Elmira Savings Bank : Reports 2013 Earnings

Elmira Savings Bank Reports 2013 Earnings 

Wednesday, January 22, 2014

Elmira, New York, January 22, 2014 --- Elmira Savings Bank

(NASDAQ:ESBK)

Highlights

• Net income was $5,054,000 for the twelve months ended December 31, 2013 compared to $5,213,000 for the same period in 2012.  Income available to common shareholders after dividends on preferred stock increased 6.5% to $3,839,000 for the twelve months ended December 31, 2013 compared to $3,604,000 for the same period in 2012.
• Diluted earnings per share was $1.40 per share for the twelve months ended December 31, 2013 compared to $1.37 per share for the same period in 2012.  This represents an increase of 2.2% for the twelve months ended December 31, 2013 compared to the same period in 2012.
• Return on average assets was .97% for the twelve months ended December 31, 2013 compared to .99% for the same period in 2012.
• Return on average equity was 8.51% for the twelve months ended December 31, 2013 compared to 7.92% for the same period in 2012.

"We are pleased to report a third consecutive year of net income in excess of $5 million.  In addition to strong earnings of $5.1 million, the retirement of the SBLF preferred shares allowed us to increase our earnings per common share by 2%, despite slightly lower net income," said Thomas M. Carr, President and COO.  Carr continued, "In January 2013, we expanded our branch network in Steuben County by opening a full branch in Erwin, NY.  We also expanded our mortgage operations into Broome County in September with the opening of a loan production office in Vestal, NY.  Finally, our shareholders were rewarded during the year with $.84 of cash dividends, a 10% stock dividend, and a year ending share price of $25.20 per share." 

Net Income

Net income totaled $5,054,000 for the twelve months ended December 31, 2013, a decrease of $159,000 or 3% from the $5,213,000 of net income recorded for the same period in 2012.  This decrease was the net result of a decline in net interest income of $36,000, a decrease in noninterest income of $493,000, and an increase in noninterest expense of $918,000, offset by a reduction in tax expense of $1,140,000 and a reduction in the provision for loan losses of $148,000.

Net income totaled $1,119,000 for the three months ended December 31, 2013, a decrease of $180,000 or 14% from the $1,299,000 recorded for the same period in 2012.  This decrease was the net result of a decline in noninterest income of $350,000 and an increase of $272,000 in noninterest expense, offset by an increase in net interest income of $33,000, a reduction in tax expense of $367,000, and a reduction in the provision for loan losses of $42,000.

Basic and diluted earnings per share for the twelve months ended December 31, 2013 were $1.47 per share and $1.40 per share compared to $1.44 per share and $1.37 per share for the same period in 2012.  Basic and diluted earnings per share for the three months ended December 31, 2013 were $.32 per share and $.30 per share compared to $.35 per share and $.33 per share for the same period in 2012.

Net Interest Margin

The net interest margin for the twelve months ended December 31, 2013 was 3.25% compared to 3.34% for the same period in 2012.  The yield on average earning assets was 4.37% for the twelve months ended December 31, 2013 compared to 4.64% for the same period in 2012.  The average cost of interest-bearing liabilities was 1.31% for the twelve months ended December 31, 2013 compared to 1.47% for the same period in 2012.

The net interest margin for the three months ended December 31, 2013 was 3.22% compared to 3.25% for the same period in 2012.  The average yield on earning assets was 4.31% for the three months ended December 31, 2013 compared to 4.45% for the same period in 2012.  The average cost of interest-bearing liabilities was 1.28% for the three months ended December 31, 2013 compared to 1.37% for the same period in 2012.

Assets

Total assets decreased $22.6 million or 4% to $514.3 million at December 31, 2013 compared to $536.9 million at December 31, 2012.  Loans receivable increased 3% to $389.1 million at December 31, 2013 compared to December 31, 2012.  The available-for-sale investment portfolio decreased $3.4 million from December 31, 2012 to December 31, 2013.

Nonperforming Loans

Our nonperforming loans to total loans ratio has decreased to .90% at December 31, 2013 from 1.02% at December 31, 2012.  Net loan charge-offs to average loans for the twelve months ended December 31, 2013 were 0.06% compared to 0.01% for the twelve month period ended December 31, 2012.  The allowance for loan losses was 0.99% of total loans at December 31, 2013 and December 31, 2012.

Liabilities

Deposits totaled $397.7 million at December 31, 2013, a decrease of $11.8 million or 3%.  The $11.8 million decrease consists of a $14.8 million decrease in time deposits and a $1.5 million decrease in transaction accounts, partially offset by a $1.9 million increase in savings accounts, a $1.6 million increase in NOW accounts, and a $1.0 million increase in money market accounts.  Borrowed funds increased by $2.5 million or 5%.

Shareholders' Equity

Shareholders' equity decreased $12.9 million to $54.0 million at December 31, 2013 compared to December 31, 2012. The decrease in shareholders' equity is attributable to the Bank redeeming $14.1 million of preferred stock issued to the United States Treasury Department through the Small Business Lending Fund.  The current level of shareholders' equity equates to a book value per share of $16.64 at December 31, 2013, compared to $16.76 at December 31, 2012.  Dividends paid to common shareholders were $0.21 and $0.84 for the three and twelve months ended December 31, 2013 compared to $0.20 and $0.77 for the same periods in 2012, representing increases of 5% for the three month period and 9% for the twelve month period.

Elmira Savings Bank, with $514.3 million in total assets, is insured by the Federal Deposit Insurance Corporation (FDIC) and is a state-chartered bank with six offices in Chemung County, NY; three offices and a loan center in Tompkins County, NY; two offices in Steuben County, NY; one office in Cayuga County, NY; one office in Schuyler County; a loan center in Cortland County, NY; and a loan center in Broome County, NY.

Except for the historical information contained herein, the matters discussed in this news release are forward looking statements that involve the risks and uncertainties, including the timely availability and acceptance of Bank products, the impact of competitive products and pricing, the management of growth, and other risks detailed from time to time in the Bank's regulatory reports.

For further information contact:
Thomas M. Carr, President & COO
Elmira Savings Bank
333 East Water Street
Elmira, New York  14901
[phone]
[e-mail]