Timberland Bancorp, Inc. (NASDAQ: TSBK) (“Timberland” or “the
Company”), the holding company for Timberland Bank (the “Bank”),
today reported net income of $5.71 million, or $0.70 per diluted
common share, for the quarter ended March 31, 2024. This compares
to net income of $6.30 million, or $0.77 per diluted common share,
for the preceding quarter and $6.66 million, or $0.80 per diluted
common share, for the comparable quarter one year ago.
For the first six months of fiscal 2024, Timberland’s net income
decreased 15% to $12.00 million, or $1.47 per diluted common share,
compared to $14.17 million, or $1.70 per diluted common share for
the first six months of fiscal 2023.
“Our second quarter of fiscal year 2024 operating results were
highlighted by solid earnings, moderate growth in loans and
deposits, and continued stable asset quality metrics,” stated Dean
Brydon, Chief Executive Officer. “While second quarter earnings and
performance metrics were strong, they were lower compared to the
year ago quarter, which was near the highest point of our margin in
this interest rate cycle before deposit cost increases began
compressing margins.”
As a result of Timberland’s solid earnings and strong capital
position, its Board of Directors announced a quarterly cash
dividend to shareholders to $0.24 per share, payable on May 24,
2024, to shareholders of record on May 10, 2024. This represents
the 46th consecutive quarter Timberland will have paid a cash
dividend.
“Our loan portfolio continues to grow, but not at the robust
pace we’ve experienced during the past two years,” Brydon
continued. “Construction loan balances declined during the quarter,
in part due to construction projects completing and being
transferred to permanent loan categories. Although loan origination
volumes slowed during the quarter, net loans receivable increased
by $23 million during the quarter. We continue to remain optimistic
regarding the overall strength of our loan portfolio and the
opportunities for growth in our markets, even in this anticipated
‘higher for longer’ interest rate environment. Credit quality
continues to be monitored closely and our credit metrics remain
relatively strong with only $3,000 in net charge-offs for the
quarter and non-performing assets at only 19 basis points of total
assets at the end of the second quarter.”
“The net interest margin was 3.48% for the second quarter, a 12
basis points contraction compared to the preceding quarter as the
increase in cost of funds continued to outpace the growth in yields
on interest-earning assets,” said Jonathan Fischer, President and
Chief Operating Officer. “We believe the pace of net interest
margin contraction has started to stabilize at current levels.
Total deposits increased $11 million during the quarter, with
increases in money market and certificates of deposit balances more
than offsetting decreases in checking account balances. We believe
we are near the peak for deposit costs, which should help our net
interest margin stabilize or improve going forward.”
Earnings and Balance Sheet Highlights (at or
for the periods ended March 31, 2024, compared to March 31, 2023,
or December 31, 2023):
Earnings Highlights:
- Earnings per diluted common share (“EPS”) decreased 9% to $0.70
for the current quarter from $0.77 for the preceding quarter and
decreased 13% from $0.80 for the comparable quarter one year ago;
EPS for the first six months of fiscal 2024 decreased 14% to $1.47
from $1.70 for the first six months of fiscal 2023;
- Net income decreased 9% to $5.71 million for the current
quarter from $6.30 million for the preceding quarter and decreased
14% from $6.66 million for the comparable quarter one year ago; Net
income decreased 15% to $12.00 million for the first six months of
fiscal 2024 compared to $14.17 million for the first six months of
fiscal 2023;
- Return on average equity (“ROE”) and return on average assets
(“ROA”) for the current quarter were 9.67% and 1.22%,
respectively;
- Net interest margin (“NIM”) for the current quarter compressed
to 3.48% from 3.60% for the preceding quarter and from 3.99% for
the comparable quarter one year ago; and
- The efficiency ratio for the current quarter was 60.22%
compared to 56.50% for the preceding quarter and 55.31% for the
comparable quarter one year ago.
Balance Sheet Highlights:
- Total assets increased 1% from the prior quarter and increased
7% year-over-year;
- Net loans receivable increased 2% from the prior quarter and
increased 12% year-over-year;
- Total deposits increased 1% from the prior quarter and
increased 6% year-over-year;
- Total shareholders’ equity increased 1% from the prior quarter
and increased 5% year-over-year;
- Non-performing assets to total assets ratio was 0.19% at March
31, 2024 compared to 0.18% at December 31, 2023 and 0.12% at March
31, 2023;
- Book and tangible book (non-GAAP) values per common share
increased to $29.75 and $27.79, respectively, at March 31, 2024;
and
- Liquidity (both on-balance sheet and off-balance sheet)
remained strong at March 31, 2024 with only $20 million in
borrowings and additional secured borrowing line capacity of $707
million available through the Federal Home Loan Bank (“FHLB”) and
the Federal Reserve.
Operating Results
Operating revenue (net interest income before the
provision for credit losses plus non-interest income) for the
current quarter decreased 3% to $18.25 million from $18.80 million
for the preceding quarter and decreased 8% from $19.79 million for
the comparable quarter one year ago. The decrease in operating
revenue compared to the preceding quarter was primarily due to an
increase in funding costs, and to a lesser extent, a decrease in
non-interest income. These decreases to operating revenue were
partially offset by an increase in interest income from loans and
overnight funds. Operating revenue decreased by 8%, to $37.05
million for the first six months of fiscal 2024 from $40.24 million
for the first six months of fiscal 2023, primarily due to an
increase in funding costs, which outpaced the increase in interest
income.
Net interest income decreased $369,000, or 2%, to
$15.64 million for the current quarter from $16.00 million for the
preceding quarter and decreased $1.52 million, or 9%, from $17.15
million for the comparable quarter one year ago. The decrease in
net interest income compared to the preceding quarter was primarily
due to an increase in the weighted average cost of interest-bearing
liabilities to 2.50% from 2.22% for the preceding quarter.
Partially offsetting the increase in funding costs, was an increase
in the weighted average yield of interest-earning assets to 5.16%
from 5.07% for the preceding quarter and a $30.15 million increase
in average total interest-earning assets. Timberland’s NIM for the
current quarter compressed to 3.48% from 3.60% for the preceding
quarter and from 3.99% for the comparable quarter one year
ago. The NIM for the current quarter
was increased by approximately three basis points due to the
collection of $90,000 in pre-payment penalties, non-accrual
interest, and late fees and the accretion of $10,000 of the fair
value discount on acquired loans. The
NIM for the preceding quarter was increased by approximately three
basis points due to the collection of $142,000 in pre-payment
penalties, non-accrual interest, and late fees, and the accretion
of $10,000 of the fair value discount on acquired
loans. The NIM for the comparable
quarter one year ago was increased by approximately three basis
points due to the collection of $99,000 in pre-payment penalties,
non-accrual interest, and late fees, and the accretion of $15,000
of the fair value discount on acquired loans. Net interest income
for the first six months of fiscal 2024 decreased $3.26 million, or
9%, to $31.64 million from $34.89 million for the first six months
of fiscal 2023, primarily due to funding cost increases, which
outpaced the increase in interest income. Timberland’s NIM
compressed to 3.53% for the first six months of fiscal 2024 from
4.02% for the first six months of fiscal 2023.
A $166,000 provision for credit losses on loans was
recorded for the quarter ended March 31, 2024. The provision was
primarily due to loan portfolio growth, which was partially offset
by changes in the composition of the loan portfolio, as
construction loan balances (which have a higher reserve factor)
decreased. This compares to a $379,000 provision for credit losses
on loans for the preceding quarter and a $475,000 provision for
credit losses on loans for the comparable quarter one year ago. In
addition, an $88,000 recapture of credit losses for unfunded
commitments was recorded for the current quarter, primarily as a
result of a decrease in the level of unfunded commitments for
construction loans.
