bancorp, Inc. Territorial Bancorp stockholders are encouraged to read the Registration Statement and the Proxy Statement/Prospectus regarding the merger and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information about the proposed merger. Territorial Bancorp stockholders are able to obtain a free copy of the Proxy Statement/Prospectus, as well as other filings containing information about Hope Bancorp and Territorial Bancorp at the SEC’s Internet site (www.sec.gov).

    Forward-looking statements

    This earnings release contains forward-looking statements, which can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect,” “will,” “may” and words of similar meaning. These forward-looking statements include, but are not limited to:

    • statements of our goals, intentions and expectations;
    • statements regarding our business plans, prospects, growth and operating strategies;
    • statements regarding the asset quality of our loan and investment portfolios; and
    • estimates of our risks and future costs and benefits.

    These forward-looking statements are based on our current beliefs and expectations and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of this earnings release.

    The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

    • factors related to the proposed transaction with Hope Bancorp, including the receipt of regulatory and stockholder approvals, and other customary closing conditions;
    • general economic conditions, either internationally, nationally or in our market areas, that are worse than expected;
    • competition among depository and other financial institutions;
    • inflation and changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments;
    • adverse changes in the securities markets;
    • changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements;
    • changes in monetary or fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board;
    • our ability to enter new markets successfully and capitalize on growth opportunities;
    • our ability to successfully integrate acquired entities, if any;
    • changes in consumer demand, spending, borrowing and savings habits;
    • changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission and the Public Company Accounting Oversight Board;
    • changes in our organization, compensation and benefit plans;
    • the timing and amount of revenues that we may recognize;
    • the value and marketability of collateral underlying our loan portfolios;
    • our ability to retain key employees;
    • cyberattacks, computer viruses and other technological risks that may breach the security of our websites or other systems to obtain unauthorized access to confidential information, destroy data or disable our systems;
    • technological change that may be more difficult or expensive than expected;
    • the ability of third-party providers to perform their obligations to us;
    • the ability of the U.S. Government to manage federal debt limits;
    • the quality and composition of our investment portfolio;
    • the effect of any pandemic disease, natural disaster, war, act of terrorism, accident or similar action or event;
    • changes in market and other conditions that would affect our ability to repurchase our common stock; and
    • changes in our financial condition or results of operations that reduce capital available to pay dividends.

    Because of these and a wide variety of other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements.

    Contact:
    Walter Ida
    (808) 946-1400

       
    Territorial Bancorp Inc. and Subsidiaries  
    Consolidated Statements of Operations (Unaudited)  
    (Dollars in thousands, except per share data)  
                 
        Three Months Ended   Nine Months Ended  
        September 30,   September 30,  
        2024   2023   2024    2023   
    Interest income:                      
    Loans   $ 12,229     $ 11,886   $ 36,540   $ 35,037    
    Investment securities     4,183       4,447     12,753     13,512    
    Other investments     1,901       1,051     5,104     2,848    
    Total interest income     18,313       17,384     54,397     51,397    
                           
    Interest expense:                      
    Deposits     8,469       5,408     22,658     13,261    
    Advances from the Federal Home Loan Bank     1,714       1,896     5,330     4,782    
    Advances from the Federal Reserve Bank     600       —     1,789     —    
    Securities sold under agreements to repurchase     46       46     137     137    
    Total interest expense     10,829       7,350     29,914     18,180    
                           
    Net interest income     7,484       10,034     24,483     33,217    
    Provision (reversal of provision) for credit losses     29       (259 )   22     (147 )  
                           
    Net interest income after provision (reversal of provision) for credit losses     7,455       10,293     24,461     33,364    
                           
    Noninterest income:                      
    Service and other fees     273       298     885     1,022    
    Income on bank-owned life insurance     255       218     750     628    
    Net gain on sale of loans     19       —     19     10    
    Other     69       73     215     208    
    Total noninterest income     616       589     1,869     1,868    
                           
    Noninterest expense:                      
    Salaries and employee benefits     4,899       5,176     14,606     15,723    
    Occupancy     1,813       1,819     5,319     5,201    
    Equipment     1,335       1,263     3,987     3,878    
    Federal deposit insurance premiums     392       246     1,281     737    
    Other general and administrative expenses     1,561       1,163     4,851     3,251    
    Total noninterest expense     10,000       9,667     30,044     28,790    
                           
    (Loss) Income before income taxes     (1,929 )     1,215     (3,714 )   6,442    
    Income tax (benefit) expense     (611 )     335     (1,139 )   1,749    
    Net (loss) income   $ (1,318 )   $ 880   $ (2,575 ) $ 4,693    
                           
    Basic (loss) earnings per share   $ (0.15 )   $ 0.10   $ (0.30 ) $ 0.54    
    Diluted (loss) earnings per share   $ (0.15 )   $ 0.10   $ (0.30 ) $ 0.53    
    Cash dividends declared per common share   $ 0.01     $ 0.23   $ 0.07   $ 0.69    
    Basic weighted-average shares outstanding     8,618,155       8,577,632     8,604,082     8,656,915    
    Diluted weighted-average shares outstanding     8,618,155       8,610,289     8,604,082     8,705,784    
                           
     
    Territorial Bancorp Inc. and Subsidiaries
    Consolidated Balance Sheets (Unaudited)
    (Dollars in thousands, except per share data)
                 
        September 30,   December 31,
        2024   2023
    ASSETS            
    Cash and cash equivalents   $ 143,128     $ 126,659  
    Investment securities available for sale, at fair value     19,920       20,171  
    Investment securities held to maturity, at amortized cost (fair value of $552,222 and $568,128 at September 30, 2024 and December 31, 2023, respectively)     654,349       685,728  
    Loans receivable     1,287,688       1,308,552  
    Allowance for credit losses     (5,055 )     (5,121 )
    Loans receivable, net of allowance for credit losses     1,282,633       1,303,431  
    Federal Home Loan Bank stock, at cost     9,307       12,192  
    Federal Reserve Bank stock, at cost     3,187       3,180  
    Accrued interest receivable     6,056       6,105  
    Premises and equipment, net     7,257       7,185  
    Right-of-use asset, net     11,613       12,371  
    Bank-owned life insurance     49,388       48,638  
    Income taxes receivable     1,832       344  
    Deferred income tax assets, net     2,465       2,457  
    Prepaid expenses and other assets     7,297       8,211  
    Total assets   $ 2,198,432     $ 2,236,672  
                 
    LIABILITIES AND STOCKHOLDERS’ EQUITY            
    Liabilities:            
    Deposits   $ 1,670,281     $ 1,636,604  
    Advances from the Federal Home Loan Bank     177,000       242,000  
    Advances from the Federal Reserve Bank     50,000       50,000  
    Securities sold under agreements to repurchase     10,000       10,000  
    Accounts payable and accrued expenses     22,176       23,334  
    Lease liability     17,090       17,297  
    Advance payments by borrowers for taxes and insurance     3,148       6,351  
    Total liabilities     1,949,695       1,985,586  
                 
    Stockholders’ Equity:            
    Preferred stock, $0.01 par value; authorized 50,000,000 shares, no shares issued or outstanding     —       —  
    Common stock, $0.01 par value; authorized 100,000,000 shares; issued and outstanding            
    8,832,210 and 8,826,613 shares at September 30, 2024 and December 31, 2023, respectively     88       88  
    Additional paid-in capital     48,163       48,022  
    Unearned ESOP shares     (2,079 )     (2,447 )
    Retained earnings     208,504       211,644  
    Accumulated other comprehensive loss     (5,939 )     (6,221 )
    Total stockholders’ equity     248,737       251,086  
    Total liabilities and stockholders’ equity   $ 2,198,432     $ 2,236,672  
                 
     
      Territorial Bancorp Inc. and Subsidiaries    
      Selected Financial Data (Unaudited)    
                                 
                                 
                                 
                    Three Months Ended        
                    September 30,        
                      2024       2023          
                                 
      Performance Ratios (annualized):                    
        Return on average assets         (0.24% )     0.16%          
        Return on average equity         (2.09% )     1.39%          
        Net interest margin on average interest earning assets   1.42%       1.90%          
        Efficiency ratio (1)           123.46%       91.00%          
                                 
                    At   At        
                    September   December        
                      30, 2024       31, 2023          
                                 
      Selected Balance Sheet Data:                    
        Book value per share (2)       $ 28.16     $ 28.45          
        Stockholders’ equity to total assets       11.31%       11.23%          
                                 
                                 
      Asset Quality                        
      (Dollars in thousands):                      
        Delinquent loans 90 days past due and not accruing $ 0     $ 227          
        Non-performing assets (3)       $ 2,339     $ 2,260          
        Allowance for credit losses       $ 5,055     $ 5,121          
        Non-performing assets to total assets       0.11%       0.10%          
        Allowance for credit losses to total loans       0.39%       0.39%          
        Allowance for credit losses to non-performing assets   216.12%       226.59%          
                                 
                                 
      Note:                        
                                 
      (1) Efficiency ratio is equal to noninterest expense divided by the sum of net interest income and noninterest income                         
      (2)  Book value per share is equal to stockholders’ equity divided by number of shares issued and outstanding                         
      (3)  Non-performing assets consist of non-accrual loans and real estate owned. Amounts are net of charge-offs                         
                                 

    The MIL Network –

  • MIL-OSI: CareCloud Pays Off Credit Line, Signs an Updated Credit Facility Agreement

    Source: GlobeNewswire (MIL-OSI)

    SOMERSET, N.J., Oct. 28, 2024 (GLOBE NEWSWIRE) — — CareCloud, Inc. (the “Company”) (Nasdaq: CCLD, CCLDO, CCLDP), a leader in healthcare technology solutions for medical practices and health systems nationwide, today announced that it has fully paid down its credit facility line with Silicon Valley Bank (“SVB”), achieving a key 2024 objective. Additionally, CareCloud requested and secured a reduction in its borrowing fees and lowered its overall revolving credit facility limit.

    “We are thrilled to have reached this important strategic milestone,” said Norm Roth, Interim CFO and Corporate Controller of CareCloud. “We started 2024 with a $10 million outstanding balance and a clear goal to significantly increase our free cash flow, allowing us to fully pay down this debt. We are pleased to have accomplished this ahead of schedule, achieving a zero balance at the end of the third quarter.”

    “Along with eliminating the credit facility balance — which had been incurring interest expense since the beginning of the year — we sought and achieved a reduction in the available amount of our credit line. This reduction will lower the annual anniversary and unused revolving line facility fees. These savings amount to approximately $140,000 on an annual basis. Moreover, these cost reductions are a small part of a larger plan to accelerate free cashflow and revitalize our business model as we continue to strategically drive efficiencies across the organization,” said Roth.

    Pursuant to the Company’s Ninth Loan Modification Agreement, dated October 25, 2024, with Silicon Valley Bank, a division of First-Citizens Bank & Trust Company (the “Agreement”), the Company continues to maintain an unused, but available, credit facility line of $10 million. The information contained in this press release is a summary of certain relevant portions of the Agreement and Form 8-K, which are filed with Securities and Exchange Commission.

    About CareCloud

    CareCloud brings disciplined innovation to the business of healthcare. Our suite of technology-enabled solutions helps clients increase financial and operational performance, streamline clinical workflows and improve the patient experience. More than 40,000 providers count on CareCloud to help them improve patient care while reducing administrative burdens and operating costs. Learn more about our products and services including revenue cycle management (RCM), practice management (PM), electronic health records (EHR), business intelligence, patient experience management (PXM) and digital health at www.carecloud.com.

    Follow CareCloud on LinkedIn, X and Facebook.

    Forward-Looking Statements

    This press release contains various forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements relate to anticipated future events, future results of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “might,” “will,” “shall,” “should,” “could”, “intends,” “expects,” “plans,” “goals,” “projects,” “anticipates,” “believes,” “seeks,” “estimates,” “predicts,” “possible,” “potential,” “target,” or “continue” or the negative of these terms or other comparable terminology.

    Our operations involve risks and uncertainties, many of which are outside our control, and any one of which, or a combination of which, could materially affect our results of operations and whether the forward-looking statements ultimately prove to be correct. Forward-looking statements in this press release include, without limitation, statements reflecting management’s expectations for future financial performance and operating expenditures, expected growth, profitability and business outlook, the impact of pandemics on our financial performance and business activities, and the expected results from the integration of our acquisitions.

    These forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are only predictions, are uncertain and involve substantial known and unknown risks, uncertainties and other factors which may cause our (or our industry’s) actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements. We do not have an ongoing obligation to update shareholders regarding future proxy or vote trends, even if they are materially different from those experienced to date. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all of the risks and uncertainties that could have an impact on the forward-looking statements, including without limitation, risks and uncertainties relating to the Company’s ability to manage growth, migrate newly acquired customers and retain new and existing customers, maintain cost-effective global operations, increase operational efficiency and reduce operating costs, predict and properly adjust to changes in reimbursement and other industry regulations and trends, retain the services of key personnel, develop new technologies, upgrade and adapt legacy and acquired technologies to work with evolving industry standards, compete with other companies products and services competitive with ours, and other important risks and uncertainties referenced and discussed under the heading titled “Risk Factors” in the Company’s filings with the Securities and Exchange Commission.

    The statements in this press release are made as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company does not assume any obligations to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.

    SOURCE CareCloud

    Company and Investor Contact:
    Stephen Snyder
    President
    CareCloud, Inc.
    ir@carecloud.com

    The MIL Network –

  • MIL-OSI: Norwood Financial Corp Announces Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    Quarterly Highlights:

    • Net interest margin increased 19 basis points vs. the prior quarter and 7 basis points over the prior year.
    • Loans grew at an 8% annualized rate during the 3rd quarter.
    • Capital continues to improve as the negative mark-to-market effect lessens 42% since last year.

    HONESDALE, Pa., Oct. 28, 2024 (GLOBE NEWSWIRE) — Norwood Financial Corp (Nasdaq Global Market-NWFL) and its subsidiary, Wayne Bank, announced earnings for the three months ended September 30, 2024 of $3.8 million, which was $275 thousand lower than the same three-month period of last year. Net interest income was up by $892 thousand which was offset by increases in operating expense and the provision for credit losses. Earnings per share (fully diluted) were $0.48 in the three months ended September 30, 2024, compared to $0.51 in the same period of last year. The annualized return on average assets for the three months ended September 30, 2024, was 0.68%, while the annualized return on average tangible equity was 9.58%.

    Net income for the nine months ended September 30, 2024, was $12.5 million, which is $3.9 million lower than the same nine-month period of 2023, due to a decrease in net interest income, an increase in the provision for credit losses, and an increase in operating expenses, partially offset by an increase in total other income. Earnings per share (fully diluted) for the nine months ended September 30, 2024, were $1.55, compared to $2.03 for the nine months ended September 30, 2023. The annualized return on average assets for the nine months ended September 30, 2024 was 0.75%. The annualized return on average tangible equity for the nine months ended September 30, 2024 was 10.82%.

    Total assets as of September 30, 2024 were $2.280 billion, compared to $2.180 billion at September 30, 2023. At September 30, 2024, loans receivable were $1.675 billion, total deposits were $1.855 billion and stockholders’ equity was $195.7 million.

    For the three months ended September 30, 2024, net interest income, on a fully-taxable equivalent basis (fte), totaled $16.1 million, an increase of $914 thousand compared to the same period in 2023. A $77.5 million increase in average interest-earning assets, generated an increase in interest income of $4.0 million. Interest expense increased $3.1 million mainly due to higher deposit balances and higher rates on those deposits. Net interest margin (fte) for the three months ended September 30, 2024 was 2.99%, compared to 2.92% in the same period of 2023. The tax-equivalent yield on interest-earning assets increased 58 basis points to 5.31% during the three months ended September 30, 2024, compared to the same prior year period, while the cost of interest-bearing liabilities increased 62 basis points to 3.09%.

    Net interest income (fte) for the nine-months ended September 30, 2024 totaled $45.6 million, which was $1.2 million lower than the same period in 2023, due primarily to a $14.8 million increase in the cost of interest-bearing liabilities. The net interest margin (fte) was 2.87% for the nine-months ended September 30, 2024, as compared to 3.10% for the nine-months ended September 30, 2023.

    Other income for the three months ended September 30, 2024, totaled $2.3 million, compared to $2.3 million for the same period in 2023. For the nine-months ended September 30, 2024, other income totaled $6.5 million, compared to $6.0 million for the nine-months ended September 30, 2023.

    Other expenses totaled $12.0 million for the three months ended September 30, 2024, an increase of $755 thousand, compared to the $11.3 million for the same period of 2023. For the nine-months ended September 30, 2024, other expenses totaled $35.2 million, compared to $32.6 million for the same period in 2023, due primarily to an increase in salaries and benefits, professional fees, data processing costs and FDIC insurance.

    Jim Donnelly President and CEO of Norwood Financial Corp and Wayne Bank, stated, “We are pleased to present our result of operations for the third quarter. Although strong loan growth caused an increase in our provision for credit losses we welcome the ongoing opportunity to serve our customers. Net interest margin (fte) for this quarter eclipsed the margin for last year, something that hasn’t happened since the Federal Reserve began raising interest rates. Our capital base remains above “Well-Capitalized” targets and we continue to show less impact from the market value of our bond portfolio. Additionally, our credit quality metrics remained strong during the third quarter, which we believe should benefit future performance. We appreciate the opportunity to serve our Wayne Bank customers and our customers at the Bank of the Finger Lakes and Bank of Cooperstown locations. We continue to look for opportunities available to us as we service our growing base of stockholders and customers.”

    Norwood Financial Corp is the parent company of Wayne Bank, which operates from fourteen offices throughout Northeastern Pennsylvania and fifteen offices in 4 Delaware, Sullivan, Ontario, Otsego and Yates Counties, New York. The Company’s stock trades on the Nasdaq Global Market under the symbol “NWFL”.

    Forward-Looking Statements

    The Private Securities Litigation Reform Act of 1995 contains safe harbor provisions regarding forward-looking statements. When used in this discussion, the words “believes”, “anticipates”, “contemplates”, “expects”, “bode”, “future performance” and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from those projected. Those risks and uncertainties include, among other things, changes in federal and state laws, changes in interest rates, our ability to maintain strong credit quality metrics, our ability to have future performance, our ability to control core operating expenses and costs, demand for real estate, government fiscal and trade policies, cybersecurity and general economic conditions. The Company undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

    Non-GAAP Financial Measures

    This release references net interest income on a fully taxable-equivalent basis (fte), which is a non-GAAP (Generally Accepted Accounting Principles) financial measure. Fully taxable-equivalent net interest income was derived from GAAP interest income and net interest income using an assumed tax rate of 21%. We believe the presentation of net interest income on a fully taxable-equivalent basis ensures comparability of net interest income arising from both taxable and tax-exempt sources and is consistent with industry practice.

    The following table reconciles net interest income to net interest income on a fully taxable-equivalent basis:

         
    (dollars in thousands) Three months ended Nine months ended
    September 30 September 30
        2024     2023     2024     2023
    Net Interest Income $         15,931   $         15,039   $         45,566   $         46,774
    Taxable equivalent basis
    adjustment using 21% marginal
    tax rate    		   207     185     601     554
    Net interest income on a fully
    taxable equivalent basis    		 $ 16,138   $ 15,224   $ 46,167   $ 47,328
                           

    This release also references average tangible equity, which is also a non-GAAP financial measure. Average tangible equity is calculated by deducting average goodwill and other intangible assets from average stockholders’ equity. The Company believes that disclosure of tangible equity ratios enhances investor understanding of our financial position and improves the comparability of our financial data.

    The following table reconciles average equity to average tangible equity:

           
      Three months ended   Nine months ended
    (dollars in thousands) September 30   September 30
        2024      2023     2024     2023
    Average equity $ 189,135   $ 175,224   $ 183,593    $ 174,943
    Average goodwill and other
    intangibles    		    (29,440)     (29,514)      (29,457)     (29,536)
    Average tangible equity $ 159,695   $ 145,710   $ 154,136   $ 145,407
                           

    Contact: John M. McCaffery
    Executive Vice President &
    Chief Financial Officer
    NORWOOD FINANCIAL CORP
    272-304-3003
    www.waynebank.com

     
    NORWOOD FINANCIAL CORP
    Consolidated Balance Sheets
    (dollars in thousands, except share and per share data)
    (unaudited)
      September 30
        2024
    		   2023
    		  
    ASSETS              
    Cash and due from banks $  47,072     $ 41,141  
    Interest-bearing deposits with banks   35,808       13,005  
    Cash and cash equivalents   82,880       54,146  
                   
    Securities available for sale   396,891       380,499  
    Loans receivable   1,675,139       1,611,069  
    Less: Allowance for credit losses   18,699       16,086  
    Net loans receivable   1,656,440       1,594,983  
    Regulatory stock, at cost   6,329       8,843  
    Bank premises and equipment, net   18,503       17,254  
    Bank owned life insurance   46,382       46,197  
    Foreclosed real estate owned   0       290  
    Accrued interest receivable   8,062       7,759  
    Deferred tax assets, net   18,818       25,610  
    Goodwill   29,266       29,266  
    Other intangible assets   167       240  
    Other assets   16,013       14,911  
    TOTAL ASSETS $         2,279,751     $         2,179,998  
               
    LIABILITIES          
    Deposits:          
    Non-interest bearing demand $ 420,967     $ 430,242  
    Interest-bearing   1,434,284       1,316,582  
    Total deposits   1,855,251       1,746,824  
    Short-term borrowings   52,453       103,881  
    Other borrowings   144,959       137,447  
    Accrued interest payable   12,688       8,605  
    Other liabilities   18,746       18,539  
    TOTAL LIABILITIES   2,084,097       2,015,296  
                   
    STOCKHOLDERS’ EQUITY
    Preferred Stock, no par value per share, authorized 5,000,000 shares    		   –       –  
    Common Stock, $.10 par value per share,              
    authorized: 20,000,000 shares,
    issued: 2024: 8,311,851 shares, 2023: 8,291,401 shares    		   831       829  
    Surplus   98,330       97,449  
    Retained earnings   140,489       137,363  
    Treasury stock, at cost: 2024: 221,140 shares, 2023: 222,051 shares   (5,969 )     (5,957 )
    Accumulated other comprehensive loss   (38,027 )     (64,982 )
    TOTAL STOCKHOLDERS’ EQUITY   195,654       164,702  
    TOTAL LIABILITIES AND
    STOCKHOLDERS’ EQUITY    		 $ 2,279,751     $ 2,179,998  
             
    NORWOOD FINANCIAL CORP
    Consolidated Statements of Income
    (dollars in thousands, except per share data)
    (unaudited)    		        
        Three Months Ended September 30,   Nine Months Ended September 30,
        2024  2023     2024       2023  
    INTEREST INCOME                      
    Loans receivable, including fees $ 25,464   $  22,021   $ 73,266   $ 61,881  
    Securities   2,526     2,433     7,635     7,418  
    Other   497     54     2,194     156  
    Total Interest income   28,487     24,508     83,095     69,455  
                         
    INTEREST EXPENSE                    
    Deposits   10,553     7,017     31,349     17,119  
    Short-term borrowings   323     1,126     1,015     2,702  
    Other borrowings   1,680     1,326     5,165     2,860  
    Total Interest expense   12,556     9,469     37,529     22,681  
    NET INTEREST INCOME   15,931     15,039     45,566     46,774  
    PROVISION FOR CREDIT LOSSES   1,345   $ 882   $         1,069   $ (568 )
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES   14,586     14,157     44,497     47,342  
                         
    OTHER INCOME                    
    Service charges and fees   1,517     1,527     4,364     4,192  
    Income from fiduciary activities   256     246     719     688  
    Net realized (losses) gains on sales of securities   –     –     –     (209 )
    Gains on sales of loans, net   103     18     145     27  
    Gains on sales of foreclosed real estate owned   –     13     32     13  
    Earnings and proceeds on life insurance policies   261     328     781     770  
    Other   158     174     467     520  
    Total other income   2,295     2,306     6,508     6,001  
                         
    OTHER EXPENSES                    
    Salaries and employee benefits   6,239     6,083     18,328     17,893  
    Occupancy, furniture and equipment   1,269     1,242     3,758     3,818  
    Data processing and related operations   1,162     876     3,208     2,465  
    Taxes, other than income   179     167     452     490  
    Professional fees   576     524     1,669     1,132  
    FDIC Insurance assessment   339     254     1,009     699  
    Foreclosed real estate   9     9     45     112  
    Amortization of intangibles   16     20     54     66  
    Other   2,242     2,101     6,683     5,974  
    Total other expenses   12,031     11,276     35,206     32,649  
                             
    INCOME BEFORE TAX   4,850     5,187     15,799     20,694  
    INCOME TAX EXPENSE   1,006     1,068     3,308     4,289  
    NET INCOME $ 3,844   $ 4,119   $ 12,491   $ 16,405  
                             
    Basic earnings per share $ 0.48   $ 0.51   $ 1.55   $ 2.03  
                             
    Diluted earnings per share $ 0.48   $ 0.51   $ 1.55   $ 2.03  
                   
    NORWOOD FINANCIAL CORP
    Financial Highlights (Unaudited)
    (dollars in thousands, except per share data)    		              
    For the Three Months Ended September 30   2024       2023  
    Net interest income $         15,931     $         15,039  
    Net income   3,844       4,119  
                   
    Net interest spread (fully taxable equivalent)   2.23 %     2.26 %
    Net interest margin (fully taxable equivalent)   2.99 %     2.92 %
    Return on average assets   0.68 %     0.76 %
    Return on average equity   8.09 %     9.33 %
    Return on average tangible equity   9.58 %     11.22 %
    Basic earnings per share $         0.48     $         0.51  
    Diluted earnings per share $         0.48     $         0.51  
                   
    For the Nine Months Ended September 30   2024       2023  
    Net interest income $         45,566     $         46,774  
    Net income   12,491       16,405  
                   
    Net interest spread (fully taxable equivalent)   2.12 %     2.56 %
    Net interest margin (fully taxable equivalent)   2.87 %     3.10 %
    Return on average assets   0.75 %     1.04 %
    Return on average equity   9.09 %     12.54 %
    Return on average tangible equity   10.82 %     15.08 %
    Basic earnings per share $         1.55     $         2.03  
    Diluted earnings per share $         1.55     $         2.03  
                   
    As of September 30   2024       2023  
    Total assets $         2,279,751     $         2,179,998  
    Total loans receivable   1,675,139       1,611,069  
    Allowance for credit losses   18,699       16,086  
    Total deposits   1,855,251       1,746,824  
    Stockholders’ equity   195,654       164,702  
    Trust assets under management   209,857       185,913  
                   
    Book value per share $         24.92     $         21.15  
    Tangible book value per share $         21.28     $         17.49  
    Equity to total assets   8.58 %     7.56 %
    Allowance to total loans receivable   1.12 %     1.00 %
    Nonperforming loans to total loans   0.47 %     0.65 %
    Nonperforming assets to total assets   0.35 %     0.50 %
     
    NORWOOD FINANCIAL CORP
    Consolidated Balance Sheets (unaudited)
    (dollars in thousands)
      September 30
    2024    		 June 30
    2024    		 March 31
    2024    		 December 31
    2023    		 September 30
    2023
    ASSETS          
    Cash and due from banks $         47,072   $         29,903   $         19,519   $         28,533   $         41,141  
    Interest-bearing deposits with banks    35,808     39,492     92,444     37,587     13,005  
    Cash and cash equivalents   82,880     69,395     111,963     66,120     54,146  
                                   
