☒ | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 95-4547287 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
4601 Wilshire Boulevard, Suite 150 Los Angeles, California | 90010 | |
(Address of principal executive offices) | (Zip Code) |
Title of each class: | Trading Symbol(s) | Name of each exchange on which registered: | ||
Common Stock, par value $0.01 per share (including attached preferred stock purchase rights) | BYFC | Nasdaq Capital Market |
Large accelerated filer | ☐ | Accelerated filer | ☐ |
Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
Emerging growth company | ☐ |
March 31, 2022 | December 31, 2021 | March 31, 2023 | December 31, 2022 | |||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||
Assets: | ||||||||||||||||
Cash and due from banks | $ | 37,925 | $ | 38,418 | $ | 8,432 | $ | 7,459 | ||||||||
Interest-bearing deposits in other banks | 208,181 | 193,102 | 21,216 | 8,646 | ||||||||||||
Cash and cash equivalents | 246,106 | 231,520 | 29,648 | 16,105 | ||||||||||||
Securities available-for-sale, at fair value | 170,308 | 156,396 | 329,026 | 328,749 | ||||||||||||
Loans receivable held for investment, net of allowance of $3,539 and $3,391 | 653,375 | 648,513 | ||||||||||||||
Loans receivable held for investment, net of allowance of $6,285 and $4,388 | 776,053 | 768,046 | ||||||||||||||
Accrued interest receivable | 2,449 | 3,372 | 4,219 | 3,973 | ||||||||||||
Federal Home Loan Bank (“FHLB”) stock | 2,222 | 2,573 | ||||||||||||||
Federal Home Loan Bank (FHLB) stock | 7,300 | 5,535 | ||||||||||||||
Federal Reserve Bank (FRB) stock | 693 | 693 | 3,543 | 5,264 | ||||||||||||
Office properties and equipment, net | 10,380 | 10,344 | 10,122 | 10,291 | ||||||||||||
Bank owned life insurance | 3,200 | 3,190 | 3,242 | 3,233 | ||||||||||||
Deferred tax assets, net | 8,312 | 6,101 | 10,823 | 11,872 | ||||||||||||
Core deposit intangible, net | 2,827 | 2,936 | 2,403 | 2,501 | ||||||||||||
Goodwill | 25,858 | 25,996 | 25,858 | 25,858 | ||||||||||||
Other assets | 5,395 | 1,871 | 2,824 | 2,866 | ||||||||||||
Total assets | $ | 1,131,125 | $ | 1,093,505 | $ | 1,205,061 | $ | 1,184,293 | ||||||||
Liabilities and stockholders’ equity | ||||||||||||||||
Liabilities: | ||||||||||||||||
Deposits | $ | 839,714 | $ | 788,052 | $ | 657,542 | $ | 686,916 | ||||||||
Securities sold under agreements to repurchase | 56,003 | 51,960 | 70,941 | 63,471 | ||||||||||||
FHLB advances | 73,001 | 85,952 | 168,810 | 128,344 | ||||||||||||
Notes payable | 14,000 | 14,000 | 14,000 | 14,000 | ||||||||||||
Accrued expenses and other liabilities | 12,070 | 12,441 | 13,900 | 11,910 | ||||||||||||
Total liabilities | 994,788 | 952,405 | 925,193 | 904,641 | ||||||||||||
Cumulative Redeemable Perpetual Preferred stock, Series A, authorized 3,000 shares at March 31, 2022 and December 31, 2021; issued and outstanding NaN at March 31, 2022 and 3,000 shares at December 31, 2021, liquidation value $1,000 per share | 0 | 3,000 | ||||||||||||||
Common stock, Class A, $0.01 par value, voting, authorized 75,000,000 shares at March 31, 2022 and December 31, 2021; issued 48,949,221 at March 31, 2022 and 46,291,852 shares at December 31, 2021; outstanding 46,194,148 shares at March 31, 2022 and 43,674,026 shares at December 31, 2021 | 489 | 463 | ||||||||||||||
Common stock, Class B, $0.01 par value, non-voting, authorized 15,000,000 shares at March 31, 2022 and December 31, 2021; issued and outstanding 11,404,618 shares at March 31, 2022 and December 31, 2021 | 114 | 114 | ||||||||||||||
Common stock, Class C, $0.01 par value, non-voting, authorized 25,000,000 shares at March 31, 2022 and December 31, 2021; issued 15,768,172 shares at March 31, 2022 and 16,689,775 shares at December 31, 2021; outstanding 15,768,172 shares at March 31, 2022 and 16,689,775 shares at December 31, 2021 | 158 | 167 | ||||||||||||||
Non-Cumulative Redeemable Perpetual Preferred stock, Series C; authorized 150,000 shares at March 31, 2023 and December 31, 2022; issued and outstanding 150,000 shares at March 31, 2023 and December 31, 2022; liquidation value $1,000 per share | 150,000 | 150,000 | ||||||||||||||
Common stock, Class A, $0.01 par value, voting; authorized 75,000,000 shares at March 31, 2023 and December 31, 2022; issued 51,335,981 shares at March 31, 2023 and 51,265,209 shares at December 31, 2022; outstanding 48,718,155 shares at March 31, 2023 and 48,647,383 shares at December 31, 2022 | 513 | 513 | ||||||||||||||
Common stock, Class B, $0.01 par value, non-voting; authorized 15,000,000 shares at March 31, 2023 and December 31, 2022; issued and outstanding 11,404,618 shares at March 31, 2023 and December 31, 2022 | 114 | 114 | ||||||||||||||
Common stock, Class C, $0.01 par value, non-voting; authorized 25,000,000 shares at March 31, 2023 and December 31, 2022; issued and outstanding 13,380,516 at March 31, 2023 and December 31, 2022 | 134 | 134 | ||||||||||||||
Additional paid-in capital | 143,373 | 140,289 | 143,621 | 143,491 | ||||||||||||
Retained earnings | 4,616 | 3,673 | 9,611 | 9,294 | ||||||||||||
Unearned Employee Stock Ownership Plan (ESOP) shares | (813 | ) | (829 | ) | (3,963 | ) | (1,265 | ) | ||||||||
Accumulated other comