Figure 1
Dollars in thousands except per share amounts. Certain items in the prior period financial statements have been reclassified to conform with the June 30, 2023 presentation.
FENTON, Mich., July 28, 2023 (GLOBE NEWSWIRE) -- Fentura Financial, Inc. (OTCQX: FETM) announces quarterly net income results of $3,226 and $7,070 for the three and six months ended June 30, 2023.
Ronald L. Justice, President and CEO, stated, “I am proud of our strong second quarter and year-to-date performance, as we successfully navigate a challenging banking environment. This is a direct result of our Bank’s focus on supporting our customers, maintaining solid asset quality, and controlling expenses. While we were able to settle the proxy contest prior to the annual meeting, we incurred $523 in legal and professional fees in the process. Excluding the costs associated with the proxy contest and other non-recurring items, adjusted net income from operations for the quarter was $3,604 as compared to $3,483 for the quarter ended June 30, 2022. Throughout these challenging times, we remain committed to providing long-term shareholder value.”
Mr. Justice continued, “We continue to focus on strengthening our balance sheet by taking a measured approach to loan growth, while maintaining strong asset quality. Gross loans increased 19.4% year-over-year to a record $1.47 billion at June 30, 2023. Our asset quality remains excellent with historically low levels of net charge-offs and nonperforming loans to gross loans of just 0.16%, reflecting our stringent underwriting standards and stable economic trends across our local Michigan markets. In addition, our non-owner occupied commercial office exposure was only 4.22% of gross loans at June 30, 2023 with limited exposure in suburban markets. Overall, our performance throughout the first half of 2023 is encouraging and we continue to believe 2023 will be another good year for Fentura Financial.”
Following is a discussion of our financial performance as of, and for the three and six months ended June 30, 2023. At the end of this document is a list of abbreviations and acronyms.
Results of Operations (unaudited)
The following table outlines our QTD results of operations and provides certain performance measures as of, and for the three months ended:
| 6/30/2023 | 3/31/2023 | 12/31/2022 | 9/30/2022 | 6/30/2022 | ||||||||||||||||
| INCOME STATEMENT DATA | ||||||||||||||||||||
| Interest income | $ | 19,553 | $ | 18,679 | $ | 17,782 | $ | 15,726 | $ | 13,411 | ||||||||||
| Interest expense | 6,469 | 5,335 | 3,645 | 1,738 | 785 | |||||||||||||||
| Net interest income | 13,084 | 13,344 | 14,137 | 13,988 | 12,626 | |||||||||||||||
| Provision for loan losses | 205 | 236 | 847 | 1,231 | 525 | |||||||||||||||
| Noninterest income | 2,460 | 2,328 | 1,949 | 2,395 | 2,794 | |||||||||||||||
| Noninterest expenses | 11,320 | 10,633 | 9,781 | 10,143 | 10,560 | |||||||||||||||
| Federal income tax expense | 793 | 959 | 1,094 | 1,000 | 859 | |||||||||||||||
| Net income | $ | 3,226 | $ | 3,844 | $ | 4,364 | $ | 4,009 | $ | 3,476 | ||||||||||
| PER SHARE | ||||||||||||||||||||
