FOR IMMEDIATE RELEASE

Investor and Press Contact:

Brian K. Finneran

President & Chief Financial Officer

(516) 548-8500

Hanover Bancorp, Inc. Reports Second Fiscal Quarter 2021

Results highlighted by Record Net Interest Income and

Record Net Interest Margin

Mineola, NY – April 27, 2021 – Hanover Bancorp, Inc. (“Hanover” or “the Company”), the holding company for Hanover Community Bank (“the Bank”) today reported significant performance achievements for the quarter ended March 31, 2021, highlighted by strong capital and loan growth in addition to record levels of net interest income and net interest margin.

Earnings Summary for the Quarter Ended March 31, 2021

The Company reported net income for the calendar quarter ended March 31, 2021 of $2.1 million or $0.48 per diluted common share, representing an increase of $1.8 million from the comparable year ago period when net income totaled $249 thousand or $0.06 per diluted common share. Second fiscal quarter returns on average total assets and average stockholders’ equity were 0.97% and 10.28%, respectively, in 2021versus 0.11% and 1.34% in the year ago period.

The improvement in net income recorded in the second fiscal quarter of 2021 resulted from a $1.3 million or 19.7% increase in net interest income, an $800 thousand reduction in the provision for loan losses and a $254 thousand increase in non-interest income versus the comparable 2020 period. Partially offsetting these positive factors was a $94 thousand or 1.7% increase in total operating expenses in the second fiscal quarter of 2021 from the year ago quarter.  The year-over-year growth in net interest income was due to a substantial widening of the Company’s net interest margin to 3.79% in 2021 from 3.06% in the comparable 2020 quarter.  The margin improvement resulted principally from a 110 basis point reduction in the cost of average interest-bearing liabilities to 0.96% in 2021, largely due to a 125 basis point reduction in the average rate paid on savings and time deposits in the 2021 quarter. Also adding to the wider margin was a shift in the average interest-earning asset mix resulting from a $28.3 million increase in average loans outstanding coupled with a $55.2 million reduction in low yielding average interest-earning cash in the second fiscal quarter of 2021 versus the comparable 2020 period.  The reduction in the provision for loan losses in the second fiscal quarter of 2021 was due to the additional provision taken in the second fiscal quarter of 2020 due to economic concerns primarily related to the COVID-19 pandemic.  Although the economy in the Company’s market area appears to have stabilized in 2021, the Company did not reverse any previously recognized loan loss provisions due to continued economic uncertainty. The growth in non-interest income in the second fiscal quarter of 2021 resulted primarily from a $240 thousand gain on the sale of a security available for sale and a $68 thousand or 119.3% increase in loan fees and service charges.

Excluding merger-related charges recorded in the second fiscal quarter of 2021 and litigation and proxy contest expenses recorded in the comparable 2020 period, core (non-GAAP) operating net income was $2.2 million or $0.51 per diluted common share, up $1.5 million versus 2020 core operating net income. Second fiscal quarter core returns on average total assets and average stockholders’ equity, excluding merger, litigation, and proxy-related charges in each respective period, were 1.02% and 10.88%, respectively in 2021, versus 0.30% and 3.56% a year ago.

Earnings Summary for the Six Months Ended March 31, 2021

For the six months ended March 31, 2021, the Company reported net income of $3.6 million or $0.84 per diluted common share versus $2.0 million or $0.48 per diluted common share a year ago.

The improved level of earnings in 2021 resulted from a $1.9 million increase in net interest income, principally due to a 50 basis point widening of the company’s net interest margin to 3.66% in the six months ended March 31, 2021, a $700 thousand reduction in the provision for loan losses and a reduction in the effective tax rate to 20.4% in 2021 from 22.4% a year ago.  Partially offsetting these positive factors was a $152 thousand reduction in non-interest income in the 2021 period coupled with a $533 thousand increase in total operating expenses, principally resulting from growth in compensation and benefits related to increased headcount as the Company has continued to grow and create the infrastructure required for a public reporting company. Experienced executives have also been added to implement new product initiatives such as municipal banking along with expanded commercial real estate and commercial and industrial lending.

