NewzIntel.com

Category: Banking

  • MIL-OSI Europe: Switzerland at 2024 IMF and World Bank Annual Meetings and G20 Finance Ministers Meeting in Washington

    Source: Switzerland – Department of Finance

    Federal Councillors Karin Keller-Sutter and Guy Parmelin, accompanied by Martin Schlegel, Chairman of the Governing Board of the Swiss National Bank, will attend the Annual Meetings of the International Monetary Fund (IMF) and the World Bank in Washington from 23 to 25 October 2024. A meeting of G20 finance ministers and central bank governors will also take place during the Annual Meetings. The Swiss delegation will additionally use the event for bilateral talks.

    MIL OSI Europe News –

  • MIL-OSI Submissions: WHO – Ten additional countries in the Western Pacific Regionpledge to invest in WHO

    Source: World Health Organization (WHO)

    MANILA, 23 October 2024 – In a historic show of support, 10 more countries in the Western Pacific Region pledged to provide an additional US$ 12.1 million to the World Health Organization (WHO) through its first-ever Investment Round. This comes in addition to US$ 18 million announced by Singapore in May. The WHO Investment Round aims to secure predictable, flexible, and resilient resources for WHO’s core work over the next four years.

    The seventy-fifth session of the WHO Regional Committee for the Western Pacific began on Monday with Member States formally endorsing the new regional vision Weaving Health for Families, Communities and Societies in the Western Pacific Region (2025-2029): Working together to improve health, well-being and save lives.

    The financial commitments were made during a Special Event on the Investment Round at the Regional Committee today. Governments and partners from across Asia and the Pacific in attendance emphasized the importance of ensuring WHO has robust financing to implement its global strategy for the 2025-2028 period, the 14th General Programme of Work, which was approved by Member States at the World Health Assembly in May 2024.

    The Government of the Philippines co-hosted the Special Event and made a historic pledge of US$ 10 million to the WHO Investment Round. During his remarks, Secretary of Health Dr Teodoro J. Herbosa of the Philippines said “A robust, reliable, and sustainably funded WHO is crucial for the Western Pacific Region and the world to address inequities and inequalities in health which were amplified by the COVID-19 pandemic. Today, we have taken a significant first step towards a future where health and well-being are accessible to everyone.”

    Malaysia also demonstrated its support of WHO’s work through a US$ 2 million pledge towards the Investment Round.

    In a powerful symbol of Pacific leaders’ commitment to health and WHO’s pivotal role in supporting them, eight Pacific Island countries pledged to double their funding contributions to WHO for 2025.  First-ever voluntary contributions to WHO were announced today by Papua New Guinea, and Cook Islands, Palau, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu.

    Speaking to the Regional Committee through a live video connection on Tuesday morning, WHO Director-General Dr Tedros Adhanom Ghebreyesus noted that to support the implementation of the Organization’s new global strategy, “we have launched the first WHO Investment Round, which aims to mobilize the sustainable and predictable resources we need to do our work. Thank you all for your commitment to promoting, providing and protecting health, for all people of the Western Pacific.”

    During the Investment Round Special Event, WHO Regional Director for the Western Pacific, Dr Saia Ma’u Piukala, thanked Member States and partners for their pledges, which will enable the Organization to support countries more effectively.

    “The commitments made today are truly historic,” Dr Piukala said. “They include a doubling of financial contributions from several of our small island developing states, and significant sums from the Philippines and Malaysia.

    “It’s a sign of governments’ confidence in WHO as their partner in health, and a recognition of the need for sustainable financing in order to deliver on the vision of weaving health for families, communities and societies in the Western Pacific,” he said.

    Prior to the meeting, WHO launched the document All for Health, Health for All: WHO Investment Case 2025-28 Western Pacific to capture the impact of a fully-funded Western Pacific Region over the next four years.

    Partners joined Members States in statements of support for WHO. Organizations including the Asian Development Bank, the Institute of Philanthropy and Temasek Trust committed to working closely with WHO during the next four years. Earlier this month, the Institute of Philanthropy made a US$10 million pledge to the Investment Round during the World Health Summit in Berlin, following a $1.2 million pledge in May at the World Health Assembly. The Temasek Foundation also pledged $10 million on the sidelines of the United Nations General Assembly in September.

    “We are off to a great start for the Investment Round in the Western Pacific based on today’s event,” said Dr Piukala. “Today we also heard that we should expect to see more countries and partners stepping up to provide additional resources in the coming weeks.”

    With a fully and sustainably funded operating budget for 2025–2028, WHO will be better able to tackle emergencies and outbreaks that jeopardize health security and threaten lives, reduce the burden of both infectious diseases and noncommunicable diseases (NCDs), and continue working to improve the health and well-being of everyone, especially the most vulnerable.

    Launched at the World Health Assembly in May 2024, the Investment Round aims to mobilize contributions that are flexible and thereby aligned with WHO’s strategy as approved by its Member States, predictably provided at the start of the four-year programme cycle to enable strategic decision-making, and resilient in that they will derive from a larger, more diverse set of donors.

    WHO’s Investment Round will culminate at the G20 leaders’ summit chaired by Brazilian President Lula da Silva next month.

    Notes:

    The seventy-fifth session of the Western Pacific Regional Committee began on 21 October and runs through 25 October at WHO’s Regional Office for the Western Pacific in Manila, Philippines. The agenda (https://cdn.who.int/media/docs/default-source/wpro—documents/regional-committee/session-75/wpr-rc75-01-provisional-agenda.pdf ) and timetable (https://cdn.who.int/media/docs/default-source/wpro—documents/regional-committee/session-75/tentative-timetable_rc75.pdf ) are available online. A livestream of proceedings, all other official documents, as well as fact sheets and videos on the issues to be addressed can be accessed here. https://www.who.int/westernpacific/about/governance/regional-committee/session-75

    Working with 194 Member States across six regions, WHO is the United Nations specialized agency responsible for public health. Each WHO region has a regional committee – a governing body composed of ministers of health and senior officials from Member States. Each regional committee meets annually to agree on health actions and to chart priorities for WHO’s work.

    The WHO Western Pacific Region is home to more than 1.9 billion people across 37 countries and areas: American Samoa (United States of America), Australia, Brunei Darussalam, Cambodia, China, Cook Islands, Fiji, French Polynesia (France), Guam (United States of America), Hong Kong SAR (China), Japan, Kiribati, the Lao People’s Democratic Republic, Macao SAR (China), Malaysia, the Marshall Islands, the Federated States of Micronesia, Mongolia, Nauru, New Caledonia (France), New Zealand, Niue, the Commonwealth of the Northern Mariana Islands (United States of America), Palau, Papua New Guinea, the Philippines, Pitcairn Islands (United Kingdom of Great Britain and Northern Ireland), the Republic of Korea, Samoa, Singapore, Solomon Islands, Tokelau, Tonga, Tuvalu, Vanuatu and Viet Nam, Wallis and Futuna (France).

    MIL OSI – Submitted News –

  • MIL-OSI United Kingdom: Work begins on new Community-Led Housing project in Ryde 23 October 2024 Work begins on new Community-Led Housing project in Ryde

    Source: Aisle of Wight

    Work is underway on a new Community-Led Housing project in Ryde — one of the first of its kind on the Island.

    The innovative development will offer a mix of studio and one-bedroom flats, available at truly affordable rents.

    The scheme is the first to be funded under the Isle of Wight Council’s Community-Led Housing project and is due to welcome its first residents in June next year.

    John Prickett, the council’s Community-Led Housing officer, has been supporting Aspire Ryde to purchase and re-purpose the charity’s High Street building.

    Last month work started to convert the upper two floors into seven self-contained flats for Island people, including veterans, who would otherwise be in danger of homelessness.

    The ARCH Community Hub and shop will be retained on the ground floor.

    Aspire will support people with their tenancies with the view to their eventual move to a suitable permanent home.

    Councillor Ian Stephens, the council’s Cabinet member for housing, said: “We’re excited that we’re finally able to start work on this important, Community-Led Housing project in partnership with Aspire Ryde.

    “We recognise the issues facing the Island and remain absolutely committed to the delivery of affordable housing.

    “We hope developments such as this will encourage more Community-Led Housing schemes to come forward and help us to provide the affordable homes we so desperately need for Islanders.”

    Aspire has been able to fund the purchase and development of the project through a mix of specific Community-Led Housing funding from the Isle of Wight Council, and a long-term loan from Charity Bank.

    Grants from Charity Bank, the Armed Forces Covenant Trust and the B&Q Foundation have also been secured to fund the finishes to the flats.

    The designers for the project, who worked with Aspire through various re-designs, were local practice Arid Design (Ltd) and the building contractor is DN Associates Limited.

    Trevor Nicholas, chief executive of Aspire Ryde, said: “We are thrilled to have got to this point with the project and are extremely grateful to John Prickett and the Isle of Wight Council, alongside Charity Bank and other grant funders for their support and commitment to providing homes for those in the greatest need.

    “It is fantastic to see Community-Led Housing taking shape here and we hope that this will act as a catalyst for other projects across the Island. We are so looking forward to welcoming our first residents.”

    Photo shows: JD Viette (project manager for Aspire), John Prickett, Trevor Nicholas and council Leader Councillor Phil Jordan.

    MIL OSI United Kingdom –

  • MIL-OSI Europe: The EBA releases a first draft of the technical package for its 4.0 reporting framework

    Source: European Banking Authority

    The European Banking Authority (EBA) published today a draft technical package for version 4.0 of its reporting framework. This publication aims to provide an early version of the 4.0 release given that its reporting obligations will apply as of the first half of 2025. This package, whose final version will be released in December 2024, will facilitate a smoother transition to the new data point model (DPM) semantic glossary and the capabilities of the DPM 2.0 model.

    The package provides the standard specifications that include the validation rules, the DPM and the XBRL taxonomies to support the following reporting obligations:

    This draft technical package includes a version of the data dictionary contents in both formats the DPM 1.0 and the new format DPM 2.0.

    The  DPM Query Tool has also been updated to reflect the current release. 

    Background and next steps

    The final version of the technical package for the 4.0 reporting framework will be published in December and will include the changes suggested by the three ESAs in the Opinion, published on 15 October, on the European Commission’s (EC) rejection of the draft ITS on the registers of information under the Digital Operational Resilience Act (DORA). Together with this technical package the EBA is publishing a set of Q&As providing additional explanations, including on the next steps as well as on the package to be published in December.

    The EBA published in June new Implementing Technical Standards specifying the reporting obligations under Regulation (EU) 2023/1114 on Markets in Crypto-Assets (MiCAR).

    MIL OSI Europe News –

  • MIL-OSI: Home BancShares, Inc. Announces Fourth Quarter Cash Dividend

    Source: GlobeNewswire (MIL-OSI)

    CONWAY, Ark., Oct. 23, 2024 (GLOBE NEWSWIRE) — Home BancShares, Inc. (NYSE: HOMB), parent company of Centennial Bank, today announced that its Board of Directors has declared a regular $0.195 per share quarterly cash dividend payable December 4, 2024, to shareholders of record November 13, 2024. This cash dividend represents a $0.015 per share, or 8.3%, increase over the $0.18 cash dividend paid during the fourth quarter of 2023 and is consistent with the dividend paid during the third quarter of 2024.

    Home BancShares, Inc. is a bank holding company, headquartered in Conway, Arkansas. Its wholly-owned subsidiary, Centennial Bank, provides a broad range of commercial and retail banking plus related financial services to businesses, real estate developers, investors, individuals and municipalities. Centennial Bank has branch locations in Arkansas, Florida, Texas, South Alabama and New York City. The Company’s common stock is traded through the New York Stock Exchange under the symbol “HOMB.”

    FOR MORE INFORMATION CONTACT:
    Donna Townsell
    Senior Executive Vice President &
       Director of Investor Relations
    (501) 328-4625

    The MIL Network –

  • MIL-OSI: Spar Nord revises its financial guidance

    Source: GlobeNewswire (MIL-OSI)

    Company announcement no. 64
     

    Spar Nord revises its expectations for profit after tax for 2024 to DKK 2,100-2,300 million.

    In Interim report H1 2024, Spar Nord reiterated its full-year 2024 guidance for profit after tax at the DKK 1,950-2,250 million range and guidance for full-year core earnings before impairment at the DKK 2.600-3,000 million range.

    In Q3 2024, core earnings before impairment has been in line with the Bank’s expectations while a persistently strong credit quality for the bank’s retail and business customers has led to a minor net reversal of impairments for the sixth consecutive quarter in a row.

    Against this background, Spar Nord now expects a profit impact from impairment charges of around DKK 0 million for 2024.

    As a result, the bank’s full-year guidance for profit after tax is revised to DKK 2,100-2,300 million.

    Furthermore, full-year guidance for core earnings before impairment is narrowed to the DKK 2,700-3,000 million range.

    Spar Nord’s financial report for Q3 2024 will be released as scheduled on 31 October 2024.

    Please direct any questions regarding this release to Rune Brandt Børglum, Head of Investor Relations, on tel. + 45 9634 4236.

    Rune Brandt Børglum
    Head of Investor Relations

    Attachment

    The MIL Network –

  • MIL-OSI: Aktia’s interim report for January–September will be published on Wednesday 6 November 2024 at 8.00 a.m.

    Source: GlobeNewswire (MIL-OSI)

    Aktia Bank Plc
    Press release
    23 October 2024 at 1.00 p.m.

    Aktia’s interim report for January–September will be published on Wednesday 6 November 2024 at 8.00 a.m.

    Aktia’s interim report for January–September 2024 will be published on Wednesday 6 November 2024 at 8.00 a.m. (EET). The interim report is available at Aktia’s website http://www.aktia.com after the publication.

    Briefing for analysts, investors and media

    Aktia’s briefing for analysts, investors and media will be held in English at Flik Studio Eliel (Sanoma House, 1st floor, Töölönlahdenkatu 2, Helsinki) on Wednesday 6 November 2024 at 10.30 a.m. Aktia’s CEO Aleksi Lehtonen and interim CFO Karri Varis will be presenting the results. Attendees are kindly asked to register before 1 November 2024 by email at the address ir@aktia.fi.

    The briefing can be seen live as a webcast or as a recording after the briefing at https://aktia.videosync.fi/aktia-pankki-oyj-q3-report-2024. Questions can be asked in writing during the live webcast.

    The presentation material in English is available at Aktia’s website http://www.aktia.com before the briefing.

    Aktia Bank Plc

    Further information:
    Oscar Taimitarha, Director, Investor Relations, tel. +358 40 562 2315

    Distribution:
    Nasdaq Helsinki Ltd
    Mass media
    http://www.aktia.com

    Aktia is a Finnish asset manager, bank and life insurer that has been creating wealth and wellbeing from one generation to the next for 200 years. We serve our customers in digital channels everywhere and face-to-face in our offices in the Helsinki, Turku, Tampere, Vaasa and Oulu regions. Our award-winning asset management business sells investment funds internationally. We employ approximately 850 people around Finland. Aktia’s assets under management (AuM) on 30 June 2024 amounted to EUR 14.1 billion, and the balance sheet total was EUR 12.4 billion. Aktia’s shares are listed on Nasdaq Helsinki Ltd (AKTIA). aktia.com.

    The MIL Network –

  • MIL-OSI Asia-Pac: CEDD deeply saddened by passing of worker

    Source: Hong Kong Government special administrative region

         The Director of Civil Engineering and Development, Mr Michael Fong, today (October 23) was deeply saddened by the passing of a subcontractor’s worker who fell into the sea at the Tuen Mun Area 38 Fill Bank earlier. Mr Fong expressed his deepest condolences to the deceased’s family. The Civil Engineering and Development Department (CEDD) is working with the contractor to provide appropriate assistance to the deceased’s family.

         The worker fell into the sea after assisting with the berthing of a vessel on October 21. The Fire Services Department recovered a body underwater around 7.30am today near a pier at the Tuen Mun Area 38 Fill Bank. The body was later confirmed to be the worker who fell into the sea and went missing earlier.

         The CEDD is rendering full assistance to investigations by the Labour Department and the Police on the cause of the incident. The CEDD requires contractors and subcontractors to strictly comply with safety guidelines. After the incident, the CEDD immediately requested the contractor and subcontractor to suspend relevant works and carry out a thorough review on safety measures to prevent a reoccurrence of similar incidents.

    MIL OSI Asia Pacific News –

  • MIL-OSI: Multitude P.L.C.: The Extraordinary General Meeting of Shareholders Decided on the Approval of the Final Accounts and Discharging the Members of the Board of Directors and the Chief Executive Officer from Liability

    Source: GlobeNewswire (MIL-OSI)

    Multitude P.L.C.: The Extraordinary General Meeting of Shareholders Decided on the Approval of the Final Accounts and Discharging the Members of the Board of Directors and the Chief Executive Officer from Liability 

    Gzira, 23 October 2024 – The Extraordinary General Meeting of Shareholders (“Meeting”) of Multitude P.L.C., a listed European FinTech company, offering digital lending and online banking services to consumers, small and medium-sized businesses, and other FinTechs (WKN: A40G1Q, ISIN: MT0002810100) (“Multitude” or “Company”), has today resolved to adopt and approve the Company’s final accounts including the financial statements and the Board of Directors’ report for the period for which financial statements had not yet been presented at the Shareholders’ General Meeting, i.e., for the period running from 1 January 2024 to 30 June 2024.  

    In addition, the Extraordinary General Meeting of Shareholders resolved, insofar as permitted under the Maltese Companies Act (chapter 386 of the laws of Malta), and in line with Finnish market practice, to discharge the members of the Board of Directors and the CEO from liability for the period covered by the final accounts (i.e., while the Company was still registered in Finland).  

    The Meeting was held following the transfer of the Company’s registered office from Finland to Malta in accordance with Article 8 of the Council Regulation (EC) No 2157/2001 of 8 October 2001 on the Statute for a European company (SE) on 30 June 2024, in order to adopt the Company’s final accounts as required pursuant to Section 11 of the Finnish European Companies Act (742/2004, as amended) and to make certain related resolutions. Accordingly, for the purposes of Section 11 of the Finnish European Companies Act, the Meeting was deemed to be a meeting of shareholders (in Finnish: “osakkeenomistajien kokous”). 

    The full minutes of the October EGM setting out said resolutions which were adopted will be available on the Company’s website no later than one week after the date of the Extraordinary General Meeting, i.e., no later than on 30 October 2024.  

    Contact: 

    Lasse Mäkelä  
    Chief Strategy and IR Officer 
    Phone: +41 79 371 34 17 
    E-Mail: Lasse.makela@multitude.com 

    About Multitude P.L.C.: 

    Multitude is a listed European FinTech company, offering digital lending and online banking services to consumers, small and medium-sized enterprises, and other FinTechs overlooked by traditional banks. The services are provided through three independent business units, which are served by our internal Banking-as-a-Service Growth Platform. Multitude’s business units are Consumer Banking (Ferratum), SME Banking (CapitalBox), and Wholesale Banking (Multitude Bank). Multitude Group employs over 700 people in 25 countries and offers services in 16 countries, achieving a combined turnover of 230 million euros in 2023. Multitude was founded in Finland in 2005 and is listed on the Prime Standard segment of the Frankfurt Stock Exchange under the symbol ‘E4l’. http://www.multitude.com 

    The MIL Network –

  • MIL-OSI Europe: Take a ‘teledrive’

    Source: European Investment Bank

    In January 2024, Vay launched its first commercial service – in Las Vegas, where regulations for driverless vehicles are currently less stringent than in Europe. The technology was installed in 20 Kia Niro electric vehicles, and the service covers about a quarter of the city. The company plans to scale up the Las Vegas service, and to introduce it across Europe.

    Developing the technology and scaling up the service is expensive, but the company raised money fast. “We have fantastic investors. We raised our first pre-seed in three days – €1.1 million,” von der Ohe says. Eight months later, the company secured an additional €12.5 million, and in 2021, an additional €95 million. “Having the experience from Silicon Valley helped,” he adds.

    In September 2024, the European Investment Bank signed a €34 million venture-debt investment, supported by InvestEU, to help Vay accelerate the development of its service and technology.

    “The European Investment Bank helped by giving us good financing terms to take our technology to the next step,” von der Ohe says. “It helps us roll out our technology in more markets, especially across Europe.”

    Given von der Ohe’s European ambitions, it’s notable that Vay became the first and only company in Europe to drive on public streets without a safety driver, when it received authorisation from Hamburg to operate a driverless car in the city’s streets in 2023.

    “That’s the big step change – taking out the physical driver,” says von der Ohe. “Even in the US, only Waymo has achieved this, and they’re owned by Google, which invests billions of dollars every year to develop that technology.”

    Teledriving: This is how it works.

    MIL OSI Europe News –

  • MIL-OSI Europe: EIB Investment Survey 2024: More than 60% of European companies have invested in climate mitigation and adaptation and more than 70% in their digital transformation

    Source: European Investment Bank

    • EU businesses lead way in investments in climate mitigation and adaptation, with 61% having already invested and 53% planning to do so.
    • Use of advanced digital technologies on the rise as 74% of European firms embrace advanced technologies to enhance competitiveness.
    • Faced with trade shocks, firms are investing in more resilient and secure supply chains.

    Companies in the European Union weathered relatively well the health, price and trade shocks of the last four years and have increased their ambitions for green and digital transformation, according to a survey by the European Investment Bank (EIB).  

    The EIB’s Investment Survey 2024 , released today at the World Bank-IMF Annual Meetings in Washington, paints a picture of leadership of EU businesses in the green transition and the reinforcement of their supply chains in the face of heightened geopolitical risks and supply-chain disruptions.

    Many firms in Europe are satisfied with their investment levels over the past three years and are committed to tackling climate change and embracing digital technologies, the survey shows. It covers a total of around 12,000 companies in all EU countries as well as a comparison sample in the United States.

    While the share of EU companies expecting to increase rather than decrease investment has halved to a net balance of 7% in 2024, compared with last year, businesses in Europe continue to outpace their US counterparts and lead in investments to slash emissions that cause climate change or cope with the impact of severe weather. The latest Investment Survey shows that 61% of EU firms have invested in tackling climate change, compared to 56% in 2023 and 53% in 2022. The green transition impose transformation, but also brings opportunities. More than a quarter of EU firms –27%– view the transition to a net-zero economy, as an opportunity over the next five years.

    “The commitment of EU firms to the green and digital transitions illustrates the potential of the European economy,” said EIB President Nadia Calviño. “The survey confirms that public-private partnership is at the heart of strategic investments to sustain the competitiveness, security and autonomy of the EU in global markets.”

    Around 90% of EU and US firms have taken measures to reduce greenhouse gas emissions. Key strategies adopted include investment in waste reduction and recycling and energy efficiency. EU companies are more likely than US ones to have enacted sustainable transport options, opted for renewable-energy generation and set emissions-reduction targets. One in three EU companies –34%– sees the green transition as a business risk compared with 42% in the US. 

    In the EU, 37% of total investments by businesses are directed towards intangible assets such as research, skills and know-how, highlighting a strategic focus on innovation and digital solutions.74% of EU businesses reported using digital technologies, marking a 4% increase from last year. Meanwhile, the US continues to lead at 81%.

    Looking ahead to the next three years, however, many European companies are prioritising replacement investments over capacity expansion, with only 26% of EU firms planning to expand operations in the next three years compared with 47% of US firms.

    “The focus of EU companies on innovation is welcome and must be supported”, added EIB President Nadia Calviño. “That is why the EIB Group is working on new Action Plan to reinforce the integration of Europe´s Capital Markets and thereby channel private savings into productive investment in Europe”.

    The business environment remains a concern for firms in the European Union and the United States, with lack of skilled labour and uncertainty about the future as one of the key concerns in both regions. Business investment is still hindered by high energy costs, which pose significant obstacles for 46% of EU businesses.

    The majority (60%) of EU exporters report that they still have to comply with different standards and consumer protection rules from one Member State to the next, highlighting that market fragmentation persists.

    “European firms are making strides in addressing both climate change and the digital transformation,” said EIB Chief Economist Debora Revoltella. “But boosting EU investment requires a less fragmented EU single market.”

    The survey also underscores the importance of robust supply chains. Concerns about trade disruptions have eased compared to last year, but firms did not see improvements in terms of new regulations, tariffs or trade restriction. EU companies are well integrated into global trade and substantially benefited from it in the past. In a new world with rising geopolitical tensions, EU firms are reacting by enhancing the resilience of their supply chains in looking at economic security and efficiency.

    The 2024 report serves policymakers, economists and business leaders by providing insights into the investment landscape and identifying actions needed to foster economic growth and resilience. For more information and the full report, visit our website here.

     Background information

    The European Investment Bank (EIB) is the long-term lending institution of the European Union and is owned by its Member States. It provides finance and expertise for projects that contribute to the EU’s policy objectives. The EIB works closely with public and private-sector partners to support sustainable investment, job creation, economic growth and innovation across Europe.

    On October 7th, European Union Finance ministers have welcomed an Action Plan to be deployed by the European Investment Bank (EIB) Group, to support the development of the EU’s Capital Markets Union. One key objective of the Action Plan is closing the funding gap throughout the company and innovation cycle; the EIB Group plans to scale up support for the EU venture capital and private equity markets, to help retain the most innovative scale-ups in Europe.

    About the report

    The EIB Group Survey on Investment, which has been carried out since 2016, is a unique annual survey of some 12,000 firms. Data for the latest edition was collected in mid-2024 from companies in all EU Member States. The survey also includes a sample of businesses in the United States. The survey collects data on company characteristics and performance, past investment activities and future plans, sources of finance, financing hurdles and other business challenges such as climate change, digitalisation and international trade.

    MIL OSI Europe News –

  • MIL-OSI Banking: Thales reports its order intake and sales as of September 30, 2024

    Source: Thales Group

    Headline: Thales reports its order intake and sales as of September 30, 2024

    • Order intake: €15.6 billion, up 23% on an organic basis1(+26% total change)
    • Sales: €14.1 billion, up 6.2% on an organic basis (+9.4% total change)
    • 2024 targets confirmed:
      • Book-to-bill ratio above 1
      • Organic sales growth between +5% and +6%2
      • EBIT margin: 11.7% to 11.8%

    Thales (Euronext Paris: HO) today announced its order intake and sales for the period ending September 30, 2024.

    Reminder: 9m 2023 figures have been restated to include Cyber civil activities transferred from Defence and Security to Digital Identity & Security.

    “The third quarter confirmed the continued strong commercial momentum and organic sales growth in most of Thales’ businesses.
    ​The Defence business enjoyed unparalleled visibility thanks to emblematic long-term contracts. Avionics was driven by the recovery in air traffic and solid growth prospects. The cybersecurity and biometrics businesses benefited from a robust environment.
    ​We are also proud of Thales’ inclusion in the CAC 40 ESG index. This is a strong external endorsement of our non-financial performance and of our contribution to the protection of society, the planet and citizens.
    ​We are confident that we will achieve our annual financial targets for 2024, thanks to our teams’ unwavering involvement.”
    ​
    ​Patrice Caine, Chairman & Chief Executive Officer

    Order intake

    Order intake over the first nine months of 2024 amounted to €15,551 million, up 23% on an organic basis4 compared with the first nine months of 2023 (up 26% total change). The Group continued to benefit from an excellent commercial momentum in all its businesses, particularly in Defence & Security.

    Over the period, Thales recorded 19 large orders with a unit value of more than €100 million, the cumulative amount of which came to €4,983 million:

    • Four large orders booked in Q1 2024:
      • The entry into force of the third phase of the order placed by Indonesia in 2022 for the purchase of 42 Rafale aircraft (18 aircraft and support services);
      • Order of an aerial surveillance system for a military customer in the Middle East;
      • Second tranche of the contract signed in 2023 between France and Italy for the production of 400 ASTER B1NT ground-to-air missiles;
      • Phased contract with the French Defence Procurement Agency (DGA) to develop the next generation of sonars to equip French nuclear-powered ballistic-missile submarines (SSBN).
    • Eight large orders booked in Q2 2024:
      • Order of two new F126 frigates by the German Navy. This additional contract brings the number of F126 frigates acquired by the German Navy to six in the past four years;
      • Exomars 2028, a contract signed between industrial prime contractor Thales Alenia Space and the European Space Agency (ESA) to relaunch the European space mission dedicated to the exploration of the Red Planet;
      • Order by SKY Perfect JSAT to Thales Alenia Space of JSAT-31, a new generation of satellite reconfigurable in orbit using Space INSPIRE technology;
      • Order by France’s Joint Munitions Command (SiMu) of tens of thousands of 120mm rifled ammunition;
      • Order for a next generation cloud native “FLYTEDGE” InFlight Entertainment System for a major worldwide airline;
      • Order by an Asian customer of latest-generation Ground Master 400 Alpha long-range air surveillance radars;
      • Order by the Dutch Ministry of Defence of seven additional Ground Master 200 multi-mission compact radars;
      • Service contract for the maintenance of the Royal Australian Navy fleet.
    • Seven major orders recorded in Q3 2024:
      • Order for the supply of communications, vetronics, navigation and optronics equipment for vehicles in the French Army’s SCORPION program;
      • Order for the renovation of an air traffic management system;
      • Order from the UK Ministry of Defence for the supply of LMM missiles to strengthen Ukraine’s air defence capabilities;
      • Order of LMM missiles for the British armed forces;
      • Order for the supply of Ground Fire multifunction radars and engagement modules following France’s acquisition of seven SAMP/T NG air defence systems;
      • Order for the supply of anti-submarine warfare systems for the first phase of the construction of six HUNTER-class frigates for the Royal Australian Navy;
      • Notification by the DGA of the second tranche of the development of the future RBE2 XG radar for the Rafale F5.

    At €10,567 million, order intake with a unit value of less than €100 million increased by 6% compared to the first nine months of 2023; while order intake with a unit value of less than €10 million was up by 7% at September 30, 2024.

    From a geographical5 point of view, order intake in mature markets recorded organic growth of 12%, to €11,413 million, driven by strong sales momentum in the United Kingdom (up 28% on an organic basis) as well as in Australia and New Zealand (up 34% on an organic basis). Order intake in emerging markets amounted to €4,137 million, with strong organic growth of 69% as at September 30, 2024. This performance reflected excellent momentum in the Near and Middle East (up 175% on an organic basis) and in Asia (up 49% on an organic basis).

    Order intake in the Aerospace segment totaled €3,639 million, versus €3,403 million over the first nine months of 2023 (+8% at constant scope and exchange rates). This increase reflects two contrasting trends. On the one hand, the avionics market remained strong, our activities growing double-digit organically. On the other hand, the order intake in the space business declined due to a high comparison basis (two large orders signed as at September 30, 2024 versus five as of September 30, 2023).

    At €8,951 million (compared with €6,404 million for the first nine months of 2023), order intake in the Defence & Security segment continued to record a strong momentum, with organic growth of 40%. Seven new orders with a unit value of more than €100 million in the third quarter were added to the nine already recorded in the first half of the year. The order book stood at €37.0 billion, compared with €35.1 billion at September 30, 2023.

    At €2,905 million, order intake in the Digital Identity & Security segment was in line with sales over the period, as most of the activities in this segment operate on short cycles.

    Sales

    Sales for the first nine months of 2024 amounted to €14,069million, compared with €12,854 million for the same period in 2023, an increase of 6.2% at constant scope and exchange rates.

    From a geographical5 point of view, sales growth was strong in mature markets (+6.3% on an organic basis), driven in particular by Europe (+9.0%) including France (+9.4%), and Australia and New Zealand (+8.5%). Emerging markets posted organic growth of +5.8% over the period.

    Sales in the Aerospace segment amounted to €3,839 million, up 5.6% compared to the first nine months of 2023 (+5.3% at constant scope and exchange rates). This growth reflected ongoing robust demand in the avionics market, leading the activity to grow mid-single digit plus. It was however mitigated by the low-single digit organic growth of the space business.

    Sales in the Defence & Security segment totaled €7,239 million, up +8.8% compared to the first nine months of 2023 (+8.5% at constant scope and exchange rates). After sustained growth recorded in the first half of the year, this segment confirmed its strong momentum in the third quarter. Growth was driven in particular by land and air systems.

    In the Digital Identity & Security segment, sales totaled €2,914 million, up 15.7% in the first nine months of 2024 (+0.3% at constant scope and exchange rates), including the positive scope effect linked to the acquisitions of Tesserent and Imperva. The stability in organic growth in this segment reflects contrasting trends:

    • Banking and Payment solutions, negatively affected by a high comparison basis, continued to suffer from further destocking in North America;
    • Steady pace of growth in Cyber and Biometrics activities;
    • Continued ramp-up on Connectivity Solutions market, recording double-digit organic growth.

    Outlook

    Thales continues to benefit from its solid positioning in all its major markets and enjoys robust medium-term outlook, as illustrated by the continued strong sales momentum in the third quarter of 2024.

    As a result, assuming there are no major new disruptions in the global economy or global supply chains, Thales confirms its 2024 annual targets:

    • A book-to-bill ratio above 1;
    • Organic sales growth of between +5% and +6%, corresponding to sales in the range of €19.9 billion to €20.1 billion6;
    • An EBIT margin between 11.7% and 11.8%.

    ****

    This press release contains certain forward-looking statements. Although Thales believes that its expectations are based on reasonable assumptions, actual results may differ significantly from the forward-looking statements due to various risks and uncertainties, as described in the Company’s Universal Registration Document, which has been filed with the French financial markets authority (Autorité des marchés financiers – AMF).

    1In this press release, “organic” means “at constant scope and exchange rates”.

    2Between €19.9 billion and €20.1 billion based on September 2024 scope and exchange rates.

    3Mature markets: Europe, North America, Australia, New Zealand; emerging markets: all other countries.

    4Taking into account a negative currency effect of -€45 million and a positive net scope effect of €441 million.

    5See table on page 6.

    5Seetableon page 6.

    6Based on September 2024 scope and exchanges rates.

    MIL OSI Global Banks –

  • MIL-OSI Banking: Committee on Market Access holds third thematic session on supply chain resilience

    Source: WTO

    Headline: Committee on Market Access holds third thematic session on supply chain resilience

    The moderator of the session, Mr Iain Fifer of the United Kingdom, emphasized the critical role of trade data in analyzing and enhancing the resilience of supply chains. He noted the challenges in gathering reliable, timely and relevant data, and underlined how such information can inform decision-making.
    Thailand highlighted logistical challenges related to train freight routes from Thailand to Europe. While rail transport is faster than ocean freight and cheaper than air freight, it faces significant obstacles such as customs clearance issues at multiple borders, a lack of harmonized standards, and higher costs compared to sea freight. Additionally, it stressed how limitations in rail infrastructure add complexity.
    China emphasized the importance of multilateral and bilateral trade frameworks, such as those supported by the WTO, in ensuring smooth supply chain operations. It underscored technological advances, particularly in big data and green energy, as key influencers of the development of global supply chains. China also announced the upcoming release of its Global Supply Chain Connectivity Index at the second China International Supply Chain Expo in November 2024. The document will provide a quantitative assessment of the resilience and stability of global supply chains.
    India focused on the three fundamental pillars of supply chains — production, logistics and markets. It also underlined the importance of digital infrastructure in bolstering supply chain resilience. Additionally, India discussed initiatives such as the Unified Logistics Interface Platform and the PM Gati Shakti National Master Plan, which utilize geospatial data to enhance infrastructure connectivity and logistics efficiency.
    The United States introduced its newly established Supply Chain Center within the Department of Commerce, designed to enhance supply chain resilience. The unit’s “Scale” tool assesses risks across sectors of the US economy by evaluating more than 40 indicators of criticality, vulnerability and resiliency in supply chains. The tool provides an in-depth view of current risks to better inform policy decisions, the United States underlined.
    Switzerland presented an initiative led by the Organisation for Economic Cooperation and Development (OECD) aimed at improving the transparency and resilience of medical supply chains. The initiative was prompted by the supply shortages experienced during the COVID-19 pandemic. Switzerland’s project involves a monitoring mechanism designed to increase visibility in global medical supply chains and address future disruptions through international cooperation and the use of advanced technologies such as artificial intelligence.
    In his conclusion, the moderator emphasized the importance of data design and collection in creating a comprehensive understanding of various supply chains. He stressed that data sharing and collaboration were central themes of the discussion, noting that swift and accurate exchange of information between stakeholders and governments is essential. Additionally, he acknowledged the significant analytical work required after data collection and pointed out that once data analysis is completed, it must be effectively utilized to guide policymaking. The session also featured examples of ongoing policy initiatives shaped by data-driven projects.
    The interim Chair of the Market Access Committee, Ms Nicola Waterfield of Canada, expressed appreciation for the presentations and highlighted the importance of the discussions. She also announced that the Committee’s next formal meeting is scheduled for 19-20 November 2024.

    Share

    MIL OSI Global Banks –

  • MIL-OSI China: Xi underscores BRICS’ role in building multipolar world, driving globalization

    Source: People’s Republic of China – State Council News

    KAZAN, Russia, Oct. 23 — The BRICS mechanism is a pillar in promoting a multipolar world and fostering an inclusive economic globalization, said Chinese President Xi Jinping on Tuesday as leaders gathered in Kazan for the 16th BRICS Summit.

    Xi made the remarks while meeting with Russian President Vladimir Putin ahead of the leaders’ formal meetings. He noted that BRICS is the world’s most important platform for solidarity and cooperation between emerging markets and developing countries.

    He also voiced his hope to have in-depth discussions with Putin and other leaders participating in the summit on the future development of the BRICS mechanism, so as to secure more opportunities for the Global South.

    Putin thanked China for its support during Russia’s presidency of BRICS, stressing that Russia is ready to closely cooperate with China to ensure the success of the first BRICS Summit after its expansion and bolster BRICS cooperation.

    Kazan, the capital of Tatarstan and the fifth-largest city in Russia, holds historical and cultural significance. Xi told Putin during their meeting that around 400 years ago, the Great Tea Road that connected the two countries went past Kazan, through which tea leaves from China’s Wuyi Mountain region found their way into many Russian households.

    The city is also home to Kazan Federal University, where notable figures like the Russian writer Leo Tolstoy and Russian revolutionary leader Vladimir Lenin studied.

    Russian fighter jets escorted Xi’s plane before its landing at the Kazan International Airport around noon on Tuesday. Guards of honor lined both sides of a red carpet to salute Xi, while Russian youths in traditional attire offered him a warm welcome.

    Kazan Mayor Ilsur Metshin, one of the Russian officials who greeted Xi at the airport, told Xinhua that the city is honored to host the Chinese president.

    During the three-day summit, Xi will attend small- and large-scale leaders’ meetings and the BRICS Plus leaders’ dialogue. He will also have in-depth exchanges with leaders of other countries on the current international situation, BRICS cooperation, the development of the BRICS mechanism and important issues of common concern, according to Chinese Foreign Ministry Spokesperson Mao Ning.

    GREATER BRICS

    Observers see the BRICS Summit as an opportunity for Global South countries to voice their needs.

    Victoria Fedosova, deputy director of the Institute for Strategic Research and Forecasts of the Russian Peoples’ Friendship University, said the very dynamic development of BRICS and the growth in its membership reflect a demand for a platform to address global issues.

    “The BRICS mechanism has enormous potential in adjusting the imbalances in global development accumulated over the last 80 years,” said Fedosova.

    The New Development Bank (NDB) is a flagship project of BRICS cooperation. As the first multilateral development bank established by emerging economies, the NDB, headquartered in Shanghai, provides financing support for infrastructure development, clean energy, environmental protection, and the building of cyber infrastructure across BRICS countries.

    Dilma Rousseff, president of the NDB who is also in Kazan, told Putin during a meeting on Tuesday that the summit is “very important.”

    BRICS has emerged as “the core of this multipolar world” alongside other global and regional organizations, said British author and political commentator Carlos Martinez. “It is essential to move away from the dominance of Western voices and allow countries from the Global South to have a meaningful say in international relations.”

    “BRICS, with its focus on inclusivity and equality, serves as a shining star of this new type of international relations,” he said.

    Zukiswa Roboji, a researcher at Walter Sisulu University in South Africa, said that BRICS has “undoubtedly made notable strides in recent years,” offering emerging economies easier access to financial resources and better opportunities for trade, investment and development.

    Experts also highlighted China’s role in BRICS cooperation and development. Timirkhan Alishev, vice rector for International Affairs at Kazan Federal University, told Xinhua that all initiatives introduced by China are rooted in multilateralism, fostering communication and dialogue on multiple levels.

    “We see China puts a lot of efforts into developing BRICS,” said Alishev, adding that there are no preconditions for BRICS cooperation as one can begin dialogue on equal footing with everyone.

    STRONGER APPEAL

    The term BRIC was initially coined in 2001 by Jim O’Neill, former chief economist at Goldman Sachs, as an investment concept referring to emerging market economies of Brazil, Russia, India and China. With South Africa’s inclusion in 2010, BRICS officially took shape.

    Following last year’s expansion, the BRICS grouping now represents approximately 30 percent of global GDP, nearly half of the world’s population, and one-fifth of global trade.

    “Measured by GDP, the BRICS countries have already surpassed the G7 in importance,” said Rousseff in a recent interview with Xinhua.

    One of the key priorities of Russia’s BRICS chairmanship is integrating the new members into the BRICS framework, according to the official website. Other areas of practical cooperation include boosting trade and direct investment, as well as fostering a balanced and equitable transition to a low-carbon economy.

    As BRICS’ influence grows, its appeal has strengthened. Over 30 countries like Thailand, Malaysia, Türkiye and Azerbaijan have either formally applied for or expressed interest in its membership, while many other developing countries are seeking deeper cooperation with the group.

    “Joining BRICS will benefit Thailand in many ways, including advancing cooperation with other developing countries and increasing its influence in the international arena,” said Tang Zhimin, director of China ASEAN Studies at the Bangkok-based Panyapiwat Institute of Management.

    BRICS “has become an engine of growth for the world economy and plays an important role in global policymaking,” Tang added.

    MIL OSI China News –

  • MIL-OSI Africa: Environmental, Social and Governance Disclosure is Critical for Africa’s Sustainable Development — African Development Bank Group (AfDB) Vice-President (VP) Quaynor at Inaugural Africa Environmental, Social and Governance (ESG) Forum

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

    ABIDJAN, Ivory Coast, October 23, 2024/APO Group/ —

    “The importance of ESG disclosure for attracting finance for sustainable development in Africa cannot be overstated. It is no longer an optional add-on; it is a necessity if Africa is to thrive and not just survive in the 21st century,” stated Solomon Quaynor, African Development Bank Group (www.AfDB.org) Vice-President in opening the inaugural Africa ESG Forum today in Abidjan, Côte d’Ivoire.

    The two-day event, jointly organised by the African Development Bank, the Multilateral Cooperation Center for Development Finance (MCDF) (http://apo-opa.co/4eQY1bJ), and Making Finance Work for Africa (MFW4A) takes place under the theme Building a Sustainable Finance Ecosystem for Africa: A Collaborative Approach for ESG Disclosure.

    The forum aims to catalyze collaboration and knowledge sharing on ESG issues, paving the way for the establishment of a centralised Africa ESG Information Disclosure Hub and embedding ESG principles into the continent’s development strategies.

    MFW4A is a platform for African governments, the private sector, and development partners to coordinate financial sector development across the continent. Its secretariat is hosted by the African Development Bank Group.

    Quaynor, the Bank Group’s Vice president for Private Sector, Infrastructure & Industrialization emphasized the urgency of adopting robust ESG practices. “Achieving sustainable development requires substantial financial investments which will not come without trust, transparency, and accountability,” he said. He also highlighted that Africa faces low awareness of ESG’s importance, inadequate infrastructure for data collection, and inconsistent policy engagement. Fragmented ESG disclosure standards could lead to Africa being excluded from global capital markets that increasingly prioritise sustainability.

    Quaynor noted, “By facilitating better data availability and promoting best practices, we can enhance stakeholder engagement and foster greater trust between investors and businesses. This is essential for building a sustainable finance ecosystem that benefits everyone.”

    Frederic Wiltmann, Head of Project Team at MCDF, elaborated on its work to support sustainable investment. “We now have several capacity-building programs focused on facilitating trade financing, connectivity infrastructure development, and environmental and social safeguards,” he said. “One of the pillars involves establishing this Disclosure Hub initiative, and today’s forum serves as a launch for this capacity-building program, of which we hope the Disclosure Hub will be one of the major outputs.”

    Opening-day sessions featured discussion of the development of an African ESG taxonomy and an overview of the global landscape of ESG disclosure. “Despite the challenges we face, there are many opportunities for Africa to lead in sustainability reform, and the establishment of the Sustainability Centre of Excellence is critical for driving the adoption of international standards,” said Lebogang Senne, Technical Director of the Pan African Federation of Accountants. PAFA’s board in August 2024 approved the establishment of a Centre of Excellence to accelerate the Africa-wide adoption and implementation of the IFRS Sustainability Disclosure Standards of the International Sustainability Standards Board (ISSB).

    In a session titled, Perspectives from Sustainable Finance Initiatives, Wakesho Sonje of ICEA LION GROUP said The Nairobi Declaration for Sustainable Insurance is driving ESG integration in Africa’s insurance sector, with 219 members across 36 countries committed to sustainable principles and SDGs. She also highlighted that innovative products like parametric insurance are being developed to address climate-related risks and protect vulnerable communities. Additionally, initiatives like the African Development Bank’s Africa Climate Risk Insurance Facility for Adaptation (ACRIFA) are partnering to achieve similar goals, she said.  

    Nearly one hundred delegates attended physically with a further 400 online sharing insights and posing questions to the speakers, reflecting strong commitment to addressing the critical role of Environmental, Social, and Governance (ESG) disclosure in fostering sustainable development across the continent.

    Day 2 will feature engaging discussions on the challenges and opportunities in ESG reporting in Africa with insights from industry leaders. Additionally, sessions will focus on investor expectations for ESG reporting, including a panel discussion featuring representatives from various financial institutions.

    MIL OSI Africa –

  • MIL-OSI: Fidelity D & D Bancorp, Inc. Reports Third Quarter 2024 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    DUNMORE, Pa., Oct. 23, 2024 (GLOBE NEWSWIRE) — Fidelity D & D Bancorp, Inc. (NASDAQ: FDBC) and its banking subsidiary, The Fidelity Deposit and Discount Bank, announced its unaudited, consolidated financial results for the three and nine-month periods ended September 30, 2024.

    Unaudited Financial Information

    Net income for the quarter ended September 30, 2024 was $5.0 million, or $0.86 diluted earnings per share, compared to $5.3 million, or $0.93 diluted earnings per share, for the quarter ended September 30, 2023.  The $0.3 million decline in net income resulted primarily from the $1.0 million increase in non-interest expenses coupled with a $0.4 million increase in the provision for credit losses on unfunded loan commitments and $0.2 million increase in the provision for credit losses on loans. This was partially offset by a $0.8 million increase in net interest income and a $0.7 million increase in non-interest income.

    For the nine months ended September 30, 2024, net income was $15.0 million, or $2.59 diluted earnings per share, compared to $17.7 million, or $3.11 diluted earnings per share, for the nine months ended September 30, 2023.  The $2.7 million, or 15%, decline in net income stemmed from the $2.0 million higher non-interest expenses and $1.6 million reduction in net interest income partially offset by the increase of $0.8 million in non-interest income.

    “Our third quarter results reflect strong balance sheet growth, increased capital levels, liquidity, and non-interest income,” stated Daniel J. Santaniello, President and Chief Executive Officer. “Q3 also reflected an increase in net interest margin. We remain focused, disciplined and thoughtful as we execute on our strategic plan. The Fidelity Bankers continue to demonstrate exemplary efforts and Fidelity Bank is well positioned for the future and committed to our clients, shareholders, and the communities we serve.”

    Consolidated Third Quarter Operating Results Overview

    Net interest income was $15.4 million for the third quarter of 2024, a 5% increase over the $14.6 million earned for the third quarter of 2023.  The $0.8 million increase in net interest income resulted from the increase of $3.6 million in interest income primarily due to a $71.0 million increase in the average balance of interest-earning assets and a 50 basis point increase in fully-taxable equivalent (“FTE”) yield. The loan portfolio had the biggest impact, producing a $3.7 million increase in FTE interest income from $122.8 million in higher quarterly average balances and an increase of 50 basis points in FTE loan yield. Slightly offsetting the higher interest income, a $2.8 million increase in interest expense was due to a 55 basis point increase in the rates paid on interest-bearing deposits coupled with a $94.4 million quarter-over-quarter increase in average deposit balances. 

    The overall cost of interest-bearing liabilities was 2.70% for the third quarter of 2024, an increase of 53 basis points from the 2.17% for the third quarter of 2023.  The cost of funds increased 45 basis points to 2.08% for the third quarter of 2024 from 1.63% for the third quarter of 2023. The FTE yield on interest-earning assets was 4.68% for the third quarter of 2024, an increase of 50 basis points from the 4.18% for the third quarter of 2023.  The Company’s FTE (non-GAAP measurement) net interest spread was 1.98% for the third quarter of 2024, a decrease of 3 basis points from the 2.01% recorded for the third quarter of 2023.  FTE net interest margin increased to 2.70% for the three months ended September 30, 2024 from 2.63% for the same 2023 period due to allocation of better performing interest earning assets, which led to a 7 basis point margin improvement.

    The provision for credit losses on loans was $0.7 million coupled with a provision for credit losses on unfunded loan commitments of $0.1 million for the third quarter of 2024. For the three months ended September 30, 2024, the provision for credit losses on loans increased $0.2 million compared to the three months ended September 30, 2023. The increase in the provision for credit losses on loans was due to growth in the loan portfolio of $67.0 million in the third quarter of 2024 compared to growth of $16.1 million in the same quarter of 2023, specifically in the commercial loan portfolio. For the three months ended September 30, 2024, the provision for credit losses on unfunded loan commitments increased $0.4 million compared to the three months ended September 30, 2023. The increase in the provision for credit losses on unfunded commitments was due to a growth in the unfunded commitments reserve of $135 thousand in the third quarter of 2024 compared to a reduction of $275 thousand in the same quarter of 2023, specifically in commercial construction commitments.

    Total non-interest income increased $0.7 million, or 15%, to $5.0 million for the third quarter of 2024 compared to $4.3 million for the third quarter of 2023. The increase in non-interest income was primarily attributable to an additional $0.1 million service charges on commercial loans, $0.1 million higher fees from trust fiduciary activities, $0.1 million more in financial services revenue, and fees from commercial loans with interest rate hedges increased $0.1 million.

    Non-interest expenses increased $1.0 million, or 8%, for the third quarter of 2024 to $13.8 million from $12.8 million for the same quarter of 2023. The increase in non-interest expenses was primarily due to $0.9 million higher salaries and benefits expense from higher salaries related to new hires and banker incentives. There were also increases in professional services of $0.1 million and PA shares tax of $0.1 million.

    The provision for income taxes increased $0.2 million during the third quarter of 2024 primarily due to less tax credits compared to the third quarter of 2023.

    Consolidated Year-To-Date Operating Results Overview

    Net interest income was $45.5 million for the nine months ended September 30, 2024 compared to $47.1 million for the nine months ended September 30, 2023.  The $1.6 million, or 3%, reduction was the result of interest expense growing faster than interest income.  On the asset side, the loan portfolio caused interest income growth by producing $9.5 million more in interest income primarily from an increase of 47 basis points in FTE loan yields on $97.4 million in higher average balances.  On the funding side, total interest expense increased by $11.6 million primarily due to an increase in interest expense paid on deposits of $12.0 million from an 86 basis point higher rate paid on a $97.1 million larger average balance of interest-bearing deposits, partially offset by a decrease in interest expense on borrowings of $0.4 million for the nine months ended September 30, 2024 compared to the same period in 2023.

    The overall cost of interest-bearing liabilities was 2.60% for the nine months ended September 30, 2024 compared to 1.79% for the nine months ended September 30, 2023.  The cost of funds increased 66 basis points to 1.99% for the nine months ended September 30, 2024 from 1.33% for the same period of 2023. The FTE yield on interest-earning assets was 4.59% for the nine months ended September 30, 2024, an increase of 47 basis points from the 4.12% for year-to-date September 30, 2023.  The Company’s FTE (non-GAAP measurement) net interest spread was 1.99% for the nine months ended September 30, 2024, a decrease of 34 basis points from the 2.33% recorded for the same period of 2023.  FTE net interest margin decreased by 16 basis points to 2.70% for the nine months ended September 30, 2024 from 2.86% for the same 2023 period due to the increase in rates paid on interest-bearing liabilities growing at a faster pace than the yields on interest-earning assets.

    The provision for credit losses on loans was $1.1 million and the provision for credit losses on unfunded loan commitments was $0.2 million for the nine months ended September 30, 2024. For the nine months ended September 30, 2024, the provision for credit losses on loans decreased $0.3 million compared to the nine months ended September 30, 2023. The decrease in the provision for credit losses on loans was due to a reduction in net charge-offs. For the nine months ended September 30, 2024, the provision for credit losses on unfunded loan commitments increased $0.3 million compared to the nine months ended September 30, 2023. The increase in the provision for credit losses on unfunded commitments was due to a higher growth in unfunded loan commitments, specifically commercial construction commitments.

    Total non-interest income for the nine months ended September 30, 2024 was $14.2 million, an increase of $0.8 million, or 7%, from $13.4 million for the nine months ended September 30, 2023.  The increase was primarily due to $0.5 million in additional trust fiduciary fees and $0.2 million higher fees from financial services.  During the first nine months of 2023, the Company recorded a write-down associated with a branch closure reducing non-interest income. In the third quarter of 2023, the Company received $0.3 million in recoveries from acquired charged-off loans, offsetting the increase in other income. Additionally, the Company experienced a decrease of $0.2 million in fees from commercial loans with interest rate hedges compared to the first nine months of 2023.

    Non-interest expenses increased to $41.1 million for the nine months ended September 30, 2024, an increase of $2.0 million, or 5%, from $39.1 million for the nine months ended September 30, 2023.  The increase in non-interest expenses was primarily due to the $2.0 million increase in salaries and benefits expense coupled with increases in professional fees of $0.3 million and PA shares tax of $0.3 million for the nine months ended September 30, 2024 compared to the same period in 2023. The increases were partially offset by $0.4 million less in fraud losses and $0.2 million less advertising and marketing expenses. 

    The provision for income taxes decreased $0.2 million during the nine months ended September 30, 2024 compared to the same period in 2023 primarily due to lower income before taxes. 

    Consolidated Balance Sheet & Asset Quality Overview

    The Company’s total assets had a balance of $2.6 billion as of September 30, 2024, an increase of $0.1 billion, from $2.5 billion as of December 31, 2023. The increase resulted from $107.9 million in growth in the loans and leases portfolio during the nine months ended September 30, 2024. Cash and cash equivalents increased $8.2 million and the investment portfolio decreased by $8.5 million. The decline in the investment portfolio was primarily due to $16.7 million in paydowns partially offset by an $8.4 million increase in market value of available-for-sale securities. As of September 30, 2024, the market value of held-to-maturity securities also increased by $6.0 million compared to December 31, 2023, with $22.2 million in unrealized losses. During the same time period, total liabilities increased $95.0 million, or 4%. Deposit growth of $184.1 million was utilized to pay down $92.0 million in short-term borrowings. The Company experienced an increase of $98.7 million in money market deposits and an increase of $96.1 million in certificate of deposits due to promotional rates offered as a result of market competition. The growth in these products was partially offset by a decrease of $10.8 million in checking and savings account balances as of September 30, 2024. As of September 30, 2024, the ratio of insured and collateralized deposits to total deposits was approximately 75%.

    Shareholders’ equity increased $17.8 million, or 9%, to $207.3 million at September 30, 2024 from $189.5 million at December 31, 2023. The increase was caused by retained earnings improvement from net income of $15.0 million, partially offset by $6.6 million in cash dividends paid to shareholders and a $8.0 million improvement in accumulated other comprehensive income due to lower unrealized losses in the investment portfolio. At September 30, 2024, there were no credit losses on available-for-sale and held-to-maturity debt securities.  Accumulated other comprehensive income (loss) is excluded from regulatory capital ratios. The Fidelity Deposit and Discount Bank remains above well capitalized limits with Tier 1 capital at 9.30% of total average assets as of September 30, 2024.  Total risk-based capital was 14.56% of risk-weighted assets and Tier 1 risk-based capital was 13.38% of risk-weighted assets as of September 30, 2024.  Tangible book value per share was $32.55 at September 30, 2024 compared to $29.57 at December 31, 2023.  Tangible common equity was 7.19% of total assets at September 30, 2024 compared to 6.79% at December 31, 2023.

    Asset Quality

    Total non-performing assets were $7.6 million, or 0.29% of total assets, at September 30, 2024, compared to $3.3 million, or 0.13% of total assets, at December 31, 2023. Past due and non-accrual loans to total loans were 0.62% at September 30, 2024, compared to 0.46% at December 31, 2023. Net charge-offs to average total loans were 0.02% at September 30, 2024, compared to 0.04% at December 31, 2023. 

    About Fidelity D & D Bancorp, Inc. and The Fidelity Deposit and Discount Bank

    Fidelity D & D Bancorp, Inc. has built a strong history as trusted financial advisor to the clients served by The Fidelity Deposit and Discount Bank (“Fidelity Bank”).  Fidelity Bank continues its mission of exceeding client expectations through a unique banking experience. It operates 21 full-service offices throughout Lackawanna, Luzerne, Lehigh and Northampton Counties and a Fidelity Bank Wealth Management Office in Schuylkill County. Fidelity Bank provides a digital banking experience online at http://www.bankatfidelity.com, through the Fidelity Mobile Banking app, and in the Client Care Center at 1-800-388-4380. Additionally, the Bank offers full-service Wealth Management & Brokerage Services, a Mortgage Center, and a full suite of personal and commercial banking products and services. Part of the Company’s vision is to serve as the best bank for the community, which was accomplished by having provided over 5,980 hours of volunteer time and over $1.4 million in donations to non-profit organizations directly within the markets served throughout 2023. Fidelity Bank’s deposits are insured by the Federal Deposit Insurance Corporation up to the full extent permitted by law.

    Non-GAAP Financial Measures

    The Company uses non-GAAP financial measures to provide information useful to the reader in understanding its operating performance and trends, and to facilitate comparisons with the performance of other financial institutions. Management uses these measures internally to assess and better understand our underlying business performance and trends related to core business activities.  The Company’s non-GAAP financial measures and key performance indicators may differ from the non-GAAP financial measures and key performance indicators other financial institutions use to measure their performance and trends. Non-GAAP financial measures should be supplemental to GAAP used to prepare the Company’s operating results and should not be read in isolation or relied upon as a substitute for GAAP measures.  Reconciliations of non-GAAP financial measures to GAAP are presented in the tables below.

    Interest income was adjusted to recognize the income from tax exempt interest-earning assets as if the interest was taxable, fully-taxable equivalent (FTE), in order to calculate certain ratios within this document.  This treatment allows a uniform comparison among yields on interest-earning assets.  Interest income was FTE adjusted, using the corporate federal tax rate of 21% for 2024 and 2023.

    Forward-looking statements

    Certain of the matters discussed in this press release constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and as such may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements.  The words “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” and similar expressions are intended to identify such forward-looking statements.

    The Company’s actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation:

    • local, regional and national economic conditions and changes thereto;
    • the short-term and long-term effects of inflation, and rising costs to the Company, its customers and on the economy;
    • the risks of changes and volatility of interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities and interest rate protection agreements, as well as interest rate risks;
    • securities markets and monetary fluctuations and volatility;
    • disruption of credit and equity markets;
    • impacts of the capital and liquidity requirements of the Basel III standards and other regulatory pronouncements, regulations and rules;
    • governmental monetary and fiscal policies, as well as legislative and regulatory changes;
    • effects of short- and long-term federal budget and tax negotiations and their effect on economic and business conditions;
    • the costs and effects of litigation and of unexpected or adverse outcomes in such litigation;
    • the impact of new or changes in existing laws and regulations, including laws and regulations concerning taxes, banking, securities and insurance and their application with which the Company and its subsidiaries must comply;
    • the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters;
    • the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market area and elsewhere, including institutions operating locally, regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the internet;
    • the effects of economic conditions of any other pandemic, epidemic or other health-related crisis such as COVID-19 and responses thereto on current customers and the operations of the Company, specifically the effect of the economy on loan customers’ ability to repay loans;
    • the effects of bank failures, banking system instability, deposit fluctuations, loan and securities value changes;
    • technological changes;
    • the interruption or breach in security of our information systems, continually evolving cybersecurity and other technological risks and attacks resulting in failures or disruptions in customer account management, general ledger processing and loan or deposit updates and potential impacts resulting therefrom including additional costs, reputational damage, regulatory penalties, and financial losses;
    • acquisitions and integration of acquired businesses;
    • the failure of assumptions underlying the establishment of reserves for loan losses and estimations of values of collateral and various financial assets and liabilities;
    • acts of war or terrorism; and
    • the risk that our analyses of these risks and forces could be incorrect and/or that the strategies developed to address them could be unsuccessful.

    The Company cautions readers not to place undue reliance on forward-looking statements, which reflect analyses only as of the date of this release.  The Company has no obligation to update any forward-looking statements to reflect events or circumstances after the date of this release.

    For more information please visit our investor relations web site located through http://www.bankatfidelity.com. 

    Contacts:  
       
    Daniel J. Santaniello Salvatore R. DeFrancesco, Jr.
    President and Chief Executive Officer Treasurer and Chief Financial Officer
    570-504-8035 570-504-8000
    FIDELITY D & D BANCORP, INC.
    Unaudited Condensed Consolidated Balance Sheets
    (dollars in thousands)
     
    At Period End:   September 30, 2024     December 31, 2023  
    Assets                
    Cash and cash equivalents   $ 120,169     $ 111,949  
    Investment securities     559,819       568,273  
    Restricted investments in bank stock     3,944       3,905  
    Loans and leases     1,795,548       1,686,555  
    Allowance for credit losses on loans     (19,630 )     (18,806 )
    Premises and equipment, net     36,057       34,232  
    Life insurance cash surrender value     57,672       54,572  
    Goodwill and core deposit intangible     20,576       20,812  
    Other assets     41,778       41,667  
                     
    Total assets   $ 2,615,933     $ 2,503,159  
                     
    Liabilities                
    Non-interest-bearing deposits   $ 549,710     $ 536,143  
    Interest-bearing deposits     1,792,796       1,622,282  
    Total deposits     2,342,506       2,158,425  
    Short-term borrowings     25,000       117,000  
    Secured borrowings     6,323       7,372  
    Other liabilities     34,843       30,883  
    Total liabilities     2,408,672       2,313,680  
                     
    Shareholders’ equity     207,261       189,479  
                     
    Total liabilities and shareholders’ equity   $ 2,615,933     $ 2,503,159  
    Average Year-To-Date Balances:   September 30, 2024     December 31, 2023  
    Assets                
    Cash and cash equivalents   $ 51,707     $ 35,462  
    Investment securities     556,559       597,359  
    Restricted investments in bank stock     3,961       4,212  
    Loans and leases     1,722,655       1,635,286  
    Allowance for credit losses on loans     (19,169 )     (18,680 )
    Premises and equipment, net     35,418       32,215  
    Life insurance cash surrender value     55,963       54,085  
    Goodwill and core deposit intangible     20,679       20,977  
    Other assets     41,854       44,180  
                     
    Total assets   $ 2,469,627     $ 2,405,096  
                     
    Liabilities                
    Non-interest-bearing deposits   $ 524,238     $ 558,962  
    Interest-bearing deposits     1,673,443       1,586,527  
    Total deposits     2,197,681       2,145,489  
    Short-term borrowings     39,873       49,860  
    Secured borrowings     7,009       7,489  
    Other liabilities     31,724       29,881  
    Total liabilities     2,276,287       2,232,719  
                     
    Shareholders’ equity     193,340       172,377  
                     
    Total liabilities and shareholders’ equity   $ 2,469,627     $ 2,405,096  
    FIDELITY D & D BANCORP, INC.
    Unaudited Condensed Consolidated Statements of Income
    (dollars in thousands)
     
        Three Months Ended     Nine Months Ended  
        Sep. 30, 2024     Sep. 30, 2023     Sep. 30, 2024     Sep. 30, 2023  
    Interest income                                
    Loans and leases   $ 24,036     $ 20,502     $ 68,685     $ 59,223  
    Securities, interest-bearing cash and other     3,263       3,176       10,278       9,772  
                                     
    Total interest income     27,299       23,678       78,963       68,995  
                                     
    Interest expense                                
    Deposits     (11,297 )     (8,488 )     (31,697 )     (19,713 )
    Borrowings and debt     (571 )     (551 )     (1,775 )     (2,136 )
                                     
    Total interest expense     (11,868 )     (9,039 )     (33,472 )     (21,849 )
                                     
    Net interest income     15,431       14,639       45,491       47,146  
                                     
    Net benefit (provision) for credit losses on loans     (675 )     (525 )     (1,075 )     (1,380 )
    Net benefit (provision) for credit losses on unfunded loan commitments     (135 )     275       (225 )     100  
    Non-interest income     4,979       4,325       14,167       13,349  
    Non-interest expense     (13,840 )     (12,784 )     (41,146 )     (39,066 )
                                     
    Income before income taxes     5,760       5,930       17,212       20,149  
                                     
    (Provision) benefit for income taxes     (793 )     (590 )     (2,252 )     (2,407 )
    Net income   $ 4,967     $ 5,340     $ 14,960     $ 17,742  
        Three Months Ended  
        Sep. 30, 2024     Jun. 30, 2024     Mar. 31, 2024     Dec. 31, 2023     Sep. 30, 2023  
    Interest income                                        
    Loans and leases   $ 24,036     $ 22,516     $ 22,133     $ 21,406     $ 20,502  
    Securities, interest-bearing cash and other     3,263       3,523       3,492       3,434       3,176  
                                             
    Total interest income     27,299       26,039       25,625       24,840       23,678  
                                             
    Interest expense                                        
    Deposits     (11,297 )     (10,459 )     (9,941 )     (9,232 )     (8,488 )
    Borrowings and debt     (571 )     (463 )     (741 )     (707 )     (551 )
                                             
    Total interest expense     (11,868 )     (10,922 )     (10,682 )     (9,939 )     (9,039 )
                                             
    Net interest income     15,431       15,117       14,943       14,901       14,639  
                                             
    Net benefit (provision) for credit losses on loans     (675 )     (275 )     (125 )     (111 )     (525 )
    Net benefit (provision) for credit losses on unfunded loan commitments     (135 )     (140 )     50       65       275  
    Non-interest income (loss)     4,979       4,615       4,572       (1,944 )     4,325  
    Non-interest expense     (13,840 )     (13,616 )     (13,689 )     (12,804 )     (12,784 )
                                             
    Income before income taxes     5,760       5,701       5,751       107       5,930  
                                             
    (Provision) benefit for income taxes     (793 )     (766 )     (694 )     361       (590 )
    Net income   $ 4,967     $ 4,935     $ 5,057     $ 468     $ 5,340  
    FIDELITY D & D BANCORP, INC.
    Unaudited Condensed Consolidated Balance Sheets
    (dollars in thousands)
     
    At Period End:   Sep. 30, 2024     Jun. 30, 2024     Mar. 31, 2024     Dec. 31, 2023     Sep. 30, 2023  
    Assets                                        
    Cash and cash equivalents   $ 120,169     $ 78,085     $ 72,733     $ 111,949     $ 110,471  
    Investment securities     559,819       552,495       559,016       568,273       576,688  
    Restricted investments in bank stock     3,944       3,968       3,959       3,905       3,800  
    Loans and leases     1,795,548       1,728,509       1,697,299       1,686,555       1,647,552  
    Allowance for credit losses on loans     (19,630 )     (18,975 )     (18,886 )     (18,806 )     (18,757 )
    Premises and equipment, net     36,057       35,808       34,899       34,232       32,625  
    Life insurance cash surrender value     57,672       57,278       54,921       54,572       54,226  
    Goodwill and core deposit intangible     20,576       20,649       20,728       20,812       20,897  
    Other assets     41,778       42,828       44,227       41,667       49,318  
                                             
    Total assets   $ 2,615,933     $ 2,500,645     $ 2,468,896     $ 2,503,159     $ 2,476,820  
                                             
    Liabilities                                        
    Non-interest-bearing deposits   $ 549,710     $ 527,572     $ 537,824     $ 536,143     $ 549,741  
    Interest-bearing deposits     1,792,796       1,641,558       1,678,172       1,622,282       1,602,018  
    Total deposits     2,342,506       2,169,130       2,215,996       2,158,425       2,151,759  
    Short-term borrowings     25,000       98,120       25,000       117,000       124,000  
    Secured borrowings     6,323       7,237       7,299       7,372       7,439  
    Other liabilities     34,843       30,466       28,966       30,883       28,190  
    Total liabilities     2,408,672       2,304,953       2,277,261       2,313,680       2,311,388  
                                             
    Shareholders’ equity     207,261       195,692       191,635       189,479       165,432  
                                             
    Total liabilities and shareholders’ equity   $ 2,615,933     $ 2,500,645     $ 2,468,896     $ 2,503,159     $ 2,476,820  
    Average Quarterly Balances:   Sep. 30, 2024     Jun. 30, 2024     Mar. 31, 2024     Dec. 31, 2023     Sep. 30, 2023  
    Assets                                        
    Cash and cash equivalents   $ 41,991     $ 58,351     $ 54,887     $ 42,176     $ 33,238  
    Investment securities     554,578       551,445       563,674       558,423       598,604  
    Restricted investments in bank stock     3,965       3,983       3,934       3,854       3,763  
    Loans and leases     1,763,254       1,707,598       1,696,669       1,664,905       1,640,411  
    Allowance for credit losses on loans     (19,323 )     (19,171 )     (19,013 )     (19,222 )     (18,812 )
    Premises and equipment, net     36,219       35,433       34,591       33,629       31,746  
    Life insurance cash surrender value     57,525       55,552       54,796       54,449       54,110  
    Goodwill and core deposit intangible     20,602       20,677       20,759       20,844       20,930  
    Other assets     41,734       42,960       40,871       46,028       44,346  
                                             
    Total assets   $ 2,500,545     $ 2,456,828     $ 2,451,168     $ 2,405,086     $ 2,408,336  
                                             