Non-interest income decreased $183,000 or 7%, to
$2.62 million for the current quarter from $2.80 million for the
preceding quarter and decreased $21,000, or 1%, from $2.64 million
for the comparable quarter one year ago. The decrease in
non-interest income compared to the preceding quarter was primarily
due to a $52,000 decrease in ATM and debit card interchange
transaction fees, a $37,000 decrease in gain on sale of loans, a
$35,000 decrease in service charges on deposits, and smaller
changes in several other categories. Fiscal year-to-date
non-interest income increased by 1% to $5.41 million from $5.34
million for the first six months of fiscal 2023.
Total operating (non-interest) expenses for the
current quarter increased $367,000, or 3%, to $10.99 million from
$10.62 million for the preceding quarter and increased $47,000
(less than 1%) from $10.94 million for the comparable quarter one
year ago. The increase in operating
expenses compared to the preceding quarter was primarily due to
increases in salaries and employee benefits, premises and
equipment, technology and communications, and professional fees and
smaller changes in several other categories. The efficiency ratio
for the current quarter was 60.22% compared to 56.50% for the
preceding quarter and 55.31% for the comparable quarter one year
ago. Fiscal year-to-date operating expenses increased 1% to $21.62
million from $21.48 million for the first six months of fiscal
2023. The efficiency ratio for the first six months of fiscal 2024
was 58.34% compared to 53.38% for the first six months of fiscal
2023.
The provision for income taxes for the current
quarter decreased $76,000, or 5%, to $1.47 million from $1.55
million for the preceding quarter, primarily due to lower taxable
income. Timberland’s effective income
tax rate was 20.5% for the quarter ended March 31, 2024 compared to
19.7% for the quarter ended December 31, 2023 and 20.4% for the
quarter ended March 31, 2023. Timberland’s effective income tax
rate was 20.1% for the first six months of fiscal 2024 compared to
20.2% for the first six months of fiscal 2023.
Balance Sheet Management
Total assets increased $12.12 million, or 1%, during the quarter
to $1.91 billion at March 31, 2024 from $1.90 billion at December
31, 2023 and increased $120.62 million, or 7%, from $1.79 billion
one year ago. The increase during the current quarter was primarily
due to a $22.83 million increase in net loans receivable and a
$22.33 million increase in total cash and cash equivalents, which
was partially offset by a $34.22 million decrease in investment
securities and CDs held for investment. The quarterly increase in
assets was primarily funded by an $11.49 million increase in
deposits.
Liquidity
Timberland has maintained a strong liquidity position (both
on-balance sheet and off-balance sheet) while continuing to grow
the loan portfolio. Liquidity, as measured by the sum of cash and
cash equivalents, CDs held for investment, and available for sale
investment securities, was 15.2% of total liabilities at March 31,
2024, compared to 12.7% at December 31, 2023, and 14.0% one year
ago. Timberland had secured borrowing line capacity of $707 million
available through the FHLB and the Federal Reserve at March 31,
2024. With a strong and diversified deposit base, only 18% of
Timberland’s deposits were uninsured or uncollateralized at March
31, 2024. (Note: This calculation excludes public deposits that are
fully collateralized.)
Loans
Net loans receivable increased $22.83 million, or 2%, during the
quarter to $1.36 billion at March 31, 2024 from $1.34 billion at
December 31, 2023. This increase was primarily due to a $19.95
million increase in multi-family loans, a $13.31 million increase
in one- to four-family loans and smaller increases in several other
loan categories. Also impacting the quarterly comparison was a
$27.18 million decrease in the undisbursed portion of construction
loans in process. These increases to net loans receivable were
partially offset by a $40.53 million decrease in construction and
land development loans and smaller decreases in several other loan
categories. The increases in multi-family loans and one-to-four
family loans and the corresponding decrease in construction loans
were, in large part, due to the construction portion of these loans
being completed and moved into permanent financing categories.
|
Loan Portfolio($ in
thousands) |
| |
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
| |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
|
Amount |
|
Percent |
| Mortgage loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family (a) |
|
$ |
276,433 |
|
|
19 |
% |
|
$ |
263,122 |
|
|
18 |
% |
|
$ |
216,639 |
|
|
16 |
% |
|
Multi-family |
|
|
167,275 |
|
|
12 |
|
|
|
147,321 |
|
|
10 |
|
|
|
103,870 |
|
|
8 |
|
|
Commercial |
|
|
577,373 |
|
|
40 |
|
|
|
579,038 |
|
|
40 |
|
|
|
547,876 |
|
|
41 |
|
|
Construction - custom and owner/builder |
|
|
122,988 |
|
|
8 |
|
|
|
134,878 |
|
|
9 |
|
|
124,071 |
|
|
9 |
|
|
Construction - speculative one-to four-family |
|
|
16,407 |
|
|
1 |
|
|
|
17,609 |
|
|
1 |
|
|
|
11,343 |
|
|
1 |
|
|
Construction - commercial |
|
|
32,318 |
|
|
2 |
|
|
|
36,702 |
|
|
3 |
|
|
|
31,458 |
|
|
3 |
|
|
Construction - multi-family |
|
|
36,795 |
|
|
3 |
|
|
|
57,019 |
|
|
4 |
|
|
|
83,051 |
|
|
6 |
|
|
Construction - land development |
|
|
16,051 |
|
|
1 |
|
|
|
18,878 |
|
|
1 |
|
|
|
17,018 |
|
|
1 |
|
|
Land |
|
|
31,821 |
|
|
2 |
|
|
|
28,697 |
|
|
2 |
|
|
|
24,520 |
|
|
2 |
|
|
Total mortgage loans |
|
|
1,277,461 |
|
|
88 |
|
|
|
1,283,264 |
|
|
88 |
|
|
|
1,159,846 |
|
|
87 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Consumer loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Home equity and second mortgage |
|
|
42,357 |
|
|
3 |
|
|
|
39,403 |
|
|
3 |
|
|
|
36,896 |
|
|
3 |
|
|
Other |
|
|
2,925 |
|
|
-- |
|
|
|
2,926 |
|
|
-- |
|
|
|
2,283 |
|
|
-- |
|
|
Total consumer loans |
|
|
45,282 |
|
|
3 |
|
|
|
42,329 |
|
|
3 |
|
|
|
39,179 |
|
|
3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Commercial loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial business loans |
|
|
135,505 |
|
|
9 |
|
|
|
136,942 |
|
|
9 |
|
|
|
129,306 |
|
|
10 |
|
|
SBA PPP loans |
|
|
367 |
|
|
-- |
|
|
|
423 |
|
|
-- |
|
|
|
572 |
|
|
-- |
|
|
Total commercial loans |
|
|
135,872 |
|
|
9 |
|
|
|
137,365 |
|
|
9 |
|
|
|
129,878 |
|
|
10 |
|
| Total loans |
|
|
1,458,615 |
|
|
100 |
% |
|
|
1,462,958 |
|
|
100 |
% |
|
|
1,328,903 |
|
|
100 |
% |
| Less: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Undisbursed portion of construction loans in process |
|
|
(77,502 |
) |
|
|
|
|
(104,683 |
) |
|
|
|
|
(99,253 |
) |
|
|
|
Deferred loan origination fees |
|
|
(5,179 |
) |
|
|
|
|
(5,337 |
) |
|
|
|
|
(4,759 |
) |
|
|
|
Allowance for credit losses |
|
|
(16,818 |
) |
|
|
|
|
(16,655 |
) |
|
|
|
|
(14,698 |
) |
|
|
|
Total loans receivable, net |
|
$ |
1,359,116 |
|
|
|
|
$ |
1,336,283 |
|
|
|
|
$ |
1,210,193 |
|
|
|
_______________________(a) Does not include one- to four-family
loans held for sale totaling $1,311, $1,425, and $200 at March 31
2024, December 31, 2023, and March 31, 2023, respectively.