Michael P. Puorro, Chairman and Chief Executive Officer, commented on the Company’s results: “I am extremely pleased with Hanover’s second fiscal quarter 2021 financial results which produced record levels of net interest income and net interest margin and prudent loan growth. We will continue to be very cautious when extending credit until the economy shows signs of sustained improvement though I am confident that recent indications bode well for a strong recovery during the balance of 2021. As I have previously stated, we continue to work proactively with our borrowers who have been granted loan forbearances and we have had great success to date in returning the vast majority of these borrowers back to regular payment status.  I am also very excited about our strategic merger with Savoy Bank that we are confident will create one of the premier community banks in the metro New York City area with under $5 billion in total assets. We have highly complementary lending niches, and we believe that Savoy’s funding profile will benefit greatly from Hanover’s rapid progress in building out several niche core deposit businesses, including our municipal banking function, which fueled our record net interest margin this quarter. I am also looking forward to working closely with Mac Wilcox, Savoy’s President and CEO who will join Hanover as Senior Executive Vice President, Head of Commercial Lending and Chief Revenue Officer, as well as Metin Negrin and Elena Sisti from Savoy who will be joining Hanover’s Board of Directors. The merger is expected to close in the second quarter of 2021, subject to satisfaction of customary closing conditions, including receipt of required regulatory approvals and approval by Savoy’s shareholders.”

Mr. Puorro also noted, “Growth in shareholder value is always our highest priority at Hanover Bancorp. This hallmark of our success continues to be reflected by growth in tangible book value per share which increased by $1.66, or 9.5%, to $19.19 per share at March 31, 2021 versus the comparable 2020 date.”

Balance Sheet Growth

Total assets at March 31, 2021 were $890.4 million versus $895.6 million at the comparable 2020 date. Total deposits at the same date were largely flat at $718.2 million when compared to March 31, 2020, however, there was a significant shift in the deposit mix as core deposits (Demand, N.O.W., Savings and Money Market) increased year-over-year by $171.2 million while Time Deposits declined by $170.1 million. Management reduced usage of its Federal Home Loan Bank (“FHLB”) borrowing capacity in the second fiscal quarter of 2021 as other lower cost funding options were utilized to replace maturing FHLB advances. Borrowings at March 31, 2021 declined by $25.0 million to $56.4 million, with a weighted average rate and term of 1.23% and 24 months, respectively. At March 31, 2021, the Bank had $154.0 million of additional borrowing capacity from the FHLB.

Stockholders’ equity increased by $7.7 million to $82.2 million at March 31, 2021 from the comparable 2020 date resulting in an 9.5% increase in tangible book value per share over the past twelve months to $19.19 at March 31, 2021.

The Company’s average cost of interest-bearing liabilities decreased to 0.96% for the quarter ended March 31, 2021, from 2.06% a year ago and declined from 1.26% on a linked quarter basis. Partially offsetting the improvement in the Company’s average cost of interest-bearing liabilities from the March 2020 period was a 27 basis point reduction in the average yield on interest-earning assets to 4.56% during the calendar quarter ended March 31, 2021, primarily driven by lower average loan yields (down 49 basis points in 2021) resulting principally from the lower interest rate environment that continues to prevail in 2021.

Strong Loan Portfolio Growth

For the twelve months ended March 31, 2021, the Bank’s loan portfolio, net of sales, grew by $71.5 million, or 10.3%. Year over year growth was concentrated primarily in multi-family, commercial real estate, and PPP loans. At March 31, 2021, the Company’s residential loan portfolio amounted to $432.5 million, with an average loan balance of $430 thousand and a weighted average loan-to-value ratio of 52%. Commercial real estate loans totaled $293.7 million at March 31, 2021, with an average loan balance of $816 thousand and a weighted average loan-to-value ratio of 53%. The Company’s commercial real estate concentration ratio was 247% of capital at March 31, 2021 versus 235% of capital at the comparable 2020 date.

Historically, the Bank has been able to generate additional income by strategically originating and selling its primary lending products to other financial institutions at premiums, while also retaining servicing rights in some sales. The Bank expects that it will continue to originate loans, for its own portfolio and for sale, which will result in continued growth in interest income while also realizing gains on sale of loans to others and recording servicing income. The loan sale market was negatively impacted by the COVID-19 pandemic during much of 2020 although current indications are that it is again close to normalizing. During the quarter ended March 31, 2021, the Company sold $9.4 million in performing loans and recorded gains on the sale of loans held-for-sale of $295 thousand versus gains of $181 thousand in the quarter ended December 31, 2020 and gains of $339 thousand in the quarter ended March 31, 2020. During the twelve months ended March 31, 2021, the Company recorded cumulative gains of $491 thousand on the sale of performing loans held-for-sale.