    Liabilities                                        
    Non-interest-bearing deposits   $ 522,827     $ 530,048     $ 519,856     $ 533,663     $ 548,682  
    Interest-bearing deposits     1,702,187       1,670,211       1,647,615       1,616,826       1,607,793  
    Total deposits     2,225,014       2,200,259       2,167,471       2,150,489       2,156,475  
    Short-term borrowings     37,220       28,477       53,952       48,490       37,595  
    Secured borrowings     6,429       7,269       7,335       7,412       7,470  
    Other liabilities     31,999       30,734       32,434       30,745       29,638  
    Total liabilities     2,300,662       2,266,739       2,261,192       2,237,136       2,231,178  
                                             
    Shareholders’ equity     199,883       190,089       189,976       167,950       177,158  
                                             
    Total liabilities and shareholders’ equity   $ 2,500,545     $ 2,456,828     $ 2,451,168     $ 2,405,086     $ 2,408,336  
    FIDELITY D & D BANCORP, INC.
    Selected Financial Ratios and Other Financial Data
     
        Three Months Ended  
        Sep. 30, 2024     Jun. 30, 2024     Mar. 31, 2024     Dec. 31, 2023     Sep. 30, 2023  
    Selected returns and financial ratios                                        
    Basic earnings per share   $ 0.87     $ 0.86     $ 0.88     $ 0.08     $ 0.94  
    Diluted earnings per share   $ 0.86     $ 0.86     $ 0.88     $ 0.08     $ 0.93  
    Dividends per share   $ 0.38     $ 0.38     $ 0.38     $ 0.38     $ 0.36  
    Yield on interest-earning assets (FTE)*     4.68 %     4.58 %     4.52 %     4.36 %     4.18 %
    Cost of interest-bearing liabilities     2.70 %     2.58 %     2.51 %     2.36 %     2.17 %
    Cost of funds     2.08 %     1.96 %     1.93 %     1.79 %     1.63 %
    Net interest spread (FTE)*     1.98 %     2.00 %     2.01 %     2.00 %     2.01 %
    Net interest margin (FTE)*     2.70 %     2.71 %     2.69 %     2.66 %     2.63 %
    Return on average assets     0.79 %     0.81 %     0.83 %     0.08 %     0.88 %
    Pre-provision net revenue to average assets*     1.05 %     1.00 %     0.96 %     0.03 %     1.02 %
    Return on average equity     9.89 %     10.44 %     10.71 %     1.10 %     11.96 %
    Return on average tangible equity*     11.02 %     11.72 %     12.02 %     1.26 %     13.56 %
    Efficiency ratio (FTE)*     65.33 %     66.47 %     67.56 %     63.74 %     65.01 %
    Expense ratio     1.41 %     1.47 %     1.50 %     2.43 %     1.39 %
        Nine months ended  
        Sep. 30, 2024     Sep. 30, 2023  
    Basic earnings per share   $ 2.61     $ 3.13  
    Diluted earnings per share   $ 2.59     $ 3.11  
    Dividends per share   $ 1.14     $ 1.08  
    Yield on interest-earning assets (FTE)*     4.59 %     4.12 %
    Cost of interest-bearing liabilities     2.60 %     1.79 %
    Cost of funds     1.99 %     1.33 %
    Net interest spread (FTE)*     1.99 %     2.33 %
    Net interest margin (FTE)*     2.70 %     2.86 %
    Return on average assets     0.81 %     0.99 %
    Pre-provision net revenue to average assets*     1.00 %     1.19 %
    Return on average equity     10.34 %     13.64 %
    Return on average tangible equity*     11.57 %     15.52 %
    Efficiency ratio (FTE)*     66.44 %     62.33 %
    Expense ratio     1.46 %     1.43 %
    Other financial data   At period end:  
    (dollars in thousands except per share data)   Sep. 30, 2024     Jun. 30, 2024     Mar. 31, 2024     Dec. 31, 2023     Sep. 30, 2023  
    Assets under management   $ 942,190     $ 906,861     $ 900,964     $ 876,287     $ 799,968  
    Book value per share   $ 36.13     $ 34.12     $ 33.41     $ 33.22     $ 29.04  
    Tangible book value per share*   $ 32.55     $ 30.52     $ 29.80     $ 29.57     $ 25.37  
    Equity to assets     7.92 %     7.83 %     7.76 %     7.57 %     6.68 %
    Tangible common equity ratio*     7.19 %     7.06 %     6.98 %     6.79 %     5.89 %
    Allowance for credit losses on loans to:                                        
    Total loans     1.09 %     1.10 %     1.11 %     1.12 %     1.14 %
    Non-accrual loans   2.77x     2.75x     5.31x     5.68x     6.24x  
    Non-accrual loans to total loans     0.39 %     0.40 %     0.21 %     0.20 %     0.18 %
    Non-performing assets to total assets     0.29 %     0.28 %     0.15 %     0.13 %     0.14 %
    Net charge-offs to average total loans     0.02 %     0.03 %     0.01 %     0.04 %     0.04 %
                                             
    Fidelity Bank Capital Adequacy Ratios                                        
    Total risk-based capital ratio     14.56 %     14.69 %     14.68 %     14.57 %     14.69 %
    Common equity tier 1 risk-based capital ratio     13.38 %     13.52 %     13.47 %     13.32 %     13.51 %
    Tier 1 risk-based capital ratio     13.38 %     13.52 %     13.47 %     13.32 %     13.51 %
    Leverage ratio     9.30 %     9.30 %     9.15 %     9.08 %     9.17 %

    * Non-GAAP Financial Measures – see reconciliations below

    FIDELITY D & D BANCORP, INC.
    Reconciliations of Non-GAAP Financial Measures to GAAP
     
    Reconciliations of Non-GAAP Measures to GAAP   Three Months Ended  
    (dollars in thousands, except per share data)   Sep. 30, 2024     Jun. 30, 2024     Mar. 31, 2024     Dec. 31, 2023     Sep. 30, 2023  
    FTE net interest income (non-GAAP)                                        
    Interest income (GAAP)   $ 27,299     $ 26,039     $ 25,625     $ 24,840     $ 23,678  
    Adjustment to FTE     775       751       747       664       700  
    Interest income adjusted to FTE (non-GAAP)     28,074       26,790       26,372       25,504       24,378  
    Interest expense (GAAP)     11,868       10,922       10,682       9,939       9,039  
    Net interest income adjusted to FTE (non-GAAP)   $ 16,206     $ 15,868       15,690       15,565       15,339  
                                             
    Efficiency Ratio (non-GAAP)                                        
    Non-interest expenses (GAAP)   $ 13,840     $ 13,616     $ 13,689     $ 12,804     $ 12,784  
                                             
    Net interest income (GAAP)     15,431       15,117       14,943       14,901       14,639  
    Plus: taxable equivalent adjustment     775       751       747       664       700  
    Non-interest income (GAAP)     4,979       4,615       4,572       (1,944 )     4,325  
    Less: (Loss) gain on sales of securities     –       –       –       (6,467 )     –  
    Net interest income (FTE) plus adjusted non-interest income (non-GAAP)   $ 21,185     $ 20,483     $ 20,262     $ 20,088     $ 19,664  
    Efficiency ratio (non-GAAP) (1)     65.33 %     66.48 %     67.56 %     63.74 %     65.01 %
    (1) The reported efficiency ratio is a non-GAAP measure calculated by dividing non-interest expense by the sum of net interest income, on an FTE basis, and adjusted non-interest (loss) income.                                        
                                             
    Tangible Book Value per Share/Tangible Common Equity Ratio (non-GAAP)                                        
    Total assets (GAAP)   $ 2,615,933     $ 2,500,645     $ 2,468,896     $ 2,503,159     $ 2,476,820  
    Less: Intangible assets     (20,576 )     (20,649 )     (20,728 )     (20,812 )     (20,897 )
    Tangible assets     2,595,357       2,479,996       2,448,168       2,482,347       2,455,923  
    Total shareholders’ equity (GAAP)     207,261       195,692       191,635       189,479       165,432  
    Less: Intangible assets     (20,576 )     (20,649 )     (20,728 )     (20,812 )     (20,897 )
    Tangible common equity     186,685       175,043       170,907       168,667       144,535  
                                             
    Common shares outstanding, end of period     5,736,025       5,735,728       5,735,732       5,703,636       5,696,351  
    Tangible Common Book Value per Share   $ 32.55     $ 30.52     $ 29.80     $ 29.57     $ 25.37  
    Tangible Common Equity Ratio     7.19 %     7.06 %     6.98 %     6.79 %     5.89 %
                                             
    Pre-Provision Net Revenue to Average Assets                                        
    Income before taxes (GAAP)   $ 5,760     $ 5,701     $ 5,751     $ 107     $ 5,930  
    Plus: Provision for credit losses     810       415       75       47       250  
    Total pre-provision net revenue (non-GAAP)     6,570       6,116       5,826       154       6,180  
    Total (annualized) (non-GAAP)   $ 26,423     $ 24,600     $ 23,432     $ 609     $ 24,517  
                                             
    Average assets   $ 2,500,545     $ 2,456,828     $ 2,451,168     $ 2,405,086     $ 2,408,336  
    Pre-Provision Net Revenue to Average Assets (non-GAAP)     1.05 %     1.00 %     0.96 %     0.03 %     1.02 %
    Reconciliations of Non-GAAP Measures to GAAP   Nine months ended  
    (dollars in thousands)   Sep. 30, 2024     Sep. 30, 2023  
    FTE net interest income (non-GAAP)                
    Interest income (GAAP)   $ 78,963     $ 68,995  
    Adjustment to FTE     2,272       2,186  
    Interest income adjusted to FTE (non-GAAP)     81,235       71,181  
    Interest expense (GAAP)     33,472       21,849  
    Net interest income adjusted to FTE (non-GAAP)   $ 47,763     $ 49,332  
                     
    Efficiency Ratio (non-GAAP)                
    Non-interest expenses (GAAP)   $ 41,146     $ 39,066  
                     
    Net interest income (GAAP)     45,491       47,146  
    Plus: taxable equivalent adjustment     2,272       2,186  
    Non-interest income (GAAP)     14,167       13,349  
    Net interest income (FTE) plus non-interest income (non-GAAP)   $ 61,930     $ 62,681  
    Efficiency ratio (non-GAAP) (1)     66.44 %     62.33 %
    (1) The reported efficiency ratio is a non-GAAP measure calculated by dividing non-interest expense by the sum of net interest income, on an FTE basis, and adjusted non-interest (loss) income.                
                     
    Pre-Provision Net Revenue to Average Assets                
    Income before taxes (GAAP)   $ 17,212     $ 20,149  
    Plus: Provision for credit losses     1,300       1,280  
    Total pre-provision net revenue (non-GAAP)   $ 18,512     $ 21,429  
    Total (annualized) (non-GAAP)   $ 24,661     $ 28,650  
                     
    Average assets   $ 2,469,627     $ 2,405,100  
    Pre-Provision Net Revenue to Average Assets (non-GAAP)     1.00 %     1.19 %

    The MIL Network –

  • MIL-OSI: Stifel Reports Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    ST. LOUIS, Oct. 23, 2024 (GLOBE NEWSWIRE) — Stifel Financial Corp. (NYSE: SF) today reported net revenues of $1.2 billion for the three months ended September 30, 2024, compared with $1.0 billion a year ago. Net income available to common shareholders was $149.2 million, or $1.34 per diluted common share, compared with $58.8 million, or $0.52 per diluted common share for the third quarter of 2023. Non-GAAP net income available to common shareholders was $166.3 million, or $1.50 per diluted common share for the third quarter of 2024.

    Ronald J. Kruszewski, Chairman and Chief Executive Officer, said “The third quarter represented our second highest quarterly net revenue, an increase of 17%, while earnings per share increased 150%. Through the first three quarters of 2024, net revenue was up 13% to a record $3.6 billion, driven by continued growth in Global Wealth, improvement in our Institutional business, and the stabilization of net interest income. Our financial results illustrate the strength of the Stifel franchise and our ability to capitalize on improving market conditions. Momentum in our business continues to build and we anticipate further upside to both the top and bottom lines in the fourth quarter and in 2025.”

    Highlights

    • The Company reported net revenues of $1.2 billion, the second best revenue quarter in its history, driven by higher investment banking revenues, asset management revenues, and transactional revenues, partially offset by lower net interest income.
    • Non-GAAP net income available to common shareholders of $1.50 per diluted common share was negatively impacted by elevated provisions for legal matters of $0.10 per diluted common share (after-tax).
    • Investment banking revenues increased 66% over the year-ago quarter, driven by higher capital raising and advisory revenues.
      • Capital raising revenues increased 114% over the year-ago quarter.
      • Advisory revenues increased 41% over the year-ago quarter.
    • Record asset management revenues, up 15% over the year-ago quarter.
    • Record client assets of $496.3 billion, up 20% over the year-ago quarter.
    • Recruited 28 financial advisors during the quarter, including 13 experienced employee advisors.
    • Non-GAAP pre-tax margin of 19.2% as the Company maintained its focus on expense discipline, while continuing to invest in the business.
    • Annualized return on tangible common equity (ROTCE) (5) of 20%.
    • Tangible book value per common share (7) of $33.62, up 12% from prior year.
    Financial Summary (Unaudited)
    (000s) 3Q 2024 3Q 2023 9m 2024 9m 2023
    GAAP Financial Highlights:      
    Net revenues $ 1,224,668   $ 1,045,051   $ 3,605,638   $ 3,202,565  
    Net income (1) $ 149,185   $ 58,840   $ 459,413   $ 332,091  
    Diluted EPS (1) $ 1.34   $ 0.52   $ 4.16   $ 2.91  
    Comp. ratio   58.6 %   58.7 %   58.8 %   58.7 %
    Non-comp. ratio   23.7 %   30.8 %   22.8 %   25.7 %
    Pre-tax margin   17.7 %   10.5 %   18.4 %   15.6 %
    Non-GAAP Financial Highlights:      
    Net revenues $ 1,225,351   $ 1,045,028   $ 3,606,330   $ 3,202,539  
    Net income (1)(2) $ 166,270   $ 67,413   $ 506,186   $ 364,937  
    Diluted EPS (1) (2) $ 1.50   $ 0.60   $ 4.58   $ 3.20  
    Comp. ratio (2)   58.0 %   58.0 %   58.0 %   58.0 %
    Non-comp. ratio (2)   22.8 %   30.2 %   22.1 %   24.9 %
    Pre-tax margin (3)   19.2 %   11.8 %   19.9 %   17.1 %
    ROCE (4)   13.7 %   5.8 %   14.4 %   10.4 %
    ROTCE (5)   19.5 %   8.5 %   20.7 %   15.1 %
    Global Wealth Management (assets and loans in millions)  
    Net revenues $ 827,116   $ 768,558   $ 2,418,751   $ 2,283,934  
    Pre-tax net income $ 301,703   $ 298,449   $ 891,624   $ 914,462  
    Total client assets $ 496,298   $ 412,458      
    Fee-based client assets $ 190,771   $ 150,982      
    Bank loans (6) $ 20,633   $ 20,435      
    Institutional Group        
    Net revenues $ 372,401   $ 256,888   $ 1,114,498   $ 867,025  
    Equity $ 222,459   $ 144,764   $ 646,570   $ 508,371  
    Fixed Income $ 149,942   $ 112,124   $ 467,928   $ 358,654  
    Pre-tax net income/ (loss) $ 41,797   ($ 27,804 ) $ 127,719   ($ 5,671 )
    Global Wealth Management
     

    Global Wealth Management reported record net revenues of $827.1 million for the three months ended September 30, 2024 compared with $768.6 million during the third quarter of 2023. Pre-tax net income was $301.7 million compared with $298.4 million in the third quarter of 2023.

    Highlights

    • Recruited 28 financial advisors during the quarter, including 13 experienced employee advisors, with total trailing 12 month production of $10.5 million.
    • Client assets of $496.3 billion, up 20% over the year-ago quarter.
    • Fee-based client assets of $190.8 billion, up 26% over the year-ago quarter.

    Net revenues increased 8% from a year ago:

    • Transactional revenues increased 16% over the year-ago quarter reflecting an increase in client activity.
    • Asset management revenues increased 15% over the year-ago quarter due to higher asset values and net new assets.
    • Net interest income decreased 11% from the year-ago quarter driven by changes in deposit mix, partially offset by higher yields on the investment portfolio and lending growth.

    Total Expenses:

    • Compensation expense as a percent of net revenues increased to 48.7% primarily as a result of higher compensable revenues.
    • Provision for credit losses decreased from the year-ago quarter primarily as a result of lower provisions in the real estate sector compared to the year-ago quarter, partially offset by growth in the loan portfolio.
    • Non-compensation operating expenses as a percent of net revenues increased to 14.8% primarily as a result of higher litigation-related expenses, partially offset by revenue growth over the year-ago quarter.
    Summary Results of Operations
    (000s) 3Q 2024 3Q 2023
    Net revenues $ 827,116   $ 768,558  
    Transactional revenues   192,727     165,547  
    Asset management   382,309     333,088  
    Net interest income   240,825     269,431  
    Investment banking   6,217     3,895  
    Other income   5,038     (3,403 )
    Total expenses $ 525,413   $ 470,109  
    Compensation expense   403,205     359,325  
    Provision for credit losses   5,287     9,992  
    Non-comp. opex   116,921     100,792  
    Pre-tax net income $ 301,703   $ 298,449  
    Compensation ratio   48.7 %   46.8 %
    Non-compensation ratio   14.8 %   14.4 %
    Pre-tax margin   36.5 %   38.8 %
    Institutional Group
     

    Institutional Group reported net revenues of $372.4 million for the three months ended September 30, 2024 compared with $256.9 million during the third quarter of 2023. Institutional Group reported pre-tax net income of $41.8 million for the three months ended September 30, 2024 compared with pre-tax net loss of $27.8 million in the third quarter of 2023.

    Highlights

    Investment banking revenues increased 66% from a year ago:

    • Advisory revenues increased from the year-ago quarter driven by higher levels of completed advisory transactions.
    • Fixed income capital raising revenues more than doubled over the year-ago quarter primarily driven by higher bond issuances.
    • Equity capital raising revenues increased significantly over the year-ago quarter driven by higher volumes.

    Fixed income transactional revenues increased 17% from a year ago:

    • Fixed income transactional revenues increased from the year-ago quarter driven by improved client engagement and volatility.

    Equity transactional revenues increased 4% from a year ago:

    • Equity transactional revenues increased from the year-ago quarter primarily driven by an increase in equities trading commissions.

    Total Expenses:

    • Compensation expense as a percent of net revenues decreased to 60.3% primarily as a result of higher revenues.
    • Non-compensation operating expenses as a percent of net revenues decreased to 28.5% primarily as a result of revenue growth and expense discipline.
    Summary Results of Operations
    (000s) 3Q 2024 3Q 2023
    Net revenues $ 372,401   $ 256,888  
    Investment banking   236,965     142,991  
    Advisory   136,857     97,272  
    Fixed income capital raising   49,364     24,670  
    Equity capital raising   50,744     21,049  
    Fixed income transactional   78,974     67,439  
    Equity transactional   48,824     46,930  
    Other   7,638     (472 )
    Total expenses $ 330,604   $ 284,692  
    Compensation expense   224,556     192,638  
    Non-comp. opex.   106,048     92,054  
    Pre-tax net income/(loss) $ 41,797   ($ 27,804 )
    Compensation ratio   60.3 %   75.0 %
    Non-compensation ratio   28.5 %   35.8 %
    Pre-tax margin   11.2 %   (10.8 %)
    Other Matters
     

    Highlights

    • During the third quarter, the Company’s 4.25% Senior Notes matured resulting in the retirement of the $500.0 million outstanding balance.
    • The Company repurchased $20.2 million of its outstanding common stock during the third quarter.
    • Weighted average diluted shares outstanding decreased primarily as a result of share repurchases. The Company has repurchased 3.7 million shares under its share repurchase program since the third quarter of 2023.
    • The Board of Directors declared a $0.42 quarterly dividend per share payable on September 17, 2024 to common shareholders of record on September 3, 2024.
    • The Board of Directors declared a quarterly dividend on the outstanding shares of the Company’s preferred stock payable on September 17, 2024 to shareholders of record on September 3, 2024.
      3Q 2024 3Q 2023
    Common stock repurchases    
    Repurchases (000s) $20,222 $118,810
    Number of shares (000s) 249 1,886
    Average price $81.23 $63.00
    Period end shares (000s) 102,313 103,120
    Weighted average diluted shares outstanding (000s) 110,994 113,195
    Effective tax rate 26.8% 37.7%
    Stifel Financial Corp. (8)    
    Tier 1 common capital ratio 15.0% 13.9%
    Tier 1 risk based capital ratio 17.9% 16.9%
    Tier 1 leverage capital ratio 11.3% 10.8%
    Tier 1 capital (MM) $4,159 $3,914
    Risk weighted assets (MM) $23,184 $23,219
    Average assets (MM) $36,813 $36,356
    Quarter end assets (MM) $38,935 $37,878
    Agency Rating Outlook
    Fitch Ratings BBB+ Stable
    S&P Global Ratings BBB Stable
     

    Conference Call Information

    Stifel Financial Corp. will host its third quarter 2024 financial results conference call on Wednesday, October 23, 2024, at 9:30 a.m. Eastern Time. The conference call may include forward-looking statements.

    All interested parties are invited to listen to Stifel’s Chairman and CEO, Ronald J. Kruszewski, by dialing (866) 409-1555 and referencing conference ID 7408307. A live audio webcast of the call, as well as a presentation highlighting the Company’s results, will be available through the Company’s web site, http://www.stifel.com. For those who cannot listen to the live broadcast, a replay of the broadcast will be available through the above-referenced web site beginning approximately one hour following the completion of the call.

    Company Information

    Stifel Financial Corp. (NYSE: SF) is a financial services holding company headquartered in St. Louis, Missouri, that conducts its banking, securities, and financial services business through several wholly owned subsidiaries. Stifel’s broker-dealer clients are served in the United States through Stifel, Nicolaus & Company, Incorporated, including its Eaton Partners and Miller Buckfire & Co., LLC business divisions; Keefe, Bruyette & Woods, Inc.; and Stifel Independent Advisors, LLC; in Canada through Stifel Nicolaus Canada Inc.; and in the United Kingdom and Europe through Stifel Nicolaus Europe Limited. The Company’s broker-dealer affiliates provide securities brokerage, investment banking, trading, investment advisory, and related financial services to individual investors, professional money managers, businesses, and municipalities. Stifel Bank and Stifel Bank & Trust offer a full range of consumer and commercial lending solutions. Stifel Trust Company, N.A. and Stifel Trust Company Delaware, N.A. offer trust and related services. To learn more about Stifel, please visit the Company’s website at http://www.stifel.com. For global disclosures, please visit http://www.stifel.com/investor-relations/press-releases.

    A financial summary follows. Financial, statistical and business-related information, as well as information regarding business and segment trends, is included in the financial supplement. Both the earnings release and the financial supplement are available online in the Investor Relations section at http://www.stifel.com/investor-relations.

    The information provided herein and in the financial supplement, including information provided on the Company’s earnings conference calls, may include certain non-GAAP financial measures. The definition of such measures or reconciliation of such measures to the comparable U.S. GAAP figures are included in this earnings release and the financial supplement, both of which are available online in the Investor Relations section at http://www.stifel.com/investor-relations.

    Cautionary Note Regarding Forward-Looking Statements

    This earnings release contains certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements in this earnings release not dealing with historical results are forward-looking and are based on various assumptions. The forward-looking statements in this earnings release are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among other things, the following possibilities: the ability to successfully integrate acquired companies or the branch offices and financial advisors; a material adverse change in financial condition; the risk of borrower, depositor, and other customer attrition; a change in general business and economic conditions; changes in the interest rate environment, deposit flows, loan demand, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation and regulation; other economic, competitive, governmental, regulatory, geopolitical, and technological factors affecting the companies’ operations, pricing, and services; and other risk factors referred to from time to time in filings made by Stifel Financial Corp. with the Securities and Exchange Commission. For information about the risks and important factors that could affect the Company’s future results, financial condition and liquidity, see “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. Forward-looking statements speak only as to the date they are made. The Company disclaims any intent or obligation to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

    Summary Results of Operations (Unaudited)
     
      Three Months Ended   Nine Months Ended
    (000s, except per share amounts) 9/30/2024 9/30/2023 % Change 6/30/2024 % Change 9/30/2024 9/30/2023 % Change
    Revenues:                
    Commissions $ 183,445 $ 165,075 11.1   $ 183,317 0.1   $ 552,238 $ 499,983   10.5  
    Principal transactions   137,089   114,841 19.4     153,574 (10.7 )   429,677   336,063   27.9  
    Investment banking   243,182   146,887 65.6     233,281 4.2     690,412   525,591   31.4  
    Asset management   382,616   333,127 14.9     380,757 0.5     1,130,849   968,960   16.7  
    Other income   18,705   459 nm     16,180 15.6     39,835   (940 ) nm  
    Operating revenues   965,037   760,389 26.9     967,109 (0.2 )   2,843,011   2,329,657   22.0  
    Interest revenue   510,823   505,198 1.1     498,152 2.5     1,515,803   1,439,532   5.3  
    Total revenues   1,475,860   1,265,587 16.6     1,465,261 0.7     4,358,814   3,769,189   15.6  
    Interest expense   251,192   220,536 13.9     247,329 1.6     753,176   566,624   32.9  
    Net revenues   1,224,668   1,045,051 17.2     1,217,932 0.6     3,605,638   3,202,565   12.6  
    Non-interest expenses:                
    Compensation and benefits   718,065   613,287 17.1     722,719 (0.6 )   2,120,479   1,880,144   12.8  
    Non-compensation operating expenses   289,945   322,335 (10.0 )   268,319 8.1     822,916   821,724   0.1  
    Total non-interest expenses   1,008,010   935,622 7.7     991,038 1.7     2,943,395   2,701,868   8.9  
    Income before income taxes   216,658   109,429 98.0     226,894 (4.5 )   662,243   500,697   32.3  
    Provision for income taxes   58,153   41,268 40.9     61,600 (5.6 )   174,869   140,645   24.3  
    Net income   158,505   68,161 132.5     165,294 (4.1 )   487,374   360,052   35.4  
    Preferred dividends   9,320   9,321 (0.0 )   9,321 (0.0 )   27,961   27,961   0.0  
    Net income available to common shareholders $ 149,185 $ 58,840 153.5   $ 155,973 (4.4 ) $ 459,413 $ 332,091   38.3  
    Earnings per common share:                
    Basic $ 1.43 $ 0.55 160.0   $ 1.50 (4.7 ) $ 4.41 $ 3.09   42.7  
    Diluted $ 1.34 $ 0.52 157.7   $ 1.41 (5.0 ) $ 4.16 $ 2.91   43.0  
    Cash dividends declared per common share $ 0.42 $ 0.36 16.7   $ 0.42 0.0   $ 1.26 $ 1.08   16.7  
    Weighted average number of common shares outstanding:          
    Basic   103,966   106,068 (2.0 )   104,150 (0.2 )   104,135   107,580   (3.2 )
    Diluted   110,994   113,195 (1.9 )   110,285 0.6     110,457   114,170   (3.3 )
    Non-GAAP Financial Measures (9)
     
      Three Months Ended Nine Months Ended
    (000s, except per share amounts) 9/30/2024 9/30/2023 9/30/2024 9/30/2023
    GAAP net income $ 158,505   $ 68,161   $ 487,374   $ 360,052  
    Preferred dividend   9,320     9,321     27,961     27,961  
    Net income available to common shareholders   149,185     58,840     459,413     332,091  
             
    Non-GAAP adjustments:        
    Merger-related (10)   17,950     13,771     43,925     46,301  
    Restructuring and severance (11)   1,261     —     11,222     —  
    Provision for income taxes (12)   (2,126 )   (5,198 )   (8,374 )   (13,455 )
    Total non-GAAP adjustments   17,085     8,573     46,773     32,846  
    Non-GAAP net income available to common shareholders $ 166,270   $ 67,413   $ 506,186   $ 364,937  
             
    Weighted average diluted shares outstanding   110,994     113,195     110,457     114,170  
             
    GAAP earnings per diluted common share $ 1.42   $ 0.60   $ 4.42   $ 3.15  
    Non-GAAP adjustments   0.16     0.08     0.42     0.29  
    Non-GAAP earnings per diluted common share $ 1.58   $ 0.68   $ 4.84   $ 3.44  
             
    GAAP earnings per diluted common share available to common shareholders $ 1.34   $ 0.52   $ 4.16   $ 2.91  
    Non-GAAP adjustments   0.16     0.08     0.42     0.29  
    Non-GAAP earnings per diluted common share available to common shareholders $ 1.50   $ 0.60   $ 4.58   $ 3.20  
    GAAP to Non-GAAP Reconciliation (9)
     
      Three Months Ended Nine Months Ended
    (000s) 9/30/2024 9/30/2023 9/30/2024 9/30/2023
    GAAP compensation and benefits $ 718,065   $ 613,287   $ 2,120,479   $ 1,880,144  
    As a percentage of net revenues   58.6 %   58.7 %   58.8 %   58.7 %
    Non-GAAP adjustments:        
    Merger-related (10)   (6,101 )   (7,171 )   (17,398 )   (22,947 )
    Restructuring and severance (11)   (1,261 )   —     (11,222 )   —  
    Total non-GAAP adjustments   (7,362 )   (7,171 )   (28,620 )   (22,947 )
    Non-GAAP compensation and benefits $ 710,703   $ 606,116   $ 2,091,859   $ 1,857,197  
    As a percentage of non-GAAP net revenues   58.0 %   58.0 %   58.0 %   58.0 %
             
    GAAP non-compensation expenses $ 289,945   $ 322,335   $ 822,916   $ 821,724  
    As a percentage of net revenues   23.7 %   30.8 %   22.8 %   25.7 %
    Non-GAAP adjustments:        
    Merger-related (10)   (11,166 )   (6,623 )   (25,835 )   (23,380 )
    Non-GAAP non-compensation expenses $ 278,779   $ 315,712   $ 797,081   $ 798,344  
    As a percentage of non-GAAP net revenues   22.8 %   30.2 %   22.1 %   24.9 %
    Total adjustments $ 19,211   $ 13,771   $ 55,147   $ 46,301  
    Footnotes
     
    (1) Represents available to common shareholders.
    (2) Reconciliations of the Company’s GAAP results to these non-GAAP measures are discussed within and under “Non-GAAP Financial Measures” and “GAAP to Non-GAAP Reconciliation.”
    (3) Non-GAAP pre-tax margin is calculated by adding total non-GAAP adjustments and dividing it by non-GAAP net revenues. See “Non-GAAP Financial Measures” and “GAAP to Non-GAAP Reconciliation.”
    (4) Return on average common equity (“ROCE”) is calculated by dividing annualized net income applicable to common shareholders by average common shareholders’ equity or, in the case of non-GAAP ROCE, calculated by dividing non-GAAP net income applicable to commons shareholders by average common shareholders’ equity.
    (5) Return on average tangible common equity (“ROTCE”) is calculated by dividing annualized net income applicable to common shareholders by average tangible shareholders’ equity or, in the case of non-GAAP ROTCE, calculated by dividing non-GAAP net income applicable to common shareholders by average tangible common equity. Tangible common equity, also a non-GAAP financial measure, equals total common shareholders’ equity less goodwill and identifiable intangible assets and the deferred taxes on goodwill and intangible assets. Average deferred taxes on goodwill and intangible assets was $77.9 million and $67.4 million as of September 30, 2024 and 2023, respectively.
    (6) Includes loans held for sale.
    (7) Tangible book value per common share represents shareholders’ equity (excluding preferred stock) divided by period end common shares outstanding. Tangible common shareholders’ equity equals total common shareholders’ equity less goodwill and identifiable intangible assets and the deferred taxes on goodwill and intangible assets.
    (8) Capital ratios are estimates at time of the Company’s earnings release, October 23, 2024.
    (9) The Company prepares its Consolidated Financial Statements using accounting principles generally accepted in the United States (U.S. GAAP). The Company may disclose certain “non-GAAP financial measures” in the course of its earnings releases, earnings conference calls, financial presentations and otherwise. The Securities and Exchange Commission defines a “non-GAAP financial measure” as a numerical measure of historical or future financial performance, financial position, or cash flows that is subject to adjustments that effectively exclude, or include, amounts from the most directly comparable measure calculated and presented in accordance with U.S. GAAP. Non-GAAP financial measures disclosed by the Company are provided as additional information to analysts, investors and other stakeholders in order to provide them with greater transparency about, or an alternative method for assessing the Company’s financial condition or operating results. These measures are not in accordance with, or a substitute for U.S. GAAP, and may be different from or inconsistent with non-GAAP financial measures used by other companies. Whenever the Company refers to a non-GAAP financial measure, it will also define it or present the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP, along with a reconciliation of the differences between the non-GAAP financial measure it references and such comparable U.S. GAAP financial measure.
    (10) Primarily related to charges attributable to integration-related activities, signing bonuses, amortization of restricted stock awards, debentures, and promissory notes issued as retention, additional earn-out expense, and amortization of intangible assets acquired. These costs were directly related to acquisitions of certain businesses and are not representative of the costs of running the Company’s on-going business.
    (11) The Company recorded severance costs associated with workforce reductions in certain of its foreign subsidiaries.
    (12) Primarily represents the Company’s effective tax rate for the period applied to the non-GAAP adjustments.

    Media Contact: Neil Shapiro (212) 271-3447 | Investor Contact: Joel Jeffrey (212) 271-3610 | http://www.stifel.com/investor-relations

    The MIL Network –

  • MIL-OSI China: Announcement on Open Market Operations No.209 [2024]

    Source: Peoples Bank of China

    Announcement on Open Market Operations No.209 [2024]

    (Open Market Operations Office, October 23, 2024)

    In order to offset the impact of factors such as the open market reverse repo maturity and tax periods, and to keep liquidity adequate at a reasonable level in the banking system, the People’s Bank of China conducted reverse repo operations in the amount of RMB792.7 billion through quantity bidding at a fixed interest rate on October 23, 2024.

    Details of the Reverse Repo Operations

    Maturity

    Volume

    Rate

    7 days

    RMB792.7 billion

    1.50%

    Date of last update Nov. 29 2018

    2024年10月23日

    MIL OSI China News –

  • MIL-OSI: UP Fintech Announces Pricing of Follow-on Public Offering of American Depositary Shares

    Source: GlobeNewswire (MIL-OSI)

    SINGAPORE, Oct. 23, 2024 (GLOBE NEWSWIRE) — UP Fintech Holding Limited (Nasdaq: TIGR) (“UP Fintech” or the “Company”), a leading online brokerage firm focusing on global investors, today announced the pricing of a public offering of 15,000,000 American Depositary Shares (“ADSs”), each representing 15 Class A ordinary shares of the Company, at a public offering price of US$6.25 per ADS. The underwriters will have an option to purchase up to an aggregate of 2,250,000 additional ADSs from the Company at the public offering price, less underwriting discounts and commissions, exercisable within 20 days from the date of the prospectus supplement.

    The ADS offering is expected to close on October 24, 2024, subject to customary closing conditions.

    The Company expects to use the net proceeds of approximately US$90.0 million from the ADS offering for strengthening the Company’s capital base and furthering the Company’s business development initiatives.

    Deutsche Bank AG, Hong Kong Branch, China International Capital Corporation Hong Kong Securities Limited and US Tiger Securities, Inc. are acting as the joint bookrunners for the proposed ADS offering.

    The ADS offering has been made pursuant to an automatic shelf registration statement on Form F-3 filed with the United States Securities and Exchange Commission (the “SEC”) and is available on the SEC’s website at http://www.sec.gov. The ADS offering has been made only by means of a prospectus supplement and an accompanying prospectus included in the Form F-3. The Form F-3 and the prospectus supplement are available on the SEC’s website at http://www.sec.gov. The final prospectus supplement will be filed with the SEC and will be available on the SEC’s website at: http://www.sec.gov. When available, copies of the final prospectus supplement and the accompanying prospectus may be obtained by contacting Deutsche Bank AG, Hong Kong Branch, Level 60, International Commerce Centre, 1 Austin Road West, Kowloon, Hong Kong; China International Capital Corporation Hong Kong Securities Limited 29/F, One International Finance Centre, 1 Harbour View Street, Central, Hong Kong; or, US Tiger Securities, Inc., 437 Madison Avenue, 27th Floor, New York, NY 10022, United States of America.

    This announcement shall not constitute an offer to sell, or a solicitation of an offer to buy, the securities described herein, nor shall there be any offer, solicitation or sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

    About UP Fintech Holding Limited

    UP Fintech Holding Limited is a leading online brokerage firm focusing on global investors. The Company’s proprietary mobile and online trading platform enables investors to trade in equities and other financial instruments on multiple exchanges around the world. The Company offers innovative products and services as well as a superior user experience to customers through its “mobile first” strategy, which enables it to better serve and retain current customers as well as attract new ones. The Company offers customers comprehensive brokerage and value-added services, including trade order placement and execution, margin financing, IPO subscription, ESOP management, investor education, community discussion and customer support. The Company’s proprietary infrastructure and advanced technology are able to support trades across multiple currencies, multiple markets, multiple products, multiple execution venues and multiple clearinghouses.

    For more information on the Company, please visit: https://ir.itigerup.com.

    Safe Harbor Statement

    This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “may,” “might,” “aim,” “likely to,” “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements or expressions. Among other statements, the business outlook and quotations from management in this announcement, the Company’s strategic and operational plans and expectations regarding growth and expansion of its business lines, and the Company’s plans for future financing of its business contain forward-looking statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (“SEC”) on Forms 20−F and 6−K, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties, including the earnings conference call. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s ability to effectively implement its growth strategies; trends and competition in global financial markets; changes in the Company’s revenues and certain cost or expense accounting policies; and governmental policies and regulations affecting the Company’s industry and general economic conditions in China, Singapore and other countries. Further information regarding these and other risks is included in the Company’s filings with the SEC, including the Company’s annual report on Form 20-F filed with the SEC on April 22, 2024. All information provided in this press release and in the attachments is as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement, except as required under applicable law. Further information regarding these and other risks is included in the Company’s filings with the SEC.

    For investor and media inquiries please contact:

    Investor Relations Contact
    UP Fintech Holding Limited
    Email: ir@itiger.com

    The MIL Network –

  • MIL-OSI: Landsbankinn hf.: Financial results of Landsbankinn for the first nine months of 2024

    Source: GlobeNewswire (MIL-OSI)

    • Landsbankinn’s after-tax profit in the first nine months of 2024 amounted to ISK 26.9 billion, ISK 10.8 billion thereof in the third quarter.
    • Return on equity (ROE) was 11.7%, compared with 10.5% for the same period the previous year.
    • The net interest margin was 2.9% and the net interest margin of domestic households rises from 2% to 2.1% due to higher reserve requirements.
    • Net interest income amounted to ISK 44.1 billion and net fee & commission income was ISK 8.1 billion.
    • Net impairments were negative by ISK 2.0 billion, largely attributable to uncertainty about the financial impact of natural disaster on the Reykjanes peninsula.
    • The cost-income ratio was 32.3%, compared with 34.6% in the same period of 2023.
    • The total capital ratio was 24.1% at the end of the period. The total capital requirement of the Financial Supervisory Authority (FSA) of the Central Bank of Iceland is 20.4%.
    • In September, the FSA published the results of its assessment, finding that Landsbankinn is eligible to control a qualifying holding in TM tryggingar hf. (TM). The conclusion of the Icelandic Competition Authority in the same case is pending.

    Lilja Björk Einarsdóttir, CEO of Landsbankinn:

    “These results reflect sound operation and growing activity. The Bank is advancing in all areas and fee and commission income is robust in line with our focus on adding services and growing our market share. On-going development of Landsbankinn’s app and new features are clearly translating into increased use, not least among young customers. We see this in pension savings, for example, where growth in supplementary pension agreements with young people has reached 17.3% since the feature was added to the app. 

    While use of our digital solutions continues to grow, customers are still active in visiting the Bank to seek advice and other services offered in our branches and Customer Service Centre. We operate 35 branches and outlets around Iceland and are always happy to see our customers – in the past quarter, around 85,000 visits were logged with cashiers and advisors. We emphasise initiative in our customer relations and mortgage holders with the Bank, whose mortgages were nearing the end of a fixed-rate term, received a call from the Bank and a consultation offer.

    In recent years, higher interest rates have resulted in good returns on the Bank’s liquid assets yet also made funding more costly, especially with higher deposit rates which customers enjoy in the form of improved return on their savings. As an example, the most favourable deposit rates the Bank currently offers corporates are 8.64% on an annualised basis. The Bank’s net interest margin has narrowed since the previous quarter and the interest margin of households, which is the difference between non-indexed mortgage rates and interest on non-fixed term savings, is currently 2.1%.

    Robust lending growth this year to date has been somewhat surprising in light of high interest rate levels but funding to meet this increase has been successful, and delinquencies remain low. The Bank’s loan book has grown by ISK 155 billion, or 9.5%. Of the total, loans to retail customers represent ISK 53.6 billion, almost all in the form of mortgages. Because of increased demand for inflation-indexed mortgages and higher funding terms on indexed bonds, we have changed the availability of indexed mortgages to, among other things, reduce demand. We continue to offer the best terms among the domestic banks but now only offer equal payment mortgages to first-time buyers. While monthly payments will be higher for those who select indexed loans, asset formation will also be quicker. This allowed us to keep interest rate hikes moderate and we are of the opinion that this change is more positive for the majority of our customers.

    A recent green issuance in the amount of EUR 300 million was very successful, achieving the most favourable terms any Icelandic bank has gotten in quite some while. Part of the proceeds from the issuance will be allocated to repay older bonds issued at even more favourable terms so that the net impact is slightly higher funding cost for the Bank.

    We await the conclusion of the Icelandic Competition Authority in the matter of the Bank’s purchase of TM. In the interim, there are rules that limit communication between the companies. If the conclusion is positive, the Bank will finalise the purchase without delay and the project can get off to a full start. With the Bank’s purchase of TM, our aim is to offer customers even better and varied service through all our service channels.”

    Landsbankinn’s financial calendar

    • Annual results 2024 30 January 2025 
    • Annual General Meeting 19 March 2025
    • Q1 2025 30 April 2025
    • Q2 2025 17 July 2025
    • Q3 2025 23 October 2025
    • Annual results 2025 29 January 2026

    For further information contact:

    Public Relations, pr@landsbankinn.is

    Investor Relations, ir@landsbankinn.is

    Attachments

    The MIL Network –

  • MIL-OSI: Lloyds Bank PLC: 2024 Q3 Interim Management Statement

    Source: GlobeNewswire (MIL-OSI)

    LONDON, Oct. 23, 2024 (GLOBE NEWSWIRE) —

    Lloyds Bank plc
    Q3 2024 Interim Management Statement
    23 October 2024

    Member of the Lloyds Banking Group

    FINANCIAL REVIEW

    Income statement

    The Group’s profit before tax for the first nine months of 2024 was £3,927 million, 27 per cent lower than the same period in 2023. This was driven by lower net interest income and higher operating expenses, partly offset by a lower impairment charge. Profit after tax was £2,727 million (nine months to 30 September 2023 £3,975 million).

    Total income for the first nine months of 2024 was £12,613 million, a decrease of 8 per cent on the same period in 2023. Within this, net interest income of £9,378 million was 10 per cent lower on the prior year, driven by a lower margin. The lower margin reflected anticipated headwinds due to deposit churn and asset margin compression, particularly in the mortgage book as it refinances in a lower margin environment. These factors were partially offset by benefits from higher structural hedge earnings as balances are reinvested in the higher rate environment.

    Other income amounted to £3,235 million in the nine months to 30 September 2024 compared to £3,268 million in the same period in 2023, with improved UK Motor Finance performance, reflecting growth following the acquisition of Tusker in the first quarter of 2023, increased fleet size and higher average rental value, partially offset by the impact of changes to commission arrangements with Scottish Widows.

    Operating expenses of £8,392 million were 13 per cent higher than in the prior year. This includes the impacts of higher operating lease depreciation, largely as a result of fleet growth, the depreciation of higher value vehicles and declines in used electric car prices, alongside higher ongoing strategic investment, accelerated severance charges and inflationary pressure. It also includes c.£0.1 billion relating to the sector-wide change in the charging approach for the Bank of England Levy taken in the first quarter. In the nine months to 30 September 2024, the Group recognised remediation costs of £118 million (nine months to 30 September 2023: £127 million), largely in relation to pre-existing programmes, with no further charges in respect of the FCA review of historical motor finance commission arrangements. The FCA confirmed in September 2024 its intention to set out next steps in its review in May 2025, including its assessment of the outcome of the Judicial Review and Court of Appeal decisions involving other market participants; the Group will assess the impact, if any, of these decisions.

    The impairment charge was £294 million compared with a £881 million charge in the nine months to 30 September 2023. The decrease reflects a larger credit from improvements to the Group’s economic outlook in the first half of the year, notably house price growth and through changes to the severe downside scenario methodology. The charge also benefitted from strong portfolio performance, a large debt sale write-back, and a release in Commercial Banking from loss rates used in the model. Asset quality remains strong with resilient credit performance.

    Balance sheet

    Total assets were £4,207 million higher at £609,612 million at 30 September 2024 compared to £605,405 million at 31 December 2023. Financial assets at amortised cost were £15,406 million higher at £503,477 million compared to £488,071 million at 31 December 2023 with increases in reverse repurchase agreements of £11,128 million and loans and advances to customers of £7,355 million, partly offset by a reduction in loans and advances to banks of £2,919 million. The increase in reverse repurchase agreements and the decrease in cash and balances at central banks by £17,984 million to £39,925 million reflected a change in the mix of liquidity holdings. The increase in loans and advances to customers included growth in UK mortgages, UK Retail unsecured loans, credit cards and the European retail business, partly offset by government-backed lending repayments in Commercial Banking. Financial assets at fair value through other comprehensive income were £5,032 million higher reflecting a change in the mix of liquidity holdings. Other assets increased by £1,864 million to £28,925 million, driven by higher settlement balances and higher operating lease assets reflecting continued motor finance growth.

    Total liabilities were £4,390 million higher at £569,364 million compared to £564,974 million at 31 December 2023. Customer deposits at £446,311 million have increased by £4,358 million since the end of 2023, driven by inflows to limited withdrawal and fixed term savings products, partly offset by a reduction in current account balances and an expected significant outflow in Commercial Banking. In addition, repurchase agreements at £41,370 million have increased by £3,668 million since the end of 2023. Debt securities in issue at amortised cost decreased by £7,369 million to £45,080 million at 30 September 2024. Amounts due to fellow Lloyds Banking Group undertakings increased by £1,510 million to £4,442 million at 30 September 2024. Other liabilities increased by £3,042 million to £12,926 million, driven by higher settlement balances.

    Total equity was £40,248 million at 30 September 2024 was broadly stable compared to £40,431 million at 31 December 2023, with the profit for the period largely offset by interim dividends of £3.4 billion, pension revaluations and movements in the cash flow hedging reserve.

    FINANCIAL REVIEW (continued)

    Capital

    The Group’s common equity tier 1 (CET1) capital ratio reduced to 13.6 per cent at 30 September 2024 (31 December 2023: 14.4 per cent). This largely reflected profit for the period, offset by the payment of interim ordinary dividends, the accrual for foreseeable ordinary dividends and an increase in risk-weighted assets.

    The Group’s total capital ratio reduced to 19.8 per cent (31 December 2023: 20.5 per cent). The issuance of AT1 and Tier 2 capital instruments was more than offset by the reduction in CET1 capital, the reduction in eligible provisions recognised through Tier 2 capital, the impact of regulatory amortisation and foreign exchange on Tier 2 capital instruments and the increase in risk-weighted assets.

    Risk-weighted assets have increased by £2,350 million to £184,910 million at 30 September 2024 (31 December 2023: £182,560 million). This reflects the impact of Retail lending growth, Retail secured CRD IV model updates and other movements, partly offset by optimisation including capital efficient securitisation activity.

    The Group’s UK leverage ratio reduced to 5.3 per cent (31 December 2023: 5.6 per cent). This reflected both the reduction in the total tier 1 capital position and an increase in the leverage exposure measure, principally related to the increase in securities financing transactions and other balance sheet movements.

     
    CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED)
     
      Nine
    months ended
    30 Sep
    2024
    £m    		     Nine
    months ended
    30 Sep
    2023
    £m    		  
           
    Net interest income 9,378     10,432  
    Other income 3,235     3,268  
    Total income 12,613     13,700  
    Operating expenses (8,392 )   (7,457 )
    Impairment (294 )   (881 )
    Profit before tax 3,927     5,362  
    Tax expense (1,200 )   (1,387 )
    Profit for the period 2,727     3,975  
           
    Profit attributable to ordinary shareholders 2,454     3,708  
    Profit attributable to other equity holders 256     249  
    Profit attributable to equity holders 2,710     3,957  
    Profit attributable to non-controlling interests 17     18  
    Profit for the period 2,727     3,975  
     
    CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
     
      At 30 Sep
    2024
    £m    		     At 31 Dec
    2023
    £m    		  
               
    Assets          
    Cash and balances at central banks 39,925     57,909  
    Financial assets at fair value through profit or loss 1,990     1,862  
    Derivative financial instruments 2,926     3,165  
    Loans and advances to banks 5,891     8,810  
    Loans and advances to customers 440,479     433,124  
    Reverse repurchase agreements 43,879     32,751  
    Debt securities 12,569     12,546  
    Due from fellow Lloyds Banking Group undertakings 659     840  
    Financial assets at amortised cost 503,477     488,071  
    Financial assets at fair value through other comprehensive income 32,369     27,337  
    Other assets 28,925     27,061  
    Total assets 609,612     605,405  
               
    Liabilities          
    Deposits from banks 3,474     3,557  
    Customer deposits 446,311     441,953  
    Repurchase agreements 41,370     37,702  
    Due to fellow Lloyds Banking Group undertakings 4,442     2,932  
    Financial liabilities at fair value through profit or loss 4,964     5,255  
    Derivative financial instruments 3,583     4,307  
    Debt securities in issue at amortised cost 45,080     52,449  
    Other liabilities 12,926     9,884  
    Subordinated liabilities 7,214     6,935  
    Total liabilities 569,364     564,974  
               
    Equity          
    Share capital 1,574     1,574  
    Share premium account 600     600  
    Other reserves 2,904     2,395  
    Retained profits 29,667     30,786  
    Ordinary shareholders’ equity 34,745     35,355  
    Other equity instruments 5,428     5,018  
    Non-controlling interests 75     58  
    Total equity 40,248     40,431  
    Total equity and liabilities 609,612     605,405  
    ADDITIONAL FINANCIAL INFORMATION
     

    1.  Basis of presentation

    This release covers the results of Lloyds Bank plc together with its subsidiaries (the Group) for the nine months ended 30 September 2024.

    Accounting policies

    The accounting policies are consistent with those applied by the Group in its 2023 Annual Report and Accounts

    2.  Capital

    The Group’s Q3 2024 Interim Pillar 3 Disclosures can be found at http://www.lloydsbankinggroup.com/investors/financial-downloads.html.

    3.  UK economic assumptions

    Base case and MES economic assumptions

    The Group’s base case scenario is for a slow expansion in GDP and a modest rise in the unemployment rate alongside small gains in residential and commercial property prices. Following a reduction in inflationary pressures, cuts in UK Bank Rate are expected to continue during 2024 and 2025. Risks around this base case economic view lie in both directions and are largely captured by the generation of alternative economic scenarios.

    The Group has taken into account the latest available information at the reporting date in defining its base case scenario and generating alternative economic scenarios. The scenarios include forecasts for key variables as of the third quarter of 2024. Actuals for this period, or restatements of past data, may have since emerged prior to publication and have not been included, including specifically in the Quarterly National Accounts release of 30 September 2024. The Group’s approach to generating alternative economic scenarios is set out in detail in note 19 to the financial statements for the year ended 31 December 2023. For September 2024, the Group continues to judge it appropriate to include a non-modelled severe downside scenario for ECL calculations as explained in note 12 of the Group’s 2024 Half-Year news release.

    UK economic assumptions – base case scenario by quarter

    Key quarterly assumptions made by the Group in the base case scenario are shown below. Gross domestic product is presented quarter-on-quarter. House price growth, commercial real estate price growth and CPI inflation are presented year-on-year, i.e. from the equivalent quarter in the previous year. Unemployment rate and UK Bank Rate are presented as at the end of each quarter.

    At 30 September 2024 First
    quarter
    2024
    %    		   Second
    quarter
    2024
    %    		   Third
    quarter
    2024
    %    		   Fourth
    quarter
    2024
    %    		 First
    quarter
    2025
    %    		 Second
    quarter
    2025
    %    		 Third
    quarter
    2025
    %    		 Fourth
    quarter
    2025
    %
                     
    Gross domestic product 0.7   0.6   0.3   0.3 0.3 0.3 0.4 0.4
    Unemployment rate 4.3   4.2   4.3   4.5 4.6 4.7 4.8 4.8
    House price growth 0.4   1.8   5.3   3.1 3.2 3.6 2.4 2.0
    Commercial real estate price growth (5.3 ) (4.7 ) (2.5 ) 0.3 1.4 1.9 1.6 1.7
    UK Bank Rate 5.25   5.25   5.00   4.75 4.50 4.25 4.00 4.00
    CPI inflation 3.5   2.1   2.1   2.7 2.4 2.9 2.7 2.3
                           

    ADDITIONAL FINANCIAL INFORMATION (continued)

    3.  UK economic assumptions (continued)

    UK economic assumptions – scenarios by year

    Key annual assumptions made by the Group are shown below. Gross domestic product and CPI inflation are presented as an annual change, house price growth and commercial real estate price growth are presented as the growth in the respective indices within the period. Unemployment rate and UK Bank Rate are averages for the period.

    At 30 September 2024 2024
    %    		   2025
    %    		   2026
    %    		   2027
    %    		   2028
    %    		   2024-2028
    average
    %
                 
    Upside            
    Gross domestic product 1.2   2.4   1.9   1.5   1.4   1.7  
    Unemployment rate 4.2   3.3   2.8   2.7   2.8   3.1  
    House price growth 3.5   4.6   7.1   6.4   5.1   5.3  
    Commercial real estate price growth 1.6   9.0   4.2   1.8   0.7   3.4  
    UK Bank Rate 5.06   5.08   5.16   5.34   5.58   5.24  
    CPI inflation 2.6   2.7   2.4   2.8   2.8   2.7  
                 
    Base case            
    Gross domestic product 1.1   1.3   1.5   1.5   1.5   1.4  
    Unemployment rate 4.3   4.7   4.7   4.5   4.5   4.5  
    House price growth 3.1   2.0   1.0   1.5   2.1   2.0  
    Commercial real estate price growth 0.3   1.7   2.1   0.7   0.3   1.0  
    UK Bank Rate 5.06   4.19   3.63   3.50   3.50   3.98  
    CPI inflation 2.6   2.6   2.1   2.2   2.1   2.3  
                 
    Downside            
    Gross domestic product 1.0   (0.3 ) 0.4   1.3   1.5   0.8  
    Unemployment rate 4.4   6.5   7.3   7.3   7.1   6.5  
    House price growth 2.9   (0.2 ) (6.1 ) (5.8 ) (2.9 ) (2.5 )
    Commercial real estate price growth (0.7 ) (6.2 ) (1.7 ) (1.9 ) (1.9 ) (2.5 )
    UK Bank Rate 5.06   3.11   1.48   0.96   0.65   2.25  
    CPI inflation 2.6   2.6   1.9   1.5   1.1   2.0  
                 
    Severe downside            
    Gross domestic product 0.9   (2.0 ) (0.1 ) 1.1   1.4   0.2  
    Unemployment rate 4.6   8.6   9.9   9.9   9.7   8.5  
    House price growth 2.3   (2.5 ) (13.5 ) (12.6 ) (8.3 ) (7.1 )
    Commercial real estate price growth (2.7 ) (16.5 ) (6.5 ) (6.5 ) (5.1 ) (7.6 )
    UK Bank Rate – modelled 5.06   1.83   0.23   0.06   0.02   1.44  
    UK Bank Rate – adjusted1 5.13   3.67   2.55   2.16   1.88   3.08  
    CPI inflation – modelled 2.6   2.6   1.5   0.7   0.1   1.5  
    CPI inflation – adjusted1 2.6   3.5   1.8   1.3   0.9   2.0  
                 
    Probability-weighted            
    Gross domestic product 1.1   0.8   1.1   1.4   1.4   1.2  
    Unemployment rate 4.3   5.2   5.4   5.3   5.3   5.1  
    House price growth 3.1   1.7   (0.7 ) (0.6 ) 0.5   0.8  
    Commercial real estate price growth 0.1   (0.3 ) 0.7   (0.5 ) (0.8 ) (0.1 )
    UK Bank Rate – modelled 5.06   3.90   3.10   2.95   2.92   3.59  
    UK Bank Rate – adjusted1 5.07   4.08   3.33   3.15   3.11   3.75  
    CPI inflation – modelled 2.6   2.6   2.0   2.0   1.8   2.2  
    CPI inflation – adjusted1 2.6   2.7   2.1   2.1   1.9   2.3  
                             

    1 The adjustment to UK Bank Rate and CPI inflation in the severe downside is considered to better reflect the risks to the Group’s base case view in an economic environment where the risks of supply and demand shocks are seen as more balanced.

    ADDITIONAL FINANCIAL INFORMATION (continued)

    4.  Loans and advances to customers and expected credit loss allowance

    At 30 September 2024 Stage 1
    £m    		     Stage 2
    £m    		     Stage 3
    £m    		     POCI
    £m    		     Total
    £m    		     Stage 2
    as % of
    total    		   Stage 3
    as % of
    total
                               
    Loans and advances to customers
                               
    UK mortgages 271,138     28,389     4,545     6,949     311,021     9.1   1.5
    Credit cards 13,429     2,620     262     –     16,311     16.1   1.6
    Loans and overdrafts 8,839     1,374     173     –     10,386     13.2   1.7
    UK Motor Finance 14,390     2,314     119     –     16,823     13.8   0.7
    Other 16,702     513     150     –     17,365     3.0   0.9
    Retail 324,498     35,210     5,249     6,949     371,906     9.5   1.4
    Small and Medium Businesses 26,393     3,430     1,303     –     31,126     11.0   4.2
    Corporate and Institutional Banking 37,564     2,306     637     –     40,507     5.7   1.6
    Commercial Banking 63,957     5,736     1,940     –     71,633     8.0   2.7
    Other1 260     –     –     –     260     –   –
    Total gross lending 388,715     40,946     7,189     6,949     443,799     9.2   1.6
    ECL allowance on drawn balances (764 )   (1,228 )   (1,106 )   (222 )   (3,320 )        
    Net balance sheet carrying value 387,951     39,718     6,083     6,727     440,479          
                               
    Customer related ECL allowance (drawn and undrawn)
                               
    UK mortgages 86     321     339     222     968          
    Credit cards 207     351     129     –     687          
    Loans and overdrafts 170     242     111     –     523          
    UK Motor Finance2 169     105     68     –     342          
    Other 15     18     42     –     75          
    Retail 647     1,037     689     222     2,595          
    Small and Medium Businesses 138     190     160     –     488          
    Corporate and Institutional Banking 126     125     259     –     510          
    Commercial Banking 264     315     419     –     998          
    Other –     –     –     –     –          
    Total 911     1,352     1,108     222     3,593          
                               
    Customer related ECL allowance (drawn and undrawn) as a percentage of loans and advances to customers
                               
    UK mortgages –     1.1     7.5     3.2     0.3          
    Credit cards 1.5     13.4     49.2     –     4.2          
    Loans and overdrafts 1.9     17.6     64.2     –     5.0          
    UK Motor Finance 1.2     4.5     57.1     –     2.0          
    Other 0.1     3.5     28.0     –     0.4          
    Retail 0.2     2.9     13.1     3.2     0.7          
    Small and Medium Businesses 0.5     5.5     12.3     –     1.6          
    Corporate and Institutional Banking 0.3     5.4     40.7     –     1.3          
    Commercial Banking 0.4     5.5     21.6     –     1.4          
    Other –     –     –     –     –          
    Total 0.2     3.3     15.4     3.2     0.8          
                                         

    1 Contains central fair value hedge accounting adjustments.

    2 UK Motor Finance includes £170 million relating to provisions against residual values of vehicles subject to finance leases.

    FORWARD-LOOKING STATEMENTS

    This document contains certain forward-looking statements within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended, and section 27A of the US Securities Act of 1933, as amended, with respect to the business, strategy, plans and/or results of Lloyds Bank plc together with its subsidiaries (the Lloyds Bank Group) and its current goals and expectations. Statements that are not historical or current facts, including statements about the Lloyds Bank Group’s or its directors’ and/or management’s beliefs and expectations, are forward-looking statements. Words such as, without limitation, ‘believes’, ‘achieves’, ‘anticipates’, ‘estimates’, ‘expects’, ‘targets’, ‘should’, ‘intends’, ‘aims’, ‘projects’, ‘plans’, ‘potential’, ‘will’, ‘would’, ‘could’, ‘considered’, ‘likely’, ‘may’, ‘seek’, ‘estimate’, ‘probability’, ‘goal’, ‘objective’, ‘deliver’, ‘endeavour’, ‘prospects’, ‘optimistic’ and similar expressions or variations on these expressions are intended to identify forward-looking statements. These statements concern or may affect future matters, including but not limited to: projections or expectations of the Lloyds Bank Group’s future financial position, including profit attributable to shareholders, provisions, economic profit, dividends, capital structure, portfolios, net interest margin, capital ratios, liquidity, risk-weighted assets (RWAs), expenditures or any other financial items or ratios; litigation, regulatory and governmental investigations; the Lloyds Bank Group’s future financial performance; the level and extent of future impairments and write-downs; the Lloyds Bank Group’s ESG targets and/or commitments; statements of plans, objectives or goals of the Lloyds Bank Group or its management and other statements that are not historical fact and statements of assumptions underlying such statements. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend upon circumstances that will or may occur in the future. Factors that could cause actual business, strategy, targets, plans and/or results (including but not limited to the payment of dividends) to differ materially from forward-looking statements include, but are not limited to: general economic and business conditions in the UK and internationally; acts of hostility or terrorism and responses to those acts, or other such events; geopolitical unpredictability; the war between Russia and Ukraine; the conflicts in the Middle East; the tensions between China and Taiwan; political instability including as a result of any UK general election; market related risks, trends and developments; changes in client and consumer behaviour and demand; exposure to counterparty risk; the ability to access sufficient sources of capital, liquidity and funding when required; changes to the Lloyds Bank Group’s or Lloyds Banking Group plc’s credit ratings; fluctuations in interest rates, inflation, exchange rates, stock markets and currencies; volatility in credit markets; volatility in the price of the Lloyds Bank Group’s securities; tightening of monetary policy in jurisdictions in which the Lloyds Bank Group operates; natural pandemic and other disasters; risks concerning borrower and counterparty credit quality; risks affecting defined benefit pension schemes; changes in laws, regulations, practices and accounting standards or taxation; changes to regulatory capital or liquidity requirements and similar contingencies; the policies and actions of governmental or regulatory authorities or courts together with any resulting impact on the future structure of the Lloyds Bank Group; risks associated with the Lloyds Bank Group’s compliance with a wide range of laws and regulations; assessment related to resolution planning requirements; risks related to regulatory actions which may be taken in the event of a bank or Lloyds Bank Group or Lloyds Banking Group failure; exposure to legal, regulatory or competition proceedings, investigations or complaints; failure to comply with anti-money laundering, counter terrorist financing, anti-bribery and sanctions regulations; failure to prevent or detect any illegal or improper activities; operational risks including risks as a result of the failure of third party suppliers; conduct risk; technological changes and risks to the security of IT and operational infrastructure, systems, data and information resulting from increased threat of cyber and other attacks; technological failure; inadequate or failed internal or external processes or systems; risks relating to ESG matters, such as climate change (and achieving climate change ambitions) and decarbonisation, including the Lloyds Bank Group’s or the Lloyds Banking Group’s ability along with the government and other stakeholders to measure, manage and mitigate the impacts of climate change effectively, and human rights issues; the impact of competitive conditions; failure to attract, retain and develop high calibre talent; the ability to achieve strategic objectives; the ability to derive cost savings and other benefits including, but without limitation, as a result of any acquisitions, disposals and other strategic transactions; inability to capture accurately the expected value from acquisitions; and assumptions and estimates that form the basis of the Lloyds Bank Group’s financial statements. A number of these influences and factors are beyond the Lloyds Bank Group’s control. Please refer to the latest Annual Report on Form 20-F filed by Lloyds Bank plc with the US Securities and Exchange Commission (the SEC), which is available on the SEC’s website at http://www.sec.gov, for a discussion of certain factors and risks. Lloyds Bank plc may also make or disclose written and/or oral forward-looking statements in other written materials and in oral statements made by the directors, officers or employees of Lloyds Bank plc to third parties, including financial analysts. Except as required by any applicable law or regulation, the forward-looking statements contained in this document are made as of today’s date, and the Lloyds Bank Group expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this document whether as a result of new information, future events or otherwise. The information, statements and opinions contained in this document do not constitute a public offer under any applicable law or an offer to sell any securities or financial instruments or any advice or recommendation with respect to such securities or financial instruments.

    CONTACTS

    For further information please contact:

    INVESTORS AND ANALYSTS

    Douglas Radcliffe
    Group Investor Relations Director
    020 7356 1571
    douglas.radcliffe@lloydsbanking.com

    Nora Thoden
    Director of Investor Relations – ESG
    020 7356 2334
    nora.thoden@lloydsbanking.com

    Tom Grantham
    Investor Relations Senior Manager
    07851 440 091
    thomas.grantham@lloydsbanking.com

    Sarah Robson
    Investor Relations Senior Manager
    07494 513 983
    sarah.robson2@lloydsbanking.com

    CORPORATE AFFAIRS

    Grant Ringshaw
    External Relations Director
    020 7356 2362
    grant.ringshaw@lloydsbanking.com

    Matt Smith
    Head of Media Relations
    07788 352 487
    matt.smith@lloydsbanking.com

    Copies of this News Release may be obtained from:
    Investor Relations, Lloyds Banking Group plc, 25 Gresham Street, London EC2V 7HN
    The statement can also be found on the Group’s website – http://www.lloydsbankinggroup.com

    Registered office: Lloyds Bank plc, 25 Gresham Street, London EC2V 7HN
    Registered in England No. 2065

    This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit http://www.rns.com.

    The MIL Network –

  • MIL-OSI Europe: Nordic statement on the draft legal bills in the Knesset related to UNRWA

    Source: Government of Sweden

    The Nordic countries are deeply concerned by the recent introduction of draft legal bills in the Knesset that, if adopted, would prevent the UNRWA from continuing its operations in the West Bank, including East Jerusalem, and Gaza. Effectively, UNRWA would no longer be able to exercise its core tasks as stipulated by UN General Assembly Resolution 302 (IV) of 8 December 1949, that is “to carry out […] direct relief and works programmes” for the millions of Palestine refugees living in these areas. It is from this and subsequent UN resolutions that UNRWA’s mandate is derived, and as its parent organ, it is only the General Assembly that can define the UNRWA mandate.

    UNRWA is at present the most centrally placed humanitarian organisation responding to the needs of Palestine refugees in the Middle East. UNRWA provides education for more than half a million children and adolescents, health services covering millions of patient visits annually and social safety net support for the most vulnerable refugees along with an emergency response programme. In the midst of an ongoing catastrophic humanitarian situation in Gaza, a halt to any of the organisation’s activities would have devastating consequences for the hundreds of thousands of civilians served by UNRWA. The consequential vacuum in services and humanitarian aid for Palestine refugees in Gaza, and the West Bank, including East Jerusalem, may well further destabilise the situation in these areas, in Israel and in the region as a whole, and may fundamentally jeopardize the prospects for a two-state solution. 

    Following serious allegations directed towards some workers of the Agency, we welcome the prompt follow-up action initiated by the United Nations Secretary-General and the UNRWA Commissioner General, and we expect its continued implementation. 

    Considering the above, the proposed draft legal bills that restrict UNRWA’s continued operations may entail the violation of Israel’s obligations under international law, including international humanitarian law, and the legally binding provisional measures ordered by the International Court of Justice.

    The Nordic countries reaffirm their unwavering commitment to the United Nations and international law, including international humanitarian law. The latter requires all parties to conflicts to ensure that affected populations receive the necessary humanitarian aid to live under adequate material conditions, as well as to ensure the safety of humanitarian workers. It is on this basis that the Nordic countries call for the proposed legal bills to be reconsidered and strongly urge Israel to ensure continued and unhindered humanitarian access for UNRWA to the Palestine refugees that it was set up to serve.

    Lars Løkke Rasmussen, Minister for Foreign Affairs of Denmark 
    Elina Valtonen, Minister for Foreign Affairs of Finland
    Thórdís Kolbrún Reykfjörd Gylfadóttir, Minister for Foreign Affairs of Iceland
    Espen Barth Eide, Minister for Foreign Affairs of Norway
    Maria Malmer Stenergard, Minister for Foreign Affairs of Sweden

    MIL OSI Europe News –

  • MIL-OSI: United Community Banks, Inc. Reports Third Quarter Results

    Source: GlobeNewswire (MIL-OSI)

    GREENVILLE, S.C. , Oct. 23, 2024 (GLOBE NEWSWIRE) — United Community Banks, Inc. (NYSE: UCB) (United) today announced net income for the 2024 third quarter of $47.3 million and pre-tax, pre-provision income of $74.2 million. The result included the previously announced strategic decision to sell $318 million in manufactured housing loans, which negatively impacted the quarter by $21.4 million after-tax, or $0.18 per share. Diluted earnings per share of $0.38 for the quarter represented a decrease of $0.01, or 3%, from the third quarter a year ago and a decrease of $0.16, or 30%, from the second quarter of 2024.

    On an operating basis, United’s diluted earnings per share of $0.57 was up 27% from the year-ago quarter. The primary drivers of the increased earnings per share year-over-year were higher net interest income and a lower provision for credit losses. The $0.57 result includes a $9.9 million Hurricane Helene related loan loss provision to increase the reserve on $383 million of loans in nine North Carolina counties impacted by the hurricane to 3.5% of loans.

    United’s return on assets was 0.67%, or 1.01% on an operating basis. Return on common equity was 5.20% and return on tangible common equity on an operating basis was 11.17%. On a pre-tax, pre-provision basis, operating return on assets was 1.50% for the quarter. At quarter-end, tangible common equity to tangible assets was 8.93%, up 15 basis points from the second quarter of 2024.