    Securities available for sale   396,891     397,578     398,374     406,259     380,499  
    Loans receivable   1,675,139     1,641,356     1,621,448     1,603,618     1,611,069  
    Less: Allowance for credit losses   18,699     17,807     18,020     18,968     16,086  
    Net loans receivable   1,656,440     1,623,549     1,603,428     1,584,650     1,594,983  
    Regulatory stock, at cost   6,329     6,443     6,545     7,318     8,843  
    Bank owned life insurance   46,382     46,121     45,869     46,439     46,197  
    Bank premises and equipment, net   18,503     18,264     18,057     17,838     17,254  
    Foreclosed real estate owned   0     0     97     97     290  
    Goodwill and other intangibles   29,433     29,449     29,468     29,487     29,506  
    Other assets   42,893     44,517     46,622     42,871     48,280  
    TOTAL ASSETS $         2,279,751   $         2,235,316   $         2,260,423   $         2,201,079   $         2,179,998  
               
    LIABILITIES          
    Deposits              
    Non-interest bearing demand $         420,967   $         391,849   $         383,362   $         399,545   $         430,242  
    Interest-bearing deposits   1,434,284     1,419,323     1,455,636     1,395,614     1,316,582  
    Total deposits   1,855,251     1,811,172     1,838,998     1,795,159     1,746,824  
    Borrowings   197,412     210,422     211,234     198,312     241,328  
    Other liabilities   31,434     31,534     28,978     26,538     27,144  
    TOTAL LIABILITIES   2,084,097     2,053,128     2,079,210     2,020,009     2,015,296  
                                   
    STOCKHOLDERS’ EQUITY   195,654     182,188     181,213     181,070     164,702  
                                   
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $         2,279,751   $         2,235,316   $         2,260,423   $         2,201,079   $         2,179,998  
                 
    NORWOOD FINANCIAL CORP
    Consolidated Statements of Income (unaudited)
    (dollars in thousands, except per share data)    		        
                 
        September 30
    2024    		 June 30
    2024    		 March 31
    2024    		 December 31
    2023    		 September 30
    2023
    Three months ended  
    INTEREST INCOME            
    Loans receivable, including fees $ 25,464   $ 24,121   $ 23,681   $ 23,328   $ 22,021  
    Securities   2,526     2,584     2,526     2,504     2,433  
    Other   497     966     731     253     54  
    Total interest income   28,487     27,671     26,938     26,085     24,508  
                                   
    INTEREST EXPENSE            
    Deposits   10,553     10,687     10,110     8,910     7,017  
    Borrowings   2,003     2,059     2,118     1,882     2,452  
    Total interest expense   12,556     12,746     12,228     10,792     9,469  
    NET INTEREST INCOME   15,931     14,925     14,710     15,293     15,039  
    (RELEASE OF) PROVISION FOR CREDIT LOSSES   1,345     347     (624 )    6,116     882  
    NET INTEREST INCOME AFTER (RELEASE OF)
    PROVISION FOR CREDIT LOSSES    		            
    14,586     14,578     15,334     9,177     14,157  
                 
    OTHER INCOME                              
    Service charges and fees   1,517     1,504     1,343     1,421     1,527  
    Income from fiduciary activities   256     225     238     210     246  
    Net realized (losses) gains on sales of securities   –     –     –     –     –  
    Gains on sales of loans, net   103     36     6     36     18  
    Gains on sales of foreclosed real estate owned   –     32     –     66     13  
    Earnings and proceeds on life insurance policies   261     253     268     242     328  
    Other   158     157     151     148     174  
    Total other income   2,295     2,207     2,006     2,123     2,306  
                                   
    OTHER EXPENSES            
    Salaries and employee benefits   6,239     5,954     6,135     5,672     6,083  
    Occupancy, furniture and equipment, net   1,269     1,229     1,261     1,265     1,242  
    Foreclosed real estate   9     15     21     17     9  
    FDIC insurance assessment   339     309     361     287     254  
    Other   4,175     3,937     3,954     3,608     3,688  
    Total other expenses   12,031     11,444     11,732     10,849     11,276  
                                   
    INCOME BEFORE TAX   4,850     5,341     5,608     451     5,187  
    INCOME TAX EXPENSE   1,006     1,128     1,175     96     1,068  
    NET INCOME $ 3,844   $ 4,213   $ 4,433   $ 355   $ 4,119  
                                   
    Basic earnings per share $ 0.48   $ 0.52   $ 0.55   $ 0.04   $ 0.51  
                                   
    Diluted earnings per share $ 0.48   $ 0.52   $ 0.55   $ 0.04   $ 0.51  
                                   
    Book Value per share $ 24.92   $ 23.26   $ 23.01   $ 22.99   $ 21.15  
    Tangible Book Value per share   21.28     19.62     19.38     19.36     17.49  
                                   
    Return on average assets (annualized)   0.68 %   0.75 %   0.80 %   0.06 %    0.76 %
    Return on average equity (annualized)   8.09 %   9.41 %    9.79 %    0.84 %    9.33 %
    Return on average tangible equity (annualized)   9.58 %   11.26 %    11.68 %    1.01 %    11.22 %
                                   
    Net interest spread (fte)   2.23 %   2.05 %    2.07 %    2.24 %    2.28 %
    Net interest margin (fte)   2.99 %   2.79 %    2.79 %    2.95 %    2.94 %
                                   
    Allowance for credit losses to total loans   1.12 %   1.08 %    1.11 %    1.18 %    1.00 %
    Net charge-offs to average loans (annualized)   0.08 %   0.13 %    0.08 %    0.79 %    0.59 %
    Nonperforming loans to total loans   0.47 %   0.47 %    0.23 %    0.48 %    0.65 %
    Nonperforming assets to total assets   0.35 %   0.34 %    0.17 %    0.35 %    0.50 %
    NORWOOD FINANCIAL CORP
    NET INTEREST MARGIN ANALYSIS
    (dollars in thousands)
      For the Quarter Ended
      September 30, 2024 For the Quarter Ended June 30, 2024 September 30, 2023
    Average
    Balance
    (2)    		 Interest
    (1) 
    		 Average
    Rate
    (3)    		 Average
    Balance
    (2)    		 Interest
    (1)    		 Average
    Rate
    (3)    		 Average
    Balance
    (2)    		 Interest
    (1) 
    		 Average
    Rate
     (3)
    Assets                      
    Interest-earning assets:                      
    Interest-bearing deposits with banks $ 36,221   $ 497   5.46 % $ 69,173   $ 967   5.62 % $ 3,675   $ 54   5.83 %
    Securities available for sale:                      
    Taxable   392,168     2,161   2.19     401,014     2,206   2.21     406,962     2,052   2.00  
    Tax-exempt (1)   67,563     461   2.71     69,126     477   2.78     70,219     483   2.73  
    Total securities available for sale (1)   459,731     2,622   2.27     470,140     2,683   2.30     477,181     2,535   2.11  
    Loans receivable (1) (4) (5)   1,651,921     25,575   6.16     1,629,283     24,220   5.98     1,589,474     22,104   5.52  
    Total interest-earning assets   2,147,873     28,694   5.31     2,168,596     27,870   5.17     2,070,330     24,693   4.73  
    Non-interest earning assets:                      
    Cash and due from banks   28,193           26,422           27,910      
    Allowance for credit losses   (17,944 )         (18,023 )         (17,262 )    
    Other assets   78,344           69,718           65,863      
    Total non-interest earning assets   88,593           78,117           76,511      
    Total Assets $ 2,236,466         $ 2,246,713         $ 2,146,841      
    Liabilities and Stockholders’ Equity                      
    Interest-bearing liabilities:                      
                           
    Interest-bearing demand and money market $ 461,897   $ 2,782   2.40   $ 450,918   $ 2,397   2.14   $ 439,255   $ 1,647   1.49  
    Savings   221,366     13   0.02     233,676     286   0.49     238,493     77   0.13  
    Time   734,235     7,758   4.20     755,224     8,004   4.26     611,607     5,293   3.43  
    Total interest-bearing deposits   1,417,498     10,553   2.96     1,439,818     10,687   2.99     1,289,355     7,017   2.16  
    Short-term borrowings   53,622     323   2.40     61,689     356   2.32     116,470     1,126   3.84  
    Other borrowings   146,357     1,680   4.57     149,442     1,703   4.58     116,700     1,326   4.51  
    Total interest-bearing liabilities   1,617,477     12,556   3.09     1,650,949     12,746   3.11     1,522,525     9,469   2.47  
    Non-interest bearing liabilities:                      
    Demand deposits   400,314           387,962           425,216      
    Other liabilities   29,540           28,308           23,876      
    Total non-interest bearing liabilities   429,854           416,270           449,092      
    Stockholders’ equity   189,135           179,494           175,224      
    Total Liabilities and Stockholders’ Equity $ 2,236,466         $ 2,246,713         $ 2,146,841      
    Net interest income/spread (tax equivalent basis)     16,138   2.23 %     15,124   2.06 %     15,224   2.26 %
    Tax-equivalent basis adjustment     (207 )         (199 )         (185 )  
    Net interest income   $ 15,931         $ 14,925         $ 15,039    
    Net interest margin (tax equivalent basis)     2.99 %     2.80 %     2.92 %
                             

    (1) Interest and yields are presented on a tax-equivalent basis using a marginal tax rate of 21%.
    (2) Average balances have been calculated based on daily balances.
    (3) Annualized
    (4) Loan balances include non-accrual loans and are net of unearned income.
    (5) Loan yields include the effect of amortization of deferred fees, net of costs.

    The MIL Network –

  • MIL-OSI Economics: CBB Governor receives PM Fellowship Program candidate

    Source: Central Bank of Bahrain

    Published on 28 October 2024

    Manama, Kingdom of Bahrain – 28 October 2024 – HE Khalid Humaidan, Governor of the Central Bank of Bahrain, affirmed that the PM Fellowship Program reflects the Kingdom of Bahrain’s commitment to investing in its national workforce and engaging them in comprehensive development, under the leadership of His Majesty King Hamad bin Isa Al Khalifa and in line with the vision of His Royal Highness Prince Salman bin Hamad Al Khalifa, the Crown Prince and Prime Minister.

    HE the Governor received at his office Mr. Rashed Adel Kamal, the CBB employee selected as a candidate for the 10th intake of the Prime Minister’s Fellowship Program, and  congratulated him on his selection, wishing him ongoing success and benefit from the program’s opportunities.

    Mr. Kamal expressed his gratitude to HE the Governor for his continuous support for CBB employees in achieving their aspirations.

    Share this

    MIL OSI Economics –

  • MIL-OSI: Citizens Community Bancorp, Inc. Reports Third Quarter 2024 Earnings of $0.32 Per Share; Nine Month 2024 Earnings of $1.07 Per Share

    Source: GlobeNewswire (MIL-OSI)

    EAU CLAIRE, Wis., Oct. 28, 2024 (GLOBE NEWSWIRE) — Citizens Community Bancorp, Inc. (the “Company”) (Nasdaq: CZWI), the parent company of Citizens Community Federal N.A. (the “Bank” or “CCFBank”), today reported earnings of $3.3 million and earnings per diluted share of $0.32 for the third quarter ended September 30, 2024, compared to $3.7 million and earnings per diluted share of $0.35 for the quarter ended June 30, 2024, and $2.5 million and $0.24 earnings per diluted share for the quarter ended September 30, 2023, respectively.

    The Company’s third quarter 2024 operating results reflected the following changes from the second quarter of 2024: (1) no loan forbearance interest income in the third quarter compared to $0.2 million in the second quarter; (2) a $1.1 million decrease in negative provision for credit losses to $0.4 million in the third quarter; and (3) higher non-interest income of $1.0 million due to $0.5 million higher gain on sale of loans and $0.6 million lower net losses on sale of equity securities in the third quarter of 2024.

    Book value per share improved to $17.88 at September 30, 2024, compared to $17.10 at June 30, 2024, and $15.80 at September 30, 2023. Tangible book value per share (non-GAAP)1 was $14.64 at September 30, 2024, compared to $13.91 at June 30, 2024, and a 16.1% increase from $12.61 at September 30, 2023. For the third quarter of 2024, tangible book value was positively influenced by net income, net unrealized gains on the available for sale securities portfolio and intangible amortization. Stockholders’ equity as a percentage of total assets was 10.01% at September 30, 2024, compared to 9.77% at June 30, 2024. Tangible common equity (“TCE”) as a percent of tangible assets (non-GAAP)1 was 8.35% at September 30, 2024, compared to 8.09% at June 30, 2024, with the changes above impacted favorably by asset shrinkage.

    “We continued to execute on our strategic objectives during the third quarter that further strengthened franchise value. The quarter reflected our balance sheet optimization efforts, which increased tangible common equity levels and allowed for the continued repurchase of shares at prices that were accretive to tangible book value per share and earnings per share. The TCE ratio increased to 8.35%, from 8.09% in the prior quarter, which included the impact of repurchasing 223 thousand shares. Deposits, net of the decrease in brokered deposits, increased $31 million. While credit metrics were impacted by an increase in nonperforming loans, the increase largely reflected one lending relationship. Meanwhile, we continue to maintain a healthy reserve for credit losses to total loans at 1.47%,” stated Stephen Bianchi, Chairman, President, and Chief Executive Officer.

    September 30, 2024, Highlights:

    • Quarterly earnings were $3.3 million, or $0.32 per diluted share for the quarter ended September 30, 2024, a decrease from the quarter ended June 30, 2024, earnings of $3.7 million, or $0.35 per diluted share, and an increase from the quarter ended September 30, 2023, earnings of $2.5 million, or $0.24 per diluted share.
    • Net interest income decreased $0.3 million for the current quarter ended September 30, 2024, from $11.6 million for the quarter ended June 30, 2024, and decreased from $12.1 million for the quarter ended September 30, 2023. The decrease in net interest income from the second quarter of 2024 was primarily due to lower non-recurring interest income of $0.2 million recognized in the second quarter from curing technical defaults on performing loans.
    • The net interest margin was 2.63% for the quarter ended September 30, 2024, compared to 2.72% for the previous quarter, and 2.79% for the quarter ended September 30, 2023. The net interest margin declined nine basis points in the third quarter, of which five basis points were due to no interest income recognition from curing technical defaults.
    • In the third quarter ended September 30, 2024, a negative provision for credit losses of $0.4 million was recorded compared to a negative provision for credit losses of $1.525 million in the quarter ended June 30, 2024, and a negative provision for credit losses of $0.30 million for the quarter ended September 30, 2023. The third quarter’s negative provision was due to decreases in on-balance sheet allowance for credit losses (“ACL”) of $0.1 million and a $0.3 million decrease in off-balance sheet ACL due to a reduction in unfunded loan commitments.
    • Non-interest income increased $1.0 million in the third quarter of 2024, due to $0.5 million of higher gain on sale of loans and $0.6 million of lower net losses on equity securities and was $0.4 million higher compared to the third quarter of 2023, due to higher gain on sale of loans.
    • Non-interest expense increased $122 thousand to $10.4 million from $10.3 million for the previous quarter and increased $452 thousand from $10.0 million one year earlier.
    • Gross loans decreased by $3.9 million during the third quarter ended September 30, 2024, to $1.43 billion, compared to June 30, 2024.
    • Total deposits increased $1.1 million, more than offsetting the $30.1 million decrease in brokered deposits during the quarter ended September 30, 2024, to $1.52 billion, compared to June 30, 2024.
    • Federal Home Loan Bank advances decreased $10.5 million to $21.0 million at September 30, 2024, from $31.5 million at June 30, 2024.
    • The effective tax rate was 21.48% for the quarter ended September 30, 2024, compared to 22.1% for the quarter ended June 30, 2024, and 50.5% for the quarter ended September 30, 2023. The change in tax rate from 2023 is largely due to the Wisconsin state legislation in the third quarter of 2023, eliminating the Company’s state income tax in Wisconsin.
    • Nonperforming assets increased to $17.1 million at September 30, 2024, compared to $10.3 million at June 30, 2024. The increase was largely due to one agricultural real estate loan relationship in forestry services that moved from special mention to substandard and was placed on nonaccrual in the third quarter.
    • Common stock totaling 223 thousand shares were repurchased in the third quarter of 2024 at an average price of $12.91 per share.
    • The efficiency ratio was 72% for the quarters ended September 30, 2024 and June 30, 2024.

    Balance Sheet and Asset Quality

    Total assets decreased by $3.2 million during the quarter to $1.80 billion at September 30, 2024.

    Securities available for sale (“AFS”) increased $3.0 million during the quarter ended September 30, 2024, to $149.4 million from $146.4 million at June 30, 2024. The increase was due to: (1) pre-tax unrealized gains of $4.6 million; and (2) a purchase of $2.9 million of agency MBS to support the Bank’s CRA program partially offset by principal repayments of $4.5 million.

    Securities held to maturity (“HTM”) decreased $1.6 million to $87.0 million during the quarter ended September 30, 2024, from $88.6 million at June 30, 2024, due to principal repayments.

    The on-balance sheet liquidity ratio, which is defined as the fair market value of AFS and HTM securities that are not pledged and cash on deposit with other financial institutions, was 11.46% of total assets at September 30, 2024, compared to 11.48% at June 30, 2024. On-balance sheet liquidity, collateralized new borrowing capacity and uncommitted federal funds borrowing availability was $718 million, or 269%, of uninsured and uncollateralized deposits at September 30, 2024, and $714 million, or 289%, at June 30, 2024.

    Gross loans decreased by $3.9 million during the third quarter ended September 30, 2024, due to loan payoffs exceeding origination activity and construction loan fundings.

    The office loan portfolio totaled $31.0 million at quarter end and consists of 71 loans. There was one criticized loan in this portfolio during the quarter ended September 30, 2024, totaling $0.2 million and there have been no charge-offs in the trailing twelve months.

    The allowance for credit losses on loans decreased by $0.2 million to $21.0 million at September 30, 2024, representing 1.47% of total loans receivable compared to 1.48% of total loans receivable at June 30, 2024. For the quarter ended September 30, 2024, the Bank recorded negative provision of $0.4 million which included a negative provision on ACL for loans of $0.1 million and a negative provision of $0.3 million on ACL for unfunded commitments.

    Allowance for Credit Losses (“ACL”) – Loans Percentage

    (in thousands, except ratios)

      September 30, 2024   June 30, 2024   December 31, 2023   September 30, 2023
    Loans, end of period $ 1,424,828     $ 1,428,588     $ 1,460,792     $ 1,447,529  
    Allowance for credit losses – Loans $ 21,000     $ 21,178     $ 22,908     $ 22,973  
    ACL – Loans as a percentage of loans, end of period   1.47 %     1.48 %     1.57 %     1.59 %

    In addition to the ACL – Loans, the Company has established an ACL – Unfunded Commitments of $0.460 million at September 30, 2024, $0.712 million at June 30, 2024, and $1.571 million at September 30, 2023, classified in other liabilities on the consolidated balance sheets.

    Allowance for Credit Losses – Unfunded Commitments:
    (in thousands)

      September 30, 2024
    and Three Months
    Ended    		   September 30, 2023
    and Three Months
    Ended    		   September 30, 2024
    and Nine Months
    Ended    		   September 30, 2023
    and Nine Months
    Ended
    ACL – Unfunded commitments – beginning of period $ 712     $ 1,544   $ 1,250     $ —
    Cumulative effect of ASU 2016-13 adoption   —       —     —       1,537
    (Reductions) additions to ACL – Unfunded commitments via provision for credit losses charged to operations   (252 )     27     (790 )     34
    ACL – Unfunded commitments – end of period $ 460     $ 1,571   $ 460     $ 1,571

    Special mention loans increased by $2.2 million to $11.0 million at September 30, 2024, compared to $8.8 million at June 30, 2024. The increase is largely due to one loan of $8.7 million, which is secured by a multi-family unit. The addition of the multi-family unit to special mention was partially offset by the movement of a $7.7 million agricultural real estate loan relationship in forestry services that moved to substandard and was placed on nonaccrual.

    Substandard loans increased by $6.8 million to $21.2 million at September 30, 2024, compared to $14.4 million at June 30, 2024, due to the addition of the forestry services loan relationship noted above.

    Nonperforming assets increased to $17.1 million at September 30, 2024, compared to $10.3 million at June 30, 2024 largely due to the previously mentioned forestry services loan relationship.

      (in thousands)
      September 30, 2024   June 30, 2024   March 31, 2024   December 31, 2023   September 30, 2023
    Special mention loan balances $ 11,047   $ 8,848   $ 13,737   $ 18,392   $ 20,043
    Substandard loan balances   21,202     14,420     14,733     19,596     16,171
    Criticized loans, end of period $ 32,249   $ 23,268   $ 28,470   $ 37,988   $ 36,214

    Total deposits increased $1.1 million during the quarter ended September 30, 2024, to $1.52 billion. Consumer deposits increased $22.1 million, including an increase in CDs of $17.9 million. Commercial deposits increased by $20.0 million. Brokered deposits decreased $30.1 million as the company decreased brokered MMDAs by $24.6 million and $5.5 million in brokered CDs matured and were not replaced. Public deposits decreased $10.9 million, largely due to expected seasonal outflows.

    Deposit Portfolio Composition
    (in thousands)

      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Consumer deposits $ 844,808   $ 822,665   $ 827,290   $ 814,899   $ 794,970
    Commercial deposits   432,361     412,385     414,088     423,762     429,358
    Public deposits   176,844     187,698     202,175     182,172     163,734
    Brokered deposits   66,654     96,796     83,936     98,259     85,173
    Total deposits $ 1,520,667   $ 1,519,544   $ 1,527,489   $ 1,519,092   $ 1,473,235


    Deposit Composition
    (in thousands)

      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Non-interest-bearing demand deposits $ 256,840   $ 255,703   $ 248,537   $ 265,704   $ 275,790
    Interest-bearing demand deposits   346,971     353,477     361,278     343,276     336,962
    Savings accounts   169,096     170,946     177,595     176,548     183,702
    Money market accounts   366,067     370,164     387,879     374,055     312,689
    Certificate accounts   381,693     369,254     352,200     359,509     364,092
    Total deposits $ 1,520,667   $ 1,519,544     1,527,489   $ 1,519,092   $ 1,473,235

    At September 30, 2024, the deposit portfolio composition was 56% consumer, 28% commercial, 12% public, and 4% brokered deposits compared to 54% consumer, 27% commercial, 12% public, and 7% brokered deposits at June 30, 2024.

    Uninsured and uncollateralized deposits were $267.1 million, or 18% of total deposits, at September 30, 2024, and $246.7 million, or 16% of total deposits, at June 30, 2024. Uninsured deposits alone at September 30, 2024, were $413.6 million, or 27% of total deposits, and $401.6 million, or 26% of total deposits at June 30, 2024.

    Federal Home Loan Bank advances decreased $10.5 million to $21.0 million at September 30, 2024, from $31.5 million one quarter earlier.

    Common stock totaling 223 thousand shares were repurchased in the third quarter of 2024 at an average price of $12.91 per share. For the nine-month period ended September 30, 2024, 382 thousand shares of common stock were repurchased at an average price of $12.32 per share. There are 333 thousand shares remaining under the July 2024 Board of Director repurchase authorization plan.

    Review of Operations

    Net interest income decreased $0.3 million for the current quarter ended September 30, 2024, from $11.6 million for the quarter ended June 30, 2024, and decreased from $12.1 million for the quarter ended September 30, 2023. The decrease in net interest income from the second quarter of 2024 was primarily due to lower non-recurring interest income of $0.2 million recognized from curing technical defaults on performing loans during the prior quarter. The net interest margin declined nine basis points in the third quarter, of which five basis points were due to no interest income recognition from curing technical defaults.

    Net interest income and net interest margin analysis:
    (in thousands, except yields and rates)

      Three months ended
      September 30, 2024   June 30, 2024   March 31, 2024   December 31, 2023   September 30, 2023
      Net
    Interest
    Income    		   Net
    Interest
    Margin    		   Net
    Interest
    Income    		   Net
    Interest
    Margin    		   Net
    Interest
    Income    		   Net
    Interest
    Margin    		   Net
    Interest
    Income    		   Net
    Interest
    Margin    		   Net
    Interest
    Income    		   Net
    Interest
    Margin
    As reported $ 11,285     2.63 %   $ 11,576     2.72 %   $ 11,905     2.77 %   $ 11,747     2.69 %   $ 12,121     2.79 %
    Less accretion for PCD loans   (45 )   (0.01 )%     (62 )   (0.01 )%     (75 )   (0.02 )%     (37 )   (0.01 )%     (39 )   (0.01 )%
    Less scheduled accretion interest   (33 )   (0.01 )%     (32 )   (0.01 )%     (33 )   (0.01 )%     (33 )   (0.01 )%     (77 )   (0.02 )%
    Without loan purchase accretion $ 11,207     2.61 %   $ 11,482     2.70 %   $ 11,797     2.74 %   $ 11,677     2.67 %   $ 12,005     2.76 %

    Non-interest income increased $1.0 million in the third quarter of 2024, due to $0.5 million of higher gain on sale of loans and $0.6 million of lower net losses on equity securities. Non-interest income was $0.4 million higher compared to the third quarter of 2023 due to higher gain on sale of loans.

    Non-interest expense increased $122 thousand to $10.4 million in the third quarter of 2024 from $10.3 million for the previous quarter and increased $452 thousand from $10.0 million one year earlier. The increase in the current quarter relative to the second quarter was primarily related to one-time data processing costs, modest REO losses and higher quarterly marketing spending, partially offset by $0.2 million in branch closure costs in the second quarter.

    Provision for income taxes decreased to $0.9 million in the third quarter of 2024 from $1.0 million in the second quarter of 2024 largely due to lower pre-tax income. The effective tax rate was 21.48% for the quarter ended September 30, 2024, 22.1% for the quarter ended June 30, 2024, and 50.5% for the quarter ended September 30, 2023. The change in tax rate from 2023 is largely due to the Wisconsin state legislation in the third quarter of 2023, eliminating the Company’s state income tax in Wisconsin.

    These financial results are preliminary until Form 10-Q is filed in November 2024.

    About the Company

    Citizens Community Bancorp, Inc. (NASDAQ: “CZWI”) is the holding company of the Bank, a national bank based in Altoona, Wisconsin, currently serving customers primarily in Wisconsin and Minnesota through 22 branch locations. Its primary markets include the Chippewa Valley Region in Wisconsin, the Twin Cities and Mankato markets in Minnesota, and various rural communities around these areas. The Bank offers traditional community banking services to businesses, ag operators and consumers, including residential mortgage loans.

