Auburn National Bancorporation, Inc. (Nasdaq: AUBN) reported net
earnings of $1.7 million, or $0.50 per share, for the second
quarter of 2024, compared to $1.4 million, or $0.39 per share, for
the first quarter of 2024 and $1.9 million, or $0.55 per share, for
the second quarter of 2023. Net earnings were $3.1 million, or
$0.89 per share, for the first six months of 2024, compared to $3.9
million, or $1.11 per share, for the first six months of 2023.
“The Company’s second quarter results reflect
solid loan growth, a stable and improved net interest margin,
decreased expenses and continued strength in our credit quality,
liquidity, and capital,” said David A. Hedges, President and CEO.
“While we expect the interest rate environment will remain
challenging in the second half of 2024, we are encouraged by the
economic strength of our local markets and continue to see
opportunities for loan growth,” continued Mr. Hedges.
Net interest income (tax-equivalent) was $6.7 million for each
of the second and first quarters of 2024. Compared to the second
quarter of 2023, net interest income (tax-equivalent) decreased
$0.3 million or 4%.
Net interest margin (tax-equivalent) was 3.06% in the second
quarter of 2024, compared to 3.04% in the first quarter of 2024,
and 3.03% in the second quarter of 2023. The increase was primarily
due to loan growth, a more favorable asset mix, and improvements in
our yield on interest-earning assets, which outpaced increases in
the cost of our interest-bearing deposits. Average loans for the
second quarter of 2024 were $573.4 million, a 2% increase from the
first quarter of 2024 and a 12% increase from the second quarter of
2023.
Nonperforming assets were $0.8 million, or 0.08% of total
assets, at June 30, 2024, compared to $0.9 million, or 0.09% of
total assets, at March 31, 2024, and $1.1 million, or 0.11% of
total assets, at June 30, 2023. The decrease from June 30, 2023 was
primarily due to the resolution of one nonperforming loan, which
was paid in full.
The Company recorded a negative provision for credit losses of
$0.1 million in the second quarter of 2024, compared to a provision
for credit losses of $0.3 million in the first quarter of 2024, and
a negative provision for credit losses of $0.4 million in the
second quarter of 2023.
At June 30, 2024, the Company’s allowance for credit losses was
$7.1 million, or 1.24% of total loans, compared to $7.2 million, or
1.27% of total loans, at March 31, 2024, and $6.6 million, or 1.27%
of total loans, at June 30, 2023.Noninterest income was $0.9
million for each of the second and first quarters of 2024, and $0.8
million for the second quarter of 2023.
Noninterest expense was $5.5 million for the first quarter of
2024, a decrease of $0.2 million compared to the first quarter of
2024. The decrease was primarily related to a decrease in net
occupancy and equipment expense. Compared to the second quarter of
2023, noninterest expense decreased $0.3 million, or 5%. The
decrease was primarily related to decreases in net occupancy and
equipment expense and other noninterest expense, partially offset
by an increase in salaries and benefits.
Total assets were $1.0 billion at June 30, 2024, compared to
$979.0 million at March 31, 2024, and $1.0 billion at June 30,
2023. Loans, net of unearned income were $578.1 million at June 30,
2024, compared to $567.5 million at March 31, 2024 and $520.4
million at June 30, 2023. The increase in loans reflects growth
across all major loan categories. Total deposits were $946.4
million at June 30, 2024, compared to $899.7 million at March 31,
2024, and $950.7 million at June 30, 2023. The increase in deposits
compared to March 31, 2024 was primarily related to a decrease in
reciprocal customer deposits in the one-way sell program through
the Intrafi network. At June 30, 2024 the Company had no reciprocal
deposits sold, compared to $48.9 million sold at March 31, 2024,
and none at June 30, 2023. Except for $16.0 million in brokered
deposits outstanding one year ago at June 30, 2023, the Company had
no FHLB advances or other wholesale funding outstanding at June 30,
2024, March 31, 2024, or June 30, 2023.