    Chairman and CEO Lynn Harton stated, “We continue to focus on growth and the third quarter saw the return of modest loan and strong deposit growth. Excluding the sale of our manufactured housing portfolio, announced in early September, loan balances were up 1.5% annualized. Customer deposits, which exclude brokered deposits, were up $262 million, or 5% annualized. Our balance sheet remains highly liquid and our internal capital generation rate is running well in excess of our current capital needs. We maintained robust capital ratios with our preliminary CET1 moving to 13.1% and we opportunistically redeemed $8 million of relatively expensive Trust Preferred securities. The increase in liquidity and capital place us in a great position to take advantage of growth opportunities as we move into 2025.”

    Mr. Harton continued, “We elected to sell our manufactured housing loan book, a business that was part of our Reliant Bancorp, Inc. acquisition in January of 2022, as a natural conclusion of our exit from the business, as we ceased originating loans in the third quarter of 2023. The transaction reduces our risk profile and allows us to allocate capital to other growth opportunities.”

    United’s net interest margin decreased four basis points to 3.33% from the second quarter. The average yield on United’s interest-earning assets was down four basis points to 5.55%, while its cost of interest-bearing liabilities decreased two basis points, leading to the four-basis point reduction in net interest margin. Net charge-offs were $23.7 million, or 0.52% of average loans, during the quarter, up 26 basis points compared to the second quarter of 2024 due to transaction-related losses resulting from the sale of our manufactured housing portfolio. NPAs were 42 basis points relative to total assets, down one basis point from the second quarter.

    Mr. Harton concluded, “We are pleased with our operating performance this quarter, but we were also reminded this quarter of the importance of community. Many of our employees, customers, and communities have been impacted by the recent hurricanes. We are actively involved in the recovery process through volunteer hours and financial support and will be ready to lead the rebuilding process, when and as needed. Many thanks to our employees throughout the company that have responded, in sometimes heroic ways, to support each other and our customers.”

    Third Quarter 2024 Financial Highlights:

    • Net income of $47.3 million and pre-tax, pre-provision income of $74.2 million
    • EPS down 3% compared to third quarter 2023 on a GAAP basis and up 27% on an operating basis; compared to second quarter 2024, EPS down 30% on a GAAP basis and down 2% on an operating basis
    • The GAAP results were impacted by the decision to sell the manufactured housing loan book at a $21.4 million after-tax loss, or $0.18, approximately one year after making the strategic decision to cease originations
    • Return on assets of 0.67%, or 1.01% on an operating basis
    • Pre-tax, pre-provision return on assets of 1.50% on an operating basis
    • Return on common equity of 5.20%
    • Return on tangible common equity of 11.17% on an operating basis
    • A provision for credit losses of $14.4 million, which includes $9.9 million to establish a special reserve for expected credit losses from Hurricane Helene
    • Net charge-offs of $23.7 million, or 52 basis points as a percent of average loans, which included $11.0 million, or 24 basis points, of transaction-related losses from the sale of our manufactured housing portfolio
    • Nonperforming assets of 0.42% of total assets, down one basis point compared to June 30, 2024
    • Loan production of $1.2 billion
    • Customer deposits were up $262 million from the second quarter, with most of the growth in NOW and money market deposits
    • Net interest margin of 3.33% decreased by four basis points from the second quarter mostly due to lower purchased loan accretion, the sale of our manufactured housing portfolio, and changing composition of our earning assets and interest-bearing liabilities
    • Mortgage closings of $239 million compared to $211 million a year ago; mortgage rate locks of $306 million compared to $304 million a year ago
    • Noninterest income was down $28.5 million on a linked quarter basis with $27.2 million due to losses from the sale of manufactured housing loans. The remaining decrease was primarily driven by the mark on our mortgage servicing rights asset.
    • Noninterest expenses decreased by $4.0 million compared to the second quarter on a GAAP basis and were up $0.3 million on an operating basis
    • Efficiency ratio of 65.5%, or 57.4% on an operating basis
    • Maintained robust capital ratios with preliminary CET1 increasing to 13.1% and opportunistically redeemed $8 million of relatively expensive Trust Preferred securities
    • Quarterly common dividend of $0.24 per share declared during the quarter, up 4% year-over-year

    Conference Call
    United will hold a conference call on Wednesday, October 23, 2024 at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. Participants can pre-register for the conference call by navigating to https://dpregister.com/sreg/10193157/fd9f74293a. Those without internet access or unable to pre-register may dial in by calling 1-866-777-2509. Participants are encouraged to dial in 15 minutes prior to the call start time. The conference call also will be webcast and can be accessed by selecting “Events and Presentations” under “News and Events” within the Investor Relations section of the company’s website, http://www.ucbi.com.

    UNITED COMMUNITY BANKS, INC.
    Selected Financial Information
    (In thousands, except per share data)
      2024   2023     Third
    Quarter
    2024-
    2023
    Change    		     For the Nine Months
    Ended September 30,    		      YTD
    2024-
    2023
    Change    		  
        Third
    Quarter    		       Second
    Quarter    		       First
    Quarter    		       Fourth
    Quarter    		       Third
    Quarter    		         2024       2023    
    INCOME SUMMARY                                                        
    Interest revenue $ 349,086     $ 346,965     $ 336,728     $ 338,698     $ 323,147             $ 1,032,779     $ 898,409          
    Interest expense 139,900     138,265     137,579     135,245     120,591             415,744     284,097          
    Net interest revenue 209,186     208,700     199,149     203,453     202,556       3 %   617,035     614,312       — %
    Provision for credit losses 14,428     12,235     12,899     14,626     30,268             39,562     74,804          
    Noninterest income 8,091     36,556     39,587     (23,090 )   31,977       (75 )   84,234     98,573       (15 )
    Total revenue 202,849     233,021     225,837     165,737     204,265       (1 )   661,707     638,081       4  
    Noninterest expenses 143,065     147,044     145,002     154,587     144,474       (1 )   435,111     416,686       4  
    Income before income tax expense 59,784     85,977     80,835     11,150     59,791       —     226,596     221,395       2  
    Income tax expense 12,437     19,362     18,204     (2,940 )   11,925       4     50,003     47,941       4  
    Net income 47,347     66,615     62,631     14,090     47,866       (1 )   176,593     173,454       2  
    Non-operating items 29,385     6,493     2,187     67,450     9,168             38,065     21,444          
    Income tax benefit of non-operating items (6,276 )   (1,462 )   (493 )   (16,714 )   (2,000 )           (8,231 )   (4,775 )        
    Net income – operating(1) $ 70,456     $ 71,646     $ 64,325     $ 64,826     $ 55,034       28     $ 206,427     $ 190,123       9  
    Pre-tax pre-provision income(5) $ 74,212     $ 98,212     $ 93,734     $ 25,776     $ 90,059       (18 )   $ 266,158     $ 296,199       (10 )
    PERFORMANCE MEASURES                                                        
    Per common share:                                                        
    Diluted net income – GAAP $ 0.38     $ 0.54     $ 0.51     $ 0.11     $ 0.39       (3 )   $ 1.43     $ 1.44       (1 )
    Diluted net income – operating(1) 0.57     0.58     0.52     0.53     0.45       27     1.67     1.58       6  
    Cash dividends declared 0.24     0.23     0.23     0.23     0.23       4     0.70     0.69       1  
    Book value 27.68     27.18     26.83     26.52     25.87       7     27.68     25.87       7  
    Tangible book value(3) 19.66     19.13     18.71     18.39     17.70       11     19.66     17.70       11  
    Key performance ratios:                                                        
    Return on common equity – GAAP(2)(4) 5.20 %   7.53 %   7.14 %   1.44 %   5.32 %           6.61 %   6.69 %        
    Return on common equity – operating(1)(2)(4) 7.82     8.12     7.34     7.27     6.14             7.76     7.35          
    Return on tangible common equity – operating(1)(2)(3)(4) 11.17     11.68     10.68     10.58     9.03             11.18     10.65          
    Return on assets – GAAP(4) 0.67     0.97     0.90     0.18     0.68             0.85     0.86          
    Return on assets – operating(1)(4) 1.01     1.04     0.93     0.92     0.79             0.99     0.95          
    Return on assets – pre-tax pre-provision – operating(1)(4)(5) 1.50     1.54     1.40     1.33     1.44             1.48     1.60          
    Net interest margin (fully taxable equivalent)(4) 3.33     3.37     3.20     3.19     3.24             3.30     3.41          
    Efficiency ratio – GAAP 65.51     59.70     60.47     66.33     61.32             61.76     58.06          
    Efficiency ratio – operating(1) 57.37     57.06     59.15     59.57     57.43             57.84     55.07          
    Equity to total assets 12.45     12.35     12.06     11.95     11.85             12.45     11.85          
    Tangible common equity to tangible assets(3) 8.93     8.78     8.49     8.36     8.18             8.93     8.18          
    ASSET QUALITY                                                        
    Nonperforming assets (“NPAs”) $ 114,960     $ 116,722     $ 107,230     $ 92,877     $ 90,883       26     $ 114,960     $ 90,883       26  
    Allowance for credit losses – loans 205,290     213,022     210,934     208,071     201,557       2     205,290     201,557       2  
    Allowance for credit losses – total 215,517     224,740     224,119     224,128     219,624       (2 )   215,517     219,624       (2 )
    Net charge-offs 23,651     11,614     12,908     10,122     26,638             48,173     42,121          
    Allowance for credit losses – loans to loans 1.14 %   1.17 %   1.15 %   1.14 %   1.11 %           1.14 %   1.11 %        
    Allowance for credit losses – total to loans 1.20     1.23     1.22     1.22     1.21             1.20     1.21          
    Net charge-offs to average loans(4) 0.52     0.26     0.28     0.22     0.59             0.35     0.32          
    NPAs to total assets 0.42     0.43     0.39     0.34     0.34             0.42     0.34          
    AT PERIOD END ($ in millions)                                                        
    Loans $ 17,964     $ 18,211     $ 18,375     $ 18,319     $ 18,203       (1 )   $ 17,964     $ 18,203       (1 )
    Investment securities 6,425     6,038     5,859     5,822     5,701       13     6,425     5,701       13  
    Total assets 27,373     27,057     27,365     27,297     26,869       2     27,373     26,869       2  
    Deposits 23,253     22,982     23,332     23,311     22,858       2     23,253     22,858       2  
    Shareholders’ equity 3,407     3,343     3,300     3,262     3,184       7     3,407     3,184       7  
    Common shares outstanding (thousands) 119,283     119,175     119,137     119,010     118,976       —     119,283     118,976       —  

    (1) Excludes non-operating items as detailed on Non-GAAP Performance Measures Reconciliation on next page. (2) Net income less preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). (3) Excludes effect of acquisition related intangibles and associated amortization. (4) Annualized. (5) Excludes income tax expense and provision for credit losses.

    UNITED COMMUNITY BANKS, INC.
    Non-GAAP Performance Measures Reconciliation
    (in thousands, except per share data)
      2024   2023   For the Nine Months Ended
    September 30,
        Third
    Quarter    		       Second
    Quarter    		       First
    Quarter    		       Fourth
    Quarter    		       Third
    Quarter    		       2024       2023  
                                             
    Noninterest income reconciliation                                        
    Noninterest income (GAAP) $ 8,091     $ 36,556     $ 39,587     $ (23,090 )   $ 31,977     $ 84,234     $ 98,573  
    Loss on sale of manufactured housing loans 27,209     —     —     —     —     27,209     —  
    Gain on lease termination —     —     (2,400 )   —     —     (2,400 )   —  
    Bond portfolio restructuring loss —     —     —     51,689     —     —     —  
    Noninterest income – operating $ 35,300     $ 36,556     $ 37,187     $ 28,599     $ 31,977     $ 109,043     $ 98,573  
                                             
    Noninterest expense reconciliation                                        
    Noninterest expenses (GAAP) $ 143,065     $ 147,044     $ 145,002     $ 154,587     $ 144,474     $ 435,111     $ 416,686  
    Loss on FinTrust (goodwill impairment) —     (5,100 )   —     —     —     (5,100 )   —  
    FDIC special assessment —     764     (2,500 )   (9,995 )   —     (1,736 )   —  
    Merger-related and other charges (2,176 )   (2,157 )   (2,087 )   (5,766 )   (9,168 )   (6,420 )   (21,444 )
    Noninterest expenses – operating $ 140,889     $ 140,551     $ 140,415     $ 138,826     $ 135,306     $ 421,855     $ 395,242  
                                             
    Net income to operating income reconciliation                                        
    Net income (GAAP) $ 47,347     $ 66,615     $ 62,631     $ 14,090     $ 47,866     $ 176,593     $ 173,454  
    Loss on sale of manufactured housing loans 27,209     —     —     —     —     27,209     —  
    Bond portfolio restructuring loss —     —     —     51,689     —     —     —  
    Gain on lease termination —     —     (2,400 )   —     —     (2,400 )   —  
    Loss on FinTrust (goodwill impairment) —     5,100     —     —     —     5,100     —  
    FDIC special assessment —     (764 )   2,500     9,995     —     1,736     —  
    Merger-related and other charges 2,176     2,157     2,087     5,766     9,168     6,420     21,444  
    Income tax benefit of non-operating items (6,276 )   (1,462 )   (493 )   (16,714 )   (2,000 )   (8,231 )   (4,775 )
    Net income – operating $ 70,456     $ 71,646     $ 64,325     $ 64,826     $ 55,034     $ 206,427     $ 190,123  
                                             
    Net income to pre-tax pre-provision income reconciliation                                        
    Net income (GAAP) $ 47,347     $ 66,615     $ 62,631     $ 14,090     $ 47,866     $ 176,593     $ 173,454  
    Income tax expense 12,437     19,362     18,204     (2,940 )   11,925     50,003     47,941  
    Provision for credit losses 14,428     12,235     12,899     14,626     30,268     39,562     74,804  
    Pre-tax pre-provision income $ 74,212     $ 98,212     $ 93,734     $ 25,776     $ 90,059     $ 266,158     $ 296,199  
                                             
    Diluted income per common share reconciliation                                        
    Diluted income per common share (GAAP) $ 0.38     $ 0.54     $ 0.51     $ 0.11     $ 0.39     $ 1.43     $ 1.44  
    Loss on sale of manufactured housing loans 0.18     —     —     —     —     0.18     —  
    Bond portfolio restructuring loss —     —     —     0.32     —     —     —  
    Gain on lease termination —     —     (0.02 )   —     —     (0.02 )   —  
    Loss on FinTrust (goodwill impairment) —     0.03     —     —     —     0.03     —  
    FDIC special assessment —     —     0.02     0.06     —     0.01     —  
    Merger-related and other charges 0.01     0.01     0.01     0.04     0.06     0.04     0.14  
    Diluted income per common share – operating $ 0.57     $ 0.58     $ 0.52     $ 0.53     $ 0.45     $ 1.67     $ 1.58  
                                             
    Book value per common share reconciliation                                        
    Book value per common share (GAAP) $ 27.68     $ 27.18     $ 26.83     $ 26.52     $ 25.87     $ 27.68     $ 25.87  
    Effect of goodwill and other intangibles (8.02 )   (8.05 )   (8.12 )   (8.13 )   (8.17 )   (8.02 )   (8.17 )
    Tangible book value per common share $ 19.66     $ 19.13     $ 18.71     $ 18.39     $ 17.70     $ 19.66     $ 17.70  
                                             
    Return on tangible common equity reconciliation                                        
    Return on common equity (GAAP) 5.20 %   7.53 %   7.14 %   1.44 %   5.32 %   6.61 %   6.69 %
    Loss on sale of manufactured housing loans 2.43     —     —     —     —     0.82     —  
    Bond portfolio restructuring loss —     —     —     4.47     —     —     —  
    Gain on lease termination —     —     (0.22 )   —     —     (0.07 )   —  
    Loss on FinTrust (goodwill impairment) —     0.46     —     —     —     0.16     —  
    FDIC special assessment —     (0.07 )   0.23     0.86     —     0.05     —  
    Merger-related and other charges 0.19     0.20     0.19     0.50     0.82     0.19     0.66  
    Return on common equity – operating 7.82     8.12     7.34     7.27     6.14     7.76     7.35  
    Effect of goodwill and other intangibles 3.35     3.56     3.34     3.31     2.89     3.42     3.30  
    Return on tangible common equity – operating 11.17 %   11.68 %   10.68 %   10.58 %   9.03 %   11.18 %   10.65 %
                                             
    Return on assets reconciliation                                        
    Return on assets (GAAP) 0.67 %   0.97 %   0.90 %   0.18 %   0.68 %   0.85 %   0.86 %
    Loss on sale of manufactured housing loans 0.31     —     —     —     —     0.10     —  
    Bond portfolio restructuring loss —     —     —     0.57     —     —     —  
    Gain on lease termination —     —     (0.03 )   —     —     (0.01 )   —  
    Loss on FinTrust (goodwill impairment) —     0.06     —     —     —     0.02     —  
    FDIC special assessment —     (0.01 )   0.03     0.11     —     0.01     —  
    Merger-related and other charges 0.03     0.02     0.03     0.06     0.11     0.02     0.09  
    Return on assets – operating 1.01 %   1.04 %   0.93 %   0.92 %   0.79 %   0.99 %   0.95 %
                                             
    Return on assets to return on assets- pre-tax pre-provision reconciliation                                        
    Return on assets (GAAP) 0.67 %   0.97 %   0.90 %   0.18 %   0.68 %   0.85 %   0.86 %
    Income tax (benefit) expense 0.19     0.29     0.27     (0.04 )   0.18     0.25     0.25  
    Provision for credit losses 0.21     0.18     0.19     0.21     0.45     0.19     0.38  
    Loss on sale of manufactured housing loans 0.40     —     —     —     —     0.13     —  
    Bond portfolio restructuring loss —     —     —     0.75     —     —     —  
    Gain on lease termination —     —     (0.04 )   —     —     (0.01 )   —  
    Loss on FinTrust (goodwill impairment) —     0.08     —     —     —     0.03     —  
    FDIC special assessment —     (0.01 )   0.04     0.15     —     0.01     —  
    Merger-related and other charges 0.03     0.03     0.04     0.08     0.13     0.03     0.11  
    Return on assets – pre-tax pre-provision – operating 1.50 %   1.54 %   1.40 %   1.33 %   1.44 %   1.48 %   1.60 %
                                             
    Efficiency ratio reconciliation                                        
    Efficiency ratio (GAAP) 65.51 %   59.70 %   60.47 %   66.33 %   61.32 %   61.76 %   58.06 %
    Loss on sale of manufactured housing loans (7.15 )   —     —     —     —     (2.25 )   —  
    Gain on lease termination —     —     0.60     —     —     0.21     —  
    Loss on FinTrust (goodwill impairment) —     (2.07 )   —     —     —     (0.73 )   —  
    FDIC special assessment —     0.31     (1.05 )   (4.29 )   —     (0.24 )   —  
    Merger-related and other charges (0.99 )   (0.88 )   (0.87 )   (2.47 )   (3.89 )   (0.91 )   (2.99 )
    Efficiency ratio – operating 57.37 %   57.06 %   59.15 %   59.57 %   57.43 %   57.84 %   55.07 %
                                             
    Tangible common equity to tangible assets reconciliation                                        
    Equity to total assets (GAAP) 12.45 %   12.35 %   12.06 %   11.95 %   11.85 %   12.45 %   11.85 %
    Effect of goodwill and other intangibles (3.20 )   (3.24 )   (3.25 )   (3.27 )   (3.33 )   (3.20 )   (3.33 )
    Effect of preferred equity (0.32 )   (0.33 )   (0.32 )   (0.32 )   (0.34 )   (0.32 )   (0.34 )
    Tangible common equity to tangible assets 8.93 %   8.78 %   8.49 %   8.36 %   8.18 %   8.93 %   8.18 %
    UNITED COMMUNITY BANKS, INC.
    Loan Portfolio Composition at Period-End
      2024   2023    
    Linked
    Quarter
    Change    		      
    Year over
    Year
    Change    		  
     (in millions)   Third
    Quarter    		       Second
    Quarter    		       First
    Quarter    		       Fourth
    Quarter    		       Third
    Quarter    		      
    LOANS BY CATEGORY                                
    Owner occupied commercial RE $ 3,323     $ 3,297     $ 3,310     $ 3,264     $ 3,279     $ 26     $ 44  
    Income producing commercial RE   4,259       4,058       4,206       4,264       4,130     201     129  
    Commercial & industrial   2,313       2,299       2,405       2,411       2,504     14     (191 )
    Commercial construction   1,785       2,014       1,936       1,860       1,850     (229 )   (65 )
    Equipment financing   1,603       1,581       1,544       1,541       1,534     22     69  
    Total commercial   13,283       13,249       13,401       13,340       13,297     34     (14 )
    Residential mortgage   3,263       3,266       3,240       3,199       3,043     (3 )   220  
    Home equity   1,015       985       969       959       941     30     74  
    Residential construction   189       211       257       302       399     (22 )   (210 )
    Manufactured housing   2       321       328       336       343     (319 )   (341 )
    Consumer   188       183       180       181       180     5     8  
    Other   24       (4 )     —       2     —       28     24  
    Total loans $ 17,964     $ 18,211     $ 18,375     $ 18,319     $ 18,203     $ (247 )   $ (239 )
                                                       
    LOANS BY MARKET                                                  
    Georgia $ 4,470     $ 4,411     $ 4,356     $ 4,357     $ 4,321     $ 59     $ 149  
    South Carolina   2,782       2,779       2,804       2,780       2,801     3     (19 )
    North Carolina   2,586       2,591       2,566       2,492       2,445     (5 )   141  
    Tennessee   1,848       2,144       2,209       2,244       2,314     (296 )   (466 )
    Florida   2,423       2,407       2,443       2,442       2,318     16     105  
    Alabama   996       1,021       1,068       1,082       1,070     (25 )   (74 )
    Commercial Banking Solutions   2,859       2,858       2,929       2,922       2,934     1     (75 )
    Total loans $ 17,964     $ 18,211     $ 18,375     $ 18,319     $ 18,203     $ (247 )   $ (239 )
    UNITED COMMUNITY BANKS, INC.                                    
    Credit Quality                                    
    (in thousands)                                    
          2024                        
        Third
    Quarter    		   Second
    Quarter    		   First
    Quarter    		                        
    NONACCRUAL LOANS                                    
    Owner occupied RE   $ 7,783     $ 4,820     $ 2,310                          
    Income producing RE     31,222       34,285       29,186                          
    Commercial & industrial     28,856       17,335       20,134                          
    Commercial construction     7,356       6,854       1,862                          
    Equipment financing     9,123       8,341       8,829                          
    Total commercial     84,340       71,635       62,321                          
    Residential mortgage     21,851       18,473       16,569                          
    Home equity     4,111       3,779       4,984                          
    Residential construction     118       163       1,244                          
    Manufactured housing     1,808       20,356       19,797                          
    Consumer     152       72       54                          
    Total nonaccrual loans     112,380       114,478       104,969                          
    OREO and repossessed assets     2,580       2,244       2,261                          
    Total NPAs   $ 114,960     $ 116,722     $ 107,230                          
          2024  
        Third Quarter   Second Quarter   First Quarter
    (in thousands)   Net Charge-
    Offs    		     Net Charge-
    Offs to
    Average Loans    (1)    		     Net Charge-
    Offs    		   Net Charge-
    Offs to
    Average
    Loans    (1)    		   Net Charge-
    Offs    		   Net Charge-
    Offs to
    Average
    Loans    (1)
    NET CHARGE-OFFS (RECOVERIES) BY CATEGORY                            
    Owner occupied RE   $ (184 )     (0.02 )%   $ 163       0.02 %   $ 202       0.02 %
    Income producing RE     1,409       0.13       2,968       0.29       205       0.02  
    Commercial & industrial     4,577       0.79       1,281       0.22       3,906       0.65  
    Commercial construction     36       0.01       (48 )     (0.01 )     20       —  
    Equipment financing     5,268       1.32       5,502       1.42       6,362       1.66  
    Total commercial     11,106       0.33       9,866       0.30       10,695       0.32  
    Residential mortgage     32       —       (107 )     (0.01 )     (16 )     —  
    Home equity     36       0.01       (27 )     (0.01 )     (54 )     (0.02 )
    Residential construction     111       0.22       26       0.04       119       0.17  
    Manufactured housing     11,556       28.51       1,150       1.43       1,569       1.90  
    Consumer     810       1.74       706       1.57       595       1.33  
    Total   $ 23,651       0.52     $ 11,614       0.26     $ 12,908       0.28  
                                 
    (1)Annualized.                            
    UNITED COMMUNITY BANKS, INC.
    Consolidated Balance Sheets (Unaudited)
    (in thousands, except share and per share data)   September 30,
    2024    		   December 31,
    2023
    ASSETS        
    Cash and due from banks   $ 202,644     $ 200,781  
    Interest-bearing deposits in banks     537,395       803,094  
    Cash and cash equivalents     740,039       1,003,875  
    Debt securities available-for-sale     4,023,455       3,331,084  
    Debt securities held-to-maturity (fair value $2,060,729 and $2,095,620, respectively)     2,401,877       2,490,848  
    Loans held for sale     49,800       33,008  
    Loans and leases held for investment     17,964,099       18,318,755  
    Allowance for credit losses – loans and leases     (205,290 )     (208,071 )
    Loans and leases, net     17,758,809       18,110,684  
    Premises and equipment, net     396,696       378,421  
    Bank owned life insurance     345,703       345,371  
    Goodwill and other intangible assets, net     975,117       990,087  
    Other assets     681,636       613,873  
    Total assets   $ 27,373,132     $ 27,297,251  
    LIABILITIES AND SHAREHOLDERS’ EQUITY        
    Liabilities:        
    Deposits:        
    Noninterest-bearing demand   $ 6,222,518     $ 6,534,307  
    NOW and interest-bearing demand     5,951,900       6,155,193  
    Money market     6,301,956       5,600,587  
    Savings     1,113,168       1,207,807  
    Time     3,490,399       3,649,498  
    Brokered     173,161       163,219  
    Total deposits     23,253,102       23,310,611  
    Long-term debt     316,363       324,823  
    Accrued expenses and other liabilities     396,987       400,292  
    Total liabilities     23,966,452       24,035,726  
    Shareholders’ equity:        
    Preferred stock; $1 par value; 10,000,000 shares authorized; 3,662 shares Series I issued and
    outstanding; $25,000 per share liquidation preference    		     88,266       88,266  
    Common stock, $1 par value; 200,000,000 shares authorized,
    119,282,762 and 119,010,319 shares issued and outstanding, respectively    		     119,283       119,010  
    Common stock issuable; 588,296 and 620,108 shares, respectively     12,661       13,110  
    Capital surplus     2,707,266       2,699,112  
    Retained earnings     668,965       581,219  
    Accumulated other comprehensive loss     (189,761 )     (239,192 )
    Total shareholders’ equity     3,406,680       3,261,525  
    Total liabilities and shareholders’ equity   $ 27,373,132     $ 27,297,251  
    UNITED COMMUNITY BANKS, INC.
    Consolidated Statements of Income (Unaudited)
        Three Months Ended
    September 30,    		   Nine Months Ended
    September 30,
    (in thousands, except per share data)     2024       2023       2024       2023  
    Interest revenue:                
    Loans, including fees   $ 291,574     $ 273,781     $ 867,152     $ 760,696  
    Investment securities, including tax exempt of $1,713, $1,722, $5,133 and $5,563, respectively     52,997       44,729       149,496       125,775  
    Deposits in banks and short-term investments     4,515       4,637       16,131       11,938  
    Total interest revenue     349,086       323,147       1,032,779       898,409  
                     
    Interest expense:                
    Deposits:                
    NOW and interest-bearing demand     43,401       35,613       133,522       80,809  
    Money market     56,874       46,884       160,883       105,430  
    Savings     672       868       2,065       2,108  
    Time     35,202       33,368       107,925       75,464  
    Deposits     136,149       116,733       404,395       263,811  
    Short-term borrowings     27       189       87       3,186  
    Federal Home Loan Bank advances     —       —       —       5,761  
    Long-term debt     3,724       3,669       11,262       11,339  
    Total interest expense     139,900       120,591       415,744       284,097  
    Net interest revenue     209,186       202,556       617,035       614,312  
    Provision for credit losses     14,428       30,268       39,562       74,804  
    Net interest revenue after provision for credit losses     194,758       172,288       577,473       539,508  
                     
    Noninterest income:                
    Service charges and fees     10,488       10,315       30,372       28,791  
    Mortgage loan gains and other related fees     3,520       6,159       17,830       17,264  
    Wealth management fees     6,338       6,451       19,037       17,775  
    Net (losses) gains from sales of other loans     (25,700 )     2,688       (22,867 )     6,909  
    Lending and loan servicing fees     3,512       2,985       11,050       9,979  
    Securities losses, net     —       —       —       (1,644 )
    Other     9,933       3,379       28,812       19,499  
    Total noninterest income     8,091       31,977       84,234       98,573  
    Total revenue     202,849       204,265       661,707       638,081  
                     
    Noninterest expenses:                
    Salaries and employee benefits     83,533       81,173       254,336       236,121  
    Communications and equipment     12,626       10,902       36,534       31,654  
    Occupancy     11,311       10,941       33,466       31,024  
    Advertising and public relations     2,041       2,251       6,401       6,914  
    Postage, printing and supplies     2,477       2,386       7,376       7,305  
    Professional fees     6,432       7,006       18,464       19,670  
    Lending and loan servicing expense     2,227       2,697       6,068       7,546  
    Outside services – electronic banking     4,433       2,561       10,163       8,646  
    FDIC assessments and other regulatory charges     5,003       4,314       17,036       12,457  
    Amortization of intangibles     3,528       4,171       11,209       11,120  
    Merger-related and other charges     2,176       9,168       6,420       21,444  
    Other     7,278       6,904       27,638       22,785  
    Total noninterest expenses     143,065       144,474       435,111       416,686  
    Income before income taxes     59,784       59,791       226,596       221,395  
    Income tax expense     12,437       11,925       50,003       47,941  
    Net income     47,347       47,866       176,593       173,454  
    Preferred stock dividends, net of discount on repurchases     1,573       832       4,719       4,270  
    Earnings allocated to participating securities     272       259       988       939  
    Net income available to common shareholders   $ 45,502     $ 46,775     $ 170,886     $ 168,245  
                     
    Net income per common share:                
    Basic   $ 0.38     $ 0.39     $ 1.43     $ 1.44  
    Diluted     0.38       0.39       1.43       1.44  
    Weighted average common shares outstanding:                
    Basic     119,818       119,506       119,736       116,925  
    Diluted     119,952       119,624       119,827       117,084  
    UNITED COMMUNITY BANKS, INC.
    Average Consolidated Balance Sheets and Net Interest Analysis
    For the Three Months Ended September 30,
          2024       2023  
    (dollars in thousands, fully taxable equivalent (FTE))   Average Balance   Interest   Average Rate   Average Balance   Interest   Average Rate
    Assets:                        
    Interest-earning assets:                        
    Loans, net of unearned income (FTE)(1)(2)   $ 18,051,741     $ 291,164       6.42 %   $ 18,055,402     $ 273,800       6.02 %
    Taxable securities(3)     6,182,164       51,284       3.32       5,933,708       43,007       2.90  
    Tax-exempt securities (FTE)(1)(3)     361,359       2,292       2.54       368,148       2,313       2.51  
    Federal funds sold and other interest-earning assets     505,792       5,440       4.28       538,039       5,093       3.76  
    Total interest-earning assets (FTE)     25,101,056       350,180       5.55       24,895,297       324,213       5.17  
                             
    Noninterest-earning assets:                        
    Allowance for credit losses     (215,008 )             (209,472 )        
    Cash and due from banks     206,995               225,831          
    Premises and equipment     399,262               367,217          
    Other assets(3)     1,615,468               1,568,824          
    Total assets   $ 27,107,773             $ 26,847,697          
                             
    Liabilities and Shareholders’ Equity:                        
    Interest-bearing liabilities:                        
    Interest-bearing deposits:                        
    NOW and interest-bearing demand   $ 5,797,845       43,401       2.98     $ 5,285,513       35,613       2.67  
    Money market     6,342,455       56,874       3.57       5,622,355       46,884       3.31  
    Savings     1,126,774       672       0.24       1,301,047       868       0.26  
    Time     3,465,980       34,560       3.97       3,473,191       31,072       3.55  
    Brokered time deposits     50,364       642       5.07       209,119       2,296       4.36  
    Total interest-bearing deposits     16,783,418       136,149       3.23       15,891,225       116,733       2.91  
    Federal funds purchased and other borrowings     1,899       27       5.66       44,164       189       1.70  
    Federal Home Loan Bank advances     11       —       —       —       —       —  
    Long-term debt     323,544       3,724       4.58       324,770       3,669       4.48  
    Total borrowed funds     325,454       3,751       4.59       368,934       3,858       4.15  
    Total interest-bearing liabilities     17,108,872       139,900       3.25       16,260,159       120,591       2.94  
                             
    Noninterest-bearing liabilities:                        
    Noninterest-bearing deposits     6,239,926               6,916,272          
    Other liabilities     391,574               435,592          
    Total liabilities     23,740,372               23,612,023          
    Shareholders’ equity     3,367,401               3,235,674          
    Total liabilities and shareholders’ equity   $ 27,107,773             $ 26,847,697          
                             
    Net interest revenue (FTE)       $ 210,280             $ 203,622      
    Net interest-rate spread (FTE)             2.30 %             2.23 %
    Net interest margin (FTE)(4)             3.33 %             3.24 %

    (1) Interest revenue on tax-exempt securities and loans includes a taxable-equivalent adjustment to reflect comparable interest on taxable securities and loans. The FTE adjustment totaled $1.09 million and $1.07 million, respectively, for the three months ended September 30, 2024 and 2023. The tax rate used to calculate the adjustment was 25% in 2024 and 26% in 2023, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
    (2) Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
    (3) Unrealized gains and losses on AFS securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $295 million in 2024 and $430 million in 2023 are included in other assets for purposes of this presentation.
    (4) Net interest margin is taxable equivalent net interest revenue divided by average interest-earning assets.