The following table provides a breakdown of commercial real
estate (“CRE”) mortgage loans by collateral type as of March 31,
2024:
|
CRE Loan Portfolio Breakdown by Collateral($ in
thousands) |
|
|
|
Collateral Type |
|
Balance |
|
Percent ofCREPortfolio |
|
Percent ofTotal LoanPortfolio |
|
AverageBalance PerLoan |
|
Non-Accrual |
|
Industrial warehouse |
|
$ |
112,318 |
|
|
20 |
% |
|
8 |
% |
|
$ |
1,123 |
|
|
$ |
195 |
|
|
Medical/dental offices |
|
|
81,335 |
|
|
14 |
|
|
6 |
|
|
|
1,291 |
|
|
|
-- |
|
|
Office buildings |
|
|
71,518 |
|
|
12 |
|
|
5 |
|
|
|
777 |
|
|
|
-- |
|
|
Other retail buildings |
|
|
51,422 |
|
|
9 |
|
|
3 |
|
|
|
547 |
|
|
|
-- |
|
|
Mini-storage |
|
|
39,228 |
|
|
7 |
|
|
3 |
|
|
|
1,453 |
|
|
|
-- |
|
|
Hotel/motel |
|
|
31,713 |
|
|
5 |
|
|
2 |
|
|
|
2,883 |
|
|
|
-- |
|
|
Restaurants |
|
|
27,583 |
|
|
5 |
|
|
2 |
|
|
|
563 |
|
|
|
-- |
|
|
Gas stations/conv. stores |
|
|
20,977 |
|
|
4 |
|
|
1 |
|
|
|
912 |
|
|
|
-- |
|
|
Nursing homes |
|
|
18,630 |
|
|
3 |
|
|
1 |
|
|
|
2,329 |
|
|
|
-- |
|
|
Mobile home parks |
|
|
10,869 |
|
|
2 |
|
|
1 |
|
|
|
494 |
|
|
|
-- |
|
|
Shopping centers |
|
|
10,854 |
|
|
2 |
|
|
1 |
|
|
|
1,809 |
|
|
|
-- |
|
|
Churches |
|
|
6,976 |
|
|
1 |
|
|
1 |
|
|
|
498 |
|
|
|
-- |
|
|
Additional CRE |
|
|
93,950 |
|
|
16 |
|
|
6 |
|
|
|
706 |
|
|
|
954 |
|
|
Total CRE |
|
$ |
577,373 |
|
|
100 |
% |
|
40 |
% |
|
$ |
899 |
|
|
$ |
1,149 |
|
Timberland originated $39.37 million in loans during the quarter
ended March 31, 2024, compared to $88.93 million for the preceding
quarter and $77.15 million for the comparable quarter one year ago.
Timberland continues to originate fixed-rate one- to four-family
mortgage loans, a portion of which are sold into the secondary
market for asset-liability management purposes and to generate
non-interest income. During the current quarter,
fixed-rate one- to four-family mortgage loans totaling $2.28
million were sold compared to $3.80 million for the preceding
quarter and $2.39 million for the comparable quarter one year
ago.
Investment
Securities Timberland’s
investment securities and CDs held for investment decreased $34.22
million, or 11%, to $285.61 million at December 31, 2023, from
$319.83 million at December 31, 2023. The decrease was primarily
due to maturities of U.S. Treasury investment securities
(classified as held to maturity) totaling $48.00 million and, to a
lesser extent, scheduled amortization. Partially offsetting these
decreases, was the purchase of additional U.S. government agency
mortgage-backed investment securities and U.S. Treasury investment
securities, all of which were classified as available for sale.
Deposits
Total deposits increased $11.49 million, or 1%, during the
quarter to $1.64 billion at March 31, 2024, from $1.63 billion at
December 31, 2023. The quarter’s increase consisted of a $42.31
million in money market account balances and a $35.04 million
increase in certificates of deposit balances. These increases were
partially offset by a $52.84 million decrease in NOW checking
account balances, an $8.16 million decrease in non-interest bearing
deposit balances and a $4.86 million decrease in savings account
balances.
|
Deposit Breakdown($ in thousands) |
| |
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
| |
|
Amount |
|
|
Percent |
|
Amount |
|
|
Percent |
|
Amount |
|
Percent |
|
Non-interest-bearing demand |
|
$424,906 |
|
|
26 |
% |
|
$433,065 |
|
|
27 |
% |
|
$479,283 |
|
|
31 |
% |
|
NOW checking |
|
336,621 |
|
|
20 |
|
|
389,463 |
|
|
24 |
|
|
403,463 |
|
|
26 |
|
|
Savings |
|
211,085 |
|
|
13 |
|
|
215,948 |
|
|
13 |
|
|
269,522 |
|
|
17 |
|
|
Money market |
|
311,994 |
|
|
19 |
|
|
269,686 |
|
|
17 |
|
|
210,390 |
|
|
14 |
|
|
Certificates of deposit under $250 |
|
190,762 |
|
|
12 |
|
|
181,762 |
|
|
11 |
|
|
129,331 |
|
|
8 |
|
|
Certificates of deposit $250 and over |
|
118,698 |
|
|
7 |
|
|
96,145 |
|
|
6 |
|
|
56,778 |
|
|
4 |
|
|
Certificates of deposit – brokered |
|
44,488 |
|
|
3 |
|
|
41,000 |
|
|
2 |
|
|
-- |
|
|
-- |
|
|
Total deposits |
|
$1,638,554 |
|
|
100 |
% |
|
$1,627,069 |
|
|
100 |
% |
|
$1,548,767 |
|
|
100 |
% |
Borrowings
Total borrowings were $20.00 million at both March 31, 2024 and
December 31, 2023. At March 31, 2024, the weighted average rate on
the borrowings was 4.34%.
Shareholders’ Equity and Capital
Ratios
Total shareholders’ equity increased $1.31 million, or 1%, to
$238.70 million at March 31, 2024, from $237.37 million at December
31, 2023. The increase in shareholders’ equity was primarily due to
net income of $5.71 million for the quarter and an $82,000
reduction in the accumulated other comprehensive loss category for
fair value adjustments on available for sale investment securities.
These increases to shareholders’ equity were partially offset by
the payment of $1.94 million in dividends to shareholders and the
repurchase of 99,787 shares of common stock for $2.67 million (an
average price of $26.77 per share). Timberland had
262,025 shares available to be repurchased in accordance with the
terms of its existing stock repurchase plan at March 31, 2024.
Timberland remains well capitalized with a total
risk-based capital ratio of 19.33%, a Tier 1 leverage capital ratio
of 12.01%, a tangible common equity to tangible assets ratio
(non-GAAP) of 11.79%, and a shareholders’ equity to total assets
ratio of 12.51% at March 31, 2024. Timberland’s held to maturity
investment securities were $211.82 million at March 31, 2024, with
a net unrealized loss of $13.53 million (pre-tax). Although not
permitted by U.S. Generally Accepted Accounting Principles
(“GAAP”), including these unrealized losses in accumulated other
comprehensive income (loss) (“AOCI”) would result in a ratio of
shareholders’ equity to total assets of 12.02%, compared to 12.51%,
as reported.