At March 31, 2021, the Company reported $9.4 million in non-performing loans which represented 1.22% of total loans outstanding, as compared to $1.7 million in nonperforming loans, or 0.25% of total loans outstanding at March 31, 2020. The increase in non-performing loans in 2021 resulted from the addition of several credits where the borrowers had been granted forbearance in 2020 and where management believed it unlikely that the borrowers would be able to comply with the terms of their modified payment plans. The Company believes that each of these loans is well secured. During the second fiscal quarter of 2021, the Company recorded a provision for loan losses expense of $200 thousand. The March 31, 2021 allowance for loan losses balance was $8.2 million versus $7.8 million a year ago. The allowance for loan losses as a percent of total loans was 1.07% at March 31, 2021 versus 1.09% at December 31, 2020 and 1.13% at March 31, 2020. The allowance for loan losses as a percent of total originated loans was 1.18% at March 31, 2021.

Record Net Interest Margin

The Bank’s net interest margin improved to a record 3.79% during the second fiscal quarter of 2021, versus 3.06% in the comparable 2020 quarter and 3.53% in the quarter ended December 31, 2020. The 73 basis point increase in the Bank’s net interest margin versus the comparable 2020 quarter was primarily attributable to a 110 basis point reduction in the cost of average interest-bearing liabilities to 0.96% from 2.06% a year ago.  The lower cost of funds in 2021 was the result of a significant reduction in the cost of interest-bearing deposits in 2021 (down 125 basis points), accompanied by a shift in the Company’s deposit mix to a greater concentration of core deposit balances. Also contributing to the wider margin in the second fiscal quarter of 2021 was a decrease in lower-yielding average interest-bearing cash on the balance sheet (down $55.2 million). Partially offsetting the positive impact of the foregoing factors, the average rate on total interest-earning assets declined by 27 basis points to 4.56% in the second fiscal quarter of 2021 versus the comparable 2020 period. This reduction in yield was largely the result of a 49 basis point decrease in the average loan yield to 4.99% in 2021.

Operating Efficiency Ratio

The Bank’s operating efficiency ratio was 69.4% in the second fiscal quarter of 2021 versus 81.0% a year ago.  The second fiscal quarter 2021 core operating efficiency ratio, which excludes merger-related charges, was 67.5%.

About Hanover Community Bank and Hanover Bancorp, Inc.

Hanover Bancorp, Inc., is a locally owned and operated privately held stock bank holding company for Hanover Community Bank, a community commercial bank focusing on highly personalized and efficient services and products responsive to local needs. Management and the Board of Directors are comprised of a select group of successful local businessmen and women who are committed to the success of the Bank by knowing and understanding the metro-New York area’s financial needs and opportunities. Backed by state-of-the-art technology, Hanover offers a full range of financial services. Hanover employs a complete suite of consumer and commercial banking products and services, including multi-family and commercial mortgages, residential loans, business loans and lines of credit. Hanover also offers its customers access to 24-hour ATM service with no fees attached, free checking with interest, telephone banking, advanced technologies in mobile and internet banking for our consumer and business customers, safe deposit boxes and much more. The Company’s corporate administrative office is located in Mineola, New York where it also operates a full service branch office along with additional branch locations in Garden City Park, Forest Hills, Flushing, Sunset Park, and Chinatown, New York.

Hanover Community Bank is a member of the Federal Deposit Insurance Corporation and is an Equal Housing/Equal Opportunity Lender. For further information, call 516-548-8500 or visit the Bank’s website at www.hanoverbank.com.

 

Non-GAAP Disclosure

 

This discussion includes non-GAAP financial measures of the Company’s core net income, core net interest margin, core returns on average assets and shareholders’ equity, and core operating efficiency ratio. A non-GAAP financial measure is a numerical measure of historical or future performance, financial position or cash flows that excludes or includes amounts that are required to be disclosed in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”).  The Company’s management believes that the presentation of non-GAAP financial measures provides both management and investors with a greater understanding of the Company’s operating results and trends in addition to the results measured in accordance with GAAP.  While management uses non-GAAP financial measures in its analysis of the Company’s performance, this information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with U.S. GAAP or considered to be more important than financial results determined in accordance with U.S. GAAP.  The Company’s non-GAAP financial measures may not be comparable to similarly titled measures used by other financial institutions.