    UNITED COMMUNITY BANKS, INC.
    Average Consolidated Balance Sheets and Net Interest Analysis
    For the Nine Months Ended September 30,
          2024       2023  
    (dollars in thousands, fully taxable equivalent (FTE))   Average Balance   Interest   Average Rate   Average Balance   Interest   Average Rate
    Assets:                        
    Interest-earning assets:                        
    Loans, net of unearned income (FTE)(1)(2)   $ 18,187,790     $ 866,502       6.36 %   $ 17,377,210     $ 760,802       5.85 %
    Taxable securities(3)     5,988,368       144,363       3.21       5,982,615       120,212       2.68  
    Tax-exempt securities (FTE)(1)(3)     363,692       6,876       2.52       386,499       7,470       2.58  
    Federal funds sold and other interest-earning assets     559,786       18,256       4.36       490,703       13,103       3.57  
    Total interest-earning assets (FTE)     25,099,636       1,035,997       5.51       24,237,027       901,587       4.97  
                             
    Non-interest-earning assets:                        
    Allowance for loan losses     (214,372 )             (186,428 )        
    Cash and due from banks     210,982               249,411          
    Premises and equipment     392,561               347,514          
    Other assets(3)     1,613,118               1,518,503          
    Total assets   $ 27,101,925             $ 26,166,027          
                             
    Liabilities and Shareholders’ Equity:                        
    Interest-bearing liabilities:                        
    Interest-bearing deposits:                        
    NOW and interest-bearing demand   $ 5,913,566       133,522       3.02     $ 4,891,214       80,809       2.21  
    Money market     6,092,649       160,883       3.53       5,349,265       105,430       2.64  
    Savings     1,159,982       2,065       0.24       1,341,033       2,108       0.21  
    Time     3,535,343       106,199       4.01       2,936,873       65,856       3.00  
    Brokered time deposits     50,343       1,726       4.58       280,293       9,608       4.58  
    Total interest-bearing deposits     16,751,883       404,395       3.22       14,798,678       263,811       2.38  
    Federal funds purchased and other borrowings     2,001       87       5.81       98,884       3,186       4.31  
    Federal Home Loan Bank advances     5       —       —       166,355       5,761       4.63  
    Long-term debt     324,414       11,262       4.64       324,737       11,339       4.67  
    Total borrowed funds     326,420       11,349       4.64       589,976       20,286       4.60  
    Total interest-bearing liabilities     17,078,303       415,744       3.25       15,388,654       284,097       2.47  
                             
    Noninterest-bearing liabilities:                        
    Noninterest-bearing deposits     6,306,919               7,226,096          
    Other liabilities     394,323               393,048          
    Total liabilities     23,779,545               23,007,798          
    Shareholders’ equity     3,322,380               3,158,229          
    Total liabilities and shareholders’ equity   $ 27,101,925             $ 26,166,027          
                             
    Net interest revenue (FTE)       $ 620,253             $ 617,490      
    Net interest-rate spread (FTE)             2.26 %             2.50 %
    Net interest margin (FTE)(4)             3.30 %             3.41 %
                             

    (1) Interest revenue on tax-exempt securities and loans includes a taxable-equivalent adjustment to reflect comparable interest on taxable securities and loans. The FTE adjustment totaled $3.22 million and $3.18 million, respectively, for the nine months ended September 30, 2024 and 2023. The tax rate used to calculate the adjustment was 25% in 2024 and 26% in 2023, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
    (2) Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
    (3) Unrealized gains and losses on AFS securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $320 million in 2024 and $413 million in 2023 are included in other assets for purposes of this presentation.
    (4) Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.

    About United Community Banks, Inc.
    United Community Banks, Inc. (NYSE: UCB) is the financial holding company for United Community, a top 100 U.S. financial institution that is committed to improving the financial health and well-being of its customers and the communities it serves. United Community provides a full range of banking, wealth management and mortgage services. As of September 30, 2024, United Community Banks, Inc. had $27.4 billion in assets, 202 offices across Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee, as well as a national SBA lending franchise and a national equipment lending subsidiary. In 2024, United Community became a 10-time winner of J.D. Power’s award for the best customer satisfaction among consumer banks in the Southeast region and was recognized as the most trusted bank in the Southeast. In 2023, United was named by American Banker as one of the “Best Banks to Work For” for the seventh consecutive year and was recognized in the Greenwich Excellence and Best Brands Awards, receiving 15 awards that included national honors for overall satisfaction in small business banking and middle market banking. Forbes has also consistently listed United Community as one of the World’s Best Banks and one of America’s Best Banks. Additional information about United can be found at ucbi.com.

    Non-GAAP Financial Measures
    This press release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as “noninterest income – operating”, “noninterest expense – operating”, “operating net income,” “pre-tax, pre-provision income,” “operating net income per diluted common share,” “operating earnings per share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “return on assets – pre-tax, pre-provision – operating,” “return on assets – pre-tax, pre-provision,” “operating efficiency ratio,” and “tangible common equity to tangible assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.

    Caution About Forward-Looking Statements
    This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In general, forward-looking statements usually may be identified through use of words such as “may,” “believe,” “expect,” “anticipate,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential,” or the negative of these terms or other comparable terminology. Forward-looking statements are not historical facts and represent management’s beliefs, based upon information available at the time the statements are made, with regard to the matters addressed; they are not guarantees of future performance. Actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements. Factors that could cause or contribute to such differences include, but are not limited to general competitive, economic, political and market conditions. Further information regarding additional factors which could affect the forward-looking statements contained in this press release can be found in the cautionary language included under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in United’s Annual Report on Form 10-K for the year ended December 31, 2023, and other documents subsequently filed by United with the United States Securities and Exchange Commission (“SEC”).

    Many of these factors are beyond United’s ability to control or predict. If one or more events related to these or other risks or uncertainties materialize, or if the underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, shareholders and investors should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this communication, and United undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for United to predict their occurrence or how they will affect United.

    United qualifies all forward-looking statements by these cautionary statements.

    For more information:
    Jefferson Harralson
    Chief Financial Officer
    (864) 240-6208
    Jefferson_Harralson@ucbi.com

    The MIL Network –

  • MIL-OSI: Stock Yards Bancorp Reports Third Quarter Earnings of $29.4 Million or $1.00 Per Diluted Share

    Source: GlobeNewswire (MIL-OSI)

    LOUISVILLE, Ky., Oct. 23, 2024 (GLOBE NEWSWIRE) — Stock Yards Bancorp, Inc. (NASDAQ: SYBT), parent company of Stock Yards Bank & Trust Company, with offices in Louisville, central, eastern and northern Kentucky, as well as the Indianapolis, Indiana and Cincinnati, Ohio metropolitan markets, today reported earnings of $29.4 million, or $1.00 per diluted share, for the third quarter ended September 30, 2024. This compares to net income of $27.1 million, or $0.92 per diluted share, for the third quarter of 2023. Continued strong loan growth and net interest margin expansion fueled third quarter operating results.

                           
                           
    (dollar amounts in thousands, except per share data) 3Q24
    		   2Q24
    		   3Q23
    Net income $ 29,360     $ 27,598     $ 27,092  
    Net income per share, diluted   1.00       0.94       0.92  
           
    Net interest income $ 64,979     $ 62,022     $ 61,315  
    Provision for credit losses(1)   4,325       1,300       2,775  
    Non-interest income   24,797       23,655       22,896  
    Non-interest expenses   48,452       49,109       46,702  
           
    Net interest margin   3.33 %     3.26 %     3.34 %
    Efficiency ratio(2)   53.92 %     57.26 %     55.38 %
    Tangible common equity to tangible assets(3)   8.79 %     8.42 %     7.69 %
    Annualized return on average assets(4)   1.39 %     1.35 %     1.38 %
    Annualized return on average equity(4)   12.83 %     12.64 %     13.26 %
                           
                           

    “Stock Yards delivered the best third quarter in our history, highlighted by strong loan demand and production, solid contributions from our non-interest income revenue sources and linked quarter net interest margin expansion,” commented James A. (Ja) Hillebrand, Chairman and Chief Executive Officer. “Total loans increased $661 million, or 12%, over the last 12 months, with $207 million of growth generated during the third quarter. We experienced growth within all loan categories and across all markets. Deposit balances expanded $323 million, or 5%, over the past 12 months, with balances growing $157 million, or 2%, during the third quarter. Deposit growth was also spread across all markets, enhanced by strategic time deposit marketing efforts. We continue to focus on organic growth, while avoiding brokered deposits and improving our funding position, which is contributing meaningfully to our net interest margin expansion.”

    “Non-interest revenue once again contributed to our strong operating results for the third quarter of 2024, led by expansion in several categories,” Hillebrand continued. “Treasury management fees continued to benefit from customer base growth and increased transaction volume. WM&T income was boosted by estate fees and solid market conditions. In addition, mortgage, brokerage and card income all posted meaningful contributions. As previously mentioned, we are encouraged by our net interest margin improvement and prospects for continued expansion. Third quarter net interest margin expanded seven basis points on the linked quarter, boosted by substantial loan growth, higher interest earning asset yields and a moderating cost of funds expansion.”

    As of September 30, 2024, the Company had $8.44 billion in assets, $6.28 billion in loans and $6.73 billion in total deposits. The Company’s combined enterprise, which encompasses 72 branch offices across three contiguous states, will continue to benefit from a diversified geographic footprint.

    Key factors contributing to the third quarter of 2024 results included:

    • Total loans increased $661 million, or 12%, over the last 12 months, while growing $207 million, or 3%, on the linked quarter. Broad based loan growth during the quarter included increases in all markets and across all loan categories, with Construction Land & Development (CL&D) growth of $88 million posting the largest gain. The yield earned on loans increased to 6.17% for the third quarter of 2024, benefiting primarily from significant average loan balance growth.
    • Deposit balances expanded $323 million, or 5%, over the last 12 months, with the deposit mix continuing to shift from non-interest bearing and low interest-bearing deposits into higher cost deposits. Non-interest-bearing demand accounts declined $207 million, or 12%, while interest-bearing deposits grew $530 million, or 11%, led by time deposit growth. On the linked quarter, total deposits expanded $157 million, or 2%. Non-interest-bearing demand accounts increased $26 million, or 2%, while total interest-bearing deposit accounts increased $131 million, or 3%.
    • Net interest income increased $3.7 million, or 6%, for the third quarter of 2024 compared to the third quarter a year ago, with net interest margin compressing one basis point to 3.33%. On the linked quarter, net interest income increased $3.0 million, or 5%, while net interest margin expanded 7 basis points to 3.33%.
    • Provision for credit loss expense(1) of $4.3 million was recorded for the third quarter of 2024, primarily attributed to strong loan growth and deterioration within the Federal Reserve Bank’s unemployment rate forecast used in the CECL allowance model. Traditional credit quality statistics remained strong for the quarter.
    • Non-interest income increased $1.9 million, or 8%, over the third quarter of 2023. WM&T income expanded $901,000, or 9%, to $10.9 million, with strong estate fees and improved market conditions more than offsetting a decline in net new business expansion. Treasury management fees grew $304,000, or 12%, over the last 12 months to a record $2.9 million. Card income increased $213,000, or 4% over the third quarter of 2023 consistent with increased transaction volume. Other non-interest income increased $315,000 over the third quarter of 2023, mainly due to increased swap fees collected.
    • Total non-interest expenses increased $1.8 million, or 4%, during the third quarter of 2024 compared to the third quarter of 2023, and decreased $657,000, or 1%, on the linked quarter. Overall, non-interest expenses continued to track closely to management expectations.
    • Tangible common equity per share(3) was $24.58 on September 30, 2024, compared to $23.22 on June 30, 2024, and $20.17 on September 30, 2023.

    Hillebrand concluded, “In September, we were one of only 30 banks in the U.S. to be named a “Sm-All Star” in Piper Sandler’s annual list of top-performing small-cap banks and thrifts in its “Class of 2024.” This elite annual list reflects the top banks in the industry across various metrics including growth, profitability, credit quality and capital strength. We are honored to be recognized by Piper Sandler as one of the top performing community banks in the nation, a testament to the solid foundation we have built to generate long term growth. Being named to this prestigious group is a noteworthy recognition of the hard work and dedication of the entire Stock Yards team.” Stock Yards Bancorp has been named to Piper Sandler’s Sm-All Stars list six times in 2008, 2011, 2019, 2020, 2022 and 2024.

    Results of Operations – Third Quarter 2024, Compared with Third Quarter 2023

    Net interest income, the Company’s largest source of revenue, increased by $3.7 million, or 6%, to $65.0 million. Strong organic loan growth and correlating interest income expansion contributed to net interest income growth.

    • Total interest income increased by $16.8 million, or 19%, to $105.7 million.
      • Interest income and fees on loans increased $17.5 million, or 22%, over the prior year quarter. Consistent with the $688 million, or 13%, increase in average loans and interest rate expansion, the average quarterly yield earned on loans increased 51 basis points over the past 12 months to 6.17%.
      • Interest income on securities decreased $1.1 million, or 13%, compared to the third quarter of 2023. While average securities balances have declined $235 million, or 14%, over the past 12 months, the rate earned on securities improved three basis points to 2.07%. Over the past 12 months, cash flows from investment portfolio maturities and pay downs have been utilized to fund loan growth and in lieu of redeployment into the portfolio.
      • Interest income on overnight funds increased $306,000, or 19%, consistent with the $24 million quarter over prior year quarter average balance increase.
         
    • Total interest expense increased $13.1 million, or 48%, to $40.7 million, as the cost of interest-bearing liabilities increased 68 basis points to 2.84%. For the sixth consecutive linked quarter end, the pace of expansion of total interest-bearing liability costs has slowed.
      • Interest expense on deposits increased $12.6 million over the past 12 months, as the overall cost of interest- bearing deposits increased to 2.68% in the third quarter of 2024 from 1.88% in the third quarter of 2023. Interest expense expansion was spread over most deposit categories, with time deposits and money market interest expense expanding the most at $5.5 million and $4.1 million, respectively.
      • Interest expense on Federal Home Loan Bank (FHLB) advances increased $292,000, or 6%, with the cost of funds declining 37 basis points to 4.49%. Consistent with third quarter investment securities maturities, the Bank relied less on overnight advances during the third quarter of 2024.

    For the third quarter of 2024, consistent with strong loan growth, a deterioration in unemployment rate projections and a slight increase in net charge-offs, offset by a reduction in specific reserves and other factors within the CECL allowance model, the Company recorded provision expense (1) of $4.3 million for loans. In addition, no provision expense for off balance sheet exposures was recorded. For the third quarter of 2023, the Company recorded $2.3 million in provision expense for loans and $475,000 of provision expense for off balance sheet exposures associated with expansion of C&LD and Commercial & Industrial (C&I) lines of credit.

    Non-interest income increased $1.9 million, or 8%, to $24.8 million compared to the third quarter of 2023.

    • WM&T income ended the third quarter of 2024 at $10.9 million, increasing $901,000, or 9%, over the third quarter of 2023. Despite positive equity market performance and strong estate fee revenue, WM&T income was muted by negative net new business.
    • Compared to the third quarter of 2023, treasury management fees increased $304,000, or 12%, to a record $2.9 million. The consistent treasury management growth has been driven by strong transaction volume, organic growth, modified fee schedules, strong foreign exchange income and new product sales.
    • Card income increased $213,000, or 4%, over the third quarter of 2023. Credit card interchange income and annual merchant incentives drove credit card income to a record $1.7 million. In addition, debit card income also posted growth over the prior period.
    • Other non-interest income, which includes swap fees, letter of credit fees and OREO activity, increased by $315,000. While swap fee income was strong in the third quarter of 2024, the Company’s Insurance Captive, which was not renewed in 2024, contributed approximately $302,000 to other non-interest income in the third quarter of 2023.

    Non-interest expenses, which tracked closely with management expectations, increased $1.8 million, or 4%, compared to the third quarter of 2023, to $48.5 million.

    • Compensation and benefits expense increased $2.3 million, or 9%, compared to the third quarter of 2023, consistent with annual merit-based increases and increased bonus levels, partially offset by lower health insurance claims.
    • Technology and communication expenses, which include computer software amortization, equipment depreciation and expenditures related to investments in technology needed to maintain and improve the quality of customer delivery channels, information security and internal resources, increased $264,000, or 6%, consistent with software upgrades and increased compliance-related expense.
    • Card processing expense increased $208,000, or 13%. Debit card interchange expense increased $103,000 while credit card expense increased $105,000, consistent with transaction growth and fraud mitigation efforts.
    • Amortization of investments in tax credit partnerships declined $323,000 compared to the third quarter of 2023. Effective January 1, 2024, the Bank adopted ASU 2023-02 and began booking tax credit amortization expense for all income tax credit projects as a component of tax expense via the proportional amortization method.
    • Other non-interest expenses declined $831,000, or 31%, compared to the third quarter of 2023, primarily due to modifications made to the corporate credit card reward program and significant declines in check and card losses, as well as the Company’s strategic decision to exit its Insurance Captive, which contributed $275,000 in expense to the third quarter of 2023.

    Financial Condition – September 30, 2024, Compared with September 30, 2023

    Total assets increased $534 million, or 7%, year over year to $8.44 billion.

    Total loans increased $661 million, or 12%, to $6.28 billion, with growth spread across all categories and markets. Total line of credit usage ended at 43.2% as of September 30, 2024, compared to 38.8% as of September 30, 2023, boosted by increased CL&D and C&I line usage. C&I line of credit usage expanded to 31.8% as of period end.

    Total investment securities decreased $229 million, or 16%, year over year. The overall portfolio yield was 2.07% for the third quarter of 2024, compared to 2.04% for the third quarter of 2023. Over the past 12 months, cash flows from the investment portfolio have been utilized to fund loan growth and provide liquidity in lieu of redeployment.

    Total deposits increased $323 million, or 5%, over the past 12 months, with the deposit mix continuing to shift from non-interest bearing and low interest-bearing deposits into higher cost deposits. Non-interest-bearing demand accounts declined $207 million, or 12%, while interest-bearing deposits grew $530 million, or 11%, led by $313 million of time deposit growth and $174 million of growth in money market balances.

    Non-performing loans totaled $17 million, or 0.27% of total loans outstanding on September 30, 2024, compared to $17 million, or 0.31% of total loans outstanding on September 30, 2023. The ratio of allowance for credit losses to loans ended at 1.36% on September 30, 2024, compared to 1.39% on September 30, 2023.

    As of September 30, 2024, the Company continued to be “well-capitalized,” the highest regulatory capital rating for financial institutions, with all capital ratios experiencing meaningful growth. Total equity to assets(3) was 11.07% and the tangible common equity ratio(3) was 8.79% on September 30, 2024, compared to 10.21% and 7.69% on September 30, 2023, respectively.

    In August 2024, the board of directors increased the quarterly cash dividend to $0.31 per common share. The dividend was paid October 1, 2024, to shareholders of record as of September 16, 2024.

    No shares have been purchased since 2020, and approximately 741,000 shares remain eligible for repurchase under the current buy-back plan, which expires in May 2025.

    Results of Operations – Third Quarter 2024, Compared with Second Quarter 2024

    Net interest margin improved seven basis points on the linked quarter to 3.33%, boosted by strong loan growth, higher interest earning asset yields and a slow-down in cost of funds expansion.

    Net interest income increased $3.0 million, or 5%, over the prior quarter to $65.0 million.

    • Total interest income increased $5.4 million, or 5%.
      • Interest income, including fees, on loans increased $5.7 million, or 6%. Average loans increased $201 million, or 3%, and the corresponding yield earned increased 11 basis points to 6.17%.
    • Total interest expense increased $2.5 million, or 6%.
      • Interest expense on deposits increased $2.4 million, or 8%, led by a $76 million increase in average interest-bearing deposits concentrated within the time and money market categories.

    The Company recorded $4.3 million in provision for credit losses on loans(1) and no credit loss expense for off-balance sheet exposures during the third quarter of 2024. During the second quarter of 2024, the Company recorded $1.3 million in provision for credit losses, which included a $1.1 million provision for credit losses on loans and $225,000 of credit loss expense for off-balance sheet exposures.

    Non-interest income increased $1.1 million, or 5%, on the linked quarter, with increases in nearly every category.

    Non-interest expenses decreased $657,000 to $48.5 million, as increases in compensation expense were more than offset by decreases in employee benefits, marketing and business development and technology and communication expenses.

    Financial Condition – September 30, 2024, Compared with June 30, 2024

    Total assets increased $122 million, or 1%, on the linked quarter to $8.44 billion.

    Total loans expanded $207 million, or 3%, on the linked quarter, led by increases in nearly every loan category. Total line of credit usage was 43.2% as of September 30, 2024, compared to 41.1% as of June 30, 2024. C&I line of credit usage totaled 31.8% as of September 30, 2024, compared to 30.8% as of June 30, 2024.

    Total deposits increased $157 million, or 2%, on the linked quarter. Non-interest-bearing demand accounts increased $26 million, or 2%, while total interest-bearing deposit accounts increased $131 million, or 3%. Time deposits increased by $119 million and money market balances increased by $82 million on the linked quarter.

    About the Company

    Louisville, Kentucky-based Stock Yards Bancorp, Inc., with $8.44 billion in assets, was incorporated in 1988 as a bank holding company. It is the parent company of Stock Yards Bank & Trust Company, which was established in 1904. The Company’s common shares trade on The Nasdaq Stock Market under the symbol “SYBT.”

    This report contains forward-looking statements under the Private Securities Litigation Reform Act that involve risks and uncertainties. Although the Company’s management believes the assumptions underlying the forward-looking statements contained herein are reasonable, any of these assumptions could be inaccurate. Therefore, there can be no assurance the forward-looking statements included herein will prove to be accurate. Factors that could cause actual results to differ from those discussed in forward-looking statements include, but are not limited to: economic conditions both generally and more specifically in the markets in which the Company and its banking subsidiary operates; competition for the Company’s customers from other providers of financial services; changes in, or forecasts of, future political and economic conditions, inflation and efforts to control it; government legislation and regulation, which change and over which the Company has no control; changes in interest rates; material unforeseen changes in liquidity, results of operations, or financial condition of the Company’s customers; and other risks detailed in the Company’s filings with the Securities and Exchange Commission, all of which are difficult to predict and many of which are beyond the control of the Company. Refer to Stock Yards’ Annual Report on Form 10-K for the year ended December 31, 2023, as well as its other filings with the SEC for a more detailed discussion of risks, uncertainties and factors that could cause actual results to differ from those discussed in the forward-looking statements.

                           
    Stock Yards Bancorp, Inc. Financial Information (unaudited)
    Third Quarter 2024 Earnings Release
    (In thousands unless otherwise noted)
                           
      Three Months Ended   Nine Months Ended
      September 30,   September 30,
    Income Statement Data 2024   2023   2024   2023
                           
    Net interest income, fully tax equivalent (5) $ 65,064     $ 61,437     $ 187,344     $ 185,757  
    Interest income:                      
    Loans $ 95,689     $ 78,234     $ 271,547     $ 219,329  
    Federal funds sold and interest bearing due from banks (1,946 )   (1,640 )   (6,199 )   (4,885 )
    Mortgage loans held for sale 47     55     152     173  
    Federal Home Loan Bank stock 663     499     1,601     939  
    Investment securities 7,377     8,497     23,072     26,129  
    Total interest income 105,722     88,925     302,571     251,455  
    Interest expense:                      
    Deposits 33,997     21,360     97,486     51,940  
    Securities sold under agreements to repurchase 937     597     2,639     1,429  
    Federal funds purchased 120     157     395     504  
    Federal Home Loan Bank advances 5,209     4,917     13,469     10,613  
    Subordinated debentures 480     579     1,511     1,653  
    Total interest expense 40,743     27,610     115,500     66,139  
    Net interest income 64,979     61,315     187,071     185,316  
    Provision for credit losses (1) 4,325     2,775     7,050     7,750  
    Net interest income after provision for credit losses 60,654     58,540     180,021     177,566  
    Non-interest income:                      
    Wealth management and trust services 10,931     10,030     32,497     29,703  
    Deposit service charges 2,314     2,272     6,630     6,622  
    Debit and credit card income 5,083     4,870     14,688     14,064  
    Treasury management fees 2,939     2,635     8,389     7,502  
    Mortgage banking income 1,112     814     3,077     2,882  
    Net investment product sales commissions and fees 915     791     2,580     2,345  
    Bank owned life insurance 634     569     1,817     1,677  
    Gain (loss) on sale of premises and equipment (59 )   302     (39 )   75  
    Other 928     613     2,084     2,933  
    Total non-interest income 24,797     22,896     71,723     67,803  
    Non-interest expenses:                      
    Compensation 25,534     23,379     74,389     67,382  
    Employee benefits 4,629     4,508     15,591     14,622  
    Net occupancy and equipment 3,775     3,821     11,264     11,234  
    Technology and communication 4,500     4,236     14,463     12,706  
    Debit and credit card processing 1,845     1,637     5,402     4,762  
    Marketing and business development 1,438     1,357     4,109     4,236  
    Postage, printing and supplies 901     938     2,740     2,701  
    Legal and professional 968     1,049     3,268     2,665  
    FDIC insurance 1,095     937     3,368     2,851  
    Capital and deposit based taxes 825     629     2,128     1,875  
    Intangible amortization 1,052     1,167     3,155     3,519  
    Amortization of investments in tax credit partnerships –     323     –     970  
    Other 1,890     2,721     6,645     8,293  
    Total non-interest expenses 48,452     46,702     146,522     137,816  
    Income before income tax expense 36,999     34,734     105,222     107,553  
    Income tax expense 7,639     7,642     22,377     23,749  
    Net income $ 29,360     $ 27,092     $ 82,845     $ 83,804  
                           
    Net income per share – Basic $ 1.00     $ 0.93     $ 2.83     $ 2.87  
    Net income per share – Diluted 1.00     0.92     2.82     2.86  
    Cash dividend declared per share 0.31     0.30     0.91     0.88  
                           
    Weighted average shares – Basic 29,299     29,223     29,277     29,208  
    Weighted average shares – Diluted 29,445     29,336     29,396     29,347  
                           
              September 30,
    Balance Sheet Data             2024   2023
                           
    Investment securities             $ 1,236,744     $ 1,465,463  
    Loans             6,278,133     5,617,084  
    Allowance for credit losses on loans             85,343     78,075  
    Total assets             8,437,280     7,903,430  
    Non-interest bearing deposits             1,508,203     1,714,918  
    Interest bearing deposits             5,217,870     4,687,889  
    Federal Home Loan Bank advances             325,000     350,000  
    Accumulated other comprehensive income (loss)             (75,273 )   (127,905 )
    Stockholders’ equity             934,094     806,918  
                           
    Total shares outstanding             29,414     29,323  
    Book value per share (3)             $ 31.76     $ 27.52  
    Tangible common equity per share (3)             24.58     20.17  
    Market value per share             61.99     39.29  
                           
    Stock Yards Bancorp, Inc. Financial Information (unaudited)
    Third Quarter 2024 Earnings Release
                           
      Three Months Ended
    		   Nine Months Ended
      September 30,
    		   September 30,
    Average Balance Sheet Data 2024   2023   2024   2023
                           
    Federal funds sold and interest bearing due from banks $ 148,818     $ 124,653     $ 153,755     $ 132,421  
    Mortgage loans held for sale 4,862     7,112     5,230     7,333  
    Investment securities 1,424,815     1,659,888     1,498,092     1,710,838  
    Federal Home Loan Bank stock 31,193     27,290     27,364     22,663  
    Loans 6,174,309     5,486,262     5,986,366     5,337,493  
    Total interest earning assets 7,783,997     7,305,205     7,670,807     7,210,748  
    Total assets 8,384,605     7,805,154     8,262,017     7,660,658  
    Non-interest bearing deposits 1,510,515     1,731,724     1,508,947     1,796,586  
    Interest bearing deposits 5,047,771     4,509,411     5,026,185     4,468,160  
    Total deposits 6,558,286     6,241,135     6,535,132     6,264,746  
    Securities sold under agreements to repurchase 156,865     127,063     156,392     120,740  
    Federal funds purchased 8,480     11,776     9,585     13,857  
    Federal Home Loan Bank advances 461,141     401,630     392,609     305,220  
    Subordinated debentures 26,806     26,606     26,802     26,508  
    Total interest bearing liabilities 5,701,063     5,076,486     5,611,573     4,934,485  
    Accumulated other comprehensive income (loss) (88,362 )   (112,329 )   (94,560 )   (107,374 )
    Total stockholders’ equity 910,274     810,710     883,267     796,172  
                           
    Performance Ratios                      
    Annualized return on average assets (4) 1.39 %   1.38 %   1.34 %   1.46 %
    Annualized return on average equity (4) 12.83 %   13.26 %   12.53 %   14.07 %
    Net interest margin, fully tax equivalent 3.33 %   3.34 %   3.26 %   3.44 %
    Non-interest income to total revenue, fully tax equivalent 27.59 %   27.15 %   27.69 %   26.74 %
    Efficiency ratio, fully tax equivalent (2) 53.92 %   55.38 %   56.56 %   54.35 %
                           
    Capital Ratios                      
    Total stockholders’ equity to total assets (3)             11.07 %   10.21 %
    Tangible common equity to tangible assets (3)             8.79 %   7.69 %
    Average stockholders’ equity to average assets             10.69 %   10.39 %
    Total risk-based capital             12.73 %   12.71 %
    Common equity tier 1 risk-based capital             11.16 %   11.17 %
    Tier 1 risk-based capital             11.52 %   11.57 %
    Leverage             10.05 %   9.80 %
                           
    Loan Segmentation                      
    Commercial real estate – non-owner occupied             $ 1,686,448     $ 1,508,615  
    Commercial real estate – owner occupied             949,538     945,122  
    Commercial and industrial             1,379,293     1,251,027  
    Residential real estate – owner occupied             783,337     696,162  
    Residential real estate – non-owner occupied             381,051     350,386  
    Construction and land development             674,918     480,120  
    Home equity lines of credit             236,819     203,184  
    Consumer             143,684     143,703  
    Leases             16,760     14,710  
    Credit cards             26,285     24,055  
    Total loans and leases             $ 6,278,133     $ 5,617,084  
                           
    Asset Quality Data                      
    Non-accrual loans             $ 16,288     $ 17,227  
    Modifications to borrowers experiencing financial difficulty             –     –  
    Loans past due 90 days or more and still accruing             870     1  
    Total non-performing loans             17,158     17,228  
    Other real estate owned             10     427  
    Total non-performing assets             $ 17,168     $ 17,655  
    Non-performing loans to total loans             0.27 %   0.31 %
    Non-performing assets to total assets             0.20 %   0.22 %
    Allowance for credit losses on loans to total loans             1.36 %   1.39 %
    Allowance for credit  losses on loans to average loans             1.43 %   1.46 %
    Allowance for credit losses on loans to non-performing loans             497 %   453 %
    Net (charge-offs) recoveries $ (1,137 )   $ (1,935 )   $ (606 )   $ (2,156 )
    Net (charge-offs) recoveries to average loans (6) -0.02 %   -0.04 %   -0.01 %   -0.04 %
                           
    Stock Yards Bancorp, Inc. Financial Information (unaudited)  
    Third Quarter 2024 Earnings Release  
                                 
      Quarterly Comparison
    Income Statement Data 9-30-24   6-30-24   3-31-24   12-31-23   9-30-23
                                 
    Net interest income, fully tax equivalent  (5) $ 65,064     $ 62,113     $ 60,167     $ 62,112     $ 61,437  
    Net interest income $ 64,979     $ 62,022     $ 60,070     $ 62,016     $ 61,315  
    Provision for credit losses (1) 4,325     1,300     1,425     6,046     2,775  
    Net interest income after provision for credit losses 60,654     60,722     58,645     55,970     58,540  
    Non-interest income:                            
    Wealth management and trust services 10,931     10,795     10,771     10,099     10,030  
    Deposit service charges 2,314     2,180     2,136     2,244     2,272  
    Debit and credit card income 5,083     4,923     4,682     5,374     4,870  
    Treasury management fees 2,939     2,825     2,625     2,531     2,635  
    Mortgage banking income 1,112     1,017     948     823     814  
    Loss on sale of securities –     –     –     (44 )   –  
    Net investment product sales commissions and fees 915     800     865     860     791  
    Bank owned life insurance 634     595     588     576     569  
    Gain (loss) on sale of premises and equipment (59 )   20     –     (105 )   302  
    Other 928     500     656     2,059     613  
    Total non-interest income 24,797     23,655     23,271     24,417     22,896  
    Non-interest expenses:                            
    Compensation 25,534     24,634     24,221     24,494     23,379  
    Employee benefits 4,629     5,086     5,876     3,829     4,508  
    Net occupancy and equipment 3,775     3,819     3,670     5,150     3,821  
    Technology and communication 4,500     4,894     5,069     4,612     4,236  
    Debit and credit card processing 1,845     1,811     1,746     1,719     1,637  
    Marketing and business development 1,438     1,596     1,075     1,754     1,357  
    Postage, printing and supplies 901     913     926     903     938  
    Legal and professional 968     1,185     1,115     1,293     1,049  
    FDIC insurance 1,095     1,161     1,112     1,060     937  
    Capital and deposit based taxes 825     673     630     601     629  
    Intangible amortization 1,052     1,051     1,052     1,167     1,167  
    Amortization of investments in tax credit partnerships –     –     –     324     323  
    Other 1,890     2,286     2,469     3,107     2,721  
    Total non-interest expenses 48,452     49,109     48,961     50,013     46,702  
    Income before income tax expense 36,999     35,268     32,955     30,374     34,734  
    Income tax expense 7,639     7,670     7,068     6,430     7,642  
    Net income $ 29,360     $ 27,598     $ 25,887     $ 23,944     $ 27,092  
                                 
                                 
    Net income per share – Basic $ 1.00     $ 0.94     $ 0.89     $ 0.82     $ 0.93  
    Net income per share – Diluted 1.00     0.94     0.88     0.82     0.92  
    Cash dividend declared per share 0.31     0.30     0.30     0.30     0.30  
                                 
    Weighted average shares – Basic 29,299     29,283     29,250     29,226     29,223  
    Weighted average shares – Diluted 29,445     29,383     29,361     29,331     29,336  
                                 
      Quarterly Comparison
    Balance Sheet Data 9-30-24   6-30-24   3-31-24   12-31-23   9-30-23
                                 
    Cash and due from banks $ 108,825     $ 85,441     $ 71,676     $ 94,466     $ 79,538  
    Federal funds sold and interest bearing due from banks 144,241     118,910     88,547     171,493     113,499  
    Mortgage loans held for sale 4,822     6,438     6,462     6,056     6,535  
    Investment securities 1,236,744     1,342,354     1,379,212     1,471,016     1,465,453  
    Federal Home Loan Bank stock 29,419     31,462     24,675     16,236     26,241  
    Loans 6,278,133     6,070,963     5,849,715     5,771,038     5,617,084  
    Allowance for credit losses on loans 85,343     82,155     80,897     79,374     78,075  
    Goodwill 194,074     194,074     194,074     194,074     194,074  
    Total assets 8,437,280     8,315,325     8,123,128     8,170,102     7,903,430  
    Non-interest bearing deposits 1,508,203     1,482,514     1,481,217     1,548,624     1,714,918  
    Interest bearing deposits 5,217,870     5,086,724     5,127,863     5,122,124     4,687,889  
    Securities sold under agreements to repurchase 149,852     152,948     162,528     152,991     113,894  
    Federal funds purchased 6,442     10,029     9,961     12,852     11,518  
    Federal Home Loan Bank advances 325,000     400,000     200,000     200,000     350,000  
    Subordinated debentures 26,806     26,806     26,806     26,740     26,641  
    Accumulated other comprehensive income (loss) (75,273 )   (94,980 )   (95,054 )   (92,798 )   (127,905 )
    Stockholders’ equity 934,094     894,535     874,711     858,103     806,918  
                                 
    Total shares outstanding 29,414     29,388     29,393     29,329     29,323  
    Book value per share (3) 31.76     $ 30.44     $ 29.76     $ 29.26     $ 27.52  
    Tangible common equity per share (3) 24.58     23.22     22.50     21.95     20.17  
    Market value per share 61.99     49.67     48.91     51.49     39.29  
                                 
    Capital Ratios                            
    Total stockholders’ equity to total assets (3) 11.07 %   10.76 %   10.77 %   10.50 %   10.21 %
    Tangible common equity to tangible assets (3) 8.79 %   8.42 %   8.36 %   8.09 %   7.69 %
    Average stockholders’ equity to average assets 10.86 %   10.65 %   10.56 %   10.07 %   10.39 %
    Total risk-based capital 12.73 %   12.62 %   12.69 %   12.56 %   12.71 %
    Common equity tier 1 risk-based capital 11.16 %   11.07 %   11.11 %   11.04 %   11.17 %
    Tier 1 risk-based capital 11.52 %   11.43 %   11.49 %   11.43 %   11.57 %
    Leverage 10.05 %   9.95 %   9.82 %   9.62 %   9.80 %
                                 