    Cautionary Statement Regarding Forward-Looking Statements

    Certain statements contained in this release are considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified using forward-looking words or phrases such as “anticipate,” “believe,” “could,” “expect,” “estimates,” “intend,” “may,” “on pace,” “preliminary,” “planned,” “potential,” “should,” “will,” “would” or the negative of those terms or other words of similar meaning. Such forward-looking statements in this release are inherently subject to many uncertainties arising in the operations and business environment of the Company and the Bank. These uncertainties include: conditions in the financial markets and economic conditions generally; the impact of inflation on our business and our customers; geopolitical tensions, including current or anticipated impact of military conflicts; higher lending risks associated with our commercial and agricultural banking activities; future pandemics (including new variants of COVID-19); cybersecurity risks; adverse impacts on the regional banking industry and the business environment in which it operates; interest rate risk; lending risk; changes in the fair value or ratings downgrades of our securities; the sufficiency of allowance for credit losses; competitive pressures among depository and other financial institutions; disintermediation risk; our ability to maintain our reputation; our ability to maintain or increase our market share; our ability to realize the benefits of net deferred tax assets; our inability to obtain needed liquidity; our ability to raise capital needed to fund growth or meet regulatory requirements; our ability to attract and retain key personnel; our ability to keep pace with technological change; prevalence of fraud and other financial crimes; the possibility that our internal controls and procedures could fail or be circumvented; our ability to successfully execute our acquisition growth strategy; risks posed by acquisitions and other expansion opportunities, including difficulties and delays in integrating the acquired business operations or fully realizing the cost savings and other benefits; restrictions on our ability to pay dividends; the potential volatility of our stock price; accounting standards for credit losses; legislative or regulatory changes or actions, or significant litigation, adversely affecting the Company or Bank; public company reporting obligations; changes in federal or state tax laws; and changes in accounting principles, policies or guidelines and their impact on financial performance. Stockholders, potential investors, and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. Such uncertainties and other risks that may affect the Company’s performance are discussed further in Part I, Item 1A, “Risk Factors,” in the Company’s Form 10-K, for the year ended December 31, 2023, filed with the Securities and Exchange Commission (“SEC”) on March 5, 2024 and the Company’s subsequent filings with the SEC. The Company undertakes no obligation to make any revisions to the forward-looking statements contained in this news release or to update them to reflect events or circumstances occurring after the date of this release.

    1Non-GAAP Financial Measures

    This press release contains non-GAAP financial measures, such as net income as adjusted, net income as adjusted per share, tangible book value, tangible book value per share, tangible common equity as a percent of tangible assets and return on average tangible common equity, which management believes may be helpful in understanding the Company’s results of operations or financial position and comparing results over different periods.

    Net income as adjusted and net income as adjusted per share are non-GAAP measures that eliminate the impact of certain expenses such as branch closure costs and related severance pay, accelerated depreciation expense and lease termination fees, and the gain on sale of branch deposits and fixed assets. Tangible book value, tangible book value per share, tangible common equity as a percentage of tangible assets and return on average tangible common equity are non-GAAP measures that eliminate the impact of goodwill and intangible assets on our financial position. Management believes these measures are useful in assessing the strength of our financial position.

    Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in this press release. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other banks and financial institutions.

    Contact: Steve Bianchi, CEO
    (715)-836-9994

    (CZWI-ER)

     
    CITIZENS COMMUNITY BANCORP, INC.
    Consolidated Balance Sheets
    (in thousands, except shares and per share data)
     
      September 30, 2024
    (unaudited)    		   June 30, 2024
    (unaudited)    		   December 31, 2023
    (audited)    		   September 30, 2023
    (unaudited)
    Assets              
    Cash and cash equivalents $ 36,632     $ 36,886     $ 37,138     $ 32,532  
    Securities available for sale “AFS”   149,432       146,438       155,743       153,414  
    Securities held to maturity “HTM”   87,033       88,605       91,229       92,336  
    Equity investments   5,096       5,023       3,284       2,433  
    Other investments   12,311       13,878       15,725       15,109  
    Loans receivable   1,424,828       1,428,588       1,460,792       1,447,529  
    Allowance for credit losses   (21,000 )     (21,178 )     (22,908 )     (22,973 )
    Loans receivable, net   1,403,828       1,407,410       1,437,884       1,424,556  
    Loans held for sale   697       275       5,773       2,737  
    Mortgage servicing rights, net   3,696       3,731       3,865       3,944  
    Office properties and equipment, net   17,365       17,774       18,373       19,465  
    Accrued interest receivable   6,235       6,289       5,409       5,936  
    Intangible assets   1,158       1,336       1,694       1,873  
    Goodwill   31,498       31,498       31,498       31,498  
    Foreclosed and repossessed assets, net   1,572       1,662       1,795       1,046  
    Bank owned life insurance (“BOLI”)   25,901       25,708       25,647       25,467  
    Other assets   16,683       15,794       16,334       18,741  
    TOTAL ASSETS $ 1,799,137     $ 1,802,307     $ 1,851,391     $ 1,831,087  
    Liabilities and Stockholders’ Equity              
    Liabilities:              
    Deposits $ 1,520,667     $ 1,519,544     $ 1,519,092     $ 1,473,235  
    Federal Home Loan Bank (“FHLB”) advances   21,000       31,500       79,530       114,530  
    Other borrowings   61,548       61,498       67,465       67,407  
    Other liabilities   15,773       13,720       11,970       10,513  
    Total liabilities   1,618,988       1,626,262       1,678,057       1,665,685  
    Stockholders’ equity:              
    Common stock— $0.01 par value, authorized 30,000,000; 10,074,136, 10,297,341, 10,440,591, and 10,468,091 shares issued and outstanding, respectively   101       103       104       105  
    Additional paid-in capital   115,455       117,838       119,441       119,612  
    Retained earnings   78,438       75,501       71,117       67,424  
    Accumulated other comprehensive loss   (13,845 )     (17,397 )     (17,328 )     (21,739 )
    Total stockholders’ equity   180,149       176,045       173,334       165,402  
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 1,799,137     $ 1,802,307     $ 1,851,391     $ 1,831,087  

    Note: Certain items previously reported were reclassified for consistency with the current presentation.

    CITIZENS COMMUNITY BANCORP, INC.
    Consolidated Statements of Operations
    (in thousands, except per share data)
     
      Three Months Ended   Nine Months Ended
      September 30, 2024 (unaudited)   June 30, 2024 (unaudited)   September 30, 2023 (unaudited)   September 30, 2024 (unaudited)   September 30, 2023 (unaudited)
    Interest and dividend income:                  
    Interest and fees on loans $ 20,115     $ 19,921     $ 19,083     $ 60,204     $ 54,169
    Interest on investments   2,397       2,542       2,689       7,450       8,053
    Total interest and dividend income   22,512       22,463       21,772       67,654       62,222
    Interest expense:                  
    Interest on deposits   10,165       9,338       7,388       28,712       17,898
    Interest on FHLB borrowed funds   128       576       1,210       1,216       4,595
    Interest on other borrowed funds   934       973       1,053       2,960       3,127
    Total interest expense   11,227       10,887       9,651       32,888       25,620
    Net interest income before provision for credit losses   11,285       11,576       12,121       34,766       36,602
    (Negative) provision for credit losses   (400 )     (1,525 )     (325 )     (2,725 )     175
    Net interest income after provision for credit losses   11,685       13,101       12,446       37,491       36,427
    Non-interest income:                  
    Service charges on deposit accounts   513       490       491       1,474       1,464
    Interchange income   577       579       601       1,697       1,743
    Loan servicing income   643       526       611       1,751       1,679
    Gain on sale of loans   752       226       299       1,998       1,501
    Loan fees and service charges   165       309       140       704       308
    Net realized gains on debt securities   —       —       —       —       12
    Net (losses) gains on equity securities   (78 )     (658 )     116       (569 )     170
    Bank Owned Life Insurance (BOLI) death benefit   —       184       —       184       —
    Other   349       257       307       859       893
    Total non-interest income   2,921       1,913       2,565       8,098       7,770
    Non-interest expense:                  
    Compensation and related benefits   5,743       5,675       5,293       16,901       15,967
    Occupancy   1,242       1,333       1,335       3,942       4,117
    Data processing   1,665       1,525       1,536       4,787       4,440
    Amortization of intangible assets   178       179       179       536       576
    Mortgage servicing rights expense, net   163       116       150       427       456
    Advertising, marketing and public relations   225       186       185       575       472
    FDIC premium assessment   201       200       204       606       608
    Professional services   336       347       342       1,249       1,153
    Losses (gains) on repossessed assets, net   65       (18 )     100       47       62
    Other   603       756       645       2,427       2,085
    Total non-interest expense   10,421       10,299       9,969       31,497       29,936
    Income before provision for income taxes   4,185       4,715       5,042       14,092       14,261
    Provision for income taxes   899       1,040       2,544       3,043       4,895
    Net income attributable to common stockholders $ 3,286     $ 3,675     $ 2,498     $ 11,049     $ 9,366
    Per share information:                  
    Basic earnings $ 0.32     $ 0.35     $ 0.24     $ 1.07     $ 0.89
    Diluted earnings $ 0.32     $ 0.35     $ 0.24     $ 1.07     $ 0.89
    Cash dividends paid $ —     $ —     $ —     $ 0.32     $ 0.29
    Book value per share at end of period $ 17.88     $ 17.10     $ 15.80     $ 17.88     $ 15.80
    Tangible book value per share at end of period (non-GAAP) $ 14.64     $ 13.91     $ 12.61     $ 14.64     $ 12.61

    Reconciliation of GAAP Net Income and Net Income as Adjusted (non-GAAP)

    (in thousands, except per share data)

      Three Months Ended   Nine Months Ended
      September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023    		   September 30,
    2024    		   September 30,
    2023
                       
    GAAP pretax income $ 4,185   $ 4,715   $ 5,042   $ 14,092   $ 14,261
    Branch closure costs (1)   —     168     —     168     —
    Pretax income as adjusted (2) $ 4,185   $ 4,883   $ 5,042   $ 14,260   $ 14,261
    Provision for income tax on net income as adjusted (3)   899     1,077     2,544     3,079     4,895
    Net income as adjusted (non-GAAP) (2) $ 3,286   $ 3,806   $ 2,498   $ 11,181   $ 9,366
    GAAP diluted earnings per share, net of tax $ 0.32   $ 0.35   $ 0.24   $ 1.07   $ 0.89
    Branch closure costs, net of tax   —     0.01     —     0.01     —
    Diluted earnings per share, as adjusted, net of tax (non-GAAP) $ 0.32   $ 0.36   $ 0.24   $ 1.08   $ 0.89
                       
    Average diluted shares outstanding   10,204,195     10,373,089     10,470,098     10,339,802     10,474,685

    (1) Branch closure costs include severance pay recorded in compensation and benefits and depreciation and right of use lease asset accelerated expense included in other non-interest expense in the consolidated statement of operations.
    (2) Pretax income as adjusted and net income as adjusted are non-GAAP measures that management believes enhances the market’s ability to assess the underlying business performance and trends related to core business activities.
    (3) Provision for income tax on net income as adjusted is calculated at our effective tax rate for each respective period presented.


    Loan Composition

    (in thousands)

      September 30, 2024   June 30, 2024   December 31, 2023   September 30, 2023
    Total Loans:              
    Commercial/Agricultural real estate:              
    Commercial real estate $ 730,459     $ 729,236     $ 750,531     $ 750,282  
    Agricultural real estate   76,043       78,248       83,350       84,558  
    Multi-family real estate   239,191       234,758       228,095       219,193  
    Construction and land development   87,875       87,898       110,941       109,799  
    C&I/Agricultural operating:              
    Commercial and industrial   119,619       127,386       121,666       121,033  
    Agricultural operating   27,550       27,409       25,691       24,552  
    Residential mortgage:              
    Residential mortgage   134,944       133,503       129,021       125,939  
    Purchased HELOC loans   2,932       2,915       2,880       2,881  
    Consumer installment:              
    Originated indirect paper   4,405       5,110       6,535       7,175  
    Other consumer   5,438       5,860       6,187       6,440  
    Gross loans $ 1,428,456     $ 1,432,323     $ 1,464,897     $ 1,451,852  
    Unearned net deferred fees and costs and loans in process   (2,703 )     (2,733 )     (2,900 )     (3,048 )
    Unamortized discount on acquired loans   (925 )     (1,002 )     (1,205 )     (1,275 )
    Total loans receivable $ 1,424,828     $ 1,428,588     $ 1,460,792     $ 1,447,529  

    Nonperforming Assets
    Loan Balances at Amortized Cost

    (in thousands, except ratios)

      September 30, 2024   June 30, 2024   December 31, 2023   September 30, 2023
    Nonperforming assets:              
    Nonaccrual loans              
    Commercial real estate $ 4,778     $ 5,350     $ 10,359     $ 10,570  
    Agricultural real estate   6,193       382       391       469  
    Construction and land development   106       —       54       94  
    Commercial and industrial (“C&I”)   1,956       422       —       —  
    Agricultural operating   901       1,017       1,180       1,373  
    Residential mortgage   1,088       1,145       1,167       923  
    Consumer installment   20       36       33       27  
    Total nonaccrual loans $ 15,042     $ 8,352     $ 13,184     $ 13,456  
    Accruing loans past due 90 days or more   530       256       389       971  
    Total nonperforming loans (“NPLs”) at amortized cost   15,572       8,608       13,573       14,427  
    Foreclosed and repossessed assets, net   1,572       1,662       1,795       1,046  
    Total nonperforming assets (“NPAs”) $ 17,144     $ 10,270     $ 15,368     $ 15,473  
    Loans, end of period $ 1,424,828     $ 1,428,588     $ 1,460,792     $ 1,447,529  
    Total assets, end of period $ 1,799,137     $ 1,802,307     $ 1,851,391     $ 1,831,087  
    Ratios:              
    NPLs to total loans   1.09 %     0.60 %     0.93 %     1.00 %
    NPAs to total assets   0.95 %     0.57 %     0.83 %     0.85 %

    Average Balances, Interest Yields and Rates

    (in thousands, except yields and rates)

      Three Months Ended
    September 30, 2024    		   Three Months Ended
    June 30, 2024    		   Three Months Ended
    September 30, 2023
      Average
    Balance    		   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate    		   Average
    Balance    		   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate    		   Average
    Balance    		   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate
    Average interest earning assets:                                  
    Cash and cash equivalents $ 25,187   $ 360   5.69 %   $ 18,894   $ 272   5.79 %   $ 21,298   $ 302   5.63 %
    Loans receivable   1,429,928     20,115   5.60 %     1,439,535     19,921   5.57 %     1,435,284     19,083   5.27 %
    Investment securities   236,960     1,966   3.30 %     238,147     2,012   3.40 %     252,226     2,119   3.33 %
    Other investments   12,553     71   2.25 %     13,051     258   7.95 %     15,511     268   6.85 %
    Total interest earning assets $ 1,704,628   $ 22,512   5.25 %   $ 1,709,627   $ 22,463   5.28 %   $ 1,724,319   $ 21,772   5.01 %
    Average interest-bearing liabilities:                                  
    Savings accounts $ 170,777   $ 450   1.05 %     174,259   $ 429   0.99 %   $ 199,279   $ 328   0.65 %
    Demand deposits   357,201     2,152   2.40 %     354,850   $ 2,023   2.29 %     354,073     1,863   2.09 %
    Money market accounts   381,369     3,126   3.26 %     377,346   $ 2,958   3.15 %     298,098     1,889   2.51 %
    CD’s   379,722     4,437   4.65 %     352,323   $ 3,928   4.48 %     358,238     3,308   3.66 %
    Total deposits $ 1,289,069   $ 10,165   3.14 %   $ 1,258,778   $ 9,338   2.98 %   $ 1,209,688   $ 7,388   2.42 %
    FHLB advances and other borrowings   80,338     1,062   5.26 %     121,967   $ 1,549   5.11 %     182,967     2,263   4.91 %
    Total interest-bearing liabilities $ 1,369,407   $ 11,227   3.26 %   $ 1,380,745   $ 10,887   3.17 %   $ 1,392,655   $ 9,651   2.75 %
    Net interest income     $ 11,285           $ 11,576           $ 12,121    
    Interest rate spread         1.99 %           2.11 %           2.26 %
    Net interest margin         2.63 %           2.72 %           2.79 %
    Average interest earning assets to average interest-bearing liabilities         1.24             1.24             1.24  
      Nine Months Ended
    September 30, 2024    		   Nine Months Ended
    September 30, 2023
      Average
    Balance    		   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate    		   Average
    Balance    		   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate
    Average interest earning assets:                      
    Cash and cash equivalents $ 19,073   $ 823   5.76 %   $ 19,066   $ 768   5.39 %
    Loans receivable   1,441,972     60,204   5.58 %     1,420,423     54,169   5.10 %
    Interest bearing deposits   —     —   — %     84     1   1.59 %
    Investment securities   240,054     6,038   3.36 %     261,507     6,505   3.33 %
    Other investments   12,983     589   6.06 %     16,447     779   6.33 %
    Total interest earning assets $ 1,714,082   $ 67,654   5.27 %   $ 1,717,527   $ 62,222   4.84 %
    Average interest-bearing liabilities:                      
    Savings accounts $ 173,946   $ 1,300   1.00 %   $ 208,446   $ 1,103   0.71 %
    Demand deposits   355,356     6,192   2.33 %     370,235     5,047   1.82 %
    Money market accounts   378,740     9,005   3.18 %     298,957     4,759   2.13 %
    CD’s   364,131     12,215   4.48 %     300,279     6,989   3.11 %
    Total deposits $ 1,272,173   $ 28,712   3.01 %   $ 1,177,917   $ 17,898   2.03 %
    FHLB advances and other borrowings   108,897     4,176   5.12 %     214,034     7,722   4.82 %
    Total interest-bearing liabilities $ 1,381,070   $ 32,888   3.18 %   $ 1,391,951   $ 25,620   2.46 %
    Net interest income     $ 34,766           $ 36,602    
    Interest rate spread         2.09 %           2.38 %
    Net interest margin         2.71 %           2.85 %
    Average interest earning assets to average interest bearing liabilities         1.24             1.23  


    Key Financial Metric Ratios:

      Three Months Ended   Nine Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023   September 30, 2024   September 30, 2023
    Ratios based on net income:                  
    Return on average assets (annualized) 0.72 %   0.81 %   0.54 %   0.81 %   0.68 %
    Return on average equity (annualized) 7.34 %   8.52 %   5.97 %   8.46 %   7.59 %
    Return on average tangible common equity4 (annualized) 9.38 %   10.92 %   7.74 %   10.78 %   9.91 %
    Efficiency ratio 72 %   72 %   67 %   71 %   66 %
    Net interest margin with loan purchase accretion 2.63 %   2.72 %   2.79 %   2.71 %   2.85 %
    Net interest margin without loan purchase accretion 2.61 %   2.70 %   2.76 %   2.69 %   2.82 %
    Ratios based on net income as adjusted (non-GAAP)                  
    Return on average assets as adjusted2 (annualized) 0.72 %   0.84 %   0.54 %   0.82 %   0.68 %
    Return on average equity as adjusted3 (annualized) 7.34 %   8.82 %   5.97 %   8.56 %   7.59 %


    Reconciliation of Return on Average Assets

    (in thousands, except ratios)

      Three Months Ended   Nine Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023   September 30, 2024   September 30, 2023
           
    GAAP earnings after income taxes $ 3,286     $ 3,675     $ 2,498     $ 11,049     $ 9,366  
    Net income as adjusted after income taxes (non-GAAP) (1) $ 3,286     $ 3,806     $ 2,498     $ 11,181     $ 9,366  
    Average assets $ 1,810,826     $ 1,815,693     $ 1,836,775     $ 1,822,106     $ 1,832,832  
    Return on average assets (annualized)   0.72 %     0.81 %     0.54 %     0.81 %     0.68 %
    Return on average assets as adjusted (non-GAAP) (annualized)   0.72 %     0.84 %     0.54 %     0.82 %     0.68 %

    (1) See Reconciliation of GAAP Net Income and Net Income as Adjusted (non-GAAP)


    Reconciliation of Return on Average Equity

    (in thousands, except ratios)

      Three Months Ended   Nine Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023   September 30, 2024   September 30, 2023
    GAAP earnings after income taxes $ 3,286     $ 3,675     $ 2,498     $ 11,049     $ 9,366  
    Net income as adjusted after income taxes (non-GAAP) (1) $ 3,286     $ 3,806     $ 2,498     $ 11,181     $ 9,366  
    Average equity $ 178,050     $ 173,462     $ 166,131     $ 174,436     $ 165,075  
    Return on average equity (annualized)   7.34 %     8.52 %     5.97 %     8.46 %     7.59 %
    Return on average equity as adjusted (non-GAAP) (annualized)   7.34 %     8.82 %     5.97 %     8.56 %     7.59 %

    (1) See Reconciliation of GAAP Net Income and Net Income as Adjusted (non-GAAP)


    Reconciliation of Efficiency Ratio

    (in thousands, except ratios)

      Three Months Ended   Nine Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023   September 30, 2024   September 30, 2023
    Non-interest expense (GAAP) $ 10,421     $ 10,299     $ 9,969     $ 31,497     $ 29,936  
    Less amortization of intangibles   (178 )     (179 )     (179 )     (536 )     (576 )
    Efficiency ratio numerator (GAAP) $ 10,243     $ 10,120     $ 9,790     $ 30,961     $ 29,360  
                       
    Non-interest income $ 2,921     $ 1,913     $ 2,565     $ 8,098     $ 7,770  
    Add back net losses on debt and equity securities   (78 )     (658 )     —       (569 )     —  
    Subtract net gains on debt and equity securities   —       —       116       —       182  
    Net interest income   11,285       11,576       12,121       34,766       36,602  
    Efficiency ratio denominator (GAAP) $ 14,284     $ 14,147     $ 14,570     $ 43,433     $ 44,190  
    Efficiency ratio (GAAP)   72 %     72 %     67 %     71 %     66 %


    Reconciliation of tangible book value per share (non-GAAP)

    (in thousands, except per share data)

    Tangible book value per share at end of period September 30, 2024   June 30, 2024   December 31, 2023   September 30, 2023
    Total stockholders’ equity $ 180,149     $ 176,045     $ 173,334     $ 165,402  
    Less: Goodwill   (31,498 )     (31,498 )     (31,498 )     (31,498 )
    Less: Intangible assets   (1,158 )     (1,336 )     (1,694 )     (1,873 )
    Tangible common equity (non-GAAP) $ 147,493     $ 143,211     $ 140,142     $ 132,031  
    Ending common shares outstanding   10,074,136       10,297,341       10,440,591       10,468,091  
    Book value per share $ 17.88     $ 17.10     $ 16.60     $ 15.80  
    Tangible book value per share (non-GAAP) $ 14.64     $ 13.91     $ 13.42     $ 12.61  


    Reconciliation of tangible common equity as a percent of tangible assets (non-GAAP)

    (in thousands, except ratios)

    Tangible common equity as a percent of tangible assets at end of period September 30, 2024   June 30, 2024   December 31, 2023   September 30, 2023
    Total stockholders’ equity $ 180,149     $ 176,045     $ 173,334     $ 165,402  
    Less: Goodwill   (31,498 )   $ (31,498 )     (31,498 )   $ (31,498 )
    Less: Intangible assets   (1,158 )   $ (1,336 )     (1,694 )   $ (1,873 )
    Tangible common equity (non-GAAP) $ 147,493     $ 143,211     $ 140,142     $ 132,031  
    Total Assets $ 1,799,137     $ 1,802,307     $ 1,851,391     $ 1,831,087  
    Less: Goodwill   (31,498 )     (31,498 )     (31,498 )   $ (31,498 )
    Less: Intangible assets   (1,158 )     (1,336 )     (1,694 )   $ (1,873 )
    Tangible Assets (non-GAAP) $ 1,766,481     $ 1,769,473     $ 1,818,199     $ 1,797,716  
    Total stockholders’ equity to total assets ratio   10.01 %     9.77 %     9.36 %     9.03 %
    Tangible common equity as a percent of tangible assets (non-GAAP)   8.35 %     8.09 %     7.71 %     7.34 %


    Reconciliation of Return on Average Tangible Common Equity (non-GAAP)

    (in thousands, except ratios)

      Three Months Ended   Nine Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023   September 30, 2024   September 30, 2023
    Total stockholders’ equity $ 180,149     $ 176,045     $ 165,402     $ 180,149     $ 165,402  
    Less: Goodwill   (31,498 )     (31,498 )     (31,498 )     (31,498 )     (31,498 )
    Less: Intangible assets   (1,158 )     (1,336 )     (1,873 )     (1,158 )     (1,873 )
    Tangible common equity (non-GAAP) $ 147,493     $ 143,211     $ 132,031     $ 147,493     $ 132,031  
    Average tangible common equity (non-GAAP) $ 145,305     $ 140,539     $ 132,671     $ 141,512     $ 131,425  
    GAAP earnings after income taxes   3,286       3,675       2,498       11,049       9,366  
    Amortization of intangible assets, net of tax   140       140       89       374       378  
    Tangible net income $ 3,426     $ 3,815     $ 2,587     $ 11,423     $ 9,744  
    Return on average tangible common equity (annualized)   9.38 %     10.92 %     7.74 %     10.78 %     9.91 %


    1    Net income as adjusted and net income as adjusted per share are non-GAAP financial measures that management believes enhances investors’ ability to better understand the underlying business performance and trends related to core business activities. For a detailed reconciliation of GAAP to non-GAAP results, see the accompanying financial table “Reconciliation of GAAP Net Income and Net Income as Adjusted (non-GAAP)”.

    2Return on average assets as adjusted is a non-GAAP measure that management believes enhances investors’ ability to better understand the underlying business performance and trends relative to average assets. For a detailed reconciliation of GAAP to non-GAAP results, see the accompanying financial table “Reconciliation of Return on Average Assets as Adjusted (non-GAAP)”.

    3Return on average equity as adjusted is a non-GAAP measure that management believes enhances investors’ ability to better understand the underlying business performance and trends relative to average equity. For a detailed reconciliation of GAAP to non-GAAP results, see the accompanying financial table “Reconciliation of Return on Average Equity as Adjusted (non-GAAP)”.

    4Tangible book value, tangible book value per share, tangible common equity as a percent of tangible assets and return on tangible common equity are non-GAAP measures that management believes enhances investors’ ability to better understand the Company’s financial position. For a detailed reconciliation of GAAP to non-GAAP results, see the accompanying financial table “Reconciliation of tangible book value per share (non-GAAP)”, “Reconciliation of tangible common equity as a percent of tangible assets (non-GAAP)”, and “Reconciliation of return on average tangible common equity)”.

    The MIL Network –

  • MIL-OSI: PSB Holdings, Inc. Reports Earnings of $0.69 per Share for Q3 2024; Net Interest Margin and Tangible Book Value Increase; Asset Quality Improves

    Source: GlobeNewswire (MIL-OSI)

    WAUSAU, Wis., Oct. 28, 2024 (GLOBE NEWSWIRE) — PSB Holdings, Inc. (“PSB”) (OTCQX: PSBQ), the holding company for Peoples State Bank (“Peoples”) serving Northcentral and Southeastern Wisconsin reported third quarter earnings ending September 30, 2024 of $0.69 per common share on net income of $2.9 million, compared to $0.56 per common share on net income of $2.3 million during the second quarter ending June 30, 2024, and $0.29 per common share on net income of $1.2 million during the third quarter ending September 30, 2023.

    PSB’s third quarter 2024 operating results reflected the following changes from the second quarter of 2024: (1) higher net interest margin increased 6 basis points; (2) slightly lower non-interest income; (3) lower non-interest expense due to the second quarter reflecting elevated severance expenses; and (4) the return of a $2.5 million non-performing loan to performing status and a corresponding release in specific reserves.

    “Over the past year, we have increased shareholders’ tangible book value per share 18.7% and paid $0.62 in dividends to our shareholders, up 12.7% from the 12 month period ended September 30, 2023. With the rapid rise in short term interest rates over the past couple of years coming to an apparent end, we expect our net interest margin to be stable and operating expenses to continue to be well managed and efficient. Additionally, as funds become available from investment and loan repayments and maturities, we expect the funds to be reinvested into higher yielding assets which should lessen the volatility in fair market value adjustments reflected in our tangible book value,” stated Scott Cattanach, President and CEO.

    September 30, 2024, Highlights:

    • Net interest income increased to $9.9 million for the quarter ended September 30, 2024, from $9.4 million for the quarter ended June 30, 2024, as increases in asset and loan yields outpaced the increases in funding costs.
    • Noninterest income decreased slightly to $1.8 million for the quarter ended September 30, 2024, compared to $1.9 million the prior quarter.
    • Noninterest expenses decreased during the quarter ended September 30, 2024, reflecting lower salary and benefit expenses. Included in salary and benefit expenses for the prior quarter were non-recurring expenses totaling approximately $404,000.
    • Tangible book value per common share increased $1.86 per share to $26.41 at September 30, 2024, compared to $24.55 one quarter earlier, and increased $4.16 per share, or 18.7%, compared to $22.25 at September 30, 2023. Additionally, PSB paid dividends totaling $0.62 per share over the past year. During the third quarter ended September 30, 2024, tangible book value per share was positively influenced by higher net income, intangible asset amortization, an increase in fair market value of investment securities and consistent stock repurchase activity.
    • Loans decreased $16.9 million in the third quarter ended September 30, 2024, to $1.06 billion largely due to not replacing certain out of market maturing loans. Allowance for credit losses increased to 1.18% of gross loans.
    • Non-performing assets declined to 0.71% of total assets at September 30, 2024 from 0.84% at June 30, 2024 as a $2.5 million loan returned to performing status.
    • Total deposits decreased $13.2 million during the quarter ended September 30, 2024 to $1.14 billion, with a large portion of the decrease attributable to a large overnight deposit held at June 30, 2024 which was withdrawn in early July.
    • Return on average tangible common equity was 10.96% for the quarter ended September 30, 2024, compared to 9.34% the prior quarter and 5.17% in the year ago quarter.

    Balance Sheet and Asset Quality Review

    Total assets decreased $9.7 million to $1.48 billion at September 30, 2024. Investment securities available for sale increased $9.7 million to $174.9 million at September 30, 2024, from $165.2 million one quarter earlier. Total collateralized liquidity available to meet cash demands was approximately $321 million at September 30, 2024, with an additional $343 million that could be raised in a short time frame from the brokered CDs market.

    Total loans receivable decreased $16.9 million to $1.06 billion at September 30, 2024, due primarily to lower commercial and construction lending. Commercial non-real estate loans decreased $9.1 million to $139.0 million at September 30, 2024, from $148.2 million one quarter earlier. Gross construction lending decreased $9.6 million to $61.0 million at September 30, 2024, from $70.5 million at June 30, 2024, while loans in process declined $3.6 million during the quarter ended September 30, 2024. Commercial real estate loans decreased $2.6 million to $541.6 million at September 30, 2024, from $544.2 million the prior quarter. Meanwhile, residential real estate loans increased slightly from the prior quarter to $341.3 million from $340.9 million. The loan portfolio remains well diversified with commercial real estate and construction loans totaling 55.4% of gross loans followed by residential real estate loans at 31.4% of gross loans, commercial non-real estate loans at 12.8% and consumer loans at 0.4%.

    The allowance for credit losses increased slightly to 1.18% of gross loans at September 30, 2024, from 1.16% the prior quarter. Annualized net charge-offs to average loans were zero for the last five quarters. Non-performing assets totaled 0.71% of total assets at September 30, 2024, compared to 0.84% at June 30, 2024. During the quarter ended September 30, 2024, a loan totaling $2.5 million was returned to performing status, while a loan on a recreation facility totaling $3.3 million was added to nonaccrual status. Additionally, one loan relationship to an equipment dealership on nonaccrual status totaling $5.1 million at June 30, 2024 was paid down to $2.8 million at September 30, 2024 on sale of the equipment inventory. For the seventh consecutive quarter, the Bank did not own any foreclosed real estate.

    Total deposits decreased $13.2 million to $1.14 billion at September 30, 2024, from $1.15 billion at June 30, 2024. The decrease in deposits reflects a $13.1 million decrease in interest-bearing demand and savings deposits, a $19.7 million decrease in money market deposits partially offset by a $14.6 million increase in non-interest bearing deposits and a $5.4 million increase in retail and local time deposits. The decrease in money market deposits reflected a large deposit of $49 million on June 30, 2024 that was drawn down in early July 2024.

    At September 30, 2024, non-interest bearing demand deposits increased to 23.3% of total deposits from 21.6% the prior quarter, while interest-bearing demand and savings deposits decreased to 28.4% of deposits, compared to 29.3% at June 30, 2024. Uninsured and uncollateralized deposits decreased to 21.6% of total deposits at September 30, 2024, from 24.0% of total deposits at June 30, 2024.

    FHLB advances decreased to $181.3 million at September 30, 2024, compared to $184.9 million at June 30, 2024.

    Tangible stockholder equity as a percent of total tangible assets increased to 7.85% at September 30, 2024, compared to 7.32% at June 30, 2024, and 6.98% at September 30, 2023.

    Tangible net book value per common share increased $4.16, to $26.41, at September 30, 2024, compared to $22.25 one year earlier, an increase of 18.7% after dividends of $0.62 were paid to shareholders. Relative to the prior quarter, tangible net book value per common share increased due to continued earnings, a fair market value increase in the investment portfolio which reduced unrealized losses reflected in accumulated other comprehensive income and amortization of intangible assets. The accumulated other comprehensive loss on the investment portfolio was $15.8 million at September 30, 2024, compared to $20.5 million one quarter earlier.

    Operations Review

    Net interest income increased to $9.9 million (on a net margin of 2.90%) for the third quarter of 2024, from $9.4 million (on a net margin of 2.84%) for the second quarter of 2024, and $9.6 million (on a net margin of 2.88%) for the third quarter of 2023. Earning asset yields increased by 8 basis points to 5.29% during the third quarter of 2024 from 5.21% during the second quarter of 2024, while interest bearing deposit and borrowing costs increased 7 basis points to 3.13% compared to 3.06% during the second quarter of 2024.

    The increase in earning asset yields was primarily due to higher yields on loan originations and renewals. Loan yields increased during the third quarter of 2024 to 5.78% from 5.67% for the second quarter of 2024, up 11 basis points. Taxable security yields were 3.01% for the quarter ended September 30, 2024, compared to 3.02% for the quarter ended June 30, 2024, while tax-exempt security yields were 3.31% for the quarter ended September 30, 2024 compared to 3.33% the prior quarter.

    The cost of all deposits was 2.11% for the quarter ended September 30, 2024, compared to 2.11% the prior quarter, while the overall cost of funds increased 7 basis points from 3.06% to 3.13% during the same time period. Deposit costs for money market deposits decreased during the quarter ended September 30, 2024, to 2.69% from 2.72% the prior quarter. The cost of time deposits and FHLB advances continued to increase and were primarily responsible for the rise in the Bank’s cost of funds in the current quarter. The cost of time deposits increased to 4.04% for the third quarter ended September 30, 2024, from 3.97% the prior quarter. FHLB advance costs rose to 4.44% during the third quarter ended September 30, 2024, from 4.28% the prior quarter.

    Total noninterest income decreased slightly for the third quarter of 2024 to $1.84 million, from $1.91 million for the second quarter of 2024. Mortgage banking income remained at $433,000 in the September 30, 2024 quarter while various decreases in nominal revenue sources accounted for the slight decline in non-interest income during the third quarter ended September 30, 2024. At September 30, 2024, the Bank serviced $371 million in secondary market residential mortgage loans for others which provide fee income.

    Noninterest expenses decreased to $8.2 million for the third quarter of 2024, compared to $8.4 million for the second quarter of 2024. The second quarter ended June 30, 2024, reflected higher salary and benefit expenses related to non-recurring costs. Relative to one year earlier, salary and benefit cost increased 5.7% to $4.8 million for the quarter ended September 30, 2024, compared to $4.5 million for the third quarter ended September 30, 2023.

    Taxes increased $183,000 during the third quarter to $593,000, from $410,000 one quarter earlier. The increase generally reflects higher pre-tax income. The effective tax rate for the quarter ended September 30, 2024, was 16.6% compared to 14.4% for the second quarter ended June 30, 2024, and 63.8% for the third quarter ended September 30, 2023, when higher tax expenses were incurred to recognize the loss of certain deferred tax assets following a change in Wisconsin tax law that eliminated state taxes on certain qualified assets.

    About PSB Holdings, Inc.

    PSB Holdings, Inc. is the parent company of Peoples State Bank. Peoples is a community bank headquartered in Wausau, Wisconsin, serving northcentral and southeastern Wisconsin from twelve full-service banking locations in Marathon, Oneida, Vilas, Portage, Milwaukee and Waukesha counties and a loan production office in Dane County. Peoples also provides investment and insurance products, along with retirement planning services, through Peoples Wealth Management, a division of Peoples. PSB Holdings, Inc. is traded under the stock symbol PSBQ on the OTCQX Market. More information about PSB, its management, and its financial performance may be found at www.psbholdingsinc.com. 

    Forward-Looking Statements

    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current expectations, estimates and projections about PSB’s business based, in part, on assumptions made by management and include, without limitation, statements with respect to the potential growth of PSB, its future profits, expected stock repurchase levels, future dividend rates, future interest rates, and the adequacy of its capital position. Forward-looking statements can be affected by known and unknown risks, uncertainties, and other factors, including, but not limited to, strength of the economy, the effects of government policies, including interest rate policies, risks associated with the execution of PSB’s vision and growth strategy, including with respect to current and future M&A activity, and risks associated with global economic instability. The forward-looking statements in this press release speak only as of the date on which they are made and PSB does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

                

    PSB Holdings, Inc.          
    Consolidated Balance Sheets          
    September 30, June 30, and March 31, 2024, September 30, 2023, unaudited, December 31, 2023 derived from audited financial statements
               
      Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
    (dollars in thousands, except per share data)   2024     2024     2024     2023     2023  
               
    Assets          
               
    Cash and due from banks $ 23,554   $ 16,475   $ 13,340   $ 20,887   $ 12,881  
    Interest-bearing deposits   5,126     251     105     1,431     668  
    Federal funds sold   58,434     69,249     2,439     5,462     7,764  
               
    Cash and cash equivalents   87,114     85,975     15,884     27,780     21,313  
    Securities available for sale (at fair value)   174,911     165,177     165,566     164,024     160,883  
    Securities held to maturity (fair values of $82,389, $79,993, $81,234, $82,514 and        
      $75,236 respectively)   86,847     86,825     87,104     87,081     86,908  
    Equity securities   1,752     1,661     1,474     1,474     2,273  
    Loans held for sale   –     2,268     865     230     971  
    Loans receivable, net (allowance for credit losses of $12,598, $12,597, $12,494,        
     $12,302 and $12,267 respectively)   1,057,974     1,074,844     1,081,394     1,078,475     1,098,019  
    Accrued interest receivable   4,837     5,046     5,467     5,136     4,716  
    Foreclosed assets   –     –     –     –     –  
    Premises and equipment, net   14,065     14,048     13,427     13,098     13,242  
    Mortgage servicing rights, net   1,727     1,688     1,657     1,664     1,684  
    Federal Home Loan Bank stock (at cost)   8,825     8,825     7,006     6,373     6,373  
    Cash surrender value of bank-owned life insurance   24,565     24,401     24,242     24,085     23,931  
    Core deposit intangible   212     229     249     273     297  
    Goodwill   2,541     2,541     2,541     2,541     2,541  
    Other assets   10,598     12,111     11,682     11,866     14,094  
               
    TOTAL ASSETS $ 1,475,968   $ 1,485,639   $ 1,418,558   $ 1,424,100   $ 1,437,245  
               
    Liabilities          
               
    Non-interest-bearing deposits $ 265,078   $ 250,435   $ 247,608   $ 266,829   $ 288,765  
    Interest-bearing deposits   874,035     901,886     865,744     874,973     883,474  
               
       Total deposits   1,139,113     1,152,321     1,113,352     1,141,802     1,172,239  
               
    Federal Home Loan Bank advances   181,250     184,900     158,250     134,000     128,000  
    Other borrowings   6,128     5,775     8,096     8,058     5,660  
    Senior subordinated notes   4,779     4,778     4,776     4,774     4,772  
    Junior subordinated debentures   12,998     12,972     12,947     12,921     12,896  
    Allowance for credit losses on unfunded commitments   477     477     477     577     512  
    Accrued expenses and other liabilities   12,850     13,069     10,247     12,681     10,258  
               
       Total liabilities   1,357,595     1,374,292     1,308,145     1,314,813     1,334,337  
               
    Stockholders’ equity          
               
    Preferred stock – no par value:          
       Authorized – 30,000 shares; no shares issued or outstanding          
       Outstanding – 7,200 shares, respectively   7,200     7,200     7,200     7,200     7,200  
    Common stock – no par value with a stated value of $1.00 per share:          
       Authorized – 18,000,000 shares; Issued – 5,490,798 shares          
       Outstanding – 4,105,594, 4,128,382, 4,147,649, 4,164,735 and          
         4,174,197 shares, respectively   1,830     1,830     1,830     1,830     1,830  
    Additional paid-in capital   8,567     8,527     8,466     8,460     8,421  
    Retained earnings   138,142     135,276     134,271     132,666     131,624  
    Accumulated other comprehensive income (loss), net of tax   (15,814 )   (20,503 )   (20,775 )   (20,689 )   (26,190 )
    Treasury stock, at cost – 1,385,204, 1,362,416, 1,343,149, 1,326,063 and          
      1,316,601 shares, respectively   (21,552 )   (20,983 )   (20,579 )   (20,180 )   (19,977 )
               
       Total stockholders’ equity   118,373     111,347     110,413     109,287     102,908  
               
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 1,475,968   $ 1,485,639   $ 1,418,558   $ 1,424,100   $ 1,437,245  
               
    PSB Holdings, Inc.                
    Consolidated Statements of Income                
                          Quarter Ended     Nine Months Ended
    (dollars in thousands, Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,   September
    except per share data – unaudited) 2024 2024 2024   2023   2023   2024 2023
                     
    Interest and dividend income:                
       Loans, including fees $ 15,634 $ 15,433 $ 15,109   $ 14,888   $ 14,263   $ 46,176   $ 38,745  
       Securities:                
          Taxable   1,345   1,295   1,197     1,147     1,114     3,837     3,772  
          Tax-exempt   522   521   526     532     533     1,569     1,605  
       Other interest and dividends   699   265   343     320     238     1,307     531  
                     
             Total interest and dividend income   18,200   17,514   17,175     16,887     16,148     52,889     44,653  
                     
    Interest expense:                
       Deposits   5,905   5,838   6,082     5,526     4,817     17,825     11,467  
       FHLB advances   2,038   1,860   1,450     1,349     1,321     5,348     3,068  
       Other borrowings   57   58   60     54     51     175     161  
       Senior subordinated notes   59   58   59     59     59     176     179  
       Junior subordinated debentures   252   255   251     254     255     758     731  
                     
             Total interest expense   8,311   8,069   7,902     7,242     6,503     24,282     15,606  
                     
    Net interest income   9,889   9,445   9,273     9,645     9,645     28,607     29,047  
    Provision for credit losses   –   100   95     100     150     195     350  
                     
    Net interest income after provision for credit losses   9,889   9,345   9,178     9,545     9,495     28,412     28,697  
                     
    Noninterest income:                
       Service fees   367   350   336     360     349     1,053     1,088  
       Mortgage banking income   433   433   308     247     345     1,174     981  
       Investment and insurance sales commissions   230   222   121     100     158     573     810  
       Net loss on sale of securities   –   –   (495 )   (297 )   –     (495 )   (279 )
       Increase in cash surrender value of life insurance   165   159   157     154     155     481     461  
       Life insurance death benefit   –   –   –     –     –     –     533  
       Other noninterest income   648   742   617     540     675     2,007     2,022  
                     
             Total noninterest income   1,843   1,906   1,044     1,104     1,682     4,793     5,616  
                     
    Noninterest expense:                
       Salaries and employee benefits   4,771   5,167   5,123     4,244     4,514     15,061     14,404  
       Occupancy and facilities   757   733   721     675     689     2,211     2,086  
       Loss (gain) on foreclosed assets   1   –   –     1     –     1     (46 )
       Data processing and other office operations   1,104   1,047   1,022     1,001     953     3,173     2,784  
       Advertising and promotion   164   171   129     244     161     464     489  
       Core deposit intangible amortization   17   20   24     24     24     61     85  
       Other noninterest expenses   1,337   1,257   1,306     1,169     1,113     3,900     3,388  
                     
            Total noninterest expense   8,151   8,395   8,325     7,358     7,454     24,871     23,190  
                     
    Income before provision for income taxes   3,581   2,856   1,897     3,291     3,723     8,334     11,123  
    Provision for income taxes   593   410   169     878     2,374     1,172     3,967  
                     
    Net income $ 2,988 $ 2,446 $ 1,728   $ 2,413   $ 1,349   $ 7,162   $ 7,156  
    Preferred stock dividends declared $ 122 $ 122 $ 122   $ 122   $ 122   $ 366   $ 366  
                     
    Net income available to common shareholders $ 2,866 $ 2,324 $ 1,606   $ 2,291   $ 1,227   $ 6,796   $ 6,790  
    Basic earnings per common share $ 0.69 $ 0.56 $ 0.39   $ 0.55   $ 0.29   $ 1.64   $ 1.61  
    Diluted earnings per common share $ 0.69 $ 0.56 $ 0.39   $ 0.55   $ 0.29   $ 1.64   $ 1.61  
                     
    PSB Holdings, Inc.          
    Quarterly Financial Summary          
    (dollars in thousands, except per share data) Quarter ended
        Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
    Earnings and dividends:   2024     2024     2024     2023     2023  
                 
      Interest income $ 18,200   $ 17,514   $ 17,175   $ 16,887   $ 16,148  
      Interest expense $ 8,311   $ 8,069   $ 7,902   $ 7,242   $ 6,503  
      Net interest income $ 9,889   $ 9,445   $ 9,273   $ 9,645   $ 9,645  
      Provision for credit losses $ –   $ 100   $ 95   $ 100   $ 150  
      Other noninterest income $ 1,843   $ 1,906   $ 1,044   $ 1,104   $ 1,682  
      Other noninterest expense $ 8,151   $ 8,395   $ 8,325   $ 7,358   $ 7,454  
      Net income available to common shareholders $ 2,866   $ 2,324   $ 1,606   $ 2,291   $ 1,227  
                 
      Basic earnings per common share (3) $ 0.69   $ 0.56   $ 0.39   $ 0.55   $ 0.29  
      Diluted earnings per common share (3) $ 0.69   $ 0.56   $ 0.39   $ 0.55   $ 0.29  
      Dividends declared per common share (3) $ –   $ 0.32   $ –   $ 0.30   $ –  
      Tangible net book value per common share (4) $ 26.41   $ 24.55   $ 24.21   $ 23.84   $ 22.25  
                 
      Semi-annual dividend payout ratio n/a   33.60 % n/a   38.14 % n/a
      Average common shares outstanding   4,132,218     4,139,456     4,154,702     4,168,924     4,186,940  
                 
                 
    Balance sheet – average balances:          
      Loans receivable, net of allowances for credit loss $ 1,066,795   $ 1,088,013   $ 1,081,936   $ 1,081,851   $ 1,076,158  
      Assets $ 1,445,613   $ 1,433,749   $ 1,429,437   $ 1,424,240   $ 1,425,522  
      Deposits $ 1,110,854   $ 1,111,240   $ 1,138,010   $ 1,148,399   $ 1,149,624  
      Stockholders’ equity $ 114,458   $ 110,726   $ 109,473   $ 105,060   $ 105,745  
                 
                 
    Performance ratios:          
      Return on average assets (1)   0.82 %   0.69 %   0.49 %   0.67 %   0.38 %
      Return on average common stockholders’ equity (1)   10.63 %   9.03 %   6.32 %   9.29 %   4.94 %
      Return on average tangible common          
        stockholders’ equity (1)(4)   10.96 %   9.34 %   6.57 %   9.64 %   5.17 %
      Net loan charge-offs to average loans (1)   0.00 %   0.00 %   0.00 %   0.00 %   0.00 %
      Nonperforming loans to gross loans   0.97 %   1.15 %   1.08 %   0.54 %   0.55 %
      Nonperforming assets to total assets   0.71 %   0.84 %   0.83 %   0.42 %   0.42 %
      Allowance for credit losses to gross loans   1.18 %   1.16 %   1.14 %   1.13 %   1.10 %
      Nonperforming assets to tangible equity          
        plus the allowance for credit losses (4)   8.71 %   11.09 %   10.59 %   5.38 %   5.87 %
      Net interest rate margin (1)(2)   2.90 %   2.84 %   2.80 %   2.88 %   2.88 %
      Net interest rate spread (1)(2)   2.16 %   2.15 %   2.12 %   2.20 %   2.27 %
      Service fee revenue as a percent of          
        average demand deposits (1)   0.56 %   0.56 %   0.54 %   0.52 %   0.50 %
      Noninterest income as a percent          
        of gross revenue   9.20 %   9.81 %   5.73 %   6.14 %   9.43 %
      Efficiency ratio (2)   68.43 %   72.52 %   78.93 %   67.04 %   64.58 %
      Noninterest expenses to average assets (1)   2.24 %   2.35 %   2.34 %   2.05 %   2.07 %
      Average stockholders’ equity less accumulated          
        other comprehensive income (loss) to          
        average assets   9.06 %   9.03 %   8.98 %   8.88 %   9.00 %
      Tangible equity to tangible assets (4)   7.85 %   7.32 %   7.60 %   7.49 %   6.98 %
                 
    Stock price information:          
                 
      High $ 25.00   $ 21.40   $ 22.50   $ 22.30   $ 22.50  
      Low $ 20.30   $ 19.75   $ 20.05   $ 20.10   $ 20.35  
      Last trade value at quarter-end $ 25.00   $ 20.40   $ 21.25   $ 22.11   $ 21.15  
                 
    (1) Annualized          
    (2) The yield on federally tax-exempt loans and securities is computed on a tax-equivalent basis using a federal tax rate of 21%.
    (3) Due to rounding, cumulative quarterly per share performance may not equal annual per share totals.  
    (4) Tangible stockholders’ equity excludes goodwill and core deposit intangibles.      
           
    PSB Holdings, Inc.          
    Consolidated Statements of Comprehensive Income        
                     
            Quarter Ended
            Sep. 30, Jun. 30, Mar. 31, Dec. 31, Sep. 30,
    (dollars in thousands – unaudited)   2024     2024     2024     2023     2023  
                     
    Net income $ 2,988   $ 2,446   $ 1,728   $ 2,413   $ 1,349  
                     
    Other comprehensive income, net of tax:          
                     
      Unrealized gain (loss) on securities available        
        for sale   4,738     184     (615 )   5,278     (3,085 )
                     
      Reclassification adjustment for security          
        loss included in net income   –     –     391     280     –  
                     
      Accretion of unrealized loss included in net          
        income on securities available for sale          
        deferred tax adjustment for Wisconsin          
        Act 19   –     –     (35 )   –     –  
                     
      Amortization of unrealized loss included in net        
        income on securities available for sale          
        transferred to securities held to maturity   90     89     91     91     91  
                     
      Unrealized gain (loss) on interest rate swap   (101 )   39     123     (109 )   79  
                     
      Reclassification adjustment of interest rate          
        swap settlements included in earnings   (38 )   (40 )   (41 )   (39 )   (35 )
                     
                     
    Other comprehensive income (loss)   4,689     272     (86 )   5,501     (2,950 )
                     
    Comprehensive income (loss) $ 7,677   $ 2,718   $ 1,642   $ 7,914   $ (1,601 )
                     

       

    PSB Holdings, Inc.          
    Nonperforming Assets as of:          
      Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,
    (dollars in thousands)   2024     2024     2024     2023     2023  
               
    Nonaccrual loans (excluding restructured loans) $ 10,116   $ 12,184   $ 11,498   $ 5,596   $ 5,807  
    Nonaccrual restructured loans   25     28     30     34     42  
    Restructured loans not on nonaccrual   292     299     304     310     256  
    Accruing loans past due 90 days or more   –     –     –     –     –  
               
    Total nonperforming loans   10,433     12,511     11,832     5,940     6,105  
    Other real estate owned   –     –     –     –     –  
               
    Total nonperforming assets $ 10,433   $ 12,511   $ 11,832   $ 5,940   $ 6,105  
               
    Nonperforming loans as a % of gross loans receivable   0.97 %   1.15 %   1.08 %   0.54 %   0.55 %
    Total nonperforming assets as a % of total assets   0.71 %   0.84 %   0.83 %   0.42 %   0.42 %
    Allowance for credit losses as a % of nonperforming loans   120.75 %   100.69 %   105.59 %   207.10 %   200.93 %
               
    PSB Holdings, Inc.      
    Nonperforming Assets >= $500,000 net book value before specific reserves    
    At September 30, 2024      
    (dollars in thousands)      
        Gross Specific
    Collateral Description Asset Type Principal Reserves
           
    Real estate – Recreation Facility Nonaccrual $ 3,291   $ –  
    Real estate – Independent Auto Repair Nonaccrual   562     –  
    Real estate – Equipment Dealership Nonaccrual   2,808     660  
           
           
    Total listed nonperforming assets   $ 6,661   $ 660  
    Total bank wide nonperforming assets   $ 10,433   $ 1,220  
    Listed assets as a % of total nonperforming assets     64 %   54 %
           
    PSB Holding, Inc.          
    Loan Composition by Collateral Type          
    Quarter-ended (dollars in thousands) Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023
               
    Commercial:          
    Commercial and industrial $ 115,234   $ 125,508   $ 118,821   $ 117,207   $ 138,299  
    Agriculture   11,203     11,480     12,081     12,304     12,464  
    Municipal   12,596     11,190     28,842     31,530     27,186  
               
    Total Commercial   139,033     148,178     159,744     161,041     177,949  
               
    Commercial Real Estate:          
    Commercial real estate   541,577     544,171     546,257     536,209     539,488  
    Construction and development   60,952     70,540     63,375     81,701     86,456  
               
    Total Commercial Real Estate   602,529     614,711     609,632     617,910     625,944  
               
    Residential real estate:          
    Residential   269,954     270,944     274,300     274,453     274,632  
    Construction and development   34,655     36,129     34,158     33,960     33,141  
    HELOC   36,734     33,838     31,357     29,766     29,044  
               
    Total Residential Real Estate   341,343     340,911     339,815     338,179     336,817  
               
    Consumer installment   4,770     4,423     4,867     4,357     4,350  
               
    Subtotals – Gross loans   1,087,675     1,108,223     1,114,058     1,121,487     1,145,060  
    Loans in process of disbursement   (17,836 )   (21,484 )   (20,839 )   (31,359 )   (35,404 )
               
    Subtotals – Disbursed loans   1,069,839     1,086,739     1,093,219     1,090,128     1,109,656  
    Net deferred loan costs   733     702     669     649     630  
    Allowance for credit losses   (12,598 )   (12,597 )   (12,494 )   (12,302 )   (12,267 )
               
    Total loans receivable $ 1,057,974   $ 1,074,844   $ 1,081,394   $ 1,078,475   $ 1,098,019  
               
    PSB Holding, Inc.                            
    Selected Commercial Real Estate Loans by Purpose                    
      Sept 30,   June 30,   Mar 31,   Dec 31,   Sept 30,
     (dollars in thousands)   2024       2024       2024       2023       2023  
                                 
      Total Exposure % of Portfolio (1)   Total Exposure % of Portfolio (1)   Total Exposure % of Portfolio (1)   Total Exposure % of Portfolio (1)   Total Exposure % of Portfolio (1)
    Multi Family $ 140,307 14.7 %   $ 146,873 15.2 %   $ 142,001 14.4 %   $ 132,386 13.2 %   $ 133,466 13.3 %
    Industrial and Warehousing   86,818 9.1       86,025 8.9       85,409 8.6       83,817 8.3       88,906 8.9  
    Retail   33,020 3.5       34,846 3.6       33,177 3.4       35,419 3.5       35,281 3.5  
    Hotels   31,611 3.3       34,613 3.6       35,105 3.6       36,100 3.6       31,819 3.2  
    Office   6,378 0.7       6,518 0.7       6,655 0.7       6,701 0.7       6,746 0.7  
                                 
    (1) Percentage of commercial and commercial real estate portfolio and commitments.              
                   