Asset Quality
Timberland’s non-performing assets to total assets
ratio was 0.19% at March 31, 2024 compared to 0.18% at December 31,
2023 and 0.12% at March 31, 2023 There were net charge-offs of
$3,000 for the current quarter, compared to net charge-offs of
$2,000 for the preceding quarter and net charge-offs of $6,000 for
the comparable quarter one year ago. During the current quarter,
provisions for credit losses on loans of $166,000 and on investment
securities of $3,000 were made, which were partially offset by an
$88,000 recapture of credit losses on unfunded commitments. The ACL
for loans as a percentage of loans receivable was 1.22% at March
31, 2024, compared to 1.23% at December 31, 2023 and 1.20% one year
ago.
Total delinquent loans (past due 30 days or more)
and non-accrual loans increased $598,000 or 17%, to $4.20 million
at March 31, 2024, from $3.60 million at December 31, 2023.
Non-accrual loans increased $239,000, or 7%, to $3.61 million at
March 31, 2024, from $3.37 million at December 31,
2023. The quarterly increase in
non-accrual loans was primarily due to a $466,000 increase in
commercial real estate loans on non-accrual status, which was
partially offset by a $222,000 decrease in one- to four-family
loans on non-accrual status.
|
Non-Accrual Loans($ in thousands) |
| |
| |
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
| |
|
Amount |
|
Quantity |
|
Amount |
|
Quantity |
|
Amount |
|
Quantity |
| Mortgage loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family |
|
$ |
380 |
|
|
3 |
|
$ |
602 |
|
|
4 |
|
$ |
378 |
|
|
2 |
|
Commercial |
|
|
1,149 |
|
|
3 |
|
|
683 |
|
|
2 |
|
|
694 |
|
|
2 |
|
Construction – custom and owner/builder |
|
|
152 |
|
|
1 |
|
|
150 |
|
|
1 |
|
|
-- |
|
|
-- |
|
Land |
|
|
-- |
|
|
-- |
|
|
-- |
|
|
-- |
|
|
362 |
|
|
1 |
|
Total mortgage loans |
|
|
1,681 |
|
|
7 |
|
|
1,435 |
|
|
7 |
|
|
1,434 |
|
|
5 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Consumer loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Home equity and second mortgage |
|
|
165 |
|
|
1 |
|
|
171 |
|
|
1 |
|
|
241 |
|
|
2 |
|
Other |
|
|
-- |
|
|
-- |
|
|
-- |
|
|
-- |
|
|
1 |
|
|
1 |
|
Total consumer loans |
|
|
165 |
|
|
1 |
|
|
171 |
|
|
1 |
|
|
242 |
|
|
3 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Commercial business loans |
|
|
1,759 |
|
|
6 |
|
|
1,760 |
|
|
6 |
|
|
293 |
|
|
4 |
| Total loans |
|
$ |
3,605 |
|
|
14 |
|
$ |
3,366 |
|
|
14 |
|
$ |
1,969 |
|
|
12 |
About Timberland Bancorp,
Inc.Timberland Bancorp, Inc., a Washington corporation, is
the holding company for Timberland Bank. The Bank opened for
business in 1915 and primarily serves consumers and businesses
across Grays Harbor, Thurston, Pierce, King, Kitsap and Lewis
counties, Washington with a full range of lending and deposit
services through its 23 branches (including its main office in
Hoquiam).
Disclaimer
Certain matters discussed in this press release may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements relate
to our financial condition, results of operations, plans,
objectives, future performance or business. Forward-looking
statements are not statements of historical fact, are based on
certain assumptions and often include the words "believes,"
"expects," "anticipates," "estimates," "forecasts," "intends,"
"plans," "targets," "potentially," "probably," "projects,"
"outlook" or similar expressions or future or conditional verbs
such as "may," "will," "should," "would" and "could."
Forward-looking statements include statements with respect to our
beliefs, plans, objectives, goals, expectations, assumptions and
statements about future economic performance. These
forward-looking statements are subject to known and unknown risks,
uncertainties and other factors that could cause our actual results
to differ materially from the results anticipated or implied by our
forward-looking statements, including, but not limited to:
potential adverse impacts to economic conditions in our local
market areas, other markets where the Company has lending
relationships, or other aspects of the Company's business
operations or financial markets, including, without limitation, as
a result of employment levels, labor shortages and the effects of
inflation, a potential recession or slowed economic growth caused
by increasing geopolitical instability (including wars, conflicts,
terrorist attacks, natural disasters, and other unexpected events
outside of our control), as well as increasing oil prices and
supply chain disruptions, and any governmental or societal
responses to novel coronavirus disease 2019 ("COVID-19") pandemic,
including the possibility of new COVID-19 variants; credit risks of
lending activities, including changes in the level and trend of
loan delinquencies and write-offs and changes in our allowance for
loan losses and provision for loan losses that may be impacted by
deterioration in the housing and commercial real estate markets
which may lead to increased losses and non-performing loans in our
loan portfolio may result in our allowance for loan losses not
being adequate to cover actual losses, and require us to materially
increase our loan loss reserves; changes in general economic
conditions, either nationally or in our market areas; changes in
the levels of general interest rates, and the relative differences
between short and long-term interest rates, deposit interest rates,
our net interest margin and funding sources; uncertainty regarding
the future of the London Interbank Offered Rate ("LIBOR"), and the
transition away from LIBOR toward new interest rate benchmarks;
fluctuations in the demand for loans, the number of unsold homes,
land and other properties and fluctuations in real estate values in
our market areas; secondary market conditions for loans and our
ability to sell loans in the secondary market; results of
examinations of us by the Federal Reserve and of our bank
subsidiary by the Federal Deposit Insurance Corporation, the
Washington State Department of Financial Institutions, Division of
Banks or other regulatory authorities, including the possibility
that any such regulatory authority may, among other things,
institute a formal or informal enforcement action against us or our
bank subsidiary which could require us to increase our allowance
for loan losses, write-down assets, change our regulatory capital
position or affect our ability to borrow funds or maintain or
increase deposits or impose additional requirements or restrictions
on us, any of which could adversely affect our liquidity and
earnings; legislative or regulatory changes that adversely affect
our business including changes in banking, securities and tax law,
in regulatory policies and principles, or the interpretation of
regulatory capital or other rules and including changes as a result
of COVID-19; our ability to attract and retain deposits; our
ability to control operating costs and expenses; the use of
estimates in determining fair value of certain of our assets, which
estimates may prove to be incorrect and result in significant
declines in valuation; difficulties in reducing risks associated
with the loans in our consolidated balance sheet; staffing
fluctuations in response to product demand or the implementation of
corporate strategies that affect our work force and potential
associated charges; disruptions, security breaches, or other
adverse events, failures or interruptions in, or attacks on, our
information technology systems or on the third-party vendors who
perform several of our critical processing functions; our ability
to retain key members of our senior management team; costs and
effects of litigation, including settlements and judgments; our
ability to implement our business strategies; our ability to manage
loan delinquency rates; increased competitive pressures among
financial services companies; changes in consumer spending,
borrowing and savings habits; the availability of resources to
address changes in laws, rules, or regulations or to respond to
regulatory actions; our ability to pay dividends on our common
stock; the quality and composition of our securities portfolio and
the impact if any adverse changes in the securities markets,
including on market liquidity; inability of key third-party
providers to perform their obligations to us; changes in accounting
policies and practices, as may be adopted by the financial
institution regulatory agencies or the Financial Accounting
Standards Board ("FASB"), including additional guidance and
interpretation on accounting issues and details of the
implementation of new accounting methods; the economic impact of
climate change, severe weather events, natural disasters,
pandemics, epidemics and other public health crises, acts of war or
terrorism, and other external events on our business; other
economic, competitive, governmental, regulatory, and technological
factors affecting our operations, pricing, products and services
and other risks described in our reports filed with or furnished to
the Securities and Exchange Commission.