    Stock Yards Bancorp, Inc. Financial Information (unaudited)   
    Third Quarter 2024 Earnings Release   
                                 
      Quarterly Comparison
    Average Balance Sheet Data 9-30-24   6-30-24   3-31-24   12-31-23   9-30-23
                                 
    Federal funds sold and interest bearing due from banks $ 148,818     $ 158,512     $ 153,990     $ 258,950     $ 124,653  
    Mortgage loans held for sale 4,862     6,204     4,629     5,305     7,112  
    Investment securities 1,424,815     1,491,865     1,578,401     1,618,799     1,659,888  
    Federal Home Loan Bank stock 31,193     29,735     21,121     20,519     27,290  
    Loans 6,174,309     5,973,801     5,808,924     5,676,193     5,486,262  
    Total interest earning assets 7,783,997     7,660,117     7,567,065     7,579,766     7,305,205  
    Total assets 8,384,605     8,246,735     8,153,364     8,116,569     7,805,154  
    Non-interest bearing deposits 1,510,515     1,515,708     1,500,602     1,663,962     1,731,724  
    Interest bearing deposits 5,047,771     4,971,804     5,058,743     5,025,240     4,509,411  
    Total deposits 6,558,286     6,487,512     6,559,345     6,689,202     6,241,135  
    Securities sold under agreement to repurchase 156,865     147,327     164,979     130,148     127,063  
    Federal funds purchased 8,480     10,127     10,161     13,606     11,776  
    Federal Home Loan Bank advances 461,141     441,484     274,451     205,435     401,630  
    Subordinated debentures 26,806     26,806     26,794     26,706     26,606  
    Total interest bearing liabilities 5,701,063     5,597,548     5,535,128     5,401,135     5,076,486  
    Accumulated other comprehensive income (loss) (88,362 )   (99,640 )   (95,747 )   (125,843 )   (112,329 )
    Total stockholders’ equity 910,274     878,233     861,029     817,682     810,710  
                                 
    Performance Ratios                            
    Annualized return on average assets (4) 1.39 %   1.35 %   1.28 %   1.17 %   1.38 %
    Annualized return on average equity (4) 12.83 %   12.64 %   12.09 %   11.62 %   13.26 %
    Net interest margin, fully tax equivalent 3.33 %   3.26 %   3.20 %   3.25 %   3.34 %
    Non-interest income to total revenue, fully tax equivalent 27.59 %   27.58 %   27.89 %   28.22 %   27.15 %
    Efficiency ratio, fully tax equivalent (2) 53.92 %   57.26 %   58.68 %   57.80 %   55.38 %
                                 
    Loans Segmentation                            
    Commercial real estate – non-owner occupied $ 1,686,448     $ 1,652,614     $ 1,609,483     $ 1,561,689     $ 1,508,615  
    Commercial real estate – owner occupied 949,538     943,013     931,973     907,424     945,122  
    Commercial and industrial 1,379,293     1,356,970     1,293,696     1,307,128     1,251,027  
    Residential real estate – owner occupied 783,337     749,870     723,234     708,893     696,162  
    Residential real estate – non-owner occupied 381,051     365,846     360,958     358,715     350,386  
    Construction and land development 674,918     586,820     532,183     531,324     480,120  
    Home equity lines of credit 236,819     223,304     212,443     211,390     203,184  
    Consumer 143,684     151,221     145,022     145,340     143,703  
    Leases 16,760     17,258     16,619     15,503     14,710  
    Credit cards 26,285     24,047     24,104     23,632     24,055  
    Total loans and leases $ 6,278,133     $ 6,070,963     $ 5,849,715     $ 5,771,038     $ 5,617,084  
                                 
    Asset Quality Data                            
    Non-accrual loans $ 16,288     $ 17,371     $ 13,984     $ 19,058     $ 17,227  
    Modifications to borrowers experiencing financial difficulty –     –     –     –     –  
    Loans past due 90 days or more and still accruing 870     186     106     110     1  
    Total non-performing loans 17,158     17,557     14,090     19,168     17,228  
    Other real estate owned 10     10     10     10     427  
    Total non-performing assets $ 17,168     $ 17,567     $ 14,100     $ 19,178     $ 17,655  
    Non-performing loans to total loans 0.27 %   0.29 %   0.24 %   0.33 %   0.31 %
    Non-performing assets to total assets 0.20 %   0.21 %   0.17 %   0.23 %   0.22 %
    Allowance for credit losses on loans to total loans 1.36 %   1.35 %   1.38 %   1.38 %   1.39 %
    Allowance for credit losses on loans to average loans 1.38 %   1.38 %   1.39 %   1.40 %   1.42 %
    Allowance for credit losses on loans to non-performing loans 497 %   468 %   574 %   414 %   453 %
    Net (charge-offs) recoveries $ (1,137 )   $ 183     $ 348     $ (4,472 )   $ (1,935 )
    Net (charge-offs) recoveries to average loans (6) -0.02 %   0.00 %   0.01 %   -0.08 %   -0.04 %
                                 
    Other Information                            
    Total WM&T assets under management (in millions) $ 7,317     $ 7,479     $ 7,496     $ 7,160     $ 6,670  
    Full-time equivalent employees 1,068     1,051     1,062     1,075     1,056  
                                 
    (1) – Detail of Provision for credit losses follows:
      Quarterly Comparison
    (in thousands) 9-30-24   6-30-24   3-31-24   12-31-23   9-30-23
    Provision for credit losses – loans $ 4,325     $ 1,075     $ 1,175     $ 5,771     $ 2,300  
    Provision for credit losses – off balance sheet exposures –     225     250     275     475  
    Total provision for credit losses $ 4,325     $ 1,300     $ 1,425     $ 6,046     $ 2,775  
                                 
    (2) – The efficiency ratio, a non-GAAP measure, equals total non-interest expenses divided by the sum of net interest income (FTE) and non-interest income.
      Quarterly Comparison
    (Dollars in thousands) 9-30-24   6-30-24   3-31-24   12-31-23   9-30-23
    Total non-interest expenses  (a) $ 48,452     $ 49,109     $ 48,961     $ 50,013     $ 46,702  
                                 
    Total net interest income, fully tax equivalent $ 65,064     $ 62,113     $ 60,167     $ 62,112     $ 61,437  
    Total non-interest income 24,797     23,655     23,271     24,417     22,896  
    Total revenue – Non-GAAP (b) 89,861     85,768     83,438     86,529     84,333  
                                 
    Efficiency ratio – Non-GAAP (a/b) 53.92 %   57.26 %   58.68 %   57.80 %   55.38 %
                                 
    (3) – The following table provides a reconciliation of total stockholders’ equity in accordance with GAAP to tangible stockholders’ equity, a non-GAAP disclosure. Bancorp provides the tangible book value per share, a non-GAAP measure, in addition to those defined by banking regulators, because of its widespread use by investors as a means to evaluate capital adequacy:
      Quarterly Comparison
    (In thousands, except per share data) 9-30-24   6-30-24   3-31-24   12-31-23   9-30-23
    Total stockholders’ equity – GAAP (a) $ 934,094     $ 894,535     $ 874,711     $ 858,103     $ 806,918  
    Less: Goodwill (194,074 )   (194,074 )   (194,074 )   (194,074 )   (194,074 )
    Less: Core deposit and other intangibles (17,149 )   (18,201 )   (19,252 )   (20,304 )   (21,471 )
    Tangible common equity – Non-GAAP (c) $ 722,871     $ 682,260     $ 661,385     $ 643,725     $ 591,373  
                                 
    Total assets – GAAP (b) $ 8,437,280     $ 8,315,325     $ 8,123,128     $ 8,170,102     $ 7,903,430  
    Less: Goodwill (194,074 )   (194,074 )   (194,074 )   (194,074 )   (194,074 )
    Less: Core deposit and other intangibles (17,149 )   (18,201 )   (19,252 )   (20,304 )   (21,471 )
    Tangible assets – Non-GAAP (d) $ 8,226,057     $ 8,103,050     $ 7,909,802     $ 7,955,724     $ 7,687,885  
                                 
    Total stockholders’ equity to total assets – GAAP (a/b) 11.07 %   10.76 %   10.77 %   10.50 %   10.21 %
    Tangible common equity to tangible assets – Non-GAAP (c/d) 8.79 %   8.42 %   8.36 %   8.09 %   7.69 %
                                 
    Total shares outstanding (e) 29,414     29,388     29,393     29,329     29,323  
                                 
    Book value per share – GAAP (a/e) $ 31.76     $ 30.44     $ 29.76     $ 29.26     $ 27.52  
    Tangible common equity per share – Non-GAAP (c/e) 24.58     23.22     22.50     21.95     20.17  
                                 
    (4) – Return on average assets equals net income divided by total average assets, annualized to reflect a full year return on average assets. Similarly, return on average equity equals net income divided by total average equity, annualized to reflect a full year return on average equity.
                                 
    (5) – Interest income on a FTE basis includes the additional amount of interest income that would have been earned if investments in certain tax-exempt interest earning assets had been made in assets subject to federal, state and local taxes yielding the same after-tax income.
                                 
    (6) – Quarterly net (charge-offs) recoveries to average loans ratios are not annualized.
                                 
    Contact: T. Clay Stinnett
      Executive Vice President,
      Treasurer and Chief Financial Officer
      (502) 625-0890
       

    The MIL Network –

  • MIL-OSI: Southern Michigan Bancorp, Inc. Announces Third Quarter 2024 Earnings

    Source: GlobeNewswire (MIL-OSI)

    COLDWATER, Mich., Oct. 23, 2024 (GLOBE NEWSWIRE) — Southern Michigan Bancorp, Inc. (OTC Pink: SOMC) announced third quarter net income of $2,586,000, or $0.57 per share, compared to net income of $2,767,000, or $0.61 per share, for the third quarter of 2023. For the first nine months of 2024, Southern earned $7,751,000 or $1.70 per share, compared with $8,468,000 or $1.86 per share, for the same nine-month period one year ago.  

    John R. Waldron, President and Chief Executive Officer of Southern Michigan Bancorp, Inc., stated, “For the first time, our bank has surpassed $1.5 billion in total assets, a significant milestone that reflects our ongoing growth and expansion across all markets. While our earnings continue to be impacted by the current interest rate environment, we remain encouraged by the strength of our core deposits and our ability to maintain asset quality. Our focus on disciplined growth strategies has positioned us well, even amid challenges. As we navigate the shifting economic landscape, we are confident in our capacity to sustain momentum and further strengthen our balance sheet.”

    As of September 30, 2024, total loans and deposits grew during the first nine months totaling $1.084 billion and $1.266 billion, respectively.

    The allowance for credit losses totaled $12,363,000, or 1.14% of loans on September 30, 2024. Net loan charge-offs totaled $20,000 for the first nine months of 2024, compared to net charge-offs of 7,000 for the first nine months of 2023. Non-performing loans as a percentage of total loans were 0.08% on September 30, 2024 compared to 0.09% on December 31, 2023.

    The annualized return on average assets for the nine-month periods ended September 30, 2024 and September 30, 2023 was 0.70% and 0.84% respectively. The annualized return on average equity was 10.18% for the first nine months of 2024 compared to 12.42% for the first nine months of 2023. The tax equivalent net interest margin for the nine-month periods ending September 30, 2024 and 2023 was 2.94% and 3.18%, respectively.

    Southern Michigan Bancorp, Inc. is a bank holding company and the parent company of Southern Michigan Bank & Trust. It operates 18 offices within Branch, Calhoun, Hillsdale, Jackson, Kalamazoo and St. Joseph Counties providing a broad range of consumer, business and wealth management services throughout the region.

    This press release contains forward-looking statements that are based on management’s beliefs, assumptions, current expectations, estimates and projections about the financial services industry, the economy, and Southern Michigan Bancorp, Inc. Forward-looking statements are identifiable by words or phrases such as “expected,” “begin,” and other similar words or expressions. All statements with reference to a future time period are forward-looking. Management’s determination of the provision and allowance for credit losses and other accounting estimates, such as the carrying value of goodwill, other real estate owned, mortgage servicing rights and the fair value of investment securities, involves judgments that are inherently forward-looking. The future effect of changes in the financial and credit markets and the national and regional economy on the banking industry, generally, and Southern Michigan Bancorp, Inc., specifically, are also inherently uncertain. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions (“risk factors”) that are difficult to predict with regard to timing, extend, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed in or implied by such forward-looking statements. Southern Michigan Bancorp, Inc. does not undertake to update forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

     
    SOUTHERN MICHIGAN BANCORP, INC.
    CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
    (In thousands, except share data)              
      September 30,
    2024    		   December 31,
    2023    		  
    ASSETS            
    Cash and cash equivalents $ 121,022   $ 71,620  
    Federal funds sold   264     1,468  
    Securities available for sale, at fair value   160,771     169,740  
    Securities held-to-maturity, at amortized cost   60,129     61,600  
    Loans held-for-sale   871     169  
    Loans, net of allowance for credit losses of $12,363 – 2024, $11,697 – 2023   1,071,234     1,024,720  
    Premises and equipment, net   23,406     23,114  
    Net cash surrender value of life insurance   22,970     22,472  
    Goodwill   13,422     13,422  
    Other intangible assets, net   120     147  
    Other assets   36,314     26,323  
    TOTAL ASSETS $ 1,510,523   $ 1,414,795  
                 
    LIABILITIES            
    Deposits:            
    Non-interest bearing $ 219,072   $ 226,178  
    Interest bearing   1,047,024     931,793  
    Total deposits   1,266,096     1,157,971  
                 
    Securities sold under agreements to repurchase and overnight borrowings   1,688     1,738  
    Accrued expenses and other liabilities   17,996     15,703  
    Other borrowings   82,900     106,900  
    Subordinated debentures   34,705     34,653  
    Total liabilities   1,403,385     1,316,965  
                 
    SHAREHOLDERS’ EQUITY            
    Preferred stock, 100,000 shares authorized; none issued or outstanding   –     –  
    Common stock, $2.50 par value:            
    Authorized – 10,000,000 shares            
    Issued and outstanding – 4,563,995 shares in 2024,
    4,533,637 shares in 2023    		   11,406     11,330  
    Additional paid-in capital   13,225     13,126  
    Retained earnings   95,498     89,808  
    Accumulated other comprehensive loss   (12,991 )   (16,434 )
    Total shareholders’ equity   107,138     97,830  
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 1,510,523   $ 1,414,795  
                 
     
    Southern Michigan Bancorp, Inc.
    condensed consolidated statements of income (unaudited)
    (In thousands, except per share data)
      Three Months Ended
    September 30,    		   Nine Months Ended
    September 30,    		  
      2024   2023   2024   2023  
    Interest income:                        
    Loans, including fees $ 16,444   $ 14,563   $ 47,748   $ 39,579  
    Federal funds sold and balances with banks   1,313     786     3,630     2,360  
    Securities:                        
    Taxable   1,465     1,567     4,512     4,655  
    Tax-exempt   309     315     904     961  
    Total interest income   19,531     17,231     56,794     47,555  
                             
    Interest expense:                        
    Deposits   7,567     5,777     21,655     14,516  
    Other   1,571     1,519     4,701     3,389  
    Total interest expense   9,138     7,296     26,356     17,905  
    Net interest income   10,393     9,935     30,438     29,650  
    Provision for credit losses   425     25     661     950  
    Net interest income after provision for credit losses   9,968     9,910     29,777     28,700  
                             
    Non-interest income:                        
    Service charges on deposit accounts   439     422     1,270     1,248  
    Trust fees   741     629     2,041     1,787  
    Net gains on loan sales   181     71     419     186  
    Earnings on life insurance assets   169     157     498     456  
    ATM and debit card fee income   465     452     1,356     1,339  
    Other   177     197     608     644  
    Total non-interest income   2,172     1,928     6,192     5,660  
                             
    Non-interest expense:                        
    Salaries and employee benefits   5,528     5,356     16,154     14,751  
    Occupancy, net   519     429     1,515     1,397  
    Equipment   400     404     1,233     1,063  
    Professional and outside services   530     443     1,575     1,473  
    Software maintenance   626     568     1,817     1,639  
    ATM expenses   229     195     629     602  
    Printing, postage, and supplies   124     97     413     318  
    Telecommunication expenses   75     88     240     268  
    Other   972     869     2,958     2,525  
    Total non-interest expense   9,003     8,449     26,534     24,036  
    INCOME BEFORE INCOME TAXES   3,137     3,389     9,435     10,324  
    Federal income tax provision   551     622     1,684     1,856  
    NET INCOME $ 2,586   $ 2,767   $ 7,751   $ 8,468  
                             
    Basic Earnings Per Common Share $ 0.57   $ 0.61   $ 1.70   $ 1.86  
    Diluted Earnings Per Common Share   0.57     0.61     1.70     1.86  
    Dividends Declared Per Common Share   0.15     0.14     0.45     0.42  
                             

    The MIL Network –

  • MIL-OSI: Morris State Bancshares Announces Quarterly Earnings and Declares Fourth Quarter Dividend

    Source: GlobeNewswire (MIL-OSI)

    DUBLIN, Ga., Oct. 23, 2024 (GLOBE NEWSWIRE) — Morris State Bancshares, Inc. (OTCQX: MBLU) (the “Company”), the parent of Morris Bank, today announced net income of $5.4 million for the quarter ending September 30, 2024, representing an increase of $124 thousand, or 2.34%, compared to net income of $5.3 million for the quarter ended June 30, 2024. Year over year the Company’s net income increased $954 thousand, or 21.23%, compared to net income of $4.5 million for the quarter ended September 30, 2023. The Company’s quarterly net earnings rose due to sustained loan growth, higher loan yields, an increase in noninterest-bearing deposit accounts, and some stabilization in the cost of funds. These factors combined to strengthen the bank’s net interest margin, bringing it to 4.10%.

    “We had a solid third quarter. Our core earnings engine remains strong as reflected by the growth in our net interest income. In the third quarter, we generated net interest income of $14.0 million, which was $428 thousand above the June 30, 2024, level of $13.6 million and $1.1 million above the September 30, 2023 level of $12.9 million,” said Spence Mullis, Chairman and CEO. “The Federal Reserve’s reduction in the Fed funds rate, combined with robust growth in noninterest-bearing balances, has contributed to stabilizing our cost of funds. Despite continued payoffs of larger loans, we continue to fund a good volume of new loans and previously unfunded commitments driving our loan balances slightly higher.”

    The net interest margin was 4.10% for the third quarter of 2024 compared to 4.02% for the second quarter of 2024 and 3.94% for the third quarter of 2023. The average yield on earning assets grew nine basis points from 5.96%, as of June 30, 2024, to 6.05%, while the Company’s cost of funds increased two basis points from 2.16% to 2.18% during the same period.

    Total deposits declined during the quarter by $16.6 million, or 1.37%, which included a $24 million reduction in brokered money market deposits. However, non-interest-bearing deposits increased $21.5 million, or 7.19% during the quarter, helping to bolster the net interest margin. The bank took down $15.0 million in borrowings from the Federal Home Loan Bank during the third quarter of 2024 to help fund new loan demand and offset the reduction in brokered deposits. Loans increased $6.3 million, or an annualized 2.36% during the third quarter, slowing from the second quarter’s annualized growth of 7.24%. Management anticipates steady loan demand in the fourth quarter as political uncertainty eases in November, providing customers with greater clarity to advance their growth strategies.

    The bank’s reserve as a percentage of total loans was 1.30% for September 30, 2024, as compared to 1.30% for June 30, 2024, and 1.32% as of September 30, 2023. The Company’s adversely classified index increased slightly from 6.04% as of June 30, 2024, to 6.15% as of September 30, 2024. The bank’s efficiency ratio increased slightly from 58.36% as of June 30, 2024, to 58.90% as of September 30, 2024.

    The Company’s total shareholders’ equity increased 2.35% to $190.6 million as of September 30, 2024, as compared to $186.2 million as of June 30, 2024. Tangible book value per share increased to $16.97 as of September 30, 2024, a 2.66% increase from $16.53 per share on June 30, 2024.  On October 16, 2024, the board of directors approved its fourth quarter dividend of $0.092 per share payable on or about December 15th to all shareholders of record as of November 15th. 

    Forward-looking Statements

    Certain statements contained in this release may not be based on historical facts and are forward-looking statements. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “may,” “might,” “will,” “would,” “could” or “intend.” We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including, among others, the business and economic conditions; risks related to the integration of acquired businesses and any future acquisitions; changes in management personnel; interest rate risk; ability to execute on planned expansion and organic growth; credit risk and concentrations associated with the Company’s loan portfolio; asset quality and loan charge-offs; inaccuracy of the assumptions and estimates management of the Company makes in establishing reserves for probable loan losses and other estimates; lack of liquidity; impairment of investment securities, goodwill or other intangible assets; the Company’s risk management strategies; increased competition; system failures or failures to prevent breaches of our network security; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes; and increases in capital requirements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release. 

                 
    MORRIS STATE BANCSHARES, INC.
    AND SUBSIDIARIES
                                     
    Consolidating Balance Sheet
                                     
            September 30,   June 30,           September 30,      
              2024       2024     Change   % Change     2023     Change   % Change
            (Unaudited)   (Unaudited)           (Unaudited)        
    ASSETS                                
                                     
    Cash and due from banks       $ 48,180,615     $ 43,688,884     $ 4,491,731     10.28 %   $ 36,373,555     $ 11,807,060     32.46 %
    Federal funds sold         11,932,122       14,624,710       (2,692,588 )   -18.41 %     8,695,149       3,236,973     37.23 %
    Total cash and cash equivalents         60,112,737       58,313,594       1,799,143     3.09 %     45,068,704       15,044,033     33.38 %
                                     
    Interest-bearing time deposits in other banks         100,000       100,000       —     0.00 %     100,000       —     0.00 %
    Securities available for sale, at fair value         6,299,609       7,669,642       (1,370,033 )   -17.86 %     3,879,531       2,420,078     0.00 %
    Securities held to maturity, at cost (net of CECL Reserve)         224,532,603       227,532,821       (3,000,218 )   -1.32 %     244,837,916       (20,305,313 )   -8.29 %
    Federal Home Loan Bank stock, restricted, at cost         1,740,300       1,027,800       712,500     69.32 %     1,727,100       13,200     0.76 %
    Loans, net of unearned income         1,088,132,851       1,081,790,223       6,342,628     0.59 %     1,049,730,890       38,401,961     3.66 %
    Less-allowance for credit losses         (14,179,392 )     (14,109,191 )     (70,201 )   0.50 %     (13,860,420 )     (318,972 )   2.30 %
    Loans, net         1,073,953,459       1,067,681,032       6,272,427     0.59 %     1,035,870,470       38,082,989     3.68 %
                                  –      
    Bank premises and equipment, net         12,912,111       13,051,972       (139,861 )   -1.07 %     13,325,846       (413,735 )   -3.10 %
    ROU assets for operating lease, net         854,808       945,268       (90,460 )   -9.57 %     1,216,601       (361,793 )   -29.74 %
    Goodwill         9,361,704       9,361,704       —     0.00 %     9,361,704       —     0.00 %
    Intangible assets, net         1,422,326       1,508,214       (85,888 )   -5.69 %     1,765,877       (343,551 )   -19.45 %
    Other real estate and foreclosed assets         39,755       43,408       (3,653 )   -8.42 %     3,567,309       (3,527,554 )   -98.89 %
    Accrued interest receivable         6,640,617       6,421,999       218,618     3.40 %     5,585,081       1,055,536     18.90 %
    Cash surrender value of life insurance         15,022,374       14,915,967       106,407     0.71 %     14,613,337       409,037     2.80 %
    Other assets         22,311,520       21,721,225       590,295     2.72 %     25,711,989       (3,400,469 )   -13.23 %
    Total Assets       $ 1,435,303,923     $ 1,430,294,646     $ 5,009,277     0.35 %   $ 1,406,631,465       28,672,458     2.04 %
                                     
                                     
    LIABILITIES AND SHAREHOLDERS’ EQUITY                                
                                     
    Deposits:                                
    Non-interest bearing       $ 320,503,732     $ 298,997,994     $ 21,505,738     7.19 %   $ 316,825,603       3,678,129     1.16 %
    Interest bearing         876,274,737       914,360,430       (38,085,693 )   -4.17 %     862,167,812       14,106,925     1.64 %
              1,196,778,469       1,213,358,424       (16,579,955 )   -1.37 %     1,178,993,415       17,785,054     1.51 %
                                  –      
    Other borrowed funds         34,009,138       18,998,904       15,010,234     79.01 %     42,132,633       (8,123,495 )   -19.28 %
    Lease liability for operating lease         854,808       945,268       (90,460 )   -9.57 %     1,216,601       (361,793 )   -29.74 %
    Accrued interest payable         2,114,956       1,730,280       384,676     22.23 %     979,913       1,135,043     115.83 %
    Accrued expenses and other liabilities         10,938,057       9,038,821       1,899,236     21.01 %     10,056,934       881,123     8.76 %
                                  –      
    Total liabilities         1,244,695,428       1,244,071,697       623,731     0.05 %     1,233,379,496       11,315,932     0.92 %
                                     
    Shareholders’ Equity:                                
    Common stock         10,688,223       10,688,223       —     0.00 %     2,179,210       8,509,013     390.46 %
    Paid in capital surplus         34,867,691       34,729,351       138,340     0.40 %     41,548,417       (6,680,726 )   -16.08 %
    Retained earnings         131,085,914       132,061,494       (975,580 )   -0.74 %     116,705,941       14,379,973     12.32 %
    Current year earnings         15,660,043       10,213,197       5,446,846     53.33 %     13,404,804       2,255,239     16.82 %
    Accumulated other comprehensive income (loss)         1,582,952       1,648,392       (65,440 )   -3.97 %     2,148,509       (565,557 )   -26.32 %
    Treasury Stock, at cost 91,878         (3,276,328 )     (3,117,708 )     (158,620 )   5.09 %     (2,734,912 )     (541,416 )   19.80 %
    Total shareholders’ equity         190,608,495       186,222,949       4,385,546     2.35 %     173,251,969       17,356,526     10.02 %
                                     
    Total Liabilities and Shareholders’ Equity       $ 1,435,303,923     $ 1,430,294,646       5,009,277     0.35 %   $ 1,406,631,465       28,672,458     2.04 %
                                     
    MORRIS STATE BANCSHARES, INC.
    AND SUBSIDIARIES
                                         
    Consolidating Statement of Income
    for the Three Months Ended
                                         
                September 30,   June 30,           September 30,
    		              
                  2024     2024   Change   % Change     2023     Change   % Change
                (Unaudited)   (Unaudited)           (Unaudited)        
    Interest and Dividend Income:                                    
    Interest and fees on loans           $ 18,630,690   $ 17,879,134   $ 751,556     4.20 %   $ 15,803,711     $ 2,826,979     17.89 %
    Interest income on securities             1,825,236     1,837,396     (12,160 )   -0.66 %     2,051,695       (226,459 )   -11.04 %
    Income on federal funds sold             163,624     156,184     7,440     4.76 %     216,377       (52,753 )   -24.38 %
    Income on time deposits held in other banks             338,433     590,205     (251,772 )   -42.66 %     302,545       35,888     11.86 %
    Other interest and dividend income             21,031     64,639     (43,608 )   -67.46 %     43,630       (22,599 )   -51.80 %
    Total interest and dividend income             20,979,014     20,527,558     451,456     2.20 %     18,417,958       2,561,056     13.91 %
                                         
    Interest Expense:                                    
    Deposits             6,671,982     6,568,679     103,303     1.57 %     5,109,712       1,562,270     30.57 %
    Interest on other borrowed funds             309,265     389,629     (80,364 )   -20.63 %     455,105       (145,840 )   -32.05 %
    Interest on federal funds purchased             —     —     —     —       —       —     0.00 %
    Total interest expense             6,981,247     6,958,308     22,939     0.33 %     5,564,817       1,416,430     25.45 %
                                         
    Net interest income before provision for loan losses             13,997,767     13,569,250     428,517     3.16 %     12,853,141       1,144,626     8.91 %
    Less-provision for credit losses             252,021     272,419     (20,398 )   -7.49 %     (33,351 )     285,372     -855.66 %
    Net interest income after provision for credit losses             13,745,746     13,296,831     448,915     3.38 %     12,886,492       859,254     6.67 %
                                         
    Noninterest Income:                                    
    Service charges on deposit accounts             576,751     535,847     40,904     7.63 %     532,598       44,153     8.29 %
    Other service charges, commissions and fees             399,839     397,787     2,052     0.52 %     399,587       252     0.06 %
    Gain on sales of foreclosed assets             —     —     —     0.00 %     —       —     0.00 %
    Gain on sales of premises and equipment             —     141     (141 )   -100.00 %     —       —     0.00 %
    Increase in CSV of life insurance             106,407     102,828     3,579     3.48 %     97,005       9,402     9.69 %
    Other income             23,002     355,155     (332,153 )   -93.52 %     7,681       15,321     199.47 %
    Total noninterest income             1,105,999     1,391,758     (285,759 )   -20.53 %     1,036,871       69,128     6.67 %
                                         
    Noninterest Expense:                                    
    Salaries and employee benefits             4,794,940     4,650,704     144,236     3.10 %     4,374,087       420,853     9.62 %
    Occupancy and equipment expenses, net             592,165     536,330     55,835     10.41 %     599,714       (7,549 )   -1.26 %
    Loss on sales and calls of securities             —     265     (265 )   0.00 %     —       —     0.00 %
    Loss on Sales of premises and equipment             —     —     —     0.00 %     54,269       (54,269.0 )   0.00 %
    Loss on sales of foreclosed assets             2,065     —     2,065     0.00 %     320,110       (318,045 )   0.00 %
    Other expenses             3,752,517     3,860,188     (107,671 )   -2.79 %     3,837,844       (85,327 )   -2.22 %
    Total noninterest expense             9,141,687     9,047,487     94,200     1.04 %     9,186,024       (44,337 )   -0.48 %
                                         
    Income Before Income Taxes             5,710,058     5,641,102     68,956     1.22 %     4,737,339       972,719     20.53 %
    Provision for income taxes             263,212     318,723     (55,511 )   17.42 %     244,258       18,954     7.76 %
                                      –      
    Net Income           $ 5,446,846   $ 5,322,379     124,467     2.34 %   $ 4,493,081       953,765     21.23 %
                                         
                                         
    Earnings per common share:                                    
    Basic           $ 0.51   $ 0.50     0.01     2.43 %   $ 0.42       0.09     21.00 %
    Diluted           $ 0.51   $ 0.50     0.01     2.00 %   $ 0.42       0.09     21.43 %
                                         
    Per share amounts for September 30, 2023 and previous quarters have been adjusted to reflect the April 22, 2024 5-for-1 stock dividend.
                                         
                 Quarter Ending
                     
                September 30, June 30, September 30,
                  2024       2024       2023  
    Dollars in thousand       (Unaudited) (Unaudited) (Unaudited)
                     
    Per Share Data        
    Basic Earnings per Common Share     $ 0.51     $ 0.50     $ 0.42  
    Diluted Earnings per Common Share       0.51       0.50       0.42  
    Dividends per Common Share       0.092       0.092       0.088  
    Book Value per Common Share       17.99       17.56       16.37  
    Tangible Book Value per Common Share     16.97       16.53       15.32  
                     
    Average Diluted Shared Outstanding       10,602,348       10,611,811       10,582,485  
    End of Period Common Shares Outstanding     10,596,345       10,605,080       10,582,494  
                     
                     
    Annualized Performance Ratios (Bank Only)      
    Return on Average Assets         1.65%       1.73%       1.45%  
    Return on Average Equity         12.37%       13.12%       11.37%  
    Equity/Assets           13.23%       13.18%       12.79%  
    Yield on Earning Assets         6.05%       5.96%       5.48%  
    Cost of Funds           2.18%       2.16%       1.69%  
    Net Interest Margin         4.10%       4.02%       3.94%  
    Efficiency Ratio           58.90%       58.36%       62.24%  
                     
    Credit Metrics              
    Allowance for Loan Losses to Total Loans     1.30%       1.30%       1.32%  
    Adversely Classified Assets to Tier 1 Capital        
    plus Allowance for Loan Losses       6.15%       6.04%       7.00%  
                     
    Per share amounts for September 30, 2023 and previous quarters have been adjusted to reflect the April 22, 2024 5-for-1 stock dividend.

    The MIL Network –

  • MIL-OSI: Voters Express Growing Concerns About Deepfake Technology Ahead of 2024 Elections: Global Survey Reveals Rising Fears

    Source: GlobeNewswire (MIL-OSI)

    RESTON, Va., Oct. 23, 2024 (GLOBE NEWSWIRE) — As the 2024 U.S. elections approach, a new survey by Regula, a global leader in identity verification solutions, reveals growing voter concerns about hyper-realistic fake content. Many respondents worry that deepfakes could manipulate public opinion, undermine trust in the media, and jeopardize the integrity of election results.

    Given the evolution of AI-generated content into highly sophisticated tools of deception, voters and institutions feel uncertain about the upcoming wave of fake news.

    Image: Regula’s Deepfake Trends study reveals growing fears as deepfakes threaten to distort our perception of reality

    Key highlights from the new “Deepfake Trends 2024” survey include:

    • 33% of U.S. respondents say the media is most at risk from deepfakes, fearing fake news reports and interviews that could mislead the public.
    • 28% of Americans and 34% of Germans worry that deepfakes could directly manipulate political elections, spreading fabricated content designed to influence voter behavior.
    • In Mexico, a stunning 48% of people believe their media is vulnerable to deepfake corruption, the highest among surveyed nations.
    • The threat isn’t limited to elections—35% of U.S. respondents fear that AI-generated content could disrupt courtrooms with fake evidence, a concern shared by 27% of Germans.
    • Interestingly, for Singapore, which recently passed a law banning digitally manipulated content of candidates during elections, the largest concern about deepfakes lies in Healthcare. 35% of respondents worry that deepfakes could impersonate medical professionals or spread false medical advice, potentially leading to harmful health outcomes.
    • In the United Arab Emirates, the biggest concern (34% of respondents) is the use of deepfakes to create fake social media posts, messages, or videos, which could damage personal reputations and relationships.

    “We’ve reached a tipping point where voters and institutions alike can no longer trust what they see or hear. Deepfakes are becoming so sophisticated that we must equip ourselves with the tools and skills needed to detect and combat this new wave of disinformation. It’s crucial to remember that when overwhelmed by information, we often switch to autopilot, making us more vulnerable to manipulation. That’s why building digital literacy is essential—always question what you see, double-check before sharing, and protect your personal data. Strengthen your online security and stay informed on the latest AI developments—this is how we safeguard ourselves,” says Henry Patishman, Executive VP of Identity Verification Solutions at Regula.

    Find more insights on deepfake fraud and businesses in the survey report. Read the full version on our website.

    *The research was initiated by Regula and conducted by Sapio Research in August 2024 using an online survey of 575 business decision-makers across the Financial Services (including Traditional Banking and FinTech), Crypto, Technology, Telecommunications, Aviation, Healthcare, and Law Enforcement sectors. The respondent geography included Germany, Mexico, the UAE, the US, and Singapore.