| Earnings | $ | 0.73 | $ | 0.87 | $ | 0.99 | $ | 0.91 | $ | 0.79 | ||||||||||
| Dividends | $ | 0.10 | $ | 0.10 | $ | 0.09 | $ | 0.09 | $ | 0.09 | ||||||||||
| Tangible book value(1) | $ | 27.16 | $ | 26.64 | $ | 26.22 | $ | 25.22 | $ | 24.53 | ||||||||||
| Quoted market value | ||||||||||||||||||||
| High | $ | 21.21 | $ | 24.10 | $ | 23.40 | $ | 25.20 | $ | 27.85 | ||||||||||
| Low | $ | 18.70 | $ | 21.10 | $ | 21.60 | $ | 23.00 | $ | 24.40 | ||||||||||
| Close(1) | $ | 19.35 | $ | 21.31 | $ | 22.20 | $ | 23.00 | $ | 25.00 | ||||||||||
| PERFORMANCE RATIOS | ||||||||||||||||||||
| Return on average assets | 0.76 | % | 0.92 | % | 1.06 | % | 1.02 | % | 0.96 | % | ||||||||||
| Return on average shareholders' equity | 9.89 | % | 12.32 | % | 14.01 | % | 12.96 | % | 11.55 | % | ||||||||||
| Return on average tangible shareholders' equity | 10.67 | % | 13.34 | % | 15.21 | % | 14.10 | % | 12.60 | % | ||||||||||
| Efficiency ratio | 72.83 | % | 67.85 | % | 60.80 | % | 61.91 | % | 68.48 | % | ||||||||||
| Yield on earning assets (FTE) | 4.85 | % | 4.75 | % | 4.57 | % | 4.27 | % | 3.96 | % | ||||||||||
| Rate on interest bearing liabilities | 2.35 | % | 2.02 | % | 1.42 | % | 0.75 | % | 0.38 | % | ||||||||||
| Net interest margin to earning assets (FTE) | 3.25 | % | 3.40 | % | 3.63 | % | 3.79 | % | 3.73 | % | ||||||||||
| BALANCE SHEET DATA(1) | ||||||||||||||||||||
| Total investment securities | $ | 117,563 | $ | 122,995 | $ | 125,049 | $ | 129,886 | $ | 136,725 | ||||||||||
| Gross loans | $ | 1,472,288 | $ | 1,457,173 | $ | 1,436,166 | $ | 1,350,851 | $ | 1,232,892 | ||||||||||
| Allowance for credit losses | $ | 15,400 | $ | 15,220 | $ | 13,000 | $ | 12,200 | $ | 11,000 | ||||||||||
| Total assets | $ | 1,718,819 | $ | 1,749,073 | $ | 1,688,863 | $ | 1,588,592 | $ | 1,471,454 | ||||||||||
| Total deposits | $ | 1,380,192 | $ | 1,353,918 | $ | 1,332,883 | $ | 1,345,209 | $ | 1,231,543 | ||||||||||
| Borrowed funds | $ | 200,550 | $ | 259,050 | $ | 222,350 | $ | 116,600 | $ | 111,000 | ||||||||||
| Total shareholders' equity | $ | 130,690 | $ | 128,247 | $ | 126,087 | $ | 121,630 | $ | 118,566 | ||||||||||
| Net loans to total deposits | 105.56 | % | 106.50 | % | 106.77 | % | 99.51 | % | 99.22 | % | ||||||||||
| Common shares outstanding | 4,460,053 | 4,453,951 | 4,439,725 | 4,434,937 | 4,429,357 | |||||||||||||||
| QTD BALANCE SHEET AVERAGES | ||||||||||||||||||||
| Total assets | $ | 1,706,147 | $ | 1,687,175 | $ | 1,637,191 | $ | 1,558,040 | $ | 1,449,874 | ||||||||||
| Earning assets | $ | 1,617,593 | $ | 1,595,605 | $ | 1,544,880 | $ | 1,464,233 | $ | 1,360,658 | ||||||||||
| Interest bearing liabilities | $ | 1,105,807 | $ | 1,072,417 | $ | 1,016,876 | $ | 917,888 | $ | 826,708 | ||||||||||
| Total shareholders' equity | $ | 130,860 | $ | 126,495 | $ | 123,567 | $ | 122,695 | $ | 120,659 | ||||||||||
| Total tangible shareholders' equity | $ | 121,274 | $ | 116,834 | $ | 113,810 | $ | 112,829 | $ | 110,686 | ||||||||||
| Earned common shares outstanding | 4,427,890 | 4,421,584 | 4,413,710 | 4,408,399 | 4,417,447 | |||||||||||||||
| Unvested stock grants | ||||||||||||||||||||