Any of the forward-looking statements that we make in this press
release and in the other public statements we make are based upon
management's beliefs and assumptions at the time they are made. We
do not undertake and specifically disclaim any obligation to
publicly update or revise any forward-looking statements included
in this press release to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such
statements or to update the reasons why actual results could differ
from those contained in such statements, whether as a result of new
information, future events or otherwise. In light of these risks,
uncertainties and assumptions, the forward-looking statements
discussed in this document might not occur and we caution readers
not to place undue reliance on any forward-looking statements.
These risks could cause our actual results for fiscal 2024 and
beyond to differ materially from those expressed in any
forward-looking statements by, or on behalf of, us, and could
negatively affect the Company's consolidated financial condition
and results of operations as well as its stock price
performance.
| TIMBERLAND
BANCORP INC. AND SUBSIDIARYCONSOLIDATED STATEMENTS
OF INCOME |
|
Three Months Ended |
| ($ in thousands,
except per share amounts) (unaudited) |
|
March 31, |
|
Dec. 31, |
|
March 31, |
| |
|
2024 |
|
2023 |
|
2023 |
| |
Interest and dividend
income |
|
|
|
|
|
|
|
|
Loans receivable |
|
$ |
18,909 |
|
|
$ |
18,395 |
|
|
$ |
14,950 |
|
| |
Investment securities |
|
|
2,246 |
|
|
|
2,311 |
|
|
|
2,460 |
|
| |
Dividends from mutual funds,
FHLB stock and other investments |
|
|
82 |
|
|
|
91 |
|
|
|
64 |
|
| |
Interest bearing deposits in
banks |
|
|
1,919 |
|
|
|
1,699 |
|
|
|
1,913 |
|
| |
Total interest and dividend income |
|
|
23,156 |
|
|
|
22,496 |
|
|
|
19,387 |
|
| |
|
|
|
|
|
|
|
| |
Interest
expense |
|
|
|
|
|
|
| |
Deposits |
|
|
7,301 |
|
|
|
6,143 |
|
|
|
2,236 |
|
| |
Borrowings |
|
|
220 |
|
|
|
349 |
|
|
|
-- |
|
| |
Total interest expense |
|
|
7,521 |
|
|
|
6,492 |
|
|
|
2,236 |
|
| |
Net interest income |
|
|
15,635 |
|
|
|
16,004 |
|
|
|
17,151 |
|
| |
Provision for credit
losses – loans |
|
|
166 |
|
|
|
379 |
|
|
|
475 |
|
| |
Provision for
(recapture of ) credit losses – investment securities |
|
|
3 |
|
|
|
(10 |
) |
|
|
-- |
|
| |
Recapture of credit
losses - unfunded commitments |
|
|
(88 |
) |
|
|
(33 |
) |
|
|
-- |
|
| |
Net int. income after provision for (recapture of) credit
losses |
|
|
15,554 |
|
|
|
15,668 |
|
|
|
16,676 |
|
| |
|
|
|
|
|
|
|
| |
Non-interest
income |
|
|
|
|
|
|
| |
Service charges on
deposits |
|
|
988 |
|
|
|
1,023 |
|
|
|
893 |
|
| |
ATM and debit card interchange
transaction fees |
|
|
1,212 |
|
|
|
1,264 |
|
|
|
1,275 |
|
| |
Gain on sales of loans,
net |
|
|
41 |
|
|
|
78 |
|
|
|
46 |
|
| |
Bank owned life insurance
(“BOLI”) net earnings |
|
|
156 |
|
|
|
156 |
|
|
|
157 |
|
| |
Recoveries on investment
securities, net |
|
|
2 |
|
|
|
5 |
|
|
|
2 |
|
| |
Other |
|
|
216 |
|
|
|
272 |
|
|
|
263 |
|
| |
Total non-interest income, net |
|
|
2,615 |
|
|
|
2,798 |
|
|
|
2,636 |
|
| |
|
|
|
|
|
|
|
| |
Non-interest
expense |
|
|
|
|
|
|
| |
Salaries and employee
benefits |
|
|
6,024 |
|
|
|
5,911 |
|
|
|
6,046 |
|
| |
Premises and equipment |
|
|
1,081 |
|
|
|
973 |
|
|
|
1,001 |
|
| |
Advertising |
|
|
159 |
|
|
|
186 |
|
|
|
178 |
|
| |
ATM and debit card
processing |
|
|
601 |
|
|
|
615 |
|
|
|
489 |
|
| |
Postage and courier |
|
|
145 |
|
|
|
126 |
|
|
|
147 |
|
| |
State and local taxes |
|
|
325 |
|
|
|
319 |
|
|
|
298 |
|
| |
Professional fees |
|
|
319 |
|
|
|
253 |
|
|
|
473 |
|
| |
FDIC insurance expense |
|
|
206 |
|
|
|
210 |
|
|
|
202 |
|
| |
Loan administration and
foreclosure |
|
|
134 |
|
|
|
105 |
|
|
|
138 |
|
| |
Technology and communication
expense |
|
|
1,040 |
|
|
|
974 |
|
|
|
880 |
|
| |
Deposit operations |
|
|
324 |
|
|
|
320 |
|
|
|
246 |
|
| |
Amortization of core deposit
intangible (“CDI”) |
|
|
57 |
|
|
|
56 |
|
|
|
67 |
|
| |
Other, net |
|
|
576 |
|
|
|
576 |
|
|
|
779 |
|
| |
Total non-interest expense, net |
|
|
10,991 |
|
|
|
10,624 |
|
|
|
10,944 |
|
| |
|
|
|
|
|
|
|
| |
Income before income
taxes |
|
|
7,178 |
|
|
|
7,842 |
|
|
|
8,368 |
|
| |
Provision for income
taxes |
|
|
1,470 |
|
|
|
1,546 |
|
|
|
1,705 |
|
| |
Net income |
|
$ |
5,708 |
|
|
$ |
6,296 |
|
|
$ |
6,663 |
|
| |
|
|
|
|
|
|
|
| |
Net income per common
share: |
|
|
|
|
|
|
| |
Basic |
|
$ |
0.71 |
|
|
$ |
0.78 |
|
|
$ |
0.81 |
|
| |
Diluted |
|
|
0.70 |
|
|
|
0.77 |
|
|
|
0.80 |
|
| |
|
|
|
|
|
|
|
| |
Weighted average
common shares outstanding: |
|
|
|
|
|
|
| |
Basic |
|
|
8,081,924 |
|
|
|
8,114,209 |
|
|
|
8,220,532 |
|
| |
Diluted |
|
|
8,121,109 |
|
|
|
8,166,048 |
|
|
|
8,304,370 |
|
| TIMBERLAND
BANCORP INC. AND SUBSIDIARYCONSOLIDATED STATEMENTS
OF INCOME |
|
Six Months Ended |
| ($ in thousands,
except per share amounts) (unaudited) |
|
March 31, |
|
|
|
March 31, |
| |
|
2024 |
|
|
|
2023 |
| |
Interest and dividend
income |
|
|
|
|
|
|
|
|
Loans receivable |
|
$ |
37,304 |
|
|
|
|
$ |
29,407 |
|
| |
Investment securities |
|
|
4,556 |
|
|
|
|
|
4,674 |
|
| |
Dividends from mutual funds,
FHLB stock and other investments |
|
|
173 |
|
|
|
|
|
115 |
|
| |
Interest bearing deposits in
banks |
|
|
3,618 |
|
|
|
|
|
4,304 |
|
| |
Total interest and dividend income |