 

With respect to the calculations of core operating net income and core operating efficiency ratio for the periods presented in this discussion, reconciliations to the most comparable U.S. GAAP measures are provided in the tables that follow.

 

Forward-Looking Statements

 

This release may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and may be identified by the use of such words as "may," "believe," "expect," "anticipate," "should," "plan," "estimate," "predict," "continue," and "potential" or the negative of these terms or other comparable terminology. Examples of forward-looking statements include, but are not limited to, estimates with respect to the financial condition, results of operations and business of Hanover Bancorp, Inc. Any or all of the forward-looking statements in this release and in any other public statements made by Hanover Bancorp, Inc. may turn out to be incorrect. They can be affected by inaccurate assumptions Hanover Bancorp, Inc. might make or by known or unknown risks and uncertainties. Further, the adverse effect of the COVID-19 pandemic on the Company, its customers, and the communities where it operates may adversely affect the Company’s business, results of operations and financial condition for an indefinite period. Consequently, no forward-looking statement can be guaranteed. Hanover Bancorp, Inc. does not intend to update any of the forward-looking statements after the date of this release or to conform these statements to actual events.

 

		March 31, 2021				December 31, 2020				March 31, 2020
Assets
Cash and cash equivalents		$	77,529			$	98,388			$	162,223
Securities available for sale, at fair value			7,801				7,434				966
Investments held to maturity			9,470				10,001				11,535
Loans held for sale			893				4,150				2,433
Loans, net of deferred fees and costs			763,596				728,752				692,114
Less: allowance for loan losses			(8,179	)			(7,979	)			(7,843	)
Loans, net			755,417				720,773				684,271
Goodwill			1,710				1,901				1,542
Premises & fixed assets			14,328				14,325				14,359
Other assets			23,284				19,911				18,277
Total assets		$	890,432			$	876,883			$	895,606
Liabilities and stockholders' equity
Core deposits		$	412,992			$	311,439			$	241,820
Time deposits			305,192				376,877				475,276
Total deposits			718,184				688,316				717,096
Borrowings			56,417				74,514				81,446
Note payable			-				-				14,982
Subordinated debentures			24,482				24,468				-
Other liabilities			9,104				9,561				7,569
Total liabilities			808,187				796,859				821,093
Stockholders' equity			82,245				80,024				74,513
Total liabilities and stockholders' equity		$	890,432			$	876,883			$	895,606

		Three Months Ended								Six Months Ended
		3/31/2021				3/31/2020				3/31/2021				3/31/2020
Interest income		$	9,380			$	10,281			$	18,877			$	20,717
Interest expense			1,578				3,764				3,748				7,463
Net interest income			7,802				6,517				15,129				13,254
Provision for loan losses			200				1,000				300				1,000
Net interest income after provision for loan losses			7,602				5,517				14,829				12,254
Loan fees and service charges			125				57				191				137
Service charges on deposit accounts			17				15				32				35
Gain on sale of loans held for sale			295				339				476				902
Gain on sale of securities available for sale			240				-				240				-
Other operating income			15				27				39				56
Non-interest income			692				438				978				1,130
Compensation and benefits			3,325				2,886				6,501				5,474
Occupancy and equipment			1,209				1,083				2,380				2,215
Data processing			270				250				515				466
Marketing and advertising			19				111				67				217
Acquisition costs			151				-				296				236
Professional fees			308				837				720				1,342
Other operating expenses			443				464				836				832
Non-interest expense			5,725				5,631				11,315				10,782
Income before income taxes			2,569				324				4,492				2,602
Income tax expense			514				75				918				583
Net income		$	2,055			$	249			$	3,574			$	2,019
Basic earnings per share		$	0.49			$	0.06			$	0.85			$	0.49
Diluted earnings per share		$	0.48			$	0.06			$	0.84			$	0.48