    PSB Holdings, Inc.                    
    Deposit Composition                    
                         
    Insured and Collateralized Deposits September 30, June 30, March 31, December 31, September 30,
    (dollars in thousands)   2024     2024     2024     2023     2023  
      $ % $ % $ % $ % $ %
                         
    Non-interest bearing demand $ 210,534 18.6 % $ 202,343 17.5 % $ 199,076 17.8 % $ 197,571 17.3 % $ 209,133 17.9 %
    Interest-bearing demand and savings   305,631 26.8 %   304,392 26.5 %   318,673 28.7 %   317,984 27.8 %   307,620 26.3 %
    Money market deposits   138,376 12.2 %   137,637 12.0 %   143,167 12.9 %   142,887 12.5 %   135,910 11.4 %
    Retail and local time deposits <= $250   155,988 13.7 %   149,298 13.0 %   148,404 13.3 %   149,145 13.1 %   144,738 12.4 %
                         
    Total core deposits   810,529 71.3 %   793,670 69.0 %   809,320 72.7 %   807,587 70.7 %   797,401 68.0 %
    Retail and local time deposits > $250   23,500 2.1 %   22,500 2.0 %   24,508 2.3 %   23,000 2.0 %   22,750 1.9 %
    Broker & national time deposits <= $250   1,241 0.1 %   1,490 0.1 %   2,229 0.2 %   3,470 0.3 %   3,222 0.3 %
    Broker & national time deposits > $250   56,164 4.9 %   56,328 4.9 %   61,752 5.5 %   70,020 6.1 %   88,614 7.6 %
                         
    Totals $ 891,434 78.4 % $ 873,988 76.0 % $ 897,809 80.7 % $ 904,077 79.1 % $ 911,987 77.8 %
                         
    PSB Holdings, Inc.                    
    Deposit Composition                    
                         
    Uninsured Deposits September 30, June 30, March 31, December 31, September 30,
    (dollars in thousands)   2024     2024     2024     2023     2023  
      $ % $ % $ % $ % $ %
                         
    Non-interest bearing demand $ 54,544 4.7 % $ 48,092 4.1 % $ 48,532 4.4 % $ 69,258 6.1 % $ 79,632 6.8 %
    Interest-bearing demand and savings   18,317 1.6 %   32,674 2.8 %   20,535 1.8 %   20,316 1.8 %   22,847 1.9 %
    Money market deposits   157,489 13.8 %   177,954 15.4 %   124,766 11.2 %   124,518 10.9 %   133,653 11.4 %
    Retail and local time deposits <= $250   – 0.0 %   – 0.0 %   – 0.0 %   – 0.0 %   – 0.0 %
                         
    Total core deposits   230,350 20.1 %   258,720 22.3 %   193,833 17.4 %   214,092 18.8 %   236,132 20.1 %
    Retail and local time deposits > $250   17,329 1.5 %   19,613 1.7 %   21,710 1.9 %   23,633 2.1 %   24,120 2.1 %
    Broker & national time deposits <= $250   – 0.0 %   – 0.0 %   – 0.0 %   – 0.0 %   – 0.0 %
    Broker & national time deposits > $250   – 0.0 %   – 0.0 %   – 0.0 %   – 0.0 %   – 0.0 %
                         
    Totals $ 247,679 21.6 % $ 278,333 24.0 % $ 215,543 19.3 % $ 237,725 20.9 % $ 260,252 22.2 %
                         
    PSB Holdings, Inc.                    
    Deposit Composition                    
                         
    Total Deposits September 30, June 30, March 31, December 31, September 30,
    (dollars in thousands)   2024     2024     2024     2023     2023  
      $ % $ % $ % $ % $ %
                         
    Non-interest bearing demand $ 265,078 23.3 % $ 250,435 21.6 % $ 247,608 22.2 % $ 266,829 23.4 % $ 288,765 24.7 %
    Interest-bearing demand and savings   323,948 28.4 %   337,066 29.3 %   339,208 30.5 %   338,300 29.6 %   330,467 28.2 %
    Money market deposits   295,865 26.0 %   315,591 27.4 %   267,933 24.1 %   267,405 23.4 %   269,563 22.8 %
    Retail and local time deposits <= $250   155,988 13.7 %   149,298 13.0 %   148,404 13.3 %   149,145 13.1 %   144,738 12.4 %
                         
    Total core deposits   1,040,879 91.4 %   1,052,390 91.3 %   1,003,153 90.1 %   1,021,679 89.5 %   1,033,533 88.1 %
    Retail and local time deposits > $250   40,829 3.6 %   42,113 3.7 %   46,218 4.2 %   46,633 4.1 %   46,870 4.0 %
    Broker & national time deposits <= $250   1,241 0.1 %   1,490 0.1 %   2,229 0.2 %   3,470 0.3 %   3,222 0.3 %
    Broker & national time deposits > $250   56,164 4.9 %   56,328 4.9 %   61,752 5.5 %   70,020 6.1 %   88,614 7.6 %
                         
    Totals $ 1,139,113 100.0 % $ 1,152,321 100.0 % $ 1,113,352 100.0 % $ 1,141,802 100.0 % $ 1,172,239 100.0 %
                         
    PSB Holdings, Inc.                      
    Average Balances ($000) and Interest Rates                  
    (dollars in thousands)                      
                           
      Quarter ended September 30, 2024   Quarter ended June 30, 2024   Quarter ended September 30, 2023
      Average   Yield /   Average   Yield /   Average   Yield /
      Balance Interest Rate   Balance Interest Rate   Balance Interest Rate
    Assets                      
    Interest-earning assets:                      
       Loans (1)(2) $ 1,079,393   $ 15,674 5.78 %   $ 1,100,518   $ 15,520 5.67 %   $ 1,088,137   $ 14,337 5.23 %
       Taxable securities   177,520     1,345 3.01 %     172,563     1,295 3.02 %     173,287     1,114 2.55 %
       Tax-exempt securities (2)   79,472     661 3.31 %     79,564     659 3.33 %     81,327     675 3.29 %
       FHLB stock   8,825     176 7.93 %     7,931     182 9.23 %     6,368     127 7.91 %
       Other   36,680     523 5.67 %     8,241     83 4.05 %     8,195     111 5.37 %
                           
       Total (2)   1,381,890     18,379 5.29 %     1,368,817     17,739 5.21 %     1,357,314     16,364 4.78 %
                           
    Non-interest-earning assets:                    
       Cash and due from banks   17,162           17,345           19,299      
       Premises and equipment,                    
          net   14,216           13,930           13,266      
       Cash surrender value ins   24,458           24,297           23,840      
       Other assets   20,485           21,865           23,782      
       Allowance for credit                      
          losses   (12,598 )         (12,505 )         (11,979 )    
                           
       Total $ 1,445,613     $ 1,433,749     $ 1,425,522  
                           
    Liabilities & stockholders’ equity                    
    Interest-bearing liabilities:                    
       Savings and demand                      
          deposits $ 323,841   $ 1,515 1.86 %   $ 331,740   $ 1,467 1.78 %   $ 335,214   $ 1,198 1.42 %
       Money market deposits   277,884     1,876 2.69 %     271,336     1,835 2.72 %     255,823     1,489 2.31 %
       Time deposits   247,296     2,514 4.04 %     257,006     2,536 3.97 %     279,971     2,130 3.02 %
       FHLB borrowings   182,414     2,038 4.44 %     174,596     1,860 4.28 %     134,386     1,321 3.90 %
       Other borrowings   6,702     57 3.38 %     6,870     58 3.40 %     5,681     51 3.56 %
     Senior sub. notes   4,779     59 4.91 %     4,777     58 4.88 %     4,772     59 4.91 %
       Junior sub. debentures   12,985     252 7.72 %     12,960     255 7.91 %     12,883     255 7.85 %
                           
       Total   1,055,901     8,311 3.13 %     1,059,285     8,069 3.06 %     1,028,730     6,503 2.51 %
                           
    Non-interest-bearing liabilities:                    
       Demand deposits   261,833           251,158           278,616      
       Other liabilities   13,421           12,580           12,431      
       Stockholders’ equity   114,458           110,726           105,745      
                           
       Total $ 1,445,613     $ 1,433,749     $ 1,425,522  
                           
    Net interest income   $ 10,068       $ 9,670       $ 9,861  
    Rate spread     2.16 %       2.15 %       2.27 %
    Net yield on interest-earning assets   2.90 %       2.84 %       2.88 %
                           
    (1) Nonaccrual loans are included in the daily average loan balances outstanding.          
    (2) The yield on federally tax-exempt loans and securities is computed on a tax-equivalent basis using a federal tax rate of 21%.  
                           
    PSB Holdings, Inc.              
    Average Balances ($000) and Interest Rates          
    (dollars in thousands)              
        Nine months ended September 30, 2024   Nine months ended September 30, 2023
        Average   Yield/   Average   Yield/
        Balance Interest Rate   Balance Interest Rate
    Assets              
    Interest-earning assets:              
       Loans (1)(2) $ 1,091,366   $ 46,393 5.68 %   $ 1,025,955   $ 38,851 5.06 %
       Taxable securities   173,971     3,837 2.95 %     189,583     3,772 2.66 %
       Tax-exempt securities (2)   79,822     1,986 3.32 %     81,670     2,032 3.33 %
       FHLB stock   7,755     523 9.01 %     4,943     228 6.17 %
       Other   18,804     784 5.57 %     8,154     303 4.97 %
                     
       Total (2)   1,371,718     53,523 5.21 %     1,310,305     45,186 4.61 %
                     
    Non-interest-earning assets:              
       Cash and due from banks   17,291           17,403      
       Premises and equipment,              
          net   13,778           13,311      
       Cash surrender value ins   24,301           24,446      
       Other assets   21,146           23,364      
       Allowance for credit              
          losses   (12,496 )         (12,004 )    
                     
       Total $ 1,435,738     $ 1,376,825  
                     
    Liabilities & stockholders’ equity            
    Interest-bearing liabilities:              
       Savings and demand              
          deposits $ 335,317   $ 4,654 1.85 %   $ 350,928   $ 3,286 1.25 %
       Money market deposits   274,405     5,608 2.73 %     241,594     3,508 1.94 %
       Time deposits   256,287     7,563 3.94 %     257,639     4,673 2.43 %
       FHLB borrowings   166,703     5,348 4.29 %     110,460     3,068 3.71 %
       Other borrowings   7,373     175 3.17 %     7,082     161 3.04 %
       Senior sub. notes   4,778     176 4.92 %     4,965     179 4.82 %
       Junior sub. debentures   12,972     758 7.81 %     12,857     731 7.60 %
                     
       Total   1,057,835     24,282 3.07 %     985,525     15,606 2.12 %
                     
    Non-interest-bearing liabilities:            
       Demand deposits   254,134           273,699      
       Other liabilities   12,720           12,165      
       Stockholders’ equity   111,049           105,436      
                     
       Total $ 1,435,738     $ 1,376,825  
                     
    Net interest income   $ 29,241       $ 29,580  
    Rate spread     2.14 %       2.49 %
    Net yield on interest-earning assets   2.85 %       3.02 %
                     
    (1) Nonaccrual loans are included in the daily average loan balances outstanding.    
    (2) The yield on federally tax-exempt loans and securities is computed on a tax-equivalent basis using a federal tax rate of 21%.
                     

    The MIL Network –

  • MIL-OSI: Array Acquires Payitoff to Strengthen its Intelligent Debt Management Offerings

    Source: GlobeNewswire (MIL-OSI)

    NEW YORK, Oct. 28, 2024 (GLOBE NEWSWIRE) — Money 20/20 Conference – Array, a leading embedded consumer products platform, announced the acquisition of Payitoff, a pioneer in embedded debt guidance solutions. This acquisition fortifies Array’s position as the industry leader in intelligent debt management solutions, empowering financial institutions, fintechs, and digital brands with seamless, no-code debt management tools that improve consumer outcomes, accelerate growth efforts, and unlock new revenue streams.

    Payitoff was founded by Bobby Matson, who created the company out of a personal need to manage his family’s student loans and other debt in order to buy a home. His team first launched student loan management before broadening its offerings to encompass a comprehensive suite of debt management tools. These user-friendly, embeddable tools seamlessly integrate into digital platforms without the need for complex coding, empowering financial institutions, fintechs, and digital brands to elevate their consumers’ financial experiences.

    The company has gained significant market traction, including wins with Earnest, EarnUp, Greenpath, LendKey, Splash Financial, and U.S. Bank, resulting in over 200,000 loans managed by Payitoff with a combined value of over $1.5 billion. These companies value the ability to add debt management features into their digital experience without the need to build the product themselves.

    Consumers can quickly link their debt accounts, explore repayment options, choose the most suitable plan, and apply—all within a few minutes. For student loans, a recent analysis found that users can save an average of $323 per month* that can be invested in other ways.

    “Financial institutions and other providers of financial products in digital experiences realize that helping their consumers better understand and manage their debt is a powerful way to increase deposits, revenue, and brand loyalty,” said Martin Toha, Founder and CEO of Array. “We acquired Payitoff because our companies have a shared vision to provide seamless, embeddable products that fuel financial progress. This provides our clients with the best of all worlds: bringing valuable products to market faster without additional resources and overhead.”

    “The opportunity for impact between Array and Payitoff is massive,” said Bobby Matson, CEO of Payitoff. “Student loan payments resumed a year ago, and with delinquencies starting to impact borrowers’ credit this month, the timing of this acquisition couldn’t be more critical. Array’s reach, combined with our debt management tools, will empower financial institutions and fintechs to help their consumers manage debt and save thousands—all with a seamless integration.”

    Payitoff Expands Array’s Private-Label Offerings
    The Array platform helps companies drive engagement and revenue by monetizing traffic private-labeled financial, identity and privacy protection products that build brand loyalty with users and help them take control of their financial lives. These products include:

    • My Credit Manager helps consumers view, understand, and manage their credit information. They can receive score change alerts, interact with a score simulator, and view credit score factors and debt analysis components.
    • Identity Protect includes identity monitoring, insurance, and restoration services that help keep users safe from fraud. It also features dark web monitoring, alerts, and identity theft restoration services.
    • Privacy Protect offers consumers the most effective data removal – more than 200 million records to date and assisting more than 4 million individuals.
    • Subscription Manager is an embeddable, private-label app that helps financial institutions, fintechs, and digital brands attract and retain consumers by providing insight into and control over recurring payments.​​
    • BuildCredit Rent helps consumers build credit or establish credit history when they opt to share their rent payments with a credit bureau.

    *Represents actual average savings of borrowers who linked their account with Payitoff and qualified for a federal repayment plan. The sample is based on an aggregated set of data representing over $1.5 billion in loan volume across 215,000+ loans on the Payitoff platform.

    About Array
    Array fuels financial progress for many of the world’s leading fintechs, financial institutions, and digital brands with a suite of private-label fintech solutions that can be easily embedded. Array drives engagement and revenue for clients by helping them stand out in a crowded market and forge deeper relationships with their customers. More than a suite of products, we’re building a platform to help consumers own their financial future. Array was founded in 2020 by Martin Toha and its investors include Battery Ventures, General Catalyst, and Nyca Partners. To learn more visit www.array.com.

    Media Contacts

    Kurt Foeller, Array
    press@array.com

    The MIL Network –

  • MIL-OSI USA: When Loans Become Cheesy

    Source: US Global Legal Monitor

    Did you know there is a bank in Italy that accepts wheels of Parmigiano Reggiano as collateral on loans? If, like me, you are now contemplating leaving your current career and getting a job as a bank teller for Credito Emiliano (commonly referred to in the region as Credem), read on.

    Most of the time, when we think of collateral, we think of something like the mortgage on a house. If a homeowner is unable to make payments on the house, the bank that holds the mortgage may seize the collateral (the house) and sell it to satisfy the debt (we call this liquidating the assets). So, how does this work with big wheels of cheese?

    First, it is important to note that Parmigiano Reggiano is no ordinary cheese. True Parmigiano Reggiano can only be produced in one of five provinces within Italy: Parma, Reggio-Emilia, Modena, Bologna, or Mantova. While the ingredients that go into a wheel of Parmigiano are simple – just cow’s milk, salt, and calf rennet (a natural enzyme from cow intestines that helps form curds) – the strict process, which has remained largely unchanged for eight centuries, takes time. After the cheese has aged for 12 months, the Consorzio del Formaggio Parmigiano Reggiano (the Parmigiano Reggiano Consortium), which is the governing body that regulates standards for Parmigiano Reggiano, inspects each wheel. As an aside: each wheel of Parmigiano is the same size to ensure consistent texture – and each wheel weighs over 80 pounds! If a wheel passes the 12-month test, it receives a literal stamp of approval and the protected designation of origin label (PDO or DOP in Italian). The Parmigiano Reggiano Consortium helpfully provides links to legislation and guidelines surrounding Parmigiano in English on its website, here.

    So now, back to Credem, the bank that accepts wheels of Parmigiano Reggiano as collateral on small-business loans it makes to dairy farmers in the Emilia Romagna region. Wheels of Parmigiano can go for anywhere between $900 and $2500. Parmigiano only gets more valuable as it ages. But often, farmers will sell off less mature wheels to have more immediate access to money, even though this turns into a loss of revenue in the long term. In 1953, Credem saw an opportunity to help local farmers maximize their profits by offering loans of up to 70 or 80% on wheels of Parmigiano. That way, the farmers could get the cash they needed up-front and the bank could ensure the wheels of cheese would have time to age and reach their highest value. Credem takes its role seriously, storing the wheels of cheese it accepts as collateral in climate-controlled vaults that are inspected by Parmigiano Reggiano experts for the duration of the loan.

    By the way, this is not the only instance of unusual loan collateral. Before Prohibition, banks in the United States accepted whiskey as collateral. In 2013, it was reported that a bank in Hong Kong accepted designer bags as loan collateral. Perhaps my favorite example of strange collateral is a bank in Spain that sought a loan from the European Central Bank and wanted to offer Cristiano Ronaldo and Kaká as collateral.

    Subscribe to In Custodia Legis – it’s free! – to receive interesting posts drawn from the Law Library of Congress’s vast collections and our staff’s expertise in U.S., foreign, and international law.

    MIL OSI USA News –

  • MIL-OSI: Bank of Åland Plc: Managers’ Transactions (Rauthovi)

    Source: GlobeNewswire (MIL-OSI)

    Bank of Åland Plc
    Managers’ Transactions
    October 28, 2024, 15.00 EET


    Managers’ Transactions (Rauthovi)
     __

    Person subject to the notification requirement
    Name: Juhana Rauthovi
    Position: Other senior manager
    Issuer: Ålandsbanken Abp
    LEI: 7437006WYM821IJ3MN73
    Notification type: INITIAL NOTIFICATION
    Reference number: 82632/4/4
    __

    Transaction date: 2024-10-24
    Outside a trading venue
    Instrument type: SHARE
    ISIN: FI0009001127
    Nature of transaction: SUBSCRIPTION

    Transaction details
    (1): Volume: 141 Unit price: 30.77 EUR

    Aggregated transactions (1):
    Volume: 141 Volume weighted average price: 30.77 EUR

    For further information, please contact:

    Peter Wiklöf, Managing Director and Chief Executive, tel +358 40 512 7505

    The MIL Network –

  • MIL-OSI: First Northwest Bancorp and First Fed Bank Announce Consent Order Termination and Quarterly Shareholder Dividend

    Source: GlobeNewswire (MIL-OSI)

    PORT ANGELES, Wash., Oct. 28, 2024 (GLOBE NEWSWIRE) — First Fed Bank (the “Bank”), the wholly owned subsidiary of First Northwest Bancorp (the “Company”) (NASDAQ: FNWB), announced that on October 23, 2024, the Federal Deposit Insurance Corporation terminated the Consent Order issued to the Bank that was effective November 21, 2023. The termination of the Consent Order follows the Bank’s successful resolution of the deficiencies in the Bank’s compliance program that was the subject of the Order. 

    “We are thrilled to announce the termination of the Consent Order. The Board and I want to convey our sincere thanks and appreciation to our entire compliance team who worked so diligently to strengthen our compliance programs. I also want to recognize our Board for their contributions and efforts regarding this process. The fact that we were able to achieve this in 11 months is a testament to the work the entire bank made over the past two plus years to put this chapter behind us. We appreciate the FDIC’s assessment of our compliance management system, and the recognition of our satisfaction of all of the items related to the Order,” stated Matthew P. Deines, Chief Executive Officer.

    The Company also announced the Board of Directors of First Northwest Bancorp has declared a quarterly cash dividend of $0.07 per common share. The dividend will be payable on November 22, 2024, to shareholders of record as of the close of business on November 8, 2024.

    “We believe quarterly cash dividends are an important component of building shareholder value, and our capital position enables us to continue to pay a dividend at consistent levels,” stated Matthew P. Deines, President and CEO.

    About the Company

    First Northwest Bancorp (Nasdaq: FNWB) is a financial holding company engaged in investment activities including the business of its subsidiary, First Fed Bank. First Fed is a Pacific Northwest-based financial institution which has served its customers and communities since 1923. Currently First Fed has 16 locations in Washington state including 12 full-service branches. First Fed’s business and operating strategy is focused on building sustainable earnings by delivering a full array of financial products and services for individuals, small businesses, non-profit organizations and commercial customers. In 2022, First Northwest made an investment in The Meriwether Group, LLC, a boutique investment banking and accelerator firm. Additionally, First Northwest focuses on strategic partnerships to provide modern financial services such as digital payments and marketplace lending. First Northwest Bancorp was incorporated in 2012 and completed its initial public offering in 2015 under the ticker symbol FNWB. The Company is headquartered in Port Angeles, Washington.

    Forward-Looking Statements

    Certain matters discussed in this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to, among other things, expectations of the business environment in which we operate, projections of future performance, perceived opportunities in the market, potential future credit experience, and statements regarding our mission and vision, and include, but are not limited to, statements about our plans, objectives, expectations and intentions that are not historical facts, and other statements often identified by words such as “believes,” “expects,” “anticipates,” “estimates,” or similar expressions. These forward-looking statements are based upon current management beliefs and expectations and may, therefore, involve risks and uncertainties, many of which are beyond our control. Our actual results, performance, or achievements may differ materially from those suggested, expressed, or implied by forward-looking statements as a result of a wide variety of factors including, but not limited to: increased competitive pressures; changes in the interest rate environment; the credit risks of lending activities; pressures on liquidity, including as a result of withdrawals of deposits or declines in the value of our investment portfolio; changes in general economic conditions and conditions within the securities markets; legislative and regulatory changes; and other factors described in the Company’s latest Annual Report on Form 10-K under the section entitled “Risk Factors,” and other filings with the Securities and Exchange Commission (“SEC”), which are available on our website at www.ourfirstfed.com and on the SEC’s website at www.sec.gov.

    Any of the forward-looking statements that we make in this press release and in the other public statements we make may turn out to be incorrect because of the inaccurate assumptions we might make, because of the factors illustrated above or because of other factors that we cannot foresee. Because of these and other uncertainties, our actual future results may be materially different from those expressed or implied in any forward-looking statements made by or on our behalf and the Company’s operating and stock price performance may be negatively affected. Therefore, these factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for 2024 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, us and could negatively affect the Company’s operations and stock price performance.

    For More Information Contact:
    Matthew P. Deines, President and Chief Executive Officer
    IRGroup@ourfirstfed.com
    360-457-0461

    The MIL Network –

  • MIL-OSI: Coastal Financial Corporation Announces Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    EVERETT, Wash., Oct. 28, 2024 (GLOBE NEWSWIRE) — Coastal Financial Corporation (Nasdaq: CCB) (the “Company”, “Coastal”, “we”, “our”, or “us”), the holding company for Coastal Community Bank (the “Bank”), through which it operates a community-focused bank with an industry leading banking as a service (“BaaS”) segment, today reported unaudited financial results for the quarter ended September 30, 2024, including net income of $13.5 million, or $0.97 per diluted common share, compared to $11.6 million, or $0.84 per diluted common share, for the three months ended June 30, 2024. 

    Management Discussion of the Quarter

    “The third quarter demonstrated strong momentum across both our community bank and CCBX operating segments, despite a still challenging operating environment,” said CEO Eric Sprink. “We saw high quality net loan growth of $92.4 million despite selling $423.7 million in loans. We are implementing strategies to increase fee income and we continue to build out and invest in an infrastructure that is scalable, and that we believe will enable us to be innovative leaders in financial services.”

    Key Points for Third Quarter and Our Go-Forward Strategy

    • Balance Sheet Well Positioned for Lower Rates. Our balance sheet stands in a modestly liability sensitive position as of September 30, 2024, with $1.95 billion of CCBX deposits that contractually reprice lower immediately upon any reduction in the Federal Funds Rate, with $1.09 billion of CCBX loans repricing in 90 days or less following such reduction. The Federal Open Market Committee recently lowered the targeted Federal Funds rate 0.50% on September 19, 2024; a reduction of 0.50% compared to June 30, 2024 and September 30, 2023. The rate decrease came late in the quarter, so the full impact of this and any subsequent rate changes will be reflected in future periods.
    • Expanding Relationships with CCBX Partners. We continue to focus on expanding product offerings with existing CCBX partners. We believe that launching new products with existing partners positions us to reach a wide and established customer base with modest increase in enterprise risk. Products launched in 2024 with existing partners have gained traction and are growing the balance sheet and increasing income. The pipeline for CCBX is active, although we expect to remain selective in adding new partners to manage risk and capital.
    • On-going Loan Sales. We sold $423.7 million loans in the quarter ended September 30, 2024 as part of our strategy to balance credit risk, manage partner and lending limits, protect capital levels and move credit card balances to an off balance sheet fee generating model. We are retaining a portion of the fee income for our role in processing transactions on sold credit card balances. This provides an on-going and passive revenue stream with no on balance sheet risk.
    • Continued Regulatory and Compliance Infrastructure Investments Position Us Well for Next Phase of Growth. We continue to utilize co-sourced personnel as a component of our risk and compliance efforts. This flexible co-sourcing approach allows us to manage the growth of our internal team while also ensuring CCBX has the resources it needs. While we remain 100% indemnified against partner fraud losses, we were encouraged to see fraudulent activity amongst our partners remains low during the current quarter, compared to the same period last year, a positive indicator of our continued investments in our risk infrastructure.
    • Reorganization and Strengthening of Talent to Accommodate Growth and Plans for the Future. We recently announced the bifurcation of the President of the Bank into two roles, appointing Brian Hamilton as President of CCBX, the Fintech and BaaS segment of the Bank, with Curt Queyrouze serving as President of the community bank and corporate credit.

    Third Quarter 2024 Financial Highlights

    The tables below outline some of our key operating metrics.