|
|
45,651 |
|
|
|
|
|
38,500 |
|
| |
|
|
|
|
|
|
|
| |
Interest
expense |
|
|
|
|
|
|
| |
Deposits |
|
|
13,444 |
|
|
|
|
|
3,606 |
|
| |
Borrowings |
|
|
568 |
|
|
|
|
|
-- |
|
| |
Total interest expense |
|
|
14,012 |
|
|
|
|
|
3,606 |
|
| |
Net interest income |
|
|
31,639 |
|
|
|
|
|
34,894 |
|
| |
Provision for credit
losses – loans |
|
|
545 |
|
|
|
|
|
1,000 |
|
| |
Recapture of credit
losses – investment securities |
|
|
(7 |
) |
|
|
|
|
-- |
|
| |
Recapture of credit
losses - unfunded commitments |
|
|
(121 |
) |
|
|
|
|
-- |
|
| |
Net int. income after provision for (recapture of) credit
losses |
|
|
31,222 |
|
|
|
|
|
33,894 |
|
| |
|
|
|
|
|
|
|
| |
Non-interest
income |
|
|
|
|
|
|
| |
Service charges on
deposits |
|
|
2,011 |
|
|
|
|
|
1,840 |
|
| |
ATM and debit card interchange
transaction fees |
|
|
2,476 |
|
|
|
|
|
2,526 |
|
| |
Gain on sales of loans,
net |
|
|
120 |
|
|
|
|
|
67 |
|
| |
Bank owned life insurance
(“BOLI”) net earnings |
|
|
312 |
|
|
|
|
|
313 |
|
| |
Recoveries on investment
securities, net |
|
|
7 |
|
|
|
|
|
5 |
|
| |
Other |
|
|
487 |
|
|
|
|
|
590 |
|
| |
Total non-interest income, net |
|
|
5,413 |
|
|
|
|
|
5,341 |
|
| |
|
|
|
|
|
|
|
| |
Non-interest
expense |
|
|
|
|
|
|
| |
Salaries and employee
benefits |
|
|
11,936 |
|
|
|
|
|
11,946 |
|
| |
Premises and equipment |
|
|
2,054 |
|
|
|
|
|
1,925 |
|
| |
Advertising |
|
|
345 |
|
|
|
|
|
372 |
|
| |
ATM and debit card
processing |
|
|
1,216 |
|
|
|
|
|
972 |
|
| |
Postage and courier |
|
|
271 |
|
|
|
|
|
268 |
|
| |
State and local taxes |
|
|
644 |
|
|
|
|
|
597 |
|
| |
Professional fees |
|
|
572 |
|
|
|
|
|
902 |
|
| |
FDIC insurance expense |
|
|
416 |
|
|
|
|
|
326 |
|
| |
Loan administration and
foreclosure |
|
|
239 |
|
|
|
|
|
259 |
|
| |
Technology and
telecommunications |
|
|
2,014 |
|
|
|
|
|
1,668 |
|
| |
Deposit operations |
|
|
644 |
|
|
|
|
|
592 |
|
| |
Amortization of CDI |
|
|
113 |
|
|
|
|
|
135 |
|
| |
Other, net |
|
|
1,151 |
|
|
|
|
|
1,517 |
|
| |
Total non-interest expense, net |
|
|
21,615 |
|
|
|
|
|
21,479 |
|
| |
|
|
|
|
|
|
|
| |
Income before income
taxes |
|
|
15,020 |
|
|
|
|
|
17,756 |
|
| |
Provision for income
taxes |
|
|
3,016 |
|
|
|
|
|
3,587 |
|
| |
Net income |
|
$ |
12,004 |
|
|
|
|
$ |
14,169 |
|
| |
|
|
|
|
|
|
|
| |
Net income per common
share: |
|
|
|
|
|
|
| |
Basic |
|
$ |
1.48 |
|
|
|
|
$ |
1.72 |
|
| |
Diluted |
|
|
1.47 |
|
|
|
|
|
1.70 |
|
| |
|
|
|
|
|
|
|
| |
Weighted average
common shares outstanding: |
|
|
|
|
|
|
| |
Basic |
|
|
8,098,155 |
|
|
|
|
|
8,226,467 |
|
| |
Diluted |
|
|
8,143,701 |
|
|
|
|
|
8,311,630 |
|
|
TIMBERLAND BANCORP INC. AND
SUBSIDIARYCONSOLIDATED BALANCE
SHEETS |
| ($ in thousands, except per
share amounts) (unaudited) |
|
March 31, |
|
Dec. 31, |
|
March 31, |
| |
|
2024 |
|
2023 |
|
2023 |
| Assets |
|
|
|
|
|
|
|
Cash and due from financial institutions |
|
$ |
22,310 |
|
|
$ |
28,656 |
|
|
$ |
26,015 |
|
| Interest-bearing deposits in
banks |
|
|
158,039 |
|
|
|
129,365 |
|
|
|
116,468 |
|
|
Total cash and cash equivalents |
|
|
180,349 |
|
|
|
158,021 |
|
|
|
142,483 |
|
| |
|
|
|
|
|
|
| Certificates of deposit
(“CDs”) held for investment, at cost |
|
|
11,204 |
|
|
|
12,449 |
|
|
|
20,168 |
|
| Investment securities: |
|
|
|
|
|
|
|
Held to maturity, at amortized cost (net of ACL – investment
securities) |
|
|
211,818 |
|
|
|
266,085 |
|
|
|
277,911 |
|
|
Available for sale, at fair value |
|
|
61,746 |
|
|
|
40,446 |
|
|
|
54,838 |
|
| Investments in equity
securities, at fair value |
|
|
839 |
|
|
|
848 |
|
|
|
850 |
|
| FHLB stock |
|
|
2,037 |
|
|
|
2,001 |
|
|
|
2,202 |
|
| Other investments, at
cost |
|
|
3,000 |
|
|
|
3,000 |
|
|
|
3,000 |
|
| Loans held for sale |
|
|
1,311 |
|
|
|
1,425 |
|
|
|
200 |
|
| |
|
|
|
|
|
|
| Loans receivable |
|
|
1,375,934 |
|
|
|
1,352,938 |
|
|
|
1,224,891 |
|
| Less: ACL – loans |
|
|
(16,818 |
) |
|
|
(16,655 |
) |
|
|
(14,698 |
) |
|
Net loans receivable |
|
|
1,359,116 |
|
|
|
1,336,283 |
|
|
|
1,210,193 |
|
| |
|
|
|
|
|
|
| Premises and equipment,
net |
|
|
21,718 |
|
|
|
21,584 |
|
|
|
21,744 |
|
| BOLI |
|
|
23,278 |
|
|
|
23,122 |
|
|
|
23,119 |
|
| Accrued interest
receivable |
|
|
7,108 |
|
|
|
6,731 |
|
|
|
5,295 |
|
| Goodwill |
|
|
15,131 |
|
|
|
15,131 |
|
|
|
15,131 |
|
| CDI |
|
|
564 |
|
|
|
621 |
|
|
|
813 |
|
| Loan servicing rights,
net |
|
|
1,717 |
|
|
|
1,925 |
|
|
|
2,535 |
|
| Operating lease right-of-use
assets |
|
|
1,624 |
|
|
|
1,698 |
|
|
|
1,844 |
|
| Other assets |
|
|
4,674 |
|
|
|
3,745 |
|
|
|
4,292 |
|
|
Total assets |
|
$ |
1,907,234 |
|
|
$ |
1,895,115 |
|
|
$ |
1,786,618 |
|
| |
|
|
|
|
|
|
|
Liabilities and shareholders’ equity |
|
|
|
|
|
|
| Deposits: Non-interest-bearing
demand |
|
$ |
424,906 |
|
|
$ |
433,065 |
|
|
$ |
479,283 |
|
| Deposits:
Interest-bearing |
|
|
1,213,648 |
|
|
|
1,194,004 |
|
|
|
1,069,484 |
|
|
Total deposits |
|
|
1,638,554 |
|
|
|
1,627,069 |
|
|
|
1,548,767 |
|
| |
|
|
|
|
|
|
| Operating lease
liabilities |
|
|
1,723 |
|
|
|
1,796 |
|
|
|
1,935 |
|
| FHLB borrowings |
|
|
20,000 |
|
|
|
20,000 |
|
|
|
-- |
|
| Other liabilities and accrued
expenses |
|
|
8,278 |
|
|
|
8,881 |
|
|
|
8,255 |
|
|
Total liabilities |
|
|
1,668,555 |
|
|
|
1,657,746 |
|
|
|
1,558,957 |
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
|
|
|
|
|
Common stock, $.01 par value; 50,000,000 shares
authorized;
8,023,121 shares issued and outstanding – March 31,
2024
8,120,708 shares issued and outstanding – December 31,
2023
8,203,174 shares issued and outstanding – March 31, 2023 |
|
|
32,338 |
|
|
|
34,869 |
|
|
|
37,979 |
|
| Retained earnings |
|
|
207,086 |
|
|
|
203,327 |
|
|
|
190,177 |
|
| Accumulated other
comprehensive loss |
|
|
(745 |
) |
|
|
(827 |
) |
|
|
(495 |
) |
|
Total shareholders’ equity |
|
|
238,679 |
|
|
|
237,369 |
|
|
|
227,661 |
|
|
Total liabilities and shareholders’ equity |
|
$ |
1,907,234 |
|
|
$ |
1,895,115 |
|
|
$ |
1,786,618 |
|
| |
Three Months
Ended |
| PERFORMANCE
RATIOS: |
|
March 31,2024 |
|
Dec. 31,2023 |
|
March 31,2023 |
|
Return on average assets (a) |
|
|
1.22 |
% |
|
|
1.36 |
% |
|
|
1.48 |
% |
| Return on average equity
(a) |
|
|
9.67 |
% |
|
|
10.75 |
% |
|
|
11.86 |
% |
| Net interest margin (a) |
|
|
3.48 |
% |
|
|
3.60 |
% |
|
|
3.99 |
% |
| Efficiency ratio |
|
|
60.22 |
% |
|
|
56.50 |
% |
|
|
55.31 |
% |
| |
|
|
|
|
|
|
| |
|
Six Months Ended |
| PERFORMANCE
RATIOS: |
|
March 31,2024 |
|
|
|
March 31,2023 |
| Return on average assets
(a) |
|
|
1.28 |
% |
|
|
|
|
1.55 |
% |
| Return on average equity
(a) |
|
|
10.18 |
% |
|
|
|
|
12.74 |
% |
| Net interest margin (a) |
|
|
3.53 |
% |
|
|
|
|
4.02 |
% |
| Efficiency ratio |
|
|
58.34 |
% |
|
|
|
|
53.38 |
% |
| |
|
|
|
|
|
|
| |
|
Three Months Ended |
| ASSET QUALITY RATIOS
AND DATA: |
|
March 31,2024 |
|
Dec. 31,2023 |
|
March 31,2023 |
| Non-accrual loans |
|
$ |
3,605 |
|
|
$ |
3,366 |
|
|
$ |
1,969 |
|
| Loans past due 90 days and
still accruing |
|
|
-- |
|
|
|
-- |
|
|
|
-- |
|
| Non-performing investment
securities |
|
|
79 |
|
|
|
85 |
|
|
|
93 |
|
| OREO and other repossessed
assets |
|
|
-- |
|
|
|
-- |
|
|
|
-- |
|
| Total non-performing assets
(b) |
|
$ |
3,684 |
|
|
$ |
3,451 |
|
|
$ |
2,062 |
|
| |
|
|
|
|
|
|
| Non-performing assets to total
assets (b) |
|
|
0.19 |
% |
|
|
0.18 |
% |
|
|
0.12 |
% |
| Net charge-offs (recoveries)
during quarter |
|
$ |
3 |
|
|
$ |
2 |
|
|
$ |
6 |
|
| Allowance for credit losses -
loans to non-accrual loans, |
|
|
467 |
% |
|
|
495 |
% |
|
|
746 |
% |
| Allowance for credit losses -
loans to loans receivable (c) |
|
|
1.22 |
% |
|
|
1.23 |
% |
|
|
1.20 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL RATIOS: |
|
|
|
|
|
|
| Tier 1 leverage capital |
|
|
12.01 |
% |
|
|
12.14 |
% |
|
|
11.95 |
% |
| Tier 1 risk-based capital |
|
|
18.08 |
% |
|
|
18.22 |
% |
|
|
18.16 |
% |
| Common equity Tier 1
risk-based capital |
|
|
18.08 |
% |
|
|
18.22 |
% |
|
|
18.16 |
% |
|
Total risk-based capital |
|
|
19.33 |
% |
|
|
19.50 |
% |
|
|
19.41 |
% |
| Tangible common equity to
tangible assets (non-GAAP) |
|
|
11.79 |
% |
|
|
11.79 |
% |
|
|
11.96 |
% |
| |
|
|
|
|
|
|
|
BOOK VALUES: |
|
|
|
|
|
|
| Book value per common
share |
|
$ |
29.75 |
|
|
$ |
29.23 |
|
|
$ |
27.75 |
|
| Tangible book value per common
share (d) |
|
|
27.79 |
|
|
|
27.29 |
|
|
|
25.81 |
|
_____________________________________
(a) Annualized(b) Non-performing assets include
non-accrual loans, loans past due 90 days and still accruing,
non-performing investment securities and OREO and other repossessed
assets. (c) Does not include loans held for sale and is before the
allowance for loan losses.(d) Tangible common equity divided by
common shares outstanding
(non-GAAP). AVERAGE
BALANCES, YIELDS, AND RATES - QUARTERLY ($ in
thousands)(unaudited)
| |
For the Three Months Ended |
| |
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
| |
Amount |
|
Rate |
|
Amount |
|
Rate |
|
Amount |
|
Rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Loans receivable and loans
held for sale |
$ |
1,365,417 |
|
|
5.57 |
% |
|
$ |
1,332,971 |
|
|
5.52 |
% |
|
$ |
1,200,872 |
|
|
4.98 |
% |
| Investment securities and FHLB
stock (1) |
|
298,003 |
|
|
3.14 |
|
|
|
317,164 |
|
|
3.03 |
|
|
|
340,317 |
|
|
2.97 |
|
| Interest-earning deposits in
banks and CDs |
|
143,121 |
|
|
5.39 |
|
|
|
126,253 |
|
|
5.38 |
|
|
|
177,748 |
|
|
4.30 |
|
|
Total interest-earning assets |
|
1,806,541 |
|
|
5.16 |
|
|
|
1,776,388 |
|
|
5.07 |
|
|
|
1,718,937 |
|
|
4.51 |
|
| Other assets |
|
81,337 |
|
|
|
|
|
|
81,612 |
|
|
|
|
|
|
84,072 |
|
|
|
|
|
Total assets |
$ |
1,887,878 |
|
|
|
|
|
$ |
1,858,000 |
|
|
|
|
|
$ |
1,803,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NOW checking accounts |
$ |
367,924 |
|
|
1.61 |
% |
|
$ |
376,682 |
|
|
1.51 |
% |
|
$ |
412,642 |
|
|
0.83 |
% |
| Money market accounts |
|
270,623 |
|
|
3.14 |
|
|
|
224,939 |
|
|
2.34 |
|
|
|
218,718 |
|
|
0.68 |
|
| Savings accounts |
|
214,233 |
|
|
0.23 |
|
|
|
220,042 |
|
|
0.22 |
|
|
|
274,877 |
|
|
0.14 |
|
| Certificates of deposit
accounts |
|
295,202 |
|
|
4.16 |
|
|
|
268,628 |
|
|
3.97 |
|
|
|
170,547 |
|
|
2.22 |
|
| Brokered CDs |
|
40,402 |
|
|
5.40 |
|
|
|
42,725 |
|
|
5.38 |
|
|
|
-- |
|
|
-- |
|
|
Total interest-bearing deposits |
|
1,188,384 |
|
|
2.47 |
|
|
|
1,133,016 |
|
|
2.18 |
|
|
|
1,076,784 |
|
|
0.84 |
|
| Borrowings |
|
20,001 |
|
|
4.42 |
|
|
|
28,804 |
|
|
4.81 |
|
|
|
6 |
|
|
5.43 |
|
|
Total interest-bearing liabilities |
|
1,208,385 |
|
|
2.50 |
|
|
|
1,161,820 |
|
|
2.22 |
|
|
|
1,076,790 |
|
|
0.84 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Non-interest-bearing demand
deposits |
|
431,826 |