		Three Months Ended
		3/31/2021				12/31/2020				9/30/2020				6/30/2020				3/31/2020
Interest income		$	9,380			$	9,497			$	9,751			$	9,665			$	10,281
Interest expense			1,578				2,170				2,385				3,163				3,764
Net interest income			7,802				7,327				7,366				6,502				6,517
Provision for loan losses			200				100				100				150				1,000
Net interest income after provision for loan losses			7,602				7,227				7,266				6,352				5,517
Loan fees and service charges			125				66				111				53				57
Service charges on deposit accounts			17				15				12				12				15
Gain on sale of loans held for sale			295				181				-				15				339
Gain on sale of securities available for sale			240				-				-				-				-
Other operating income			15				24				12				19				27
Non-interest income			692				286				135				99				438
Compensation and benefits			3,325				3,176				3,020				2,688				2,886
Occupancy and equipment			1,209				1,171				1,169				1,078				1,083
Data processing			270				245				234				211				250
Marketing and advertising			19				48				16				63				111
Acquisition costs			151				145				214				-				-
Professional fees			308				412				438				290				837
Other operating expenses			443				393				481				338				464
Non-interest expense			5,725				5,590				5,572				4,668				5,631
Income before income taxes			2,569				1,923				1,829				1,783				324
Income tax expense			514				404				283				374				75
Net income		$	2,055			$	1,519			$	1,546			$	1,409			$	249
Basic earnings per share		$	0.49			$	0.36			$	0.38			$	0.34			$	0.06
Diluted earnings per share		$	0.48			$	0.36			$	0.37			$	0.33			$	0.06

		Three Months Ended								Six Months Ended
		3/31/2021				3/31/2020				3/31/2021				3/31/2020
CORE NET INCOME:
Net income, as reported		$	2,055			$	249			$	3,574			$	2,019
Adjustments:
Merger-related expenses			151				-				296				236
Debt extinguishment charges			-				-				54				-
Litigation and proxy-related expenses			-				536				-				742
Total adjustments, before income taxes			151				536				350				978
Adjustment for reported effective income tax rate			30				124				72				219
Total adjustments, after income taxes			121				412				278				759
Core net income		$	2,176			$	661			$	3,852			$	2,778
Basic earnings per share - core		$	0.52			$	0.16			$	0.92			$	0.67
Diluted earnings per share - core		$	0.51			$	0.16			$	0.91			$	0.66
CORE NET INTEREST INCOME:
Net interest income, as reported		$	7,802			$	6,517			$	15,129			$	13,254
Adjustments:
Debt extinguishment charges			-				-				54				-
Core net interest income		$	7,802			$	6,517			$	15,183			$	13,254
CORE NET INTEREST MARGIN:
Net interest margin, as reported			3.79	%			3.06	%			3.66	%			3.16	%
Adjustments:
Debt extinguishment charges			-				-				0.01	%			-
Core net interest margin			3.79	%			3.06	%			3.67	%			3.16	%
CORE OPERATING EFFICIENCY RATIO: (2)
Operating efficiency ratio, as reported			69.36	%			80.96	%			71.31	%			74.96	%
Adjustments:
Merger-related expenses			-1.83	%			-				-1.87	%			-1.64	%
Debt extinguishment charges			-				-				-0.24	%			-
Litigation and proxy-related expenses			-				-7.71	%			-				-5.16	%
Core operating efficiency ratio			67.53	%			73.25	%			69.20	%			68.16	%
CORE RETURN ON AVERAGE ASSETS			1.02	%			0.30	%			0.90	%			0.64	%
CORE RETURN ON AVERAGE EQUITY			10.88	%			3.56	%			9.65	%			7.53	%

		Three Months Ended								Six Months Ended
		3/31/2021				3/31/2020				3/31/2021				3/31/2020
Profitability:
Return on average assets			0.97	%			0.11	%			0.84	%			0.47	%
Return on average equity			10.28	%			1.34	%			8.95	%			5.47	%
Yield on average interest-earning assets			4.56	%			4.83	%			4.57	%			4.94	%
Cost of average interest-bearing liabilities			0.96	%			2.06	%			1.12	%			2.09	%
Net interest rate spread (1)			3.60	%			2.77	%			3.45	%			2.85	%
Net interest margin (2)			3.79	%			3.06	%			3.66	%			3.16	%
Non-interest expense to average assets			2.69	%			2.56	%			2.64	%			2.49	%
Operating efficiency ratio (3)			69.36	%			80.96	%			71.31	%			74.96	%
Average balances:
Interest-earning assets		$	833,778			$	856,961			$	828,912			$	838,321
Interest-bearing liabilities			665,423				734,129				673,537				713,770
Loans			742,004				713,712				733,283				723,191
Deposits			690,024				697,837				675,876				675,221
Total borrowings			83,283				104,706				93,320				109,019