    About Regula

    Regula is a global developer of forensic devices and identity verification solutions. With our 30+ years of experience in forensic research and the largest library of document templates in the world, we create breakthrough technologies in document and biometric verification. Our hardware and software solutions allow over 1,000 organizations and 80 border control authorities globally to provide top-notch client service without compromising safety, security or speed. Regula was repeatedly named a Representative Vendor in the Gartner® Market Guide for Identity Verification.

    Learn more at http://www.regulaforensics.com.

    Contact:

    Kristina – ks@regulaforensics.com

    A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/7fcf6b3b-4ff4-404b-b2be-b36d7925a403

    The MIL Network –

  • MIL-OSI China: Xi advocates high quality development of greater BRICS cooperation

    Source: People’s Republic of China – State Council News

    KAZAN, Russia, Oct. 23 — Chinese President Xi Jinping on Wednesday called on BRICS countries to work for high quality development of greater BRICS cooperation.

    In a speech addressing the 16th BRICS Summit, Xi said the ongoing BRICS summit has decided to invite a number of nations to become partner countries. He hailed the decision as another important development in the course of BRICS development.

    Xi called on BRICS members to build the multilateral mechanism into a major venue of solidarity and cooperation for the Global South and a vanguard force for global governance reform.

    He called on the BRICS members to build BRICS for peace and act as guardians of common security, urging the BRICS countries to uphold the three principles of no expansion of the battlefield, no escalation of fighting and no provocation by any party, to work for de-escalation of the Ukraine crisis as soon as possible.

    Xi called on the BRICS members to build BRICS for innovation and act as pioneers for high-quality development.

    He called on BRICS members to build green BRICS and be practitioners of sustainable development, noting that China is willing to leverage its own advantages to expand cooperation with BRICS countries in green industries, clean energy and green minerals.

    Xi also called for building a BRICS for justice and leading the reform of the global governance system, calling on BRICS members to conform to the general trend of the rise of the Global South, and actively respond to the call of countries to join the BRICS cooperation mechanism.

    The group should advance the process of expanding membership and establishing partner countries, and enhance the representation and voice of developing countries in global governance, said Xi.

    Xi said the urgency of reforming the international financial architecture is becoming increasingly prominent in the current situation.

    He also called for strengthening the New Development Bank and urged BRICS countries to take the lead in promoting a better alignment of the international financial system with the changing dynamics of the global economy.

    Xi urged BRICS countries to advocate peaceful coexistence and harmony between civilizations.

    China will establish 10 overseas learning centers in BRICS countries in the next five years to provide training opportunities for 1,000 education administrators, teachers and students, he said.

    MIL OSI China News –

  • MIL-OSI: Blue Foundry Bancorp Reports Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    RUTHERFORD, N.J., Oct. 23, 2024 (GLOBE NEWSWIRE) — Blue Foundry Bancorp (NASDAQ:BLFY) (the “Company”), the holding company for Blue Foundry Bank (the “Bank”), today reported a net loss of $4.0 million, or $0.19 per diluted common share, for the three months ended September 30, 2024, compared to net loss of $2.3 million, or $0.11 per diluted common share, for the three months ended June 30, 2024, and a net loss of $1.4 million, or $0.06 per diluted common share, for the three months ended September 30, 2023.

    James D. Nesci, President and Chief Executive Officer, commented, “The Company continues to maintain its strong capital position and access to liquidity. We executed on our share repurchase program and increased our tangible book value to $14.74 per share.”

    Mr. Nesci also noted, “Deposit growth continued in the third quarter. Increases in our construction and commercial and industrial portfolios drove loan growth during the third quarter as we remain focused on growing our commercial portfolio. Credit quality remained strong highlighted by a 17% improvement in non-performing loans. Our 84 basis point allowance for credit losses now covers non-performing loans by over 2.5 times.”

    Highlights for the third quarter of 2024:

    • Deposits increased $7.5 million to $1.32 billion compared to the prior quarter.
    • Uninsured deposits to third-party customers totaled approximately 12% of total deposits as of September 30, 2024.
    • Interest income for the quarter was $21.5 million, an increase of $240 thousand, or 1.1%, compared to the prior quarter.
    • Interest expense for the quarter was $12.4 million, an increase of $726 thousand, or 6.2%, compared to the prior quarter.
    • Net interest margin decreased 14 basis points from the prior quarter to 1.82%.
    • Provision for credit losses of $248 thousand was primarily due to the increase in unused lines of credit partially offset by releases of provision for loans of $5 thousand and for securities of $11 thousand.
    • Book value per share was $14.76 and tangible book value per share was $14.74. See the “Supplemental Information – Non-GAAP Financial Measures” tables below for additional information regarding our non-GAAP measures.
    • 521,685 shares were repurchased under our share repurchase plans at a weighted average share price of $10.52 per share.

    Loans

    The Company continues to focus on diversifying its lending portfolio by growing its commercial portfolios. While total loans decreased by $9.7 million during the first nine months of 2024, our construction portfolio increased by $19.7 million and our commercial real estate portfolio increased by $9.2 million, of which $7.1 million was on owner-occupied properties. In addition, our consumer and other loans increased by $7.7 million as we took advantage of an opportunity to participate in a consumer loan participation at an attractive rate with credit enhancements. The residential and multifamily portfolios decreased by $34.2 million and $16.3 million, respectively.

    The details of the loan portfolio are below:

        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
        (In thousands)
    Residential   $ 516,754   $ 526,453   $ 540,427   $ 550,929   $ 567,384
    Multifamily     666,304     671,185     671,011     682,564     689,966
    Commercial real estate     241,711     241,867     244,207     232,505     236,325
    Construction     80,081     71,882     63,052     60,414     45,064
    Junior liens     24,174     23,653     22,052     22,503     22,297
    Commercial and industrial     14,228     12,261     13,372     11,768     9,904
    Consumer and other     7,731     83     56     47     50
    Total loans     1,550,983     1,547,384     1,554,177     1,560,730     1,570,990
    Less: Allowance for credit losses     13,012     13,027     13,749     14,154     13,872
    Loans receivable, net   $ 1,537,971   $ 1,534,357   $ 1,540,428   $ 1,546,576   $ 1,557,118
                                   

    Deposits

    As of September 30, 2024, deposits totaled $1.32 billion, an increase of $73.8 million, or 5.93%, from December 31, 2023, mostly due to the increases of $104.6 million in time deposits partially offset by decreases in savings, non-interest bearing deposits and NOW and demand accounts of $21.8 million, $5.5 million and $3.6 million, respectively. The Company’s strategy is to focus on attracting the full banking relationship of small- to medium-sized businesses through an extensive suite of deposit products. While there is strong competition for deposits in the northern New Jersey market, we were able to increase customer deposits during the quarter. Brokered deposits remain unchanged since year end 2023.

    The details of deposits are below:

        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
        (In thousands)
    Non-interest bearing deposits   $ 22,254   $ 24,733   $ 25,342   $ 27,739   $ 23,787
    NOW and demand accounts     357,503     368,386     373,172     361,139     378,268
    Savings     237,651     246,559     250,298     259,402     278,665
    Core deposits     617,408     639,678     648,812     648,280     680,720
    Time deposits     701,262     671,478     642,372     596,624     572,384
    Total deposits   $ 1,318,670   $ 1,311,156   $ 1,291,184   $ 1,244,904   $ 1,253,104
                                   

    Financial Performance Overview:

    Third quarter of 2024 compared to the second quarter of 2024

    Net interest income compared to the second quarter of 2024:

    • Net interest income was $9.1 million for the three months ended September 30, 2024 compared to $9.6 million for the second quarter of 2024 as the increase in interest paid on interest-bearing liabilities outpaced the increase in interest received on interest-earning assets.
    • Net interest margin decreased by 14 basis points to 1.82%.
    • The yield on average interest-earning assets decreased five basis points to 4.32%, while the cost of average interest-bearing liabilities increased nine basis points to 3.03%.
    • Average interest-earning assets increased by $20.9 million and average interest-bearing liabilities increased by $29.3 million.

    Non-interest income compared to the second quarter of 2024:

    • Non-interest income decreased $149 thousand primarily due the absence of the gain of $123 thousand on the sale of REO property, which was recorded in the second quarter.

    Non-interest expense compared to the second quarter of 2024:

    • Non-interest expense increased $52 thousand primarily driven by increases in professional fees, data processing expense and FDIC insurance premiums of $190 thousand, $77 thousand and $42 thousand, respectively, partially offset by decreases of $329 thousand in compensation and benefits expenses and $32 thousand in occupancy and equipment.

    Income tax expense compared to the second quarter of 2024:

    • The Company did not record a tax benefit for the losses incurred during the third quarter of 2024 and the second quarter of 2024 due to the full valuation allowance required on its deferred tax assets.
    • The Company’s current tax position reflects the previously established full valuation allowance on its deferred tax assets. At September 30, 2024, the valuation allowance on deferred tax assets was $22.2 million.

    Third quarter of 2024 compared to the third quarter of 2023

    Net interest income compared to the third quarter of 2023:

    • Net interest income was $9.1 million for the three months ended September 30, 2024 compared to $9.9 million for the same period in 2023. The decrease was largely due to increases in rates paid on interest-bearing liabilities, which outpaced rates received on interest-earning assets.
    • Net interest margin decreased by 12 basis points to 1.82%.
    • The yield on average interest-earning assets increased 35 basis points to 4.32%, while the cost of average interest-bearing liabilities increased 54 basis points to 3.03%.
    • Average interest-earning assets decreased by $32.6 million and average interest-bearing liabilities decreased by $4.1 million. Average FHLB advances decreased by $48.3 million, while average interest-bearing deposits increased by $44.1 million.

    Non-interest expense compared to the third quarter of 2023:

    • Non-interest expense was $13.3 million, an increase of $873 thousand driven by increases of $666 thousand, $167 thousand and $126 thousand in compensation and benefits expenses, professional services and occupancy and equipment expenses, respectively, partially offset by decreases of $61 thousand in data processing and $27 thousand in FDIC insurance premiums.

    Income tax expense compared to the third quarter of 2023:

    • The Company did not record a tax benefit for the losses incurred during the third quarters of 2024 and 2023 due to the full valuation allowance required on its deferred tax assets.
    • The Company’s current tax position reflects the previously established full valuation allowance on its deferred tax assets. At September 30, 2024, the valuation allowance on deferred tax assets was $22.2 million.

    Nine Months Ended September 30, 2024 compared to the nine months ended September 30, 2023

    Net interest income compared to the nine months ended September 30, 2023:

    • Net interest income was $28.1 million, a decrease of $4.6 million.
    • Net interest margin decreased 28 basis points to 1.90%.
    • The yield on average interest-earning assets increased 39 basis points to 4.30% while the cost of average interest-bearing liabilities increased 78 basis points to 2.93%.
    • Average interest-earning assets decreased by $39.1 million and average interest-bearing deposits increased by $37.0 million.
    • Average borrowings decreased by $43.3 million.

    Non-interest income compared to the nine months ended September 30, 2023:

    • Non-interest income increased $141 thousand primarily due to the gain on the sale of REO property during the second quarter of 2024.

    Non-interest expense compared to the nine months ended September 30, 2023:

    • Non-interest expense was $39.7 million, an increase of $705 thousand.
    • Compensation and benefits expense increased by $938 thousand and occupancy and equipment costs increased by $474 thousand. These increases were partially offset by decreases of $475 thousand and $224 thousand for data processing expense and fees for professional services, respectively.

    Income tax expense compared to the nine months ended September 30, 2023:

    • The Company did not record a tax benefit for the losses incurred during the nine months ended September 30, 2024 and 2023 due to the full valuation allowance required on its deferred tax assets.
    • The Company’s current tax position reflects the previously established full valuation allowance on its deferred tax assets. At September 30, 2024, the valuation allowance on deferred tax assets was $22.2 million.

    Balance Sheet Summary:

    September 30, 2024 compared to December 31, 2023

    Cash and cash equivalents:

    • Cash and cash equivalents increased $30.1 million to $76.1 million.

    Securities available-for-sale:

    • Securities available-for-sale increased $7.0 million to $290.8 million due to the decrease in unrealized losses of $7.8 million. The favorable impact of the change in the unrealized loss position was partially offset as maturities, calls and paydowns outpaced purchases during the period.

    Other investments:

    • Other investments decreased $2.1 million due to a decrease in FHLB stock as a result of a reduction in FHLB borrowings.

    Total loans:

    • Total loans held for investment decreased $9.7 million to $1.55 billion.
    • Residential loans and multifamily loans decreased $34.2 million and $16.3 million, respectively, partially offset by increases in construction loans of $19.7 million, commercial real estate loans of $9.2 million and consumer loans of $7.7 million to further diversify our loan portfolio.
    • The Company purchased a consumer loan participation of $8.0 million and residential loans totaling $7.8 million during the third quarter.

    Deposits:

    • Deposits totaled $1.32 billion, an increase of $73.8 million from December 31, 2023. This was largely the result of a $104.6 million increase in certificate of deposits.
    • Core deposits (defined as non-interest bearing checking, NOW and demand accounts and savings accounts) represented 46.8% of total deposits, compared to 52.1% at December 31, 2023.
    • Brokered deposits totaled $125.0 million at both September 30, 2024 and December 31, 2023.
    • Uninsured and uncollateralized deposits to third-party customers were $159.6 million, or 12% of total deposits, at the end of the third quarter.

    Borrowings:

    • FHLB borrowings decreased $49.0 million to $348.5 million as deposit growth outpaced asset growth.
    • As of September 30, 2024, the Company had $255.7 million of additional borrowing capacity at the FHLB and $78.2 million of other unsecured lines of credit.

    Capital:

    • Shareholders’ equity decreased $16.3 million to $339.3 million. The decrease was primarily driven by the repurchase of shares, including net shares, at a cost of $14.4 million. Additionally, the year-to-date loss, partially offset by favorable changes in accumulated other comprehensive income, also contributed to the decrease.
    • Tangible equity to tangible assets was 16.50% and tangible common equity per share outstanding was $14.74. See the “Supplemental Information – Non-GAAP Financial Measures” tables below for additional information regarding our non-GAAP measures.
    • The Bank’s capital ratios remain above the FDIC’s “well capitalized” standards.

    Asset quality:

    • As of September 30, 2024, the allowance for credit losses (“ACL”) on loans as a percentage of gross loans was 0.84%.
    • The Company recorded a provision for credit losses of $248 thousand for the third quarter of 2024 and a net release of provision for credit losses of $1.0 million for the nine months ended September 30, 2024. For the third quarter of 2024, there was a provision of $264 thousand in the ACL for off-balance-sheet commitments, offset by a release of $5 thousand in the ACL for loans and $11 thousand in the ACL for held-to-maturity securities. For the nine months ended September 30, 2024, there was a release of $1.1 million in the ACL for loans and $36 thousand in the ACL for held-to-maturity securities, offset by a provision of $94 thousand in the ACL for off-balance-sheet commitments. The release was driven by the impact of the economic forecasts for the key drivers of our loan segments partially offset by an increase in off-balance-sheet commitments.
    • Non-performing loans totaled $5.1 million, or 0.33% of total loans compared to $5.9 million, or 0.38% of total loans at December 31, 2023.
    • Net charge-offs were $11 thousand and $36 thousand for the three and nine months ended September 30, 2024, respectively.
    • Ratio of allowance for credit losses on loans to non-performing loans was 252.86% at September 30, 2024 compared to 239.98% at December 31, 2023.

    About Blue Foundry

    Blue Foundry Bancorp is the holding company for Blue Foundry Bank, a place where things are made, purpose is formed, and ideas are crafted. Headquartered in Rutherford NJ, with a presence in Bergen, Essex, Hudson, Middlesex, Morris, Passaic, Somerset and Union counties, Blue Foundry Bank is a full-service, innovative bank serving the doers, movers, and shakers in our communities. We offer individuals and businesses alike the tailored products and services they need to build their futures. With a rich history dating back more than 145 years, Blue Foundry Bank has a longstanding commitment to its customers and communities. To learn more about Blue Foundry Bank visit BlueFoundryBank.com or call (888) 931-BLUE. Member FDIC.

    Conference Call Information

    A conference call covering Blue Foundry’s third quarter 2024 earnings announcement will be held today, Wednesday, October 23, 2024 at 11:00 a.m. (EDT). To listen to the live call, please dial 1-833-470-1428 (toll free) or +1-404-975-4839 (international) and use access code 725750. The webcast (audio only) will be available on ir.bluefoundrybank.com. The conference call will be recorded and will be available on the Company’s website for one month.

    Contact:
    James D. Nesci
    President and Chief Executive Officer
    BlueFoundryBank.com
    jnesci@bluefoundrybank.com
    201-972-8900

    Forward Looking Statements

    Certain statements contained herein are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements, which are based on certain current assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of the words “may,” “will,” “should,” “could,” “would,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target” and similar expressions.

    Forward-looking statements are based on current beliefs and expectations of management 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. 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: inflation and changes in the interest rate environment that reduce our margins and yields, the fair value of financial instruments or our level of loan originations, or increase in the level of defaults, losses and prepayments on loans we have made and make; general economic conditions, either nationally or in our market areas, that are worse than expected; changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses; our ability to access cost-effective funding; fluctuations in real estate values and both residential and commercial real estate market conditions; demand for loans and deposits in our market area; our ability to implement and change our business strategies; competition among depository and other financial institutions; adverse changes in the securities or secondary mortgage markets; changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees, capital requirements and insurance premiums; changes in monetary or fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; changes in the quality or composition of our loan or investment portfolios; technological changes that may be more difficult or expensive than expected; a failure or breach of our operational or security systems or infrastructure, including cyber-attacks; the inability of third party providers to perform as expected; our ability to manage market risk, credit risk and operational risk in the current economic environment; our ability to enter new markets successfully and capitalize on growth opportunities; our ability to successfully integrate into our operations any assets, liabilities, customers, systems and management personnel we may acquire and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related there to; changes in consumer 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 or the Public Company Accounting Oversight Board; our ability to retain key employees; the current or anticipated impact of military conflict, terrorism or other geopolitical events; the ability of the U.S. Government to manage federal debt limits; and changes in the financial condition, results of operations or future prospects of issuers of securities that we own.

    Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements. Except as required by applicable law or regulation, we do not undertake, and we specifically disclaim any obligation, to release publicly the results of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.

    BLUE FOUNDRY BANCORP AND SUBSIDIARY
    Consolidated Statements of Financial Condition
                     
        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023
        (unaudited)   (unaudited)   (unaudited)   (audited)
        (Dollars in Thousands)
    ASSETS                
    Cash and cash equivalents   $ 76,109   $ 60,262   $ 53,753   $ 46,025
    Securities available-for-sale, at fair value     290,806     297,790     265,191     283,766
    Securities held to maturity     33,119     33,169     33,217     33,254
    Other investments     18,203     17,942     17,908     20,346
    Loans, net     1,537,971     1,534,357     1,540,428     1,546,576
    Real estate owned, net     —     —     593     593
    Interest and dividends receivable     8,386     7,882     8,001     7,595
    Premises and equipment, net     30,161     30,858     31,696     32,475
    Right-of-use assets     24,190     24,596     24,454     25,172
    Bank owned life insurance     22,399     22,274     22,153     22,034
    Other assets     13,749     16,322     30,393     27,127
    Total assets   $ 2,055,093   $ 2,045,452   $ 2,027,787   $ 2,044,963
                     
    LIABILITIES AND SHAREHOLDERS’ EQUITY            
    Liabilities                
    Deposits   $ 1,318,670   $ 1,311,156   $ 1,291,184   $ 1,244,904
    Advances from the Federal Home Loan Bank     348,500     342,500     342,500     397,500
    Advances by borrowers for taxes and insurance     9,909     9,875     9,368     8,929
    Lease liabilities     25,870     26,243     26,081     26,777
    Other liabilities     12,845     10,081     8,498     11,213
    Total liabilities     1,715,794     1,699,855     1,677,631     1,689,323
    Shareholders’ equity     339,299     345,597     350,156     355,640
    Total liabilities and shareholders’ equity   $ 2,055,093   $ 2,045,452   $ 2,027,787   $ 2,044,963
                             
    BLUE FOUNDRY BANCORP AND SUBSIDIARY
    Consolidated Statements of Operations
    (Dollars in Thousands Except Per Share Data) (Unaudited)
             
        Three months ended   Nine months ended
        September 30,
    2024    		   June 30, 2024   September 30,
    2023    		   September 30,
    2024    		   September 30,
    2023
        (Dollars in thousands)
    Interest income:                    
    Loans   $ 17,646     $ 17,570     $ 16,728     $ 52,408     $ 48,778  
    Taxable investment income     3,850       3,686       3,339       11,150       9,663  
    Non-taxable investment income     36       36       106       108       329  
    Total interest income     21,532       21,292       20,173       63,666       58,770  
    Interest expense:                    
    Deposits     9,712       9,132       7,034       27,257       16,361  
    Borrowed funds     2,733       2,587       3,263       8,332       9,686  
    Total interest expense     12,445       11,719       10,297       35,589       26,047  
    Net interest income     9,087       9,573       9,876       28,077       32,723  
    Provision for (release of) credit losses     248       (762 )     (717 )     (1,049 )     (597 )
    Net interest income after provision for (release of) credit losses     8,839       10,335       10,593       29,126       33,320  
    Non-interest income:                    
    Fees and service charges     272       296       291       897       833  
    Gain on sale of loans     —       —       —       36       159  
    Other income     115       240       78       441       241  
    Total non-interest income     387       536       369       1,374       1,233  
    Non-interest expense:                    
    Compensation and employee benefits     7,306       7,635       6,640       22,490       21,552  
    Occupancy and equipment     2,230       2,262       2,104       6,684       6,210  
    Data processing     1,412       1,335       1,473       4,134       4,609  
    Advertising     87       52       85       211       234  
    Professional services     813       623       646       2,166       2,390  
    Federal deposit insurance     236       194       263       629       599  
    Other     1,183       1,114       1,183       3,410       3,425  
    Total non-interest expense     13,267       13,215       12,394       39,724       39,019  
    Loss before income tax expense     (4,041 )     (2,344 )     (1,432 )     (9,224 )     (4,466 )
    Income tax expense     —       —       —       —       —  
    Net loss   $ (4,041 )   $ (2,344 )   $ (1,432 )   $ (9,224 )   $ (4,466 )
    Basic loss per share   $ (0.19 )   $ (0.11 )   $ (0.06 )   $ (0.43 )   $ (0.18 )
    Diluted loss per share   $ (0.19 )   $ (0.11 )   $ (0.06 )   $ (0.43 )   $ (0.18 )
    Weighted average shares outstanding                    
    Basic     21,263,482       21,735,002       23,278,490       21,695,895       24,289,599  
    Diluted (1)     21,263,482       21,735,002       23,278,490       21,695,895       24,289,599  

    (1) The assumed vesting of outstanding restricted stock units had an antidilutive effect on diluted earnings per share due to the Company’s net loss for the 2024 and 2023 periods.

    BLUE FOUNDRY BANCORP AND SUBSIDIARY
    Consolidated Financial Highlights
    (Dollars in Thousands Except Per Share Data) (Unaudited)
         
        Three months ended
        September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
        (Dollars in thousands)
    Performance Ratios (%):                    
    Return on average assets     (0.79 )     (0.47 )     (0.56 )     (0.57 )     (0.27 )
    Return on average equity     (4.68 )     (2.71 )     (3.23 )     (3.25 )     (1.55 )
    Interest rate spread (1)     1.29       1.43       1.40       1.33       1.48  
    Net interest margin (2)     1.82       1.96       1.92       1.84       1.94  
    Efficiency ratio (3) (4)     140.04       130.73       134.19       128.41       120.98  
    Average interest-earning assets to average interest-bearing liabilities     121.37       122.28       122.50       122.93       123.05  
    Tangible equity to tangible assets (4)     16.50       16.88       17.25       17.37       17.07  
    Book value per share (5)   $ 14.76     $ 14.70     $ 14.61     $ 14.51     $ 14.27  
    Tangible book value per share (4)(5)   $ 14.74     $ 14.69     $ 14.60     $ 14.49     $ 14.24  
                         
    Asset Quality:                    
    Non-performing loans   $ 5,146     $ 6,208     $ 6,691     $ 5,898     $ 6,139  
    Real estate owned, net     —       —       593       593       593  
    Non-performing assets   $ 5,146     $ 6,208     $ 7,284     $ 6,491     $ 6,732  
    Allowance for credit losses to total loans (%)     0.84       0.84       0.88       0.91       0.88  
    Allowance for credit losses to non-performing loans (%)     252.86       209.84       205.48       239.98       225.97  
    Non-performing loans to total loans (%)     0.33       0.40       0.43       0.38       0.39  
    Non-performing assets to total assets (%)     0.25       0.30       0.36       0.32       0.33  
    Net charge-offs to average outstanding loans during the period (%)     —       —       —       —       0.01  

    (1) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
    (2) Net interest margin represents net interest income divided by average interest-earning assets.
    (3) Efficiency ratio represents adjusted non-interest expense divided by the sum of net interest income plus non-interest income.
    (4) See the “Supplemental Information – Non-GAAP Financial Measures” tables below for additional information regarding our non-GAAP measures.
    (5) September 30, 2024 per share metrics computed using 22,990,908 total shares outstanding.

    BLUE FOUNDRY BANCORP AND SUBSIDIARY
    Analysis of Net Interest Income
    (Dollars in Thousands) (Unaudited)
         
        Three Months Ended,
        September 30, 2024   June 30, 2024   September 30, 2023
        Average
    Balance    		   Interest   Average
    Yield/Cost    		   Average
    Balance    		   Interest   Average
    Yield/Cost    		   Average
    Balance    		   Interest   Average
    Yield/Cost
        (Dollars in thousands)
    Assets:                                    
    Loans (1)   $ 1,548,962   $ 17,646   4.53 %   $ 1,550,736   $ 17,570   4.56 %   $ 1,577,173   $ 16,728   4.21 %
    Mortgage-backed securities     181,596     1,186   2.60 %     167,219     960   2.31 %     170,326     840   1.96 %
    Other investment securities     173,008     1,527   3.51 %     175,394     1,688   3.87 %     194,953     1,507   3.07 %
    FHLB stock     17,666     406   9.15 %     17,223     447   10.44 %     21,047     456   8.60 %
    Cash and cash equivalents     61,507     767   4.96 %     51,290     627   4.92 %     51,884     642   4.91 %
    Total interest-earning assets     1,982,739     21,532   4.32 %     1,961,862     21,292   4.37 %     2,015,383     20,173   3.97 %
    Non-interest earning assets     61,787             56,826             58,042        
    Total assets   $ 2,044,526           $ 2,018,688           $ 2,073,425        
    Liabilities and shareholders’ equity:                                    
    NOW, savings, and money market deposits   $ 598,048     1,925   1.28 %   $ 611,931     1,955   1.28 %   $ 684,228     2,123   1.23 %
    Time deposits     688,570     7,787   4.50 %     655,755     7,177   4.40 %     558,252     4,911   3.49 %
    Interest-bearing deposits     1,286,618     9,712   3.00 %     1,267,686     9,132   2.90 %     1,242,480     7,034   2.25 %
    FHLB advances     347,076     2,733   3.13 %     336,742     2,587   3.09 %     395,359     3,263   3.27 %
    Total interest-bearing liabilities     1,633,694     12,445   3.03 %     1,604,428     11,719   2.94 %     1,637,839     10,297   2.49 %
    Non-interest bearing deposits     23,421             25,076             25,540        
    Non-interest bearing other     43,713             41,061             44,628        
    Total liabilities     1,700,828             1,670,565             1,708,007        
    Total shareholders’ equity     343,698             348,123             365,418        
    Total liabilities and shareholders’ equity   $ 2,044,526           $ 2,018,688           $ 2,073,425        
    Net interest income       $ 9,087           $ 9,573           $ 9,876    
    Net interest rate spread (2)           1.29 %           1.43 %           1.48 %
    Net interest margin (3)           1.82 %           1.96 %           1.94 %

    (1) Average loan balances are net of deferred loan fees and costs, premiums and discounts and include non-accrual loans.
    (2) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
    (3) Net interest margin represents net interest income divided by average interest-earning assets.

    BLUE FOUNDRY BANCORP AND SUBSIDIARY
    Analysis of Net Interest Income
    (Dollars in Thousands) (Unaudited)
         
        Nine Months Ended September 30,
        2024   2023
        Average
    Balance    		   Interest   Average
    Yield/Cost    		   Average
    Balance    		   Interest   Average
    Yield/Cost
        (Dollars in thousands)
    Assets:                        
    Loans (1)   $ 1,551,734   $ 52,408   4.50 %   $ 1,571,204   $ 48,778   4.15 %
    Mortgage-backed securities     169,765     3,022   2.37 %     174,742     2,789   2.13 %
    Other investment securities     177,455     4,867   3.65 %     197,522     4,523   3.06 %
    FHLB stock     18,335     1,345   9.77 %     21,343     1,106   6.93 %
    Cash and cash equivalents     54,810     2,024   4.92 %     46,363     1,574   4.54 %
    Total interest-earning assets     1,972,099     63,666   4.30 %     2,011,174     58,770   3.91 %
    Non-interest earning assets     59,245             56,762        
    Total assets   $ 2,031,344           $ 2,067,936        
    Liabilities and shareholders’ equity:                        
    NOW, savings, and money market deposits   $ 608,677   $ 5,816   1.27 %   $ 753,419   $ 6,350   1.13 %
    Time deposits     654,639     21,441   4.36 %     472,866     10,011   2.83 %
    Interest-bearing deposits     1,263,316     27,257   2.87 %     1,226,285     16,361   1.78 %
    FHLB advances     352,544     8,332   3.15 %     395,800     9,686   3.27 %
    Total interest-bearing liabilities     1,615,860     35,589   2.93 %     1,622,085     26,047   2.15 %
    Non-interest bearing deposits     24,992             23,092        
    Non-interest bearing other     42,120             44,572        
    Total liabilities     1,682,972             1,689,749        
    Total shareholders’ equity     348,372             378,187        
    Total liabilities and shareholders’ equity   $ 2,031,344           $ 2,067,936        
    Net interest income       $ 28,077           $ 32,723    
    Net interest rate spread (2)           1.37 %           1.76 %
    Net interest margin (3)           1.90 %           2.18 %

    (1) Average loan balances are net of deferred loan fees and costs, premiums and discounts and include non-accrual loans.
    (2) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
    (3) Net interest margin represents net interest income divided by average interest-earning assets.

    BLUE FOUNDRY BANCORP AND SUBSIDIARY
    Supplemental Information – Non-GAAP Financial Measures
    (Unaudited)

    This press release contains certain supplemental financial information, described in the table below, which has been determined by methods other than U.S. Generally Accepted Accounting Principles (“GAAP”) that management uses in its analysis of Blue Foundry’s performance. Management believes these non-GAAP financial measures provide information useful to investors in understanding Blue Foundry’s financial results. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and Blue Foundry strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.

    Net income, as presented in the Consolidated Statements of Operations, includes the provision for credit losses and income tax expense, while pre-provision net revenue does not.

        Three months ended
        September 30,
    2024    		   June 30, 2024   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
        (Dollars in thousands, except per share data)
    Pre-provision net revenue and efficiency ratio:                
    Net interest income   $ 9,087     $ 9,573     $ 9,417     $ 9,196     $ 9,876  
    Other income     387       536       451       572       369  
    Total revenue     9,474       10,109       9,868       9,768       10,245  
    Operating expenses     13,267       13,215       13,242       12,543       12,394  
    Pre-provision net loss   $ (3,793 )   $ (3,106 )   $ (3,374 )   $ (2,775 )   $ (2,149 )
    Efficiency ratio     140.0 %     130.7 %     134.2 %     128.4 %     121.0 %
                         
    Core deposits:                    
    Total deposits   $ 1,318,670     $ 1,311,156     $ 1,291,184     $ 1,244,904     $ 1,253,104  
    Less: time deposits     701,262       671,478       642,372       596,624       572,384  
    Core deposits   $ 617,408     $ 639,678     $ 648,812     $ 648,280     $ 680,720  
    Core deposits to total deposits     46.8 %     48.8 %     50.2 %     52.1 %     54.3 %
                         
    Total assets   $ 2,055,093     $ 2,045,452     $ 2,027,787     $ 2,044,963     $ 2,101,055  
    Less: intangible assets     300       386       473       557       644  
    Tangible assets   $ 2,054,793     $ 2,045,066     $ 2,027,314     $ 2,044,406     $ 2,100,411  
                         
    Tangible equity:                    
    Shareholders’ equity   $ 339,299     $ 345,597     $ 350,156     $ 355,640     $ 359,149  
    Less: intangible assets     300       386       473       557       644  
    Tangible equity   $ 338,999     $ 345,211     $ 349,683     $ 355,083     $ 358,505  
                         
    Tangible equity to tangible assets     16.50 %     16.88 %     17.25 %     17.37 %     17.07 %
                         
    Tangible book value per share:                    
    Tangible equity   $ 338,999     $ 345,211     $ 349,683     $ 355,083     $ 358,505  
    Shares outstanding     22,990,908       23,505,357       23,958,888       24,509,950       25,174,412  
    Tangible book value per share   $ 14.74     $ 14.69     $ 14.60     $ 14.49       14.24  

    The MIL Network –

  • MIL-OSI Russia: Moscow Metro Celebrates 3 Years of Biometric Payment and Sets New Cashless Payment Record

    Source: Moscow Metro

    Moscow’s Metro system is celebrating a milestone: three years of successful biometric payment

    Maksim Liksutov, the Deputy Mayor of Moscow for Transport and Industry, highlighted the convenience of this payment method, now available at turnstiles across:

    • Metro and Moscow Central Circle (MCC)

    • Aeroexpress

    • Regular river transport

    • Several Moscow Central Diameter (MCD) stations

    Here are some impressive figures:

    • Over 1,100 turnstiles equipped with biometric payment

    • Over 160,000 daily passes made using biometrics

    • Around 375,000 users registered for the service

    In 2021, we launched biometric payment in the metro. Passengers no longer need cards, phones, or wallets to pass through turnstiles. They simply look into the camera, and the gate opens. Users have already made over 125 million passes. Nowhere else in the world is this service as convenient as in the Russian capital. In these 3 years, it has proven itself to be maximally secure and reliable, – said Liksutov.

    Moscow Metro also sets a new record:

    Moscow’s Metro system has reached a new milestone: a record-breaking 91.2% of passengers are now using cashless payment methods. This is the highest rate since the launch of these services and this is a clear sign of a shift towards a more convenient and efficient transportation experience for our citizens. By implementing digital solutions, we’ve made user-friendly, fast, and environmentally friendly payment tools readily available, – added Maksim Liksutov.

    The most popular cashless payment methods include:

    • Biometric payment

    • Virtual Troika card

    • Fast Payment System (FPS)

    • Bank cards and payment stickers

    Moscow is becoming a global leader in the number of payment methods available for public transportation. Following the directives of Moscow Mayor Sergey Sobyanin, we will continue to develop modern, domestic services within our city’s transportation system, – concluded Liksutov.

    This achievement highlights Moscow’s commitment to modernizing its infrastructure and embracing innovative technologies to improve the lives of its citizens.

    MIL OSI Russia News –