At June 30, 2024, the Company's consolidated stockholders'
equity (book value) was $75.2 million or $21.53 per share, compared
to $74.5 million, or $21.32 per share, at March 31, 2024, and $71.0
million, or $20.28 per share, at June 30, 2023. The increase from
March 31, 2024 was primarily driven by net earnings of $1.7
million, partially offset by cash dividends paid of $0.9 million,
and an other comprehensive loss of $0.1 million due to an increase
in unrealized losses on securities available-for-sale, net of tax.
Unrealized losses do not affect the Bank’s capital for regulatory
capital purposes.
The Company’s tangible common equity (“TCE”) ratio or total
equity to total assets ratio was 7.34% at June 30, 2024, compared
to 7.61% at March 31, 2024, and 6.92% at June 30, 2023. The TCE
ratio decreased compared to March 31, 2024 primarily due to growth
in the Company’s balance sheet and not changes in the fair value of
its available-for-sale securities. All of the Company’s securities
are classified as available-for-sale. Therefore, any changes in the
fair value of the Company’s securities portfolio are fully
reflected in total equity under generally accepted accounting
principles.
The Company paid cash dividends of $0.27 per share in the second
quarter of 2024. At June 30, 2024, the Bank’s regulatory capital
ratios were well above the minimum amounts required to be “well
capitalized” under current regulatory standards.
About Auburn National Bancorporation, Inc.
Auburn National Bancorporation, Inc. (the “Company”) is the
parent company of AuburnBank (the “Bank”), with total assets of
approximately $1.0 billion. The Bank is an Alabama state-chartered
bank that is a member of the Federal Reserve System, which has
operated continuously since 1907. Both the Company and the Bank are
headquartered in Auburn, Alabama. The Bank conducts its business in
East Alabama, including Lee County and surrounding areas. The Bank
operates eight full-service branches in Auburn, Opelika, Valley,
and Notasulga, Alabama. The Bank also operates a loan production
office in Phenix City, Alabama. Additional information about the
Company and the Bank may be found by visiting
www.auburnbank.com.
Cautionary Notice Regarding Forward-Looking
Statements
This press release contains “forward-looking statements” within
the meaning of the Securities Act of 1933 and the Securities
Exchange Act of 1934, including, without limitation, statements
about future financial and operating results, costs and revenues,
the continuing effects of the COVID-19 pandemic and
related government, Federal Reserve monetary and regulatory
actions, including the continuing effects of pandemic-related
economic stimulus and economic conditions generally and in our
markets, loan demand, mortgage lending activity, changes in the mix
of our earning assets (including those generating tax exempt income
or tax credits) and our mix and cost of deposits and wholesale
liabilities, net interest margin, yields on earning assets, the
market values and performance of securities held, effects of
inflation, including Federal Reserve monetary policies which were
tightened in response to inflation beginning in 2022 through
increases in the target federal funds rate and reductions in the
Federal Reserve’s Treasury and mortgage-backed securities holdings,
interest rates (generally and those applicable to our assets and
liabilities) and changes in our asset values, especially investment
securities, as a result of interest rate changes, noninterest
income, loan performance, loan deferrals and modifications,
nonperforming assets, other real estate owned, provision for credit
losses, including the continuing effects of the application of the
new CECL accounting standard adopted on January 1, 2023 and our
CECL models, including possible adjustments to the fair values of
securities available for sale in lieu of other-than-temporary
impairments, charge-offs, collateral values, credit quality, asset
sales, insurance claims, and market trends, as well as statements
with respect to our objectives, expectations and intentions and
other statements that are not historical facts. Actual results may
differ from those set forth in the forward-looking statements.
Forward-looking statements, with respect to our beliefs, plans,
objectives, goals, expectations, anticipations, estimates and
intentions, involve known and unknown risks, uncertainties and
other factors, which may be beyond our control, and which may cause
the actual results, performance, achievements, or financial
condition of the Company or the Bank to be materially different
from future results, performance, achievements, or financial
condition expressed or implied by such forward-looking statements.
You should not expect us to update any forward-looking
statements.
All written or oral forward-looking statements attributable to
us are expressly qualified in their entirety by this cautionary
notice, together with those risks and uncertainties described in
our annual report on Form 10-K for the year ended
December 31, 2023 and otherwise in our other SEC reports and
filings.
Explanation of Certain Unaudited Non-GAAP Financial
Measures
This press release contains financial information determined by
methods other than U.S. generally accepted accounting principles
(“GAAP”). The attached financial highlights include certain
designated net interest income amounts presented on
a tax-equivalent basis, a non-GAAP financial
measure, and the presentation and calculation of the efficiency
ratio, a non-GAAP measure. Management uses
these non-GAAP financial measures in its analysis of the
Company’s performance and believes the presentation of net interest
income on a tax-equivalent basis provides comparability
of net interest income from both taxable
and tax-exempt sources and facilitates comparability
within the industry. Similarly, the efficiency ratio is a common
measure that facilitates comparability with other financial
institutions. Although the Company believes
these non-GAAP financial measures enhance investors’
understanding of its business and performance,
these non-GAAP financial measures should not be
considered an alternative to GAAP. Along with the attached
financial highlights, the Company provides reconciliations between
the GAAP financial measures and these non-GAAP financial
measures.
1 Comparisons noted in the bullet points are for the second
quarter 2024 versus the prior quarter (first quarter 2024), unless
otherwise specified.
For additional information, contact:David A. HedgesPresident and
CEO(334) 821-9200
Financial Highlights (unaudited) |
|
Quarters Ended |
|
Six months ended |
|
(Dollars in thousands, except per share amounts) |
June 30, 2024 |
|
March 31, 2024 |
|
June 30, 2023 |
|
June 30, 2024 |
|
June 30, 2023 |
|
Results of Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income (a) |
$ |
6,728 |
|
|
$ |
6,677 |
|
|
$ |
6,994 |
|
|
$ |
13,405 |
|
|
$ |
14,211 |
|
|
Less: tax-equivalent adjustment |
|
19 |
|
|
|
20 |
|
|
|
106 |
|
|
|
39 |
|
|
|
214 |
|
|
Net interest income (GAAP) |
|
6,709 |
|
|
|
6,657 |
|
|
|
6,888 |
|
|
|
13,366 |
|
|
|
13,997 |
|
|
Noninterest income |
|
896 |
|
|
|
887 |
|
|
|
791 |
|
|
|
1,783 |
|
|
|
1,583 |
|
|
Total revenue |
|
7,605 |
|
|
|
7,544 |
|
|
|
7,679 |
|
|
|
15,149 |
|
|
|
15,580 |
|
|
Provision for credit losses |
|
(123 |
) |
|
|
334 |
|
|
|
(362 |
) |
|
|
211 |
|
|
|
(296 |
) |
|
Noninterest expense |
|
5,519 |
|
|
|
5,675 |
|
|
|
5,825 |
|
|
|
11,194 |
|
|
|
11,429 |
|
|
Income tax expense |
|
475 |
|
|
|
164 |
|
|
|
288 |
|
|
|
639 |
|
|
|
555 |
|
|
Net earnings |
$ |
1,734 |
|
|
$ |
1,371 |
|
|
$ |
1,928 |
|
|
$ |
3,105 |
|
|
$ |
3,892 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net earnings: |
$ |
0.50 |
|
|
$ |
0.39 |
|
|
$ |
0.55 |
|
|
$ |
0.89 |
|
|
$ |
1.11 |
|
|
Cash dividends declared |
$ |
0.27 |
|
|
$ |
0.27 |
|
|
$ |
0.27 |
|
|
$ |
0.54 |
|
|
$ |
0.54 |
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
3,493,699 |
|
|
|
3,493,663 |
|
|
|
3,500,064 |
|
|
|
3,493,681 |
|
|
|
3,501,098 |
|
|
Shares outstanding, at period end |
|
3,493,699 |
|
|
|
3,493,699 |
|
|
|
3,499,412 |
|
|
|
3,493,699 |
|
|
|
3,499,412 |
|
|
Book value |
$ |
21.53 |
|
|
$ |
21.32 |
|
|
$ |
20.28 |
|
|
$ |
21.53 |
|
|
$ |
20.28 |
|
|
Common stock price: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
High |
$ |
19.25 |
|
|
$ |
21.55 |
|
|
$ |
24.32 |
|
|
$ |
21.55 |
|
|
$ |
24.50 |
|
|
Low |
|
16.63 |
|
|
|
18.82 |
|
|
|
18.80 |
|
|
|
16.63 |
|
|
|
18.80 |
|
|
Period-end: |
|
18.29 |
|
|
|
19.27 |
|
|
|
21.26 |
|
|
|
18.29 |
|
|
|
21.26 |
|
|
To earnings ratio (c) |
|
101.61 |
x |
|
|
83.78 |
x |
|
|
7.21 |
x |
|
|
101.61 |
x |
|
|
7.21 |
x |
|
To book value |
|
85 |
% |
|
|
90 |
% |
|
|
105 |
% |
|
|
85 |
% |
|
|
105 |
% |
|
Performance ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average equity (annualized) |
|
9.63 |
% |
|
|
7.13 |
% |
|
|
10.37 |
% |
|
|
8.34 |
% |
|
|
10.91 |
% |
|
Return on average assets (annualized) |
|
0.71 |
% |
|
|
0.56 |
% |
|
|
0.75 |
% |
|
|
0.64 |
% |
|
|
0.76 |
% |
|
Dividend payout ratio |
|
54.00 |
% |
|
|
69.23 |
% |
|
|
49.09 |
% |
|
|
60.67 |
% |
|
|
48.65 |
% |
|
Other financial data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest margin (a) |
|
3.06 |
% |
|
|
3.04 |
% |
|
|
3.03 |
% |
|
|
3.05 |
% |
|
|
3.10 |
% |
|
Effective income tax rate |
|
21.50 |
% |
|
|
10.68 |
% |
|
|
13.00 |
% |
|
|
17.07 |
% |
|
|
12.48 |
% |
|
Efficiency ratio (b) |
|
72.39 |
% |
|
|
75.03 |
% |
|
|
74.82 |
% |
|
|
73.70 |
% |
|
|
72.36 |
% |
|
Asset Quality: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming (nonaccrual) loans |
$ |
794 |
|
|
$ |
878 |
|
|
$ |
1,149 |
|
|
$ |
794 |
|
|
$ |
1,149 |
|
|
Total nonperforming assets |
$ |
794 |
|
|
$ |
878 |
|
|
$ |
1,149 |
|
|
$ |
794 |
|
|
$ |
1,149 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs (recoveries) |
$ |
9 |
|
|
$ |
(67 |
) |
|
$ |
(144 |
) |
|
$ |
(58 |
) |
|
$ |
(141 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for credit losses as a % of: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans |
|
1.24 |
% |
|
|
1.27 |
% |
|
|
1.27 |
% |
|
|
1.24 |
% |
|
|
1.27 |
% |
|
Nonperforming loans |
|
899 |
% |
|
|
822 |
% |
|
|
577 |
% |
|
|
899 |
% |
|
|
577 |
% |
|
Nonperforming assets as a % of: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and other real estate owned |
|
0.14 |
% |
|
|
0.15 |
% |
|
|
0.22 |
% |
|
|
0.14 |
% |
|
|
0.22 |
% |
|
Total assets |
|
0.08 |
% |
|
|
0.09 |
% |
|
|
0.11 |
% |
|
|
0.08 |
% |
|
|
0.11 |
% |
|
Nonperforming loans as a % of total loans |
|
0.14 |
% |
|
|
0.15 |
% |
|
|
0.22 |
% |
|
|
0.14 |
% |
|
|
0.22 |
% |
|
Annualized net charge-offs (recoveries) as a % of
average loans |
|
0.01 |
% |
|
|
(0.05 |
) % |
|
|
(0.11 |
) % |
|
|
(0.02 |
) % |
|
|
(0.06 |
) % |
|
Selected average balances: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities |
$ |
258,228 |
|
|
$ |
267,606 |
|
|
$ |
402,929 |
|
|
$ |
262,917 |
|
|
$ |
402,807 |
|
|
Loans, net of unearned income |
|
573,443 |
|
|
|
560,757 |
|
|
|
512,066 |
|
|
|
567,100 |
|
|
|
507,139 |
|
|
Total assets |
|
978,107 |
|
|
|
976,930 |
|
|
|
1,022,874 |
|
|
|
977,518 |
|
|
|
1,022,906 |
|
|
Total deposits |
|
900,673 |
|
|
|
897,051 |
|
|
|
942,552 |
|
|
|
898,862 |
|
|
|
945,456 |
|
|
Total stockholders' equity |
$ |
72,059 |
|
|
$ |
76,948 |
|
|
$ |
74,404 |
|
|
$ |
74,503 |
|
|
$ |
71,365 |
|
|
Selected period end balances: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities |
$ |
254,359 |
|
|
$ |
260,770 |
|
|
$ |
394,079 |
|
|
$ |
254,359 |
|
|
$ |
394,079 |
|
|
Loans, net of unearned income |
|
578,068 |
|
|
|
567,520 |
|
|
|
520,411 |
|
|
|
578,068 |
|
|
|
520,411 |
|
|
Allowance for credit losses |
|
7,142 |
|
|
|
7,215 |
|
|
|
6,634 |
|
|
|
7,142 |
|
|
|
6,634 |
|
|
Total assets |
|
1,025,054 |
|
|
|
979,039 |
|
|
|
1,026,130 |
|
|
|
1,025,054 |
|
|
|
1,026,130 |
|
|
Total deposits |
|
946,405 |
|
|
|
899,673 |
|
|
|
950,742 |
|
|
|
946,405 |
|
|
|
950,742 |
|
|
Total stockholders' equity |
$ |
75,209 |
|
|
$ |
74,489 |
|
|
$ |
70,976 |
|
|
$ |
75,209 |
|
|
$ |
70,976 |
|
|
|
|
(a) Tax-equivalent. See “Explanation of Certain Unaudited Non-GAAP
Financial Measures” and “Reconciliation of GAAP
to non-GAAP Measures (unaudited).” |
(b) Efficiency ratio is the result of noninterest expense divided
by the sum of noninterest income and tax-equivalent
net interest income. See “Reconciliation of GAAP to
non-GAAP Measures (unaudited)” below. |
(c) Calculated by dividing period end share price by earnings per
share for the previous four quarters. |
|
Reconciliation of GAAP to non-GAAP Measures
(unaudited): |
|
|
Quarters Ended |
|
Six months ended |
|
(Dollars in thousands, except per share amounts) |
June 30, 2024 |
March 31, 2024 |
June 30, 2023 |
|
June 30, 2024 |
June 30, 2023 |
|
Net interest income, as reported (GAAP) |
$ |
6,709 |
|
$ |
6,657 |
|
$ |
6,888 |
|
$ |
13,366 |
|
$ |
13,997 |
|
Tax-equivalent adjustment |
|
19 |
|
|
20 |
|
|
106 |
|
|
39 |
|
|
214 |
|
Net interest income (tax-equivalent) |
$ |
6,728 |
|
$ |
6,677 |
|
$ |
6,994 |
|
$ |
13,405 |
|
$ |
14,211 |
|
Auburn National Bancorpo... (NASDAQ:AUBN)
Historical Stock Chart
From Sep 2024 to Oct 2024
Auburn National Bancorpo... (NASDAQ:AUBN)
Historical Stock Chart
From Oct 2023 to Oct 2024