On October 26, 2023, Lakeland Bancorp Inc (LBAI, Financial) reported its earnings for the third quarter of 2023. The company reported a net income of $22.2 million and earnings per diluted share ("EPS") of $0.34 for the three months ended September 30, 2023. This is compared to a net income of $28.7 million and diluted EPS of $0.44 for the same period in 2022.
Financial Performance
The company's annualized return on average assets was 0.81%, annualized return on average common equity was 7.76%, and annualized return on average tangible common equity was 10.29%. Lakeland Bancorp's President and CEO, Thomas Shara, commented on the quarterly financial results,
We are pleased with our continued steady growth during the quarter as we surpassed $11 billion in assets. Loan growth continued to be solid with 2% growth for the quarter and 5% growth year-to-date."
Loan Growth and Asset Quality
Loan growth for the third quarter was $192.8 million, or 2.4%, compared to the linked second quarter of 2023. This was attributable to expansion across all loan portfolios excluding construction loans. The company's asset quality remains strong with nonperforming loans to total loans dropping to 16 basis points.
Net Interest Margin and Net Interest Income
Net interest margin for the third quarter of 2023 decreased 15 basis points to 2.68% from 2.83% in the prior quarter and decreased 60 basis points from 3.28% in the third quarter of 2022. Net interest income for the third quarter of 2023 of $68.9 million decreased $11.4 million compared to the third quarter of 2022.
Noninterest Income and Expense
For the third quarter of 2023, noninterest income totaled $5.4 million, a decrease of $1.8 million as compared to the third quarter of 2022. Noninterest expense for the third quarter of 2023 of $44.4 million decreased $3.4 million compared to the third quarter of 2022.
Financial Condition
As of September 30, 2023, total assets were $11.18 billion, an increase of $393.0 million, compared to December 31, 2022. Total loans increased $428.0 million to $8.29 billion while investment securities decreased $176.4 million to $1.86 billion from December 31, 2022. Total deposits increased $35.0 million from December 31, 2022, to $8.60 billion at September 30, 2023.
Asset Quality
At September 30, 2023, non-performing assets totaled $13.4 million or 0.12% of total assets compared to $18.4 million, or 0.17% of total assets at September 30, 2022. The allowance for credit losses on loans totaled $75.2 million, 0.91% of total loans, at September 30, 2023, compared to $68.9 million, 0.91% of total loans, at September 30, 2022.
Capital
At September 30, 2023, stockholders' equity was $1.14 billion compared to $1.11 billion at December 31, 2022, a 2% increase, resulting primarily from net income, partially offset by the payment of dividends. Lakeland Bank remains above FDIC “well capitalized” standards, with a Tier 1 leverage ratio of 9.24% at September 30, 2023.
Explore the complete 8-K earnings release (here) from Lakeland Bancorp Inc for further details.