|
|
|
|
|
|
450,027 |
|
|
|
|
|
|
492,294 |
|
|
|
|
| Other liabilities |
|
10,182 |
|
|
|
|
|
|
11,878 |
|
|
|
|
|
|
9,136 |
|
|
|
|
| Shareholders’ equity |
|
237,485 |
|
|
|
|
|
|
234,275 |
|
|
|
|
|
|
224,789 |
|
|
|
|
|
Total liabilities and shareholders’ equity |
$ |
1,887,878 |
|
|
|
|
|
$ |
1,858,000 |
|
|
|
|
|
$ |
1,803,009 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
|
|
2.66 |
% |
|
|
|
|
|
2.85 |
% |
|
|
|
|
|
3.67 |
% |
|
Net interest margin (2) |
|
|
|
|
3.48 |
% |
|
|
|
|
|
3.60 |
% |
|
|
|
|
|
3.99 |
% |
|
Average interest-earning assets to average interest-bearing
liabilities |
|
149.50 |
% |
|
|
|
|
|
152.90 |
% |
|
|
|
|
|
159.64 |
% |
|
|
|
_____________________________________(1) Includes other
investments(2) Net interest margin = annualized net interest income
/ average interest-earning assets
| |
For the Six Months Ended |
| |
March 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
March 31, 2023 |
| |
Amount |
|
Rate |
|
|
|
|
|
|
|
|
Amount |
|
Rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Loans receivable and loans
held for sale |
$ |
1,349,105 |
|
|
5.53 |
% |
|
|
|
|
|
|
|
|
$ |
1,182,420 |
|
|
4.97 |
% |
| Investment securities and FHLB
stock (1) |
|
307,636 |
|
|
3.08 |
|
|
|
|
|
|
|
|
|
|
332,815 |
|
|
2.88 |
|
| Interest-earning deposits in
banks and CDs |
|
134,643 |
|
|
5.37 |
|
|
|
|
|
|
|
|
|
|
222,569 |
|
|
3.87 |
|
|
Total interest-earning assets |
|
1,791,384 |
|
|
5.10 |
|
|
|
|
|
|
|
|
|
|
1,737,804 |
|
|
4.43 |
|
| Other assets |
|
81,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
86,171 |
|
|
|
|
|
Total assets |
$ |
1,872,857 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,823,975 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NOW checking accounts |
$ |
372,327 |
|
|
1.56 |
% |
|
|
|
|
|
|
|
|
$ |
426,345 |
|
|
0.63 |
% |
| Money market accounts |
|
247,656 |
|
|
2.78 |
|
|
|
|
|
|
|
|
|
|
229,185 |
|
|
0.60 |
|
| Savings accounts |
|
217,153 |
|
|
0.23 |
|
|
|
|
|
|
|
|
|
|
277,382 |
|
|
0.13 |
|
| Certificates of deposit
accounts |
|
281,842 |
|
|
4.07 |
|
|
|
|
|
|
|
|
|
|
152,814 |
|
|
1.84 |
|
| Brokered CDs |
|
41,570 |
|
|
5.39 |
|
|
|
|
|
|
|
|
|
|
-- |
|
|
-- |
|
|
Total interest-bearing deposits |
|
1,160,548 |
|
|
2.32 |
|
|
|
|
|
|
|
|
|
|
1,085,726 |
|
|
0.67 |
|
| Borrowings |
|
24,427 |
|
|
4.65 |
|
|
|
|
|
|
|
|
|
|
3 |
|
|
5.43 |
|
|
Total interest-bearing liabilities |
|
1,184,975 |
|
|
2.37 |
|
|
|
|
|
|
|
|
|
|
1,085,729 |
|
|
0.67 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Non-interest-bearing demand
deposits |
|
440,976 |
|
|
|
|
|
|
|
|
|
|
|
|
|
505,949 |
|
|
|
|
| Other liabilities |
|
11,035 |
|
|
|
|
|
|
|
|
|
|
|
|
|
9,813 |
|
|
|
|
| Shareholders’ equity |
|
235,871 |
|
|
|
|
|
|
|
|
|
|
|
|
|
222,484 |
|
|
|
|
|
Total liabilities and shareholders’ equity |
$ |
1,872,857 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,823,975 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
|
|
2.73 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
3.76 |
% |
|
Net interest margin (2) |
|
|
|
|
3.53 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
4.02 |
% |
|
Average interest-earning assets to average interest-bearing
liabilities |
|
151.17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
160.06 |
% |
|
|
|
_____________________________________(1) Includes other
investments(2) Net interest margin = annualized net interest income
/ average interest-earning assets
Non-GAAP Financial MeasuresIn addition to
results presented in accordance with GAAP, this press release
contains certain non-GAAP financial measures. Timberland believes
that certain non-GAAP financial measures provide investors with
information useful in understanding the Company’s financial
performance; however, readers of this report are urged to review
these non-GAAP financial measures in conjunction with GAAP results
as reported.
Financial measures that exclude intangible assets are non-GAAP
measures. To provide investors with a broader understanding of
capital adequacy, Timberland provides non-GAAP financial measures
for tangible common equity, along with the GAAP measure. Tangible
common equity is calculated as shareholders’ equity less goodwill
and CDI. In addition, tangible assets equal total assets less
goodwill and CDI.
The following table provides a reconciliation of ending
shareholders’ equity (GAAP) to ending tangible shareholders’ equity
(non-GAAP) and ending total assets (GAAP) to ending tangible assets
(non-GAAP).
| ($ in thousands) |
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
| |
|
|
|
|
|
|
|
Shareholders’ equity |
|
$ |
238,679 |
|
|
$ |
237,369 |
|
|
$ |
227,661 |
|
| Less goodwill and CDI |
|
|
(15,695 |
) |
|
|
(15,752 |
) |
|
|
(15,944 |
) |
| Tangible common equity |
|
$ |
222,984 |
|
|
$ |
221,617 |
|
|
$ |
211,717 |
|
| |
|
|
|
|
|
|
| Total assets |
|
$ |
1,907,234 |
|
|
$ |
1,895,115 |
|
|
$ |
1,786,618 |
|
| Less goodwill and CDI |
|
|
(15,695 |
) |
|
|
(15,752 |
) |
|
|
(15,944 |
) |
| Tangible assets |
|
$ |
1,891,539 |
|
|
$ |
1,879,363 |
|
|
$ |
1,770,674 |
|
|
Contact: |
Dean
J. Brydon, CEO |
| |
Jonathan A. Fischer, President & COO |
| |
Marci A. Basich, CFO |
| |
(360) 533-4747 |
| |
www.timberlandbank.com |
Timberland Bancorp (NASDAQ:TSBK)
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