Community Bancorp operates as a bank holding company. The firm provides retail banking services to the residents, businesses, and municipalities in northeastern and central Vermont. It also offers personal banking, commercial real estate lending, business banking, residential real estate lending, retail credit, municipal & institutional banking, and retail banking. The company was founded in 1982 and is headquartered in Derby, VT.
Our common stock is not exchange-listed and our trading volume is less than that of larger public companies, which can contribute to volatility in our stock price and adversely affect the price and liquidity of an investment in our common stock.
Our ability to pay dividends on our capital stock and to service our debt depends primarily on dividends from our subsidiary and may be subject to regulatory and contractual limitations.
Securities issued by us, including our common stock, are not FDIC insured.
Changes in interest rates could adversely affect our business, results of operations and financial condition.
We are subject to liquidity risk because we rely primarily on deposit-gathering to satisfy our funding needs.
We are subject to credit risk and if our ALL is not adequate to cover actual losses, our earnings could decrease.
Prepayments of loans may negatively impact our business.
Our loans and deposits are geographically concentrated and adverse local economic conditions could negatively affect our business.
Our banking business is highly regulated, and we may be adversely affected by changes in law and regulation.
The requirement to record certain assets and liabilities at fair value may adversely affect our financial results.
Market changes in delivery of financial services may adversely affect demand for our services.
Substantial competition could adversely affect us.
Systems failures, interruptions or breaches of security could disrupt our business and have an adverse effect on our business, results of operations and financial condition.
We depend on the accuracy and completeness of information about customers and counterparties.
New products and services are essential to remain competitive but may subject us to additional risks.
Changes in accounting standards could materially affect our financial statements.
Our internal controls and procedures may fail or be circumvented.
Changes in our tax rates could affect our future results.
Our business could suffer if we fail to attract and retain skilled personnel.
Environmental liability associated with our lending activities could result in losses.
We have become subject to more stringent capital requirements.
We may be required to write down goodwill and other identifiable intangible assets.
We are not able to offer all of the financial services and products of a financial holding company.
Our organizational documents may have the effect of discouraging a third party from acquiring us.
Net income for the third quarter of 2019 was $2,261,943, or $0.43 per common share, compared to $2,269,732, or $0.44 per common share, for the same quarter of 2018. Net income for the first nine months of 2019 was $6,453,146 or $1.23 per common share, compared to $6,254,929 or $1.20 per common share for 2018. Core earnings (NII) for the third quarter of 2019 increased $100,544, or 1.6%, compared to the same quarter in 2018, and $977,392, or 5.3%, year over year. The loan mix continued to shift in favor of higher yielding commercial loans, while the deposit mix experienced an increase in non-maturity deposits, both of which have benefited the Company’s net interest income. Interest paid on deposits, which is the major component of total interest expense, increased $336,503, or 36.6%, for the third quarter of 2019 compared to the same quarter of 2018, and $1,493,272, or 64.2%, year over year, reflecting the increases in short-term rates and higher average interest-bearing deposit balances. The continuing increases in short-term market rates also had an impact on the interest paid on repurchase agreements and on the junior subordinated debentures, contributing to the increase in interest expense in both comparison periods. The Company recorded a provision for loan losses of $412,499 for the third quarter of 2019 and $766,668 for the first nine months of 2019, compared to $210,000 and $570,000, respectively in 2018. These increases are due to the year to date increase in the loan portfolio, combined with an increase in loan charge off activity during the third quarter of 2019.