        Three Months Ended
    (Dollars in thousands, except share and per share data; unaudited)   September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Income Statement Data:                    
    Interest and dividend income   $ 105,079     $ 97,487     $ 90,472     $ 88,243     $ 88,331  
    Interest expense     32,892       31,250       29,536       28,586       26,102  
    Net interest income     72,187       66,237       60,936       59,657       62,229  
    Provision for credit losses     70,257       62,325       83,158       60,789       27,253  
    Net interest (expense)/ income after provision for credit losses     1,930       3,912       (22,222 )     (1,132 )     34,976  
    Noninterest income     80,068       69,918       86,955       64,694       34,579  
    Noninterest expense     65,616       58,809       56,018       51,703       56,501  
    Provision for income tax     2,926       3,425       1,915       2,847       2,784  
    Net income     13,456       11,596       6,800       9,012       10,270  
                         
        As of and for the Three Month Period
        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Balance Sheet Data:                    
    Cash and cash equivalents   $ 484,026     $ 487,245     $ 515,128     $ 483,128     $ 474,946  
    Investment securities     48,620       49,213       50,090       150,364       141,489  
    Loans held for sale     7,565       —       797       —       —  
    Loans receivable     3,418,832       3,326,460       3,199,554       3,026,092       2,967,035  
    Allowance for credit losses     (170,263 )     (147,914 )     (139,258 )     (116,958 )     (101,085 )
    Total assets     4,065,821       3,961,546       3,865,258       3,753,366       3,678,265  
    Interest bearing deposits     3,047,861       2,949,643       2,888,867       2,735,161       2,637,914  
    Noninterest bearing deposits     579,427       593,789       574,112       625,202       651,786  
    Core deposits (1)     3,190,869       3,528,339       3,447,864       3,342,004       3,269,082  
    Total deposits     3,627,288       3,543,432       3,462,979       3,360,363       3,289,700  
    Total borrowings     47,847       47,810       47,771       47,734       47,695  
    Total shareholders’ equity     331,930       316,693       303,709       294,978       284,450  
                         
    Share and Per Share Data (2):                    
    Earnings per share – basic   $ 1.00     $ 0.86     $ 0.51     $ 0.68     $ 0.77  
    Earnings per share – diluted   $ 0.97     $ 0.84     $ 0.50     $ 0.66     $ 0.75  
    Dividends per share     —       —       —       —       —  
    Book value per share (3)   $ 24.51     $ 23.54     $ 22.65     $ 22.17     $ 21.38  
    Tangible book value per share (4)   $ 24.51     $ 23.54     $ 22.65     $ 22.17     $ 21.38  
    Weighted avg outstanding shares – basic     13,447,066       13,412,667       13,340,997       13,286,828       13,285,974  
    Weighted avg outstanding shares – diluted     13,822,270       13,736,508       13,676,917       13,676,513       13,675,833  
    Shares outstanding at end of period     13,543,282       13,453,805       13,407,320       13,304,339       13,302,449  
    Stock options outstanding at end of period     198,370       286,119       309,069       354,969       356,359  
                                             
    See footnotes that follow the tables below
     
        As of and for the Three Month Period
        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Credit Quality Data:                    
    Nonperforming assets (5) to total assets     1.34 %     1.34 %     1.42 %     1.43 %     1.18 %
    Nonperforming assets (5) to loans receivable and OREO     1.60 %     1.60 %     1.71 %     1.78 %     1.47 %
    Nonperforming loans (5) to total loans receivable     1.60 %     1.60 %     1.71 %     1.78 %     1.47 %
    Allowance for credit losses to nonperforming loans     311.5 %     278.1 %     253.8 %     217.2 %     232.2 %
    Allowance for credit losses to total loans receivable     4.98 %     4.45 %     4.35 %     3.86 %     3.41 %
    Gross charge-offs   $ 53,305     $ 55,207     $ 58,994     $ 47,652     $ 37,879  
    Gross recoveries   $ 4,069     $ 1,973     $ 1,776     $ 2,781     $ 1,045  
    Net charge-offs to average loans (6)     5.65 %     6.57 %     7.34 %     5.92 %     4.77 %
                         
    Capital Ratios:                    
    Company                    
    Tier 1 leverage capital     8.40 %     8.31 %     8.24 %     8.10 %     8.03 %
    Common equity Tier 1 risk-based capital     9.26 %     9.03 %     8.98 %     9.10 %     9.00 %
    Tier 1 risk-based capital     9.35 %     9.13 %     9.08 %     9.20 %     9.11 %
    Total risk-based capital     11.90 %     11.70 %     11.70 %     11.87 %     11.80 %
    Bank                    
    Tier 1 leverage capital     9.29 %     9.24 %     9.19 %     9.06 %     8.99 %
    Common equity Tier 1 risk-based capital     10.36 %     10.15 %     10.14 %     10.30 %     10.21 %
    Tier 1 risk-based capital     10.36 %     10.15 %     10.14 %     10.30 %     10.21 %
    Total risk-based capital     11.65 %     11.44 %     11.43 %     11.58 %     11.48 %
                                             

    (1)  Core deposits are defined as all deposits excluding brokered and all time deposits.
    (2)  Share and per share amounts are based on total actual or average common shares outstanding, as applicable.
    (3)  We calculate book value per share as total shareholders’ equity at the end of the relevant period divided by the outstanding number of our common shares at the end of each period.
    (4)  Tangible book value per share is a non-GAAP financial measure. We calculate tangible book value per share as total shareholders’ equity at the end of the relevant period, less goodwill and other intangible assets, divided by the outstanding number of our common shares at the end of each period. The most directly comparable GAAP financial measure is book value per share. We had no goodwill or other intangible assets as of any of the dates indicated. As a result, tangible book value per share is the same as book value per share as of each of the dates indicated.
    (5)  Nonperforming assets and nonperforming loans include loans 90+ days past due and accruing interest.
    (6)  Annualized calculations.

    Key Performance Ratios

    Return on average assets (“ROA”) was 1.34% for the quarter ended September 30, 2024 compared to 1.21% and 1.13% for the quarters ended June 30, 2024 and September 30, 2023, respectively.  ROA for the quarter ended September 30, 2024, increased 0.13% and 0.21% compared to June 30, 2024 and September 30, 2023, respectively. Noninterest expenses were higher for the quarter ended September 30, 2024 compared to the quarters ended June 30, 2024 and September 30, 2023 largely due to an increase in BaaS loan expense, which is directly related to the increase in the amount of interest earned on CCBX loans.

    The following table shows the Company’s key performance ratios for the periods indicated.  

        Three Months Ended
    (unaudited)   September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
                         
    Return on average assets (1)   1.34 %   1.21 %   0.73 %   0.97 %   1.13 %
    Return on average equity (1)   16.67 %   15.22 %   9.21 %   12.35 %   14.60 %
    Yield on earnings assets (1)   10.79 %   10.49 %   10.07 %   9.77 %   10.08 %
    Yield on loans receivable (1)   11.43 %   11.23 %   10.85 %   10.71 %   10.84 %
    Cost of funds (1)   3.62 %   3.60 %   3.52 %   3.39 %   3.18 %
    Cost of deposits (1)   3.59 %   3.58 %   3.49 %   3.36 %   3.14 %
    Net interest margin (1)   7.41 %   7.13 %   6.78 %   6.61 %   7.10 %
    Noninterest expense to average assets (1)   6.54 %   6.14 %   6.04 %   5.56 %   6.23 %
    Noninterest income to average assets (1)   7.98 %   7.30 %   9.38 %   6.95 %   3.81 %
    Efficiency ratio   43.10 %   43.19 %   37.88 %   41.58 %   58.36 %
    Loans receivable to deposits (2)   94.46 %   93.88 %   92.42 %   90.05 %   90.19 %
                                   

    (1)  Annualized calculations shown for quarterly periods presented.
    (2)  Includes loans held for sale.

    Management Outlook; CEO Eric Sprink

    “As we look ahead to the fourth quarter and 2025, we remain laser focused on building out our technology and risk management infrastructure to more efficiently support our next phase of growth within CCBX. While the balance sheet re-mix earlier this year resulted in a short-term reduction to income, we continue to make strategic decisions which are enhancing credit quality, generating passive fee income, strengthening our talent and growing relationships with established and prospective CCBX partners all of which are expected to position Coastal to be more profitable in 2025.”

    Coastal Financial Corporation Overview

    The Company has one main subsidiary, the Bank which consists of three segments: CCBX, the community bank and treasury & administration.  The CCBX segment includes all of our BaaS activities, the community bank segment includes all community banking activities, and the treasury & administration segment includes treasury management, overall administration and all other aspects of the Company.  

    CCBX Performance Update

    Our CCBX segment continues to evolve, and we have 22 relationships, at varying stages, as of September 30, 2024.  We continue to refine the criteria for CCBX partnerships, are exiting relationships where it makes sense for us to do so and are focusing on larger more established partners, with experienced management teams, existing customer bases and strong financial positions.

    We are expanding product offerings with our existing CCBX partners. We believe that launching new products with existing partners positions us to reach a wide and established customer base with a modest increase in regulatory risk given we have already vetted these partners and have operational history. Products launched earlier in the year with existing partners have gained traction and are growing the balance sheet and increasing income. We continue to sell loans as part of our strategy to balance partner and lending limits, and manage the loan portfolio and credit quality. We retain a portion of the fee income for our role in processing transactions on sold credit card balances. This is expected to provide an on-going and passive revenue stream with no on balance sheet risk.

    The following table illustrates the activity and evolution in CCBX relationships for the periods presented.

        As of
    (unaudited)   September 30,
    2024    		 June 30,
    2024    		 September 30,
    2023
    Active   19 19 18
    Friends and family / testing   1 1 1
    Implementation / onboarding   1 1 1
    Signed letters of intent   1 0 1
    Wind down – active but preparing to exit relationship   0 0 1
    Total CCBX relationships   22 21 22
     

    CCBX loans increased $106.9 million, or 7.6%, despite selling $423.7 million loans during the three months ended September 30, 2024 to $1.52 billion, while we continued to enhance credit standards on new CCBX loan originations. In accordance with the program agreement for one partner, effective April 1, 2024, the portion of the CCBX portfolio that we are responsible for losses on decreased from 10% to 5%. At September 30, 2024 the portion of this portfolio for which we are responsible represented $19.8 million in loans.

    The following table details the CCBX loan portfolio:

    CCBX   As of
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands; unaudited)   Balance   % to Total   Balance   % to Total   Balance   % to Total
    Commercial and industrial loans:                        
    Capital call lines   $ 103,924     6.8 %   $ 109,133     7.7 %   $ 114,174     9.6 %
    All other commercial & industrial loans     36,494     2.4       41,731     3.0       58,869     5.0  
    Real estate loans:                        
    Residential real estate loans     265,402     17.5       287,950     20.4       251,775     21.3  
    Consumer and other loans:                        
    Credit cards     633,691     41.6       549,241     38.7       440,993     37.3  
    Other consumer and other loans     482,228     31.7       426,809     30.2       316,987     26.8  
    Gross CCBX loans receivable     1,521,739     100.0 %     1,414,864     100.0 %     1,182,798     100.0 %
    Net deferred origination (fees) costs     (447 )         (438 )         (424 )    
    Loans receivable   $ 1,521,292         $ 1,414,426         $ 1,182,374      
    Loan Yield – CCBX (1)(2)     17.35 %         17.77 %         17.05 %    
                             

    (1)  CCBX yield does not include the impact of BaaS loan expense.  BaaS loan expense represents the amount paid or payable to partners for credit enhancements and originating & servicing CCBX loans. See reconciliation of the non-GAAP measures at the end of this earnings release for the impact of BaaS loan expense on CCBX loan yield.
    (2)  Loan yield is annualized for the three months ended for each period presented and includes loans held for sale and nonaccrual loans.

    The increase in CCBX loans in the quarter ended September 30, 2024, includes an increase of $139.9 million or 14.3%, in consumer and other loans, partially offset by a $22.5 million, or 7.8%, decrease in residential real estate loans and a decrease of $5.2 million, or 4.8%, in capital call lines as a result of normal balance fluctuations and business activities. We continue to monitor and manage the CCBX loan portfolio, and sold $423.7 million in CCBX loans during the quarter ended September 30, 2024 compared to sales of $155.2 million in the quarter ended June 30, 2024. We continue to reposition ourselves by managing CCBX credit and concentration levels in an effort to optimize our loan portfolio and generate off balance sheet fee income.

    Our credit card program through CCBX continues to grow in dollars and number of active cards as shown in the graph below:

    The following table details the CCBX deposit portfolio:

    CCBX   As of
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands; unaudited)   Balance   % to Total   Balance   % to Total   Balance   % to Total
    Demand, noninterest bearing   $ 60,655     2.9 %   $ 62,234     3.0 %   $ 67,782     3.9 %
    Interest bearing demand and money market     1,991,858     94.6       1,989,105     96.7       1,679,921     95.9  
    Savings     5,204     0.3       5,150     0.3       4,529     0.2  
    Total core deposits     2,057,717     97.8       2,056,489     100.0       1,752,232     100.0  
    Other deposits     47,046     2.2       —     0.0       —     —  
    Total CCBX deposits   $ 2,104,763     100.0 %   $ 2,056,489     100.0 %   $ 1,752,232     100.0 %
    Cost of deposits (1)     4.82 %         4.92 %         4.80 %    

    (1)  Cost of deposits is annualized for the three months ended for each period presented.

    CCBX deposits increased $48.3 million, or 2.3%, in the three months ended September 30, 2024 to $2.10 billion. This excludes the $214.5 million in CCBX deposits that were transferred off balance sheet for increased Federal Deposit Insurance Corporation (“FDIC”) insurance coverage purposes, compared to $117.7 million for the quarter ended June 30, 2024. Amounts in excess of FDIC insurance coverage are transferred, using a third party facilitator/vendor sweep product, to participating financial institutions.

    Community Bank Performance Update

    In the quarter ended September 30, 2024, the community bank saw net loans decrease $14.5 million, or 0.8%, to $1.90 billion.

    The following table details the Community Bank loan portfolio:

    Community Bank   As of
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands; unaudited)   Balance   % to Total   Balance   % to Total   Balance   % to Total
    Commercial and industrial loans   $ 152,161     8.0 %   $ 144,436     7.5 %   $ 158,232     8.8 %
    Real estate loans:                        
    Construction, land and land development loans     163,051     8.6       173,064     9.0       167,686     9.4  
    Residential real estate loans     212,467     11.2       229,639     12.0       225,372     12.6  
    Commercial real estate loans     1,362,452     71.5       1,357,979     70.8       1,237,849     69.1  
    Consumer and other loans:                        
    Other consumer and other loans     14,173     0.7       14,220     0.7       2,483     0.1  
    Gross Community Bank loans receivable     1,904,304     100.0 %     1,919,338     100.0 %     1,791,622     100.0 %
    Net deferred origination fees     (6,764 )         (7,304 )         (6,961 )    
    Loans receivable   $ 1,897,540         $ 1,912,034         $ 1,784,661      
    Loan Yield(1)     6.64 %         6.52 %         6.20 %    

    (1)  Loan yield is annualized for the three months ended for each period presented and includes loans held for sale and nonaccrual loans.

    Community bank loans had a $10.0 million decrease in construction, land and land development loans, partially offset by an increase of $7.7 million in commercial and industrial loans and an increase in commercial real estate loans of $4.5 million during the quarter ended September 30, 2024; consumer and other loans were flat.

    The following table details the community bank deposit portfolio:

    Community Bank   As of
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands; unaudited)   Balance   % to Total   Balance   % to Total   Balance   % to Total
    Demand, noninterest bearing   $ 518,772     34.1 %   $ 531,555     35.6 %   $ 584,004     37.9 %
    Interest bearing demand and money market     552,108     36.3       876,668     59.0       852,747     55.5  
    Savings     62,272     4.1       63,627     4.3       80,099     5.2  
    Total core deposits     1,133,152     74.5       1,471,850     98.9       1,516,850     98.6  
    Other deposits     373,681     24.5       1     0.0       1     0.0  
    Time deposits less than $100,000     6,305     0.4       6,741     0.5       8,635     0.6  
    Time deposits $100,000 and over     9,387     0.6       8,351     0.6       11,982     0.8  
    Total Community Bank deposits   $ 1,522,525     100.0 %   $ 1,486,943     100.0 %   $ 1,537,468     100.0 %
    Cost of deposits(1)     1.92 %         1.77 %         1.31 %    

    (1)  Cost of deposits is annualized for the three months ended for each period presented.

    Community bank deposits increased $35.6 million, or 2.4%, during the three months ended September 30, 2024 to $1.52 billion. This is the second consecutive quarter of growth after allowing higher rate balances to run-off earlier in the year. The community bank segment includes noninterest bearing deposits of $518.8 million, or 34.1%, of total community bank deposits, resulting in a cost of deposits of 1.92%, which compared to 1.77% for the quarter ended June 30, 2024.

    Net Interest Income and Margin Discussion

    Net interest income was $72.2 million for the quarter ended September 30, 2024, an increase of $5.9 million, or 9.0%, from $66.2 million for the quarter ended June 30, 2024, and an increase of $10.0 million, or 16.0%, from $62.2 million for the quarter ended September 30, 2023. The increase in net interest income compared to June 30, 2024, was a result of increased interest income due to an increase in average loans receivable partially offset by an increase in cost of funds. The increase in net interest income compared to September 30, 2023 was largely related to increased yield on loans resulting from higher interest rates and growth in higher yielding loans partially offset by an increase in cost of funds relating to higher interest rates and growth in interest bearing deposits.  

    Net interest margin was 7.41% for the three months ended September 30, 2024, compared to 7.13% for the three months ended June 30, 2024, with the increase primarily due to higher loan yields. Net interest margin was 7.10% for the three months ended September 30, 2023. The increase in net interest margin for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 was largely due to an increase in loan yield partially offset by higher interest rates on interest bearing deposits. Interest and fees on loans receivable increased $8.6 million, or 9.5%, to $99.6 million for the three months ended September 30, 2024, compared to $90.9 million for the three months ended June 30, 2024, and increased $15.9 million, or 19.1%, compared to $83.7 million for the three months ended September 30, 2023, due to an increase in outstanding balances and higher interest rates. 

    Average investment securities decreased $795,000 to $49.0 million compared to the three months ended June 30, 2024 and decreased $69.0 million compared to the three months ended September 30, 2023 as a result of maturing securities.

    Cost of funds was 3.62% for the quarter ended September 30, 2024, an increase of 2 basis points from the quarter ended June 30, 2024 and an increase of 44 basis points from the quarter ended September 30, 2023. Cost of deposits for the quarter ended September 30, 2024 was 3.59%, compared to 3.58% for the quarter ended June 30, 2024, and 3.14% for the quarter ended September 30, 2023. The increased cost of funds and deposits compared to June 30, 2024 and September 30, 2023 was due to the continued high interest rate environment. The late September reduction in the Fed funds rate is expected to help to lower our cost of deposits in future periods.

    The following table summarizes the average yield on loans receivable and cost of deposits:

        For the Three Months Ended
        September 30, 2024   June 30, 2024   September 30, 2023
        Yield on
    Loans (2)    		   Cost of
    Deposits (2)    		   Yield on
    Loans (2)    		   Cost of
    Deposits (2)    		   Yield on
    Loans (2)    		   Cost of
    Deposits (2)
    Community Bank   6.64 %   1.92 %   6.52 %   1.77 %   6.20 %   1.31 %
    CCBX (1)   17.35 %   4.82 %   17.77 %   4.92 %   17.05 %   4.80 %
    Consolidated   11.43 %   3.59 %   11.23 %   3.58 %   10.84 %   3.14 %

    (1)  CCBX yield on loans does not include the impact of BaaS loan expense.  BaaS loan expense represents the amount paid or payable to partners for credit and fraud enhancements and originating & servicing CCBX loans.  To determine Net BaaS loan income earned from CCBX loan relationships, the Company takes BaaS loan interest income and deducts BaaS loan expense to arrive at Net BaaS loan income which can be compared to interest income on the Company’s community bank loans. See reconciliation of the non-GAAP measures at the end of this earnings release for the impact of BaaS loan expense on CCBX loan yield.
    (2)  Annualized calculations for periods shown.

    The following tables illustrates how BaaS loan interest income is affected by BaaS loan expense resulting in net BaaS loan income and the associated yield:

        For the Three Months Ended
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands, unaudited)   Income /
    Expense    		   Income /
    expense divided
    by average
    CCBX loans     (2)    		   Income /
    Expense    		   Income /
    expense divided
    by
    average CCBX
    loans    (2)    		   Income /
    Expense    		   Income /
    expense divided
    by average
    CCBX loans     (2)
    BaaS loan interest income   $ 67,692   17.35 %   $ 60,203   17.77 %   $ 56,279   17.05 %
    Less: BaaS loan expense     32,612   8.36 %     29,076   8.58 %     23,003   6.97 %
    Net BaaS loan income (1)   $ 35,080   8.99 %   $ 31,127   9.19 %   $ 33,276   10.08 %
    Average BaaS Loans(3)   $ 1,552,443       $ 1,362,343       $ 1,309,380    

    (1) A reconciliation of the non-GAAP measures are set forth at the end of this earnings release.
    (2) Annualized calculations shown for quarterly periods presented.
    (3) Includes loans held for sale.

    Noninterest Income Discussion

    Noninterest income was $80.1 million for the three months ended September 30, 2024, an increase of $10.2 million from $69.9 million for the three months ended June 30, 2024, and an increase of $45.5 million from $34.6 million for the three months ended September 30, 2023.  The increase in noninterest income over the quarter ended June 30, 2024 was primarily due to an increase of $9.9 million in total BaaS income.  The $9.9 million increase in total BaaS income included a $9.3 million increase in BaaS credit enhancements related to the provision for credit losses, a $300,000 increase in BaaS fraud enhancements, and an increase of $340,000 in BaaS program income. The increase in BaaS program income is largely due to higher servicing and other BaaS fees, transaction fees and interchange fees and our primary BaaS source for recurring fee income (see “Appendix B” for more information on the accounting for BaaS allowance for credit losses and credit and fraud enhancements). Additionally, other income increased $229,000 largely due to increased incoming ACH activity.

    The $45.5 million increase in noninterest income over the quarter ended September 30, 2023 was primarily due to a $43.4 million increase in BaaS credit and fraud enhancements, and an increase of $2.0 million in BaaS program income.

    Noninterest Expense Discussion
    Total noninterest expense increased $6.8 million to $65.6 million for the three months ended September 30, 2024, compared to $58.8 million for the three months ended June 30, 2024, and increased $9.1 million from $56.5 million for the three months ended September 30, 2023. The increase in noninterest expense for the quarter ended September 30, 2024, as compared to the quarter ended June 30, 2024, was primarily due to a $3.8 million increase in BaaS expense (including a $300,000 increase in BaaS fraud expense and a $3.5 million increase in BaaS loan expense). BaaS loan expense represents the amount paid or payable to partners for credit enhancements, fraud enhancements, and originating & servicing CCBX loans. BaaS fraud expense represents non-credit fraud losses on partner’s customer loan and deposit accounts. A portion of this expense is realized during the quarter in which the loss occurs, and a portion is estimated based on historical or other information from our partners, partially offset by a $1.5 million increase in excise taxes (due to the recording of $1.2 million business and occupation tax credit from the State of Washington which resulted in the recognition of a net credit of $706,000 for the quarter ended June 30, 2024, compared to expense of $762,000 for the quarter ended September 30, 2024). We also recorded an increase of $587,000 in data processing and software licenses as a result of our continued investment in our infrastructure and the automation of our processes so that they are scalable and an increase of $499,000 in point of sale expenses as a result of increased partner transaction activity.

    The increase in noninterest expenses for the quarter ended September 30, 2024 compared to the quarter ended September 30, 2023 was largely due to an increase of $8.8 million in BaaS partner expense (including a $9.6 million increase in BaaS loan expense partially offset by a decrease of $766,000 in BaaS fraud expense), a $1.1 million increase in data processing and software licenses due to enhancements in technology, and a $526,000 increase in occupancy expense, largely due to higher software depreciation/amortization expense, partially offset by a $986,000 decrease in salary and employee benefits largely as a result of some one-time costs that were expensed in the quarter ended September 30, 2023 for which there was no similar expense in the current quarter, and an $850,000 decrease in legal and professional expenses as a result of risk management and projects being completed.

    Provision for Income Taxes

    The provision for income taxes was $2.9 million for the three months ended September 30, 2024, $3.4 million for the three months ended June 30, 2024 and $2.8 million for the third quarter of 2023.  The income tax provision was lower for the three months ended September 30, 2024 compared to the quarter ended June 30, 2024 as a result of the deductibility of certain equity awards which reduced tax expense despite net income being higher and higher than the quarter ended September 30, 2023, primarily due to higher net income compared to that quarter.

    The Company is subject to various state taxes that are assessed as CCBX activities and employees expand into other states, which has increased the overall tax rate used in calculating the provision for income taxes in the current and future periods. The Company uses a federal statutory tax rate of 21.0% as a basis for calculating provision for federal income taxes and 2.62% for calculating the provision for state income taxes.

    Financial Condition Overview

    Total assets increased $104.3 million, or 2.6%, to $4.07 billion at September 30, 2024 compared to $3.96 billion at June 30, 2024.  The increase is primarily due to stronger loan growth partially offset by lower cash balances. Total loans receivable increased $92.4 million to $3.42 billion at September 30, 2024, from $3.33 billion at June 30, 2024.

    As of September 30, 2024, the Company had the capacity to borrow up to a total of $656.3 million from the Federal Reserve Bank discount window and Federal Home Loan Bank, and an additional $50.0 million from a correspondent bank no borrowings outstanding on these lines as of September 30, 2024.

    The Company had a cash balance of $5.9 million as of September 30, 2024, which is retained for general operating purposes, including debt repayment, and for funding $530,000 in commitments to bank technology funds.  

    Uninsured deposits were $542.2 million as of September 30, 2024, compared to $532.9 million as of June 30, 2024.

    Total shareholders’ equity increased $15.2 million since June 30, 2024.  The increase in shareholders’ equity was primarily due to $13.5 million in net earnings, combined with an increase of $1.8 million in common stock outstanding as a result of equity awards exercised during the three months ended September 30, 2024.

    The Company and the Bank remained well capitalized at September 30, 2024, as summarized in the following table.

    (unaudited)   Coastal
    Community
    Bank    		   Coastal
    Financial
    Corporation    		   Minimum Well
    Capitalized
    Ratios under
    Prompt
    Corrective
    Action     (1)
    Tier 1 Leverage Capital (to average assets)   9.29 %   8.40 %   5.00 %
    Common Equity Tier 1 Capital (to risk-weighted assets)   10.36 %   9.26 %   6.50 %
    Tier 1 Capital (to risk-weighted assets)   10.36 %   9.35 %   8.00 %
    Total Capital (to risk-weighted assets)   11.65 %   11.90 %   10.00 %

    (1) Presents the minimum capital ratios for an insured depository institution, such as the Bank, to be considered well capitalized under the Prompt Corrective Action framework. The minimum requirements for the Company to be considered well capitalized under Regulation Y include to maintain, on a consolidated basis, a total risk-based capital ratio of 10.0 percent or greater and a tier 1 risk-based capital ratio of 6.0 percent or greater.