		At or For the Three Months Ended
		3/31/2021				12/31/2020				9/30/2020				6/30/2020
Asset quality:
Provision for loan losses		$	200			$	100			$	100			$	150
Net (recoveries)/charge-offs			-				(10	)			224				-
Allowance for loan losses			8,179				7,979				7,869				7,993
Allowance for loan losses to total loans (1)			1.07	%			1.09	%			1.09	%			1.11	%
Allowance for loan losses to originated loans (1)			1.18	%			1.22	%			1.22	%			1.25	%
Non-performing loans		$	9,350			$	4,053			$	953			$	3,171
Non-performing loans/total loans (1)			1.22	%			0.56	%			0.13	%			0.44	%
Non-performing loans/total assets			1.05	%			0.46	%			0.11	%			0.38	%
Allowance for loan losses/non-performing loans			87.48	%			196.87	%			825.71	%			252.07	%
Capital  (Bank only):
Tier 1 Capital		$	103,199			$	100,518			$	89,275			$	87,829
Tier 1 leverage ratio			12.00	%			12.04	%			11.22	%			10.21	%
Common equity tier 1 capital ratio			21.23	%			21.49	%			19.32	%			19.03	%
Tier 1 risk based capital ratio			21.23	%			21.49	%			19.32	%			19.03	%
Total risk based capital ratio			22.49	%			22.75	%			20.57	%			20.29	%
Equity data:
Common shares outstanding			4,194,890				4,185,534				4,175,144				4,169,269
Stockholders' equity		$	82,245			$	80,024			$	78,043			$	76,156
Book value per common share			19.61				19.12				18.69				18.27
Tangible common equity			80,515				78,103				76,120				74,556
Tangible book value per common share			19.19				18.66				18.23				17.88
Tangible common equity ("TCE") ratio			9.06	%			8.93	%			8.96	%			8.91	%

		3/31/2021				12/31/2020				9/30/2020				6/30/2020
Loan distribution (1):
Residential mortgages		$	408,729			$	424,479			$	432,988			$	439,876
Multi-family			175,779				147,266				136,737				125,597
Commercial real estate			117,966				115,358				113,758				111,068
Commercial and industrial			37,355				20,214				20,737				23,680
Home equity			23,747				21,405				20,772				20,056
Consumer			20				30				27				38
Total loans		$	763,596			$	728,752			$	725,019			$	720,315
Sequential quarter growth rate			4.78	%			0.51	%			0.65	%			4.07	%
Loans sold during the quarter		$	9,367			$	8,443			$	5,326			$	1,721
Funding distribution:
Demand		$	122,388			$	86,266			$	82,350			$	84,049
NOW			150,017				93,258				34,086				33,364
Savings			44,386				44,072				43,218				42,469
Money market			96,201				87,843				110,353				96,190
Total core deposits			412,992				311,439				270,007				256,072
Time			305,192				376,877				394,753				403,260
Total deposits			718,184				688,316				664,760				659,332
Borrowings			56,417				74,514				85,154				78,766
Note payable			-				-				14,984				14,983
Subordinated debentures			24,482				24,468				-				-
Total funding sources		$	799,083			$	787,298			$	764,898			$	753,081
Sequential quarter growth rate - total deposits			4.34	%			3.54	%			0.82	%			-8.06	%
Period-end core deposits/total deposits ratio			57.51	%			45.25	%			40.62	%			38.84	%
Period-end demand deposits/total deposits ratio			17.04	%			12.53	%			12.39	%			12.75	%