    Asset Quality

    The total allowance for credit losses was $170.3 million and 4.98% of loans receivable at September 30, 2024 compared to $147.9 million and 4.45% at June 30, 2024 and $101.1 million and 3.41% at September 30, 2023. The allowance for credit loss allocated to the CCBX portfolio was $150.1 million and 9.87% of CCBX loans receivable at September 30, 2024, with $20.1 million of allowance for credit loss allocated to the community bank or 1.06% of total community bank loans receivable.

    The following table details the allocation of the allowance for credit loss as of the period indicated:

        As of September 30, 2024   As of June 30, 2024   As of September 30, 2023
    (dollars in thousands; unaudited)   Community
    Bank    		   CCBX   Total   Community
    Bank    		   CCBX   Total   Community
    Bank    		   CCBX   Total
    Loans receivable   $ 1,897,540     $ 1,521,292     $ 3,418,832     $ 1,912,034     $ 1,414,426     $ 3,326,460     $ 1,784,661     $ 1,182,374     $ 2,967,035  
    Allowance for credit losses     (20,132 )     (150,131 )     (170,263 )     (21,045 )     (126,869 )     (147,914 )     (21,316 )     (79,769 )     (101,085 )
    Allowance for credit losses to total loans receivable     1.06 %     9.87 %     4.98 %     1.10 %     8.97 %     4.45 %     1.19 %     6.75 %     3.41 %
                                                                             

    Net charge-offs totaled $49.2 million for the quarter ended September 30, 2024, compared to $53.2 million for the quarter ended June 30, 2024 and $36.8 million for the quarter ended September 30, 2023. Net charge-offs as a percent of average loans decreased to 5.65% for the quarter ended September 30, 2024 compared to 6.57% for the quarter ended June 30, 2024, which we believe is a result of the steps we took manage our credit quality.   CCBX partner agreements provide for a credit enhancement that covers the net-charge-offs on CCBX loans and negative deposit accounts by indemnifying or reimbursing incurred losses, except in accordance with the program agreement for one partner where the Company was responsible for credit losses on approximately 5% of a $400.8 million loan portfolio. At September 30, 2024, our portion of this portfolio represented $19.8 million in loans. Net charge-offs for this $19.8 million in loans were $1.1 million for the three months ended September 30, 2024, compared to $1.3 million for the three months ended June 30, 2024 and $579,000 for the three months ended September 30, 2023.

    The following table details net charge-offs for the community bank and CCBX for the period indicated:

        Three Months Ended
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands; unaudited)   Community
    Bank    		   CCBX   Total   Community
    Bank    		   CCBX   Total   Community
    Bank    		   CCBX   Total
    Gross charge-offs   $ 398     $ 52,907     $ 53,305     $ 2     $ 55,205     $ 55,207     $ 3     $ 37,876     $ 37,879  
    Gross recoveries     (3 )     (4,066 )     (4,069 )     (4 )     (1,969 )     (1,973 )     (3 )     (1,042 )     (1,045 )
    Net charge-offs   $ 395     $ 48,841     $ 49,236     $ (2 )   $ 53,236     $ 53,234     $ —     $ 36,834     $ 36,834  
    Net charge-offs to average loans (1)     0.08 %     12.52 %     5.65 %     0.00 %     15.72 %     6.57 %     0.00 %     11.16 %     4.77 %

    (1) Annualized calculations shown for periods presented.

    During the quarter ended September 30, 2024, a $72.1 million provision for credit losses – loans was recorded for CCBX partner loans based on management’s analysis, compared to the $62.2 million provision for credit losses – loans that was recorded for CCBX for the quarter ended June 30, 2024. CCBX loans have a higher level of expected losses than our community bank loans, which is reflected in the factors for the allowance for credit losses. Agreements with our CCBX partners provide for a credit enhancement which protects the Bank by indemnifying or reimbursing incurred losses.

    In accordance with accounting guidance, we estimate and record a provision for expected losses for these CCBX loans and reclassified negative deposit accounts. When the provision for CCBX credit losses and provision for unfunded commitments is recorded, a credit enhancement asset is also recorded on the balance sheet through noninterest income (BaaS credit enhancements). Expected losses are recorded in the allowance for credit losses. The credit enhancement asset is relieved when credit enhancement recoveries are received from the CCBX partner. If our partner is unable to fulfill their contracted obligations then the Bank could be exposed to additional credit losses. Management regularly evaluates and manages this counterparty risk.

    The factors used in management’s analysis for community bank credit losses indicated that a provision recapture of $519,000 and was needed for the quarter ended September 30, 2024 compared to a provision recapture of $341,000 and provision of $664,000 for the quarters ended June 30, 2024 and September 30, 2023, respectively. The recapture in the current period was largely due to a change in remaining average lives of community bank loans.

    The following table details the provision expense/(recapture) for the community bank and CCBX for the period indicated:

        Three Months Ended
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    Community bank   $ (519 )   $ (341 )   $ 664
    CCBX     72,104       62,231       26,493
    Total provision expense   $ 71,585     $ 61,890     $ 27,157

    At September 30, 2024, our nonperforming assets were $54.7 million, or 1.34%, of total assets, compared to $53.2 million, or 1.34%, of total assets, at June 30, 2024, and $43.5 million, or 1.18%, of total assets, at September 30, 2023. These ratios are impacted by nonperforming CCBX loans that are covered by CCBX partner credit enhancements. As of September 30, 2024, $52.0 million of the $53.6 million in nonperforming CCBX loans were covered by CCBX partner credit enhancements described above.

    Nonperforming assets increased $1.5 million during the quarter ended September 30, 2024, compared to the quarter ended June 30, 2024. This change is largely due to an increase in CCBX nonaccrual loans partially offset by a decrease in community bank nonaccrual loans. CCBX nonaccrual loans increased $8.0 million as a result of a new collection practice that places certain loans on nonaccrual status to improve collectability, $5.3 million of these loans are less than 90 days past due as of September 30, 2024. CCBX loans that are past due 90 days or more and still accruing was $45.6 million for the quarter ended September 30, 2024 compared to $45.2 million for the quarter ended June 30, 2024. As a result of the type of loans (primarily consumer loans) originated through our CCBX partners we anticipate that balances 90 days past due or more and still accruing will generally increase as those loan portfolios grow. Installment/closed-end and revolving/open-end consumer loans originated through CCBX lending partners will continue to accrue interest until 120 and 180 days past due, respectively and are reported as substandard, 90 days or more days past due and still accruing. There were no repossessed assets or other real estate owned at September 30, 2024. Our nonperforming loans to loans receivable ratio was 1.60% at September 30, 2024, compared to 1.60% at June 30, 2024, and 1.47% at September 30, 2023.

    For the quarter ended September 30, 2024, there were $395,000 community bank net charge-offs and $1.1 million nonperforming community bank loans. For the quarter ended September 30, 2024 $48.8 million in net charge-offs were recorded on CCBX loans. These CCBX loans have a higher level of expected losses than our community bank loans, which is reflected in the factors for the allowance for credit losses.

    The following table details the Company’s nonperforming assets for the periods indicated.

    Consolidated   As of
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    Nonaccrual loans:            
    Commercial and industrial loans   $ 198     $ —     $ 2  
    Real estate loans:            
    Construction, land and land development     —       —       —  
    Residential real estate     44       213       176  
    Commercial real estate     831       7,731       7,145  
    Consumer and other loans:            
    Credit cards     7,987       —       —  
    Total nonaccrual loans     9,060       7,944       7,323  
    Accruing loans past due 90 days or more:            
    Commercial & industrial loans     1,593       1,278       1,387  
    Real estate loans:            
    Residential real estate loans     3,025       2,722       1,462  
    Consumer and other loans:            
    Credit cards     34,562       36,465       24,807  
    Other consumer and other loans     6,412       4,779       8,561  
         Total accruing loans past due 90 days or more     45,592       45,244       36,217  
    Total nonperforming loans     54,652       53,188       43,540  
    Real estate owned     —       —       —  
    Repossessed assets     —       —       —  
    Total nonperforming assets   $ 54,652     $ 53,188     $ 43,540  
    Total nonaccrual loans to loans receivable     0.27 %     0.24 %     0.25 %
    Total nonperforming loans to loans receivable     1.60 %     1.60 %     1.47 %
    Total nonperforming assets to total assets     1.34 %     1.34 %     1.18 %
                             

    The following tables detail the CCBX and community bank nonperforming assets which are included in the total nonperforming assets table above.

    CCBX   As of
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    Nonaccrual loans:            
    Consumer and other loans:            
    Credit cards   $ 7,987     $ —     $ —  
    Total nonaccrual loans     7,987       —       —  
    Accruing loans past due 90 days or more:            
    Commercial & industrial loans     1,593       1,278       1,387  
    Real estate loans:            
    Residential real estate loans     3,025       2,722       1,462  
    Consumer and other loans:            
    Credit cards     34,562       36,465       24,807  
    Other consumer and other loans     6,412       4,779       8,561  
    Total accruing loans past due 90 days or more     45,592       45,244       36,217  
    Total nonperforming loans     53,579       45,244       36,217  
    Other real estate owned     —       —       —  
    Repossessed assets     —       —       —  
    Total nonperforming assets   $ 53,579     $ 45,244     $ 36,217  
    Total CCBX nonperforming assets to total consolidated assets     1.32 %     1.14 %     0.98 %
    Community Bank   As of
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    Nonaccrual loans:            
    Commercial and industrial loans   $ 198     $ —     $ 2  
    Real estate:            
    Construction, land and land development     —       —       —  
    Residential real estate     44       213       176  
    Commercial real estate     831       7,731       7,145  
    Total nonaccrual loans     1,073       7,944       7,323  
    Accruing loans past due 90 days or more:            
    Total accruing loans past due 90 days or more     —       —       —  
    Total nonperforming loans     1,073       7,944       7,323  
    Other real estate owned     —       —       —  
    Repossessed assets     —       —       —  
    Total nonperforming assets   $ 1,073     $ 7,944     $ 7,323  
    Total community bank nonperforming assets to total consolidated assets     0.03 %     0.20 %     0.20 %
                             

    About Coastal Financial

    Coastal Financial Corporation (Nasdaq: CCB) (the “Company”), is an Everett, Washington based bank holding company whose wholly owned subsidiaries are Coastal Community Bank (“Bank”) and Arlington Olympic LLC.  The $4.07 billion Bank provides service through 14 branches in Snohomish, Island, and King Counties, the Internet and its mobile banking application.  The Bank provides banking as a service to broker-dealers, digital financial service providers, companies and brands that want to provide financial services to their customers through the Bank’s CCBX segment.  To learn more about the Company visit www.coastalbank.com. 

    CCB-ER

    Contact

    Eric Sprink, Chief Executive Officer, (425) 357-3659
    Joel Edwards, Executive Vice President & Chief Financial Officer, (425) 357-3687

    Forward-Looking Statements

    This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. Any statements about our management’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. Any or all of the forward-looking statements in this earnings release may turn out to be inaccurate. The inclusion of or reference to forward-looking information in this earnings release should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of risks, uncertainties and assumptions that are difficult to predict. Factors that could cause actual results to differ materially from those in the forward-looking statements include, without limitation, the risks and uncertainties discussed under “Risk Factors” in our Annual Report on Form 10-K for the most recent period filed and in any of our subsequent filings with the Securities and Exchange Commission.

    If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. You are cautioned not to place undue reliance on forward-looking statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by law.

     
    COASTAL FINANCIAL CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
    (Dollars in thousands; unaudited)
     
    ASSETS
        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Cash and due from banks   $ 45,327     $ 59,995     $ 32,790     $ 31,345     $ 29,984  
    Interest earning deposits with other banks     438,699       427,250       482,338       451,783       444,962  
    Investment securities, available for sale, at fair value     38       39       41       99,504       98,939  
    Investment securities, held to maturity, at amortized cost     48,582       49,174       50,049       50,860       42,550  
    Other investments     10,757       10,664       10,583       10,227       11,898  
    Loans held for sale     7,565       —       797       —       —  
    Loans receivable     3,418,832       3,326,460       3,199,554       3,026,092       2,967,035  
    Allowance for credit losses     (170,263 )     (147,914 )     (139,258 )     (116,958 )     (101,085 )
    Total loans receivable, net     3,248,569       3,178,546       3,060,296       2,909,134       2,865,950  
    CCBX credit enhancement asset     167,251       143,485       137,276       107,921       91,867  
    CCBX receivable     16,060       11,520       10,369       9,088       10,623  
    Premises and equipment, net     25,833       24,526       22,995       22,090       20,543  
    Lease right-of-use assets     5,427       5,635       5,756       5,932       6,126  
    Accrued interest receivable     23,664       23,617       24,681       26,819       23,428  
    Bank-owned life insurance, net     13,255       13,132       12,991       12,870       12,970  
    Deferred tax asset, net     3,083       2,221       2,221       3,806       4,404  
    Other assets     11,711       11,742       12,075       11,987       14,021  
    Total assets   $ 4,065,821     $ 3,961,546     $ 3,865,258     $ 3,753,366     $ 3,678,265  
                         
    LIABILITIES AND SHAREHOLDERS’ EQUITY
    LIABILITIES                    
    Deposits   $ 3,627,288     $ 3,543,432     $ 3,462,979     $ 3,360,363     $ 3,289,700  
    Subordinated debt, net     44,256       44,219       44,181       44,144       44,106  
    Junior subordinated debentures, net     3,591       3,591       3,590       3,590       3,589  
    Deferred compensation     369       405       442       479       513  
    Accrued interest payable     1,070       999       1,061       892       1,056  
    Lease liabilities     5,609       5,821       5,946       6,124       6,321  
    CCBX payable     39,188       34,536       33,095       33,651       38,229  
    Other liabilities     12,520       11,850       10,255       9,145       10,301  
    Total liabilities     3,733,891       3,644,853       3,561,549       3,458,388       3,393,815  
    SHAREHOLDERS’ EQUITY                    
    Common Stock     134,769       132,989       131,601       130,136       129,244  
    Retained earnings     197,162       183,706       172,110       165,311       156,299  
    Accumulated other comprehensive loss, net of tax     (1 )     (2 )     (2 )     (469 )     (1,093 )
    Total shareholders’ equity     331,930       316,693       303,709       294,978       284,450  
    Total liabilities and shareholders’ equity   $ 4,065,821     $ 3,961,546     $ 3,865,258     $ 3,753,366     $ 3,678,265  
     
    COASTAL FINANCIAL CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF INCOME
    (Dollars in thousands, except per share amounts; unaudited)
     
        Three Months Ended
        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    INTEREST AND DIVIDEND INCOME                    
    Interest and fees on loans   $ 99,590   $ 90,944     $ 84,621     $ 81,159     $ 83,652
    Interest on interest earning deposits with other banks     4,781     5,683       4,780       5,687       3,884
    Interest on investment securities     675     686       1,034       1,225       766
    Dividends on other investments     33     174       37       172       29
    Total interest income     105,079     97,487       90,472       88,243       88,331
    INTEREST EXPENSE                    
    Interest on deposits     32,083     30,578       28,867       27,916       25,451
    Interest on borrowed funds     809     672       669       670       651
    Total interest expense     32,892     31,250       29,536       28,586       26,102
    Net interest income     72,187     66,237       60,936       59,657       62,229
    PROVISION FOR CREDIT LOSSES     70,257     62,325       83,158       60,789       27,253
    Net interest income/(expense) after provision for credit losses     1,930     3,912       (22,222 )     (1,132 )     34,976
    NONINTEREST INCOME                    
    Deposit service charges and fees     952     946       908       957       998
    Loan referral fees     —     —       168       —       1
    Gain on sales of loans, net     —     —       —       —       107
    Unrealized gain (loss) on equity securities, net     2     9       15       80       5
    Other income     486     257       308       60       291
    Noninterest income, excluding BaaS program income and BaaS indemnification income     1,440     1,212       1,399       1,097       1,402
    Servicing and other BaaS fees     1,044     1,525       1,131       1,015       997
    Transaction fees     1,696     1,309       1,122       1,006       1,036
    Interchange fees     1,853     1,625       1,539       1,272       1,216
    Reimbursement of expenses     1,843     1,637       1,033       1,076       1,152
    BaaS program income     6,436     6,096       4,825       4,369       4,401
    BaaS credit enhancements     70,108     60,826       79,808       58,449       25,926
    BaaS fraud enhancements     2,084     1,784       923       779       2,850
    BaaS indemnification income     72,192     62,610       80,731       59,228       28,776
    Total noninterest income     80,068     69,918       86,955       64,694       34,579
    NONINTEREST EXPENSE                    
    Salaries and employee benefits     17,101     17,005       17,984       16,490       18,087
    Occupancy     1,750     1,686       1,518       1,340       1,224
    Data processing and software licenses     3,511     2,924       2,892       2,417       2,366
    Legal and professional expenses     3,597     3,631       3,672       2,649       4,447
    Point of sale expense     1,351     852       869       899       1,068
    Excise taxes     762     (706 )     320       449       541
    Federal Deposit Insurance Corporation (“FDIC”) assessments     740     690       683       665       694
    Director and staff expenses     559     470       400       478       529
    Marketing     67     14       53       138       169
    Other expense     1,482     1,383       1,867       1,089       1,523
    Noninterest expense, excluding BaaS loan and BaaS fraud expense     30,920     27,949       30,258       26,614       30,648
    BaaS loan expense     32,612     29,076       24,837       24,310       23,003
    BaaS fraud expense     2,084     1,784       923       779       2,850
    BaaS loan and fraud expense     34,696     30,860       25,760       25,089       25,853
    Total noninterest expense     65,616     58,809       56,018       51,703       56,501
    Income before provision for income taxes     16,382     15,021       8,715       11,859       13,054
    PROVISION FOR INCOME TAXES     2,926     3,425       1,915       2,847       2,784
    NET INCOME   $ 13,456   $ 11,596     $ 6,800     $ 9,012     $ 10,270
    Basic earnings per common share   $ 1.00   $ 0.86     $ 0.51     $ 0.68     $ 0.77
    Diluted earnings per common share   $ 0.97   $ 0.84     $ 0.50     $ 0.66     $ 0.75
    Weighted average number of common shares outstanding:                    
    Basic     13,447,066     13,412,667       13,340,997       13,286,828       13,285,974
    Diluted     13,822,270     13,736,508       13,676,917       13,676,513       13,675,833
     
    COASTAL FINANCIAL CORPORATION
    AVERAGE BALANCES, YIELDS, AND RATES – QUARTERLY
    (Dollars in thousands; unaudited)
     
        For the Three Months Ended
        September 30, 2024   June 30, 2024   September 30, 2023
        Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)    		   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)    		   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)
    Assets                                    
    Interest earning assets:                                    
    Interest earning deposits with other banks   $ 350,915     $ 4,781   5.42 %   $ 418,165     $ 5,683   5.47 %   $ 285,596     $ 3,884   5.40 %
    Investment securities, available for sale (2)     40       —   —       43       —   3.13       100,283       543   2.15  
    Investment securities, held to maturity (2)     48,945       675   5.49       49,737       686   5.55       17,703       223   5.00  
    Other investments     11,140       33   1.18       10,592       174   6.61       11,943       29   0.96  
    Loans receivable (3)     3,464,871       99,590   11.43       3,258,042       90,944   11.23       3,062,214       83,652   10.84  
    Total interest earning assets     3,875,911       105,079   10.79       3,736,579       97,487   10.49       3,477,739       88,331   10.08  
    Noninterest earning assets:                                    
    Allowance for credit losses     (151,292 )             (138,472 )             (100,329 )        
    Other noninterest earning assets     268,903               255,205               220,750          
    Total assets   $ 3,993,522             $ 3,853,312             $ 3,598,160          
                                         
    Liabilities and Shareholders’ Equity                                    
    Interest bearing liabilities:                                    
    Interest bearing deposits   $ 2,966,527     $ 32,083   4.30 %   $ 2,854,575     $ 30,578   4.31 %   $ 2,515,093     $ 25,451   4.01 %
    FHLB advances and other borrowings     9,717       140   5.73       1,648       3   0.73       —       —   —  
    Subordinated debt     44,234       598   5.38       44,197       598   5.44       44,084       580   5.22  
    Junior subordinated debentures     3,591       71   7.87       3,590       71   7.95       3,589       71   7.85  
    Total interest bearing liabilities     3,024,069       32,892   4.33       2,904,010       31,250   4.33       2,562,766       26,102   4.04  
    Noninterest bearing deposits     588,178               584,661               698,532          
    Other liabilities     60,101               58,267               57,865          
    Total shareholders’ equity     321,174               306,374               278,997          
    Total liabilities and shareholders’ equity   $ 3,993,522             $ 3,853,312             $ 3,598,160          
    Net interest income       $ 72,187           $ 66,237           $ 62,229    
    Interest rate spread           6.46 %           6.17 %           6.04 %
    Net interest margin (4)           7.41 %           7.13 %           7.10 %

    (1)  Yields and costs are annualized.
    (2) For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
    (3)  Includes loans held for sale and nonaccrual loans.
    (4)  Net interest margin represents net interest income divided by the average total interest earning assets.

     
    COASTAL FINANCIAL CORPORATION
    SELECTED AVERAGE BALANCES, YIELDS, AND RATES – BY SEGMENT – QUARTERLY
    (Dollars in thousands; unaudited)
     
        For the Three Months Ended
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands, unaudited)   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)    		   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)    		   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)
    Community Bank                                    
    Assets                                    
    Interest earning assets:                                    
    Loans receivable (2)   $ 1,912,428   $ 31,898   6.64 %   $ 1,895,699   $ 30,741   6.52 %   $ 1,752,834   $ 27,373   6.20 %
    Total interest earning assets     1,912,428     31,898   6.64       1,895,699     30,741   6.52       1,752,834     27,373   6.20  
    Liabilities                                    
    Interest bearing liabilities:                                      
    Interest bearing deposits     982,280     7,264   2.94 %     938,033     6,459   2.77 %     920,707     5,067   2.18 %
    Intrabank liability     406,641     5,540   5.42       429,452     5,836   5.47       223,221     3,036   5.40  
    Total interest bearing liabilities     1,388,921     12,804   3.67       1,367,485     12,295   3.62       1,143,928     8,103   2.81  
    Noninterest bearing deposits     523,507             528,214             608,906        
    Net interest income       $ 19,094           $ 18,446           $ 19,270    
    Net interest margin(3)           3.97 %           3.91 %           4.36 %
                                         
    CCBX                                    
    Assets                                    
    Interest earning assets:                                    
    Loans receivable (2)(4)   $ 1,552,443   $ 67,692   17.35 %   $ 1,362,343   $ 60,203   17.77 %   $ 1,309,380   $ 56,279   17.05 %
    Intrabank asset     496,475     6,764   5.42       610,646     8,299   5.47       374,632     5,095   5.40  
    Total interest earning assets     2,048,918     74,456   14.46       1,972,989     68,502   13.96       1,684,012     61,374   14.46  
    Liabilities                                    
    Interest bearing liabilities:                                        
    Interest bearing deposits     1,984,247     24,819   4.98 %     1,916,542     24,119   5.06 %     1,594,386     20,384   5.07 %
    Total interest bearing liabilities     1,984,247     24,819   4.98       1,916,542     24,119   5.06       1,594,386     20,384   5.07  
    Noninterest bearing deposits     64,671             56,447             89,626        
    Net interest income       $ 49,637           $ 44,383           $ 40,990    
    Net interest margin(3)           9.64 %           9.05 %           9.66 %
    Net interest margin, net of Baas loan expense (5)           3.31 %           3.12 %           4.24 %
                                               
        For the Three Months Ended
        September 30, 2024   June 30, 2024   September 30, 2023
    (dollars in thousands, unaudited)   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)    		   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)    		   Average
    Balance    		   Interest &
    Dividends    		   Yield /
    Cost (1)
    Treasury & Administration                            
    Assets                                    
    Interest earning assets:                                    
    Interest earning deposits with other banks   $ 350,915   $ 4,781   5.42 %   $ 418,165   $ 5,683   5.47 %   $ 285,596   $ 3,884   5.40 %
    Investment securities, available for sale (6)     40     —   —       43     —   3.13       100,283     543   2.15  
    Investment securities, held to maturity (6)     48,945     675   5.49       49,737     686   5.55       17,703     223   5.00  
    Other investments     11,140     33   1.18       10,592     174   6.61       11,943     29   0.96  
    Total interest earning assets     411,040     5,489   5.31 %     478,537     6,543   5.50 %     415,525     4,679   4.47 %
    Liabilities                                    
    Interest bearing liabilities:                                    
    FHLB advances and borrowings   $ 9,717   $ 140   5.73 %     1,648     3   0.73 %     —     —   — %
    Subordinated debt     44,234     598   5.38 %     44,197     598   5.44 %     44,084     580   5.22 %
    Junior subordinated debentures     3,591     71   7.87       3,590     71   7.95       3,589     71   7.85  
    Intrabank liability, net (7)     89,834     1,224   5.42       181,194     2,463   5.47       151,411     2,059   5.40  
    Total interest bearing liabilities     147,376     2,033   5.49       230,629     3,135   5.47       199,084     2,710   5.40  
    Net interest income       $ 3,456           $ 3,408           $ 1,969    
    Net interest margin(3)           3.34 %           2.86 %           1.88 %

    (1)  Yields and costs are annualized. 
    (2)  Includes loans held for sale and nonaccrual loans. 
    (3)  Net interest margin represents net interest income divided by the average total interest earning assets. 
    (4)  CCBX yield does not include the impact of BaaS loan expense. BaaS loan expense represents the amount paid or payable to partners for credit enhancements, fraud enhancements and originating & servicing CCBX loans. See reconciliation of the non-GAAP measures at the end of this earnings release for the impact of BaaS loan expense on CCBX loan yield. 
    (5)  Net interest margin, net of BaaS loan expense includes the impact of BaaS loan expense. BaaS loan expense represents the amount paid or payable to partners for credit enhancements, fraud enhancements, originating & servicing CCBX loans. See reconciliation of the non-GAAP measures at the end of this earnings release. 
    (6) For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts. 
    (7)  Intrabank assets and liabilities are consolidated for period calculations and presented as intrabank asset, net or intrabank liability, net in the table above.

    Non-GAAP Financial Measures

    The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance.

    However, these non-GAAP financial measures are supplemental and are not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these adjusted measures, this presentation may not be comparable to other similarly titled adjusted measures reported by other companies.

    The following non-GAAP measures are presented to illustrate the impact of BaaS loan expense on net loan income and yield on CCBX loans and the impact of BaaS loan expense on net interest income and net interest margin.

    Net BaaS loan income divided by average CCBX loans is a non-GAAP measure that includes the impact BaaS loan expense on net BaaS loan income and the yield on CCBX loans. The most directly comparable GAAP measure is yield on CCBX loans.

    Net interest income net of BaaS loan expense is a non-GAAP measure that includes the impact BaaS loan expense on net interest income. The most directly comparable GAAP measure is net interest income.

    Net interest margin, net of BaaS loan expense is a non-GAAP measure that includes the impact of BaaS loan expense on net interest rate margin. The most directly comparable GAAP measure is net interest margin.

    Reconciliations of the GAAP and non-GAAP measures are presented below.

        As of and for the Three Months Ended
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    Net BaaS loan income divided by average CCBX loans:
    CCBX loan yield (GAAP)(1)     17.35 %     17.77 %     17.05 %
    Total average CCBX loans receivable   $ 1,552,443     $ 1,362,343     $ 1,309,380  
    Interest and earned fee income on CCBX loans (GAAP)     67,692       60,203       56,279  
    BaaS loan expense     (32,612 )     (29,076 )     (23,003 )
    Net BaaS loan income   $ 35,080     $ 31,127     $ 33,276  
    Net BaaS loan income divided by average CCBX loans (1)     8.99 %     9.19 %     10.08 %
    Net interest margin, net of BaaS loan expense:                
    CCBX interest margin (1)     9.64 %     9.05 %     9.66 %
    CCBX earning assets     2,048,918       1,972,989       1,684,012  
    Net interest income     49,637       44,383       40,990  
    Less: BaaS loan expense     (32,612 )     (29,076 )     (23,003 )
    Net interest income, net of BaaS loan expense   $ 17,025     $ 15,307     $ 17,987  
    CCBX net interest margin, net of BaaS loan expense (1)     3.31 %     3.12 %     4.24 %

    (1) Annualized calculations for periods presented.

    APPENDIX A –
    As of September 30, 2024

    Industry Concentration

    We have a diversified loan portfolio, representing a wide variety of industries. Our major categories of loans are commercial real estate, consumer and other loans, residential real estate, commercial and industrial, and construction, land and land development loans. Together they represent $3.43 billion in outstanding loan balances. When combined with $2.29 billion in unused commitments the total of these categories is $5.72 billion.

    Commercial real estate loans represent the largest segment of our loans, comprising 39.8% of our total balance of outstanding loans as of September 30, 2024. Unused commitments to extend credit represents an additional $41.5 million, and the combined total in commercial real estate loans represents $1.40 billion, or 24.6% of our total outstanding loans and loan commitments.

    The following table summarizes our loan commitment by industry for our commercial real estate portfolio as of September 30, 2024:

    (dollars in thousands; unaudited)   Outstanding
    Balance    		   Available
    Loan
    Commitments    		   Total
    Outstanding
    Balance &
    Available
    Commitment    		   %
    of Total
    Loans
    (Outstanding
    Balance &
    Available
    Commitment)    		   Average
    Loan
    Balance    		   Number
    of
    Loans
    Apartments   $ 382,498   $ 5,685   $ 388,183   6.8 %   $ 3,714   103
    Hotel/Motel     155,441     189     155,630   2.7       6,758   23
    Convenience Store     142,366     614     142,980   2.5       2,296   62
    Office     123,423     8,204     131,627   2.3       1,371   90
    Warehouse     102,818     2,000     104,818   1.8       1,743   59
    Retail     107,934     620     108,554   1.9       1,018   106
    Mixed use     93,490     5,273     98,763   1.7       1,154   81
    Mini Storage     79,395     14,330     93,725   1.7       3,452   23
    Strip Mall     44,089     —     44,089   0.8       6,298   7
    Manufacturing     34,599     1,200     35,799   0.6       1,193   29
    Groups < 0.70% of total     96,393     3,392     99,785   1.8       1,205   80
    Total   $ 1,362,446   $ 41,507   $ 1,403,953   24.6 %   $ 2,055   663
     

    Consumer loans comprise 33.0% of our total balance of outstanding loans as of September 30, 2024. Unused commitments to extend credit represents an additional $1.07 billion, and the combined total in consumer and other loans represents $2.20 billion, or 38.4% of our total outstanding loans and loan commitments. As illustrated in the table below, our CCBX partners bring in a large number of mostly smaller dollar loans, resulting in an average consumer loan balance of just $900. CCBX consumer loans are underwritten to CCBX credit standards and underwriting of these loans is regularly tested, including quarterly testing for partners with portfolio balances greater than $10.0 million.

    The following table summarizes our loan commitment by industry for our consumer and other loan portfolio as of September 30, 2024:

    (dollars in thousands; unaudited)   Outstanding
    Balance    		   Available
    Loan
    Commitments    		   Total
    Outstanding
    Balance &
    Available
    Commitment     (1)    		   %
    of Total
    Loans
    (Outstanding
    Balance &
    Available
    Commitment)    		   Average
    Loan
    Balance    		   Number
    of
    Loans
    CCBX consumer loans
    Credit cards   $ 633,691   $ 1,055,684   $ 1,689,375   29.5 %   $ 1.7   369,404
    Installment loans     471,813     7,112     478,925   8.4       0.9   513,897
    Lines of credit     1,362     —     1,362   0.0       2.4   558
    Other loans     9,053     —     9,053   0.2       —   365,834
    Community bank consumer loans
    		                            
    Installment loans     1,291     1     1,292   0.0       51.6   25
    Lines of credit     194     365     559   0.0       6.1   32
    Other loans     12,688     3,000     15,688   0.3       32.5   390
    Total   $ 1,130,092   $ 1,066,162   $ 2,196,254   38.4 %   $ 0.9   1,250,140

    (1)  Total exposure on CCBX loans is subject to CCBX partner/portfolio maximum limits.

    Residential real estate loans comprise 13.9% of our total balance of outstanding loans as of September 30, 2024. Unused commitments to extend credit represents an additional $522.8 million, and the combined total in residential real estate loans represents $1.00 billion, or 17.5% of our total outstanding loans and loan commitments.

    The following table summarizes our loan commitment by industry for our residential real estate loan portfolio as of September 30, 2024:

    (dollars in thousands; unaudited)   Outstanding
    Balance    		   Available
    Loan
    Commitments    		   Total
    Outstanding
    Balance &
    Available
    Commitment     (1)    		   %
    of Total
    Loans
    (Outstanding
    Balance &
    Available
    Commitment)    		   Average
    Loan
    Balance    		   Number
    of
    Loans
    CCBX residential real estate loans                                  
    Home equity line of credit   $ 265,402   $ 472,385   $ 737,787   12.9 %   $ 25   10,742
    Community bank residential real estate loans                                  
    Closed end, secured by first liens     176,066     2,961     179,027   3.1       555   317
    Home equity line of credit     25,427     46,515     71,942   1.3       106   239
    Closed end, second liens     10,974     925     11,899   0.2       366   30
    Total   $ 477,869   $ 522,786   $ 1,000,655   17.5 %   $ 42   11,328

    (1)  Total exposure on CCBX loans is subject to CCBX partner/portfolio maximum limits.

    Commercial and industrial loans comprise 8.5% of our total balance of outstanding loans as of September 30, 2024. Unused commitments to extend credit represents an additional $598.4 million, and the combined total in commercial and industrial loans represents $891.0 million, or 15.6% of our total outstanding loans and loan commitments. Included in commercial and industrial loans is $103.9 million in outstanding capital call lines, with an additional $504.6 million in available loan commitments which is limited to a $350.0 million portfolio maximum. Capital call lines are provided to venture capital firms through one of our CCBX BaaS clients. These loans are secured by the capital call rights and are individually underwritten to the Bank’s credit standards and the underwriting is reviewed by the Bank on every capital call line.

    The following table summarizes our loan commitment by industry for our commercial and industrial loan portfolio as of September 30, 2024:

    (dollars in thousands; unaudited)   Outstanding
    Balance    		   Available
    Loan
    Commitments    		   Total
    Outstanding
    Balance &
    Available
    Commitment     (1)    		   %
    of Total
    Loans
    (Outstanding
    Balance &
    Available
    Commitment)    		   Average
    Loan
    Balance    		   Number
    of
    Loans
    Consolidated C&I loans
    Capital Call Lines   $ 103,924   $ 504,561   $ 608,485   10.6 %   $ 764   136
    Construction/Contractor Services     27,463     34,658     62,121   1.1       136   202
    Financial Institutions     48,648     —     48,648   0.9       4,054   12
    Retail     33,003     5,725     38,728   0.7       15   2,247
    Manufacturing     6,124     5,460     11,584   0.2       149   41
    Medical / Dental / Other Care     6,864     2,731     9,595   0.2       528   13
    Groups < 0.20% of total     66,553     45,299     111,852   2.0       58   1,143
    Total   $ 292,579   $ 598,434   $ 891,013   15.6 %   $ 77   3,794

    (1)  Total exposure on CCBX loans is subject to CCBX partner/portfolio maximum limits.

    Construction, land and land development loans comprise 4.8% of our total balance of outstanding loans as of September 30, 2024. Unused commitments to extend credit represents an additional $63.5 million, and the combined total in construction, land and land development loans represents $226.6 million, or 4.0% of our total outstanding loans and loan commitments.

    The following table details our loan commitment for our construction, land and land development portfolio as of September 30, 2024:

    (dollars in thousands; unaudited)   Outstanding
    Balance    		   Available
    Loan
    Commitments    		   Total
    Outstanding
    Balance &
    Available
    Commitment    		   %
    of Total
    Loans
    (Outstanding
    Balance &
    Available
    Commitment)    		   Average
    Loan
    Balance    		   Number
    of
    Loans
    Commercial construction   $ 97,798   $ 41,521   $ 139,319   2.5 %   $ 7,523   13
    Residential construction     35,822     16,846     52,668   0.9       1,990   18
    Developed land loans     14,863     723     15,586   0.3       743   20
    Undeveloped land loans     8,606     4,086     12,692   0.2       574   15
    Land development     5,968     345     6,313   0.1       597   10
    Total   $ 163,057   $ 63,521   $ 226,578   4.0 %   $ 2,145   76
     

    Exposure and risk in our construction, land and land development portfolio is in line with our average historically, compared to June 30, 2024 when the balance was elevated as indicated in the following table:

        Outstanding Balance as of
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Commercial construction   $ 97,798   $ 110,372   $ 102,099   $ 81,489   $ 91,396
    Residential construction     35,822     34,652     28,751     34,213     33,971
    Undeveloped land loans     8,606     8,372     8,190     7,890     8,310
    Developed land loans     14,863     13,954     14,307     20,515     21,369
    Land development     5,968     5,714     7,515     12,993     12,640
    Total   $ 163,057   $ 173,064   $ 160,862   $ 157,100   $ 167,686
     

    Commitments to extend credit total $2.29 billion at September 30, 2024,   however we do not anticipate our customers using the $2.29 billion that is showing as available.

    The following table presents outstanding commitments to extend credit as of September 30, 2024:

    Consolidated    
    (dollars in thousands; unaudited)   As of September
    30, 2024
    Commitments to extend credit:    
    Commercial and industrial loans   $ 93,873
    Commercial and industrial loans – capital call lines     504,561
    Construction – commercial real estate loans     46,007
    Construction – residential real estate loans     17,514
    Residential real estate loans     522,786
    Commercial real estate loans     41,507
    Credit cards     1,055,684
    Consumer and other loans     10,478
    Total commitments to extend credit   $ 2,292,410
     

    We have individual CCBX partner portfolio limits with our each of our partners to manage loan concentration risk, liquidity risk, and counter-party partner risk. For example, as of September 30, 2024, capital call lines outstanding balance totaled $103.9 million, and while commitments totaled $504.6 million, the commitments are limited to a maximum of $350.0 million by agreement with the partner. If a CCBX partner goes over their individual limit, it would be a breach of their contract and the Bank may impose penalties and would not be required to fund the loan.

    See the table below for CCBX portfolio maximums and related available commitments:

    CCBX                
    (dollars in thousands; unaudited)   Balance   Percent
    of CCBX
    loans
    receivable    		 Available
    Commitments     (1)    		   Maximum
    Portfolio
    Size    		 Cash
    Reserve/
    Pledge
    Account
    Amount     (2)
    Commercial and industrial loans:            
    Capital call lines   $ 103,924     6.8 % $ 504,561   $ 350,000 $ —
    All other commercial & industrial loans     36,494     2.4     16,922     285,153   675
    Real estate loans:                
    Home equity lines of credit (3)     265,402     17.5     472,385     375,000   35,597
    Consumer and other loans:            
    Credit cards – cash secured     180         —       —
    Credit cards – unsecured     633,511         1,055,684       37,065
    Credit cards – total     633,691     41.6     1,055,684     807,263   37,065
    Installment loans – cash secured     129,138         7,112       —
    Installment loans – unsecured     342,675         —       2,222
    Installment loans – total     471,813     31.0     7,112     1,630,027   2,222
    Other consumer and other loans     10,415     0.7     —     7,557   383
    Gross CCBX loans receivable     1,521,739     100.0 %   2,056,664     3,455,000 $ 75,942
    Net deferred origination fees     (447 )            
    Loans receivable   $ 1,521,292              

    (1) Remaining commitment available, net of outstanding balance.
    (2) Balances are as of October 4, 2024.
    (3) These home equity lines of credit are secured by residential real estate and are accessed by using a credit card, but are classified as 1-4 family residential properties per regulatory guidelines.

    APPENDIX B –
    As of September 30, 2024

    CCBX – BaaS Reporting Information

    During the quarter ended September 30, 2024, $70.1 million was recorded in BaaS credit enhancements related to the provision for credit losses – loans and reserve for unfunded commitments for CCBX partner loans and negative deposit accounts. Agreements with our CCBX partners provide for a credit enhancement provided by the partner which protects the Bank by indemnifying or reimbursing incurred losses. In accordance with accounting guidance, we estimate and record a provision for expected losses for these CCBX loans, unfunded commitments and negative deposit accounts. When the provision for credit losses – loans and provision for unfunded commitments is recorded, a credit enhancement asset is also recorded on the balance sheet through noninterest income (BaaS credit enhancements) in recognition of the CCBX partner legal commitment to indemnify or reimburse losses. The credit enhancement asset is relieved as credit enhancement payments and recoveries are received from the CCBX partner or taken from the partner’s cash reserve account. Agreements with our CCBX partners also provide protection to the Bank from fraud by indemnifying or reimbursing incurred fraud losses. BaaS fraud includes noncredit fraud losses on loans and deposits originated through partners. Fraud losses are recorded when incurred as losses in noninterest expense, and the enhancement received from the CCBX partner is recorded in noninterest income, resulting in a net impact of zero to the income statement. Many CCBX partners also pledge a cash reserve account at the Bank which the Bank can collect from when losses occur that is then replenished by the partner on a regular interval. Although agreements with our CCBX partners provide for credit enhancements that provide protection to the Bank from credit and fraud losses by indemnifying or reimbursing incurred credit and fraud losses, if our partner is unable to fulfill their contracted obligation then the bank would be exposed to additional loan and deposit losses if the cash flows on the loans were not sufficient to fund the reimbursement of loan losses, as a result of this counterparty risk. If a CCBX partner does not replenish their cash reserve account the Bank may consider an alternative plan for funding the cash reserve. This may involve the possibility of adjusting the funding amounts or timelines to better align with the partner’s specific situation. If a mutually agreeable funding plan is not agreed to, the Bank could declare the agreement in default, take over servicing and cease paying the partner for servicing the loan and providing credit enhancements. The Bank would evaluate any remaining credit enhancement asset from the CCBX partner in the event the partner failed to determine if a write-off is appropriate. If a write-off occurs, the Bank would retain the full yield and any fee income on the loan portfolio going forward, and our BaaS loan expense would decrease once default occurred and payments to the CCBX partner were stopped.

    The Bank records contractual interest earned from the borrower on CCBX partner loans in interest income, adjusted for origination costs which are paid or payable to the CCBX partner. BaaS loan expense represents the amount paid or payable to partners for credit and fraud enhancements and originating & servicing CCBX loans. To determine net revenue (Net BaaS loan income) earned from CCBX loan relationships, the Bank takes BaaS loan interest income and deducts BaaS loan expense to arrive at Net BaaS loan income (A reconciliation of the non-GAAP measures are set forth in the preceding section of this earnings release.) which can be compared to interest income on the Company’s community bank loans.

    The following table illustrates how CCBX partner loan income and expenses are recorded in the financial statements:

    Loan income and related loan expense   Three Months Ended
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    Yield on loans (1)     17.35 %     17.77 %     17.05 %
    BaaS loan interest income   $ 67,692     $ 60,203     $ 56,279  
    Less: BaaS loan expense     32,612       29,076       23,003  
    Net BaaS loan income (2)   $ 35,080     $ 31,127     $ 33,276  
    Net BaaS loan income divided by average BaaS loans (1)(2)     8.99 %     9.19 %     10.08 %

    (1) Annualized calculation for quarterly periods shown.
    (2) A reconciliation of the non-GAAP measures are set forth in the preceding section of this earnings release.

    An increase in average CCBX loans receivable resulted in increased interest income on CCBX loans during the quarter ended September 30, 2024 compared to the quarter ended June 30, 2024. The increase in average CCBX loans receivable was primarily due to growth in the CCBX loan portfolio as part of our strategy to optimize the CCBX loan portfolio and strengthen our balance sheet through originating higher quality new loans and enhanced credit standards. Increased interest rates and growth in CCBX loans and deposits has resulted in increases in interest income and expense for the quarter ended September 30, 2024 compared to the quarter ended September 30, 2023.

    The following tables are a summary of the interest components, direct fees, and expenses of BaaS for the periods indicated and are not inclusive of all income and expense related to BaaS.

    Interest income   Three Months Ended
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    Loan interest income   $ 67,692   $ 60,203   $ 56,279
    Total BaaS interest income   $ 67,692   $ 60,203   $ 56,279
    Interest expense   Three Months Ended
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    BaaS interest expense   $ 24,819   $ 24,119   $ 20,384
    Total BaaS interest expense   $ 24,819   $ 24,119   $ 20,384
    BaaS income   Three Months Ended
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    BaaS program income:            
    Servicing and other BaaS fees   $ 1,044   $ 1,525   $ 997
    Transaction fees     1,696     1,309     1,036
    Interchange fees     1,853     1,625     1,216
    Reimbursement of expenses     1,843     1,637     1,152
    BaaS program income     6,436     6,096     4,401
    BaaS indemnification income:            
    BaaS credit enhancements     70,108     60,826     25,926
    BaaS fraud enhancements     2,084     1,784     2,850
    BaaS indemnification income     72,192     62,610     28,776
    Total noninterest BaaS income   $ 78,628   $ 68,706   $ 33,177
     

    Servicing and other BaaS fees decreased $481,000 in the quarter ended September 30, 2024 compared to the quarter ended June 30, 2024 while transaction fees and interchange fees increased $387,000 and $228,000, respectively. We expect servicing and other BaaS fees to decrease and transaction and interchange fees to increase as partner activity grows and contracted minimum fees are replaced with recurring fees and then exceed those minimum fees.

    BaaS loan and fraud expense:   Three Months Ended
    (dollars in thousands; unaudited)   September 30,
    2024    		   June 30,
    2024    		   September 30,
    2023
    BaaS loan expense   $ 32,612   $ 29,076   $ 23,003
    BaaS fraud expense     2,084     1,784     2,850
    Total BaaS loan and fraud expense   $ 34,696   $ 30,860   $ 25,853
     

    A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/2d50cba0-18d9-4c78-8e96-0418250a8658

    The MIL Network –

  • MIL-OSI Economics: RBI imposes monetary penalty on The Gondia District Central Co-operative Bank Ltd., Maharashtra

    Source: Reserve Bank of India

    The Reserve Bank of India (RBl) has, by an order dated October 21, 2024, imposed a monetary penalty of ₹2.60 lakh (Rupees Two lakh sixty thousand only) on The Gondia District Central Co-operative Bank Ltd., Maharashtra (the bank) for contravention of the provisions of section 20 read with section 56 of the Banking Regulation Act, 1949 (BR Act) and non-compliance with certain directions issued by RBI on ‘Membership of Credit Information Companies (CICs) by Co-operative Banks’. This penalty has been imposed in exercise of powers vested in RBI, conferred under section 47A(1)(c) read with sections 46(4)(i) and section 56 of the BR Act and section 25 of the Credit Information Companies (Regulation) Act, 2005.

    The statutory inspection of the bank was conducted by the National Bank for Agriculture and Rural Development (NABARD) with reference to its financial position as on March 31, 2023. Based on supervisory findings of contravention of statutory provisions / non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said provisions/directions.

    After considering the bank’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI found, inter alia, that the following charges against the bank were sustained, warranting imposition of monetary penalty:

    The bank had:

    1. sanctioned a loan to its director; and

    2. failed to obtain the membership of three CICs.

    This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.

    (Puneet Pancholy)  
    Chief General Manager

    Press Release: 2024-2025/1387

    MIL OSI Economics –

  • MIL-OSI Economics: RBI imposes monetary penalty on The Vaijapur Merchants Co-operative Bank Limited, Vaijapur, Maharashtra

    Source: Reserve Bank of India

    The Reserve Bank of India (RBl) has, by an order dated October 21, 2024, imposed a monetary penalty of ₹7.50 lakh (Rupees Seven lakh fifty thousand only) on The Vaijapur Merchants Co-operative Bank Limited, Vaijapur, Maharashtra (the bank), for non-compliance with specific directions issued by RBI under Supervisory Action Framework (SAF) and with the certain directions issued by RBI on ‘Know Your Customers (KYC) norms’. This penalty has been imposed in exercise of powers vested in RBI, conferred under section 47A(1)(c) read with section 46(4)(i) and section 56 of the Banking Regulation Act, 1949.

    The statutory inspection of the bank was conducted by RBI with reference to its financial position as on March 31, 2023. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions.

    After considering the bank’s reply to the notice and oral submissions made by it during the personal hearing and examination of additional submissions made by it, RBI found, inter alia, that the following charges against the bank were sustained, warranting imposition of monetary penalty:

    The bank had:

    1. made donation to certain entity and offered higher interest rates on deposits (fresh/renewal) than those offered by State Bank of India in non-adherence to directions issued under SAF.

    2. failed to put in place a robust software to throw alerts as part of effective identification and reporting of suspicious transactions.

    This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.

    (Puneet Pancholy)  
    Chief General Manager

    Press Release: 2024-2025/1388

    MIL OSI Economics –

  • MIL-OSI: U.S. Representatives Ritchie Torres (NY-15) and Gregory Meeks (NY-5) Announce Federal Home Loan Bank of New York Now Accepts Mortgage Collateral Using VantageScore 4.0

    Source: GlobeNewswire (MIL-OSI)

    NEW YORK, Oct. 28, 2024 (GLOBE NEWSWIRE) — United States Representatives Ritchie Torres (NY-15) and Gregory Meeks (NY-5) announced today that members of the Federal Home Loan Bank of New York (“FHLBNY”) can now pledge mortgage collateral using VantageScore 4.0 credit scores, which considers rental payments and other data points that are not included in traditional scoring models – expanding the number of diverse and creditworthy mortgage applicants and creating more opportunities across the region to help narrow the racial homeownership gap.

    In August 2024, Reps. Torres and Meeks formally requested that the FHLBNY consider accepting mortgage collateral originated using alternative credit scores such as VantageScore to expand homeownership opportunities across the FHLBNY’s District. In response, the FHLBNY initiated a review of its ability to incorporate VantageScore 4.0 into its collateral processes, and today’s announcement marks the culmination of this effort to offer this option to its membership of more than 330 local lenders.

    “In partnership with Congressman Meeks, I worked with the Federal Home Loan Bank of New York to implement Vantage Score 4.0, which will provide liquidity for mortgages that had originated on the basis of a credit score that includes alternative data like rent payments. The decision by the Federal Home Loan Bank of New York to recognize Vantage Score 4.0 lays a critical foundation for broad base wealth creation in America,” said Congressman Ritchie Torres. “I have constituents who have reliably paid their rent in full and on time for decades, and yet none of their rental history is taken into account by conventional credit scoring. The inclusion of alternative data like rent payments in credit scoring is a simple, sensible policy change that will revolutionize access to credit for the lowest income families.”

    “I remain committed to creating more wealth building opportunities for the people of Southeast Queens, and homeownership is the best route to do so,” said Congressman Gregory W. Meeks. “My family’s own experience is a personal attestation to the importance of home ownership. By allowing for the use of VantageScore 4.0 credit scores, the Federal Home Loan Bank of New York is broadening opportunity and ensuring that people who have been traditionally left out will have the ability to begin their homeownership journeys. Addressing racial homeownership disparities is a key step in bridging the wealth gap and I commend the FHLBNY for taking this important step.”

    “The Federal Home Loan Bank of New York is grateful to Representatives Ritchie Torres and Gregory Meeks for their continued efforts to address housing affordability across New York and throughout our District, and for their focus on ensuring that the FHLBNY remains best-positioned to meet the needs of the communities we all serve,” said José R. González, president and CEO of the Federal Home Loan Bank of New York. “We are excited to incorporate VantageScore 4.0 into our collateral practices, providing another tool for our cooperative to support inclusive housing and community development efforts throughout our region.”

    The FHLBNY joins the Federal Home Loan Banks of Chicago and San Francisco in accepting mortgage collateral originated using VantageScore 4.0. In October 2022, the Federal Housing Finance Agency – the regulator of the Federal Home Loan Bank System – announced its approval of VantageScore 4.0 for Fannie Mae and Freddie Mac. VantageScore estimates that using the VantageScore 4.0 credit model will result in approximately 33 million more consumers nationwide having access to a credit score that may aid them in obtaining a mortgage. This includes an estimated 3.1 million consumers within the FHLBNY’s District, which comprises New York, New Jersey, Puerto Rico and the U.S. Virgin Islands.

    “The Federal Home Loan Bank of New York’s decision to accept mortgage collateral backed by VantageScore is a significant step forward in expanding access to homeownership for creditworthy individuals, particularly in underserved communities,” said Anthony Hutchinson, SVP of Government and Industry Relations, VantageScore. “By addressing the long-standing disparities in mortgage lending, this initiative supports our shared goal of narrowing the homeownership gap in communities of color while ensuring financial stability and inclusion for all.”

    Broad Community Support

    Through the first 10 months of 2024, the FHLBNY has made $135 million in affordable housing and community support available through multiple programs:

    • $70.8 million in grant funding through its 2024 Affordable Housing Program Round
    • $28.9 million in grant funding through its 2024 Homebuyer Dream Program® (“HDP®”) Round
    • $10.3 million in grant funding through inaugural HDP Plus Round
    • $15 million in interest rate credits through its 2024 0% Development Advance Program
    • $5 million in supplemental credits for low-to-moderate income mortgages sold into its Mortgage Asset Program
    • $5 million in grant funding through its 2024 Small Business Recovery Grant Program Round

    These programs are funded directly by the FHLBNY’s earnings and are incorporated into its strategy, reflecting the FHLBNY’s continuing commitment to strengthening the communities it serves. The FHLBNY makes its broadest impact through the execution of its foundational liquidity mission, through which it provides its members with a stable source of liquidity to facilitate the extension of credit to consumers, communities, and small businesses across its region.

    Federal Home Loan Bank of New York
    The Federal Home Loan Bank of New York is a Congressionally chartered, wholesale Bank. It is part of the Federal Home Loan Bank System, a national wholesale banking network of 11 regional, stockholder-owned banks. As of September 30, 2024, the FHLBNY serves 338 financial institutions and housing associates in New Jersey, New York, Puerto Rico, and the U.S. Virgin Islands. The mission of the FHLBNY is to provide members with reliable liquidity in support of housing and local community development.

    Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
    This report may contain forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as “projected,” “expects,” “may,” or their negatives or other variations on these terms. The Bank cautions that, by their nature, forward-looking statements involve risk or uncertainty and that actual results could differ materially from those expressed or implied in these forward-looking statements or could affect the extent to which a particular objective, projection, estimate, or prediction is realized. These forward-looking statements involve risks and uncertainties including, but not limited to, the Risk Factors set forth in our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q filed with the SEC, as well as regulatory and accounting rule adjustments or requirements, changes in interest rates, changes in projected business volumes, changes in prepayment speeds on mortgage assets, the cost of our funding, changes in our membership profile, the withdrawal of one or more large members, competitive pressures, shifts in demand for our products, and general economic conditions. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to revise or update publicly any forward-looking statements for any reason.

    CONTACT:   Brian Finnegan
    (212) 441-6877
    brian.finnegan@fhlbny.com       

    The MIL Network –