		3/31/2021				12/31/2020				9/30/2020				6/30/2020				3/31/2020
Tangible common equity
Total equity		$	82,245			$	80,024			$	78,043			$	76,156			$	74,513
Less: goodwill			(1,710	)			(1,901	)			(1,901	)			(1,577	)			(1,542	)
Less: core deposit intangible			(19	)			(20	)			(22	)			(23	)			(24	)
Tangible common equity		$	80,516			$	78,103			$	76,120			$	74,556			$	72,947
Tangible common equity ("TCE") ratio
Tangible common equity		$	80,516			$	78,103			$	76,120			$	74,556			$	72,947
Total assets			890,432				876,883				851,606				838,014				895,606
Less: goodwill			(1,710	)			(1,901	)			(1,901	)			(1,577	)			(1,542	)
Less: core deposit intangible			(19	)			(20	)			(22	)			(23	)			(24	)
Tangible assets		$	888,703			$	874,962			$	849,683			$	836,414			$	894,040
TCE ratio			9.06	%			8.93	%			8.96	%			8.91	%			8.16	%
Tangible book value per share
Tangible common equity		$	80,516			$	78,103			$	76,120			$	74,556			$	72,947
Common shares outstanding			4,194,890				4,185,534				4,175,144				4,169,269				4,162,269
Tangible book value per share		$	19.19			$	18.66			$	18.23			$	17.88			$	17.53

		2021												2020
		Average Balance				Interest				Average Rate				Average Balance				Interest				Average Rate
Assets:
Interest-earning assets:
Loans		$	742,004			$	9,133				4.99	%		$	713,712			$	9,728				5.48	%
Investment securities			17,595				182				4.20	%			12,532				111				3.56	%
Interest-earning cash			70,465				19				0.11	%			125,657				364				1.17	%
FHLB stock and other investments			3,714				46				5.02	%			5,060				78				6.20	%
Total interest-earning assets			833,778				9,380				4.56	%			856,961				10,281				4.83	%
Non interest-earning assets:
Cash and due from banks			5,576												6,417
Other assets			23,797												21,268
Total assets		$	863,151											$	884,646
Liabilities and stockholders' equity:
Interest-bearing liabilities:
Savings, NOW and money market deposits		$	247,336			$	157				0.26	%		$	180,846			$	516				1.15	%
Time deposits			334,804				915				1.11	%			448,577				2,607				2.34	%
Total savings and time deposits			582,140				1,072				0.75	%			629,423				3,123				2.00	%
Fed funds purchased & FHLB & FRB advances			58,807				180				1.24	%			89,724				418				1.87	%
Note payable			-				-				0.00	%			14,982				223				5.99	%
Subordinated debentures			24,476				326				5.40	%			-				-				0.00	%
Total interest-bearing liabilities			665,423				1,578				0.96	%			734,129				3,764				2.06	%
Demand deposits			107,884												68,414
Other liabilities			8,764												7,356
Total liabilities			782,071												809,899
Stockholders' equity			81,080												74,747
Total liabilities & stockholders' equity		$	863,151											$	884,646
Net interest rate spread											3.60	%											2.77	%
Net interest income/margin						$	7,802				3.79	%						$	6,517				3.06	%

		2021												2020
		Average Balance				Interest				Average Rate				Average Balance				Interest				Average Rate
Assets:
Interest-earning assets:
Loans		$	733,283			$	18,391				5.03	%		$	723,191			$	19,674				5.44	%
Investment securities			17,052				355				4.18	%			12,647				221				3.49	%
Interest-earning cash			74,758				40				0.11	%			97,228				655				1.35	%
FHLB stock and other investments			3,819				91				4.78	%			5,255				167				6.36	%
Total interest-earning assets			828,912				18,877				4.57	%			838,321				20,717				4.94	%
Non interest-earning assets:
Cash and due from banks			5,138												6,398
Other assets			24,051												21,297
Total assets		$	858,101											$	866,016
Liabilities and stockholders' equity:
Interest-bearing liabilities:
Savings, NOW and money market deposits		$	216,783			$	274				0.25	%		$	183,701			$	1,152				1.25	%
Time deposits			363,434				2,369				1.31	%			421,050				4,977				2.36	%
Total savings and time deposits			580,217				2,643				0.91	%			604,751				6,129				2.03	%
Fed funds purchased & FHLB & FRB advances			68,983				401				1.17	%			94,038				886				1.88	%
Note payable			659				73				22.22	%*			14,981				448				5.98	%
Subordinated debentures			23,678				631				5.34	%			-				-				0.00	%
Total interest-bearing liabilities			673,537				3,748				1.12	%			713,770				7,463				2.09	%
Demand deposits			95,659												70,470
Other liabilities			8,844												7,943
Total liabilities			778,040												792,183
Stockholders' equity			80,061												73,833
Total liabilities & stockholders' equity		$	858,101											$	866,016
Net interest rate spread											3.45	%											2.85	%
Net interest income/margin						$	15,129				3.66	%						$	13,254				3.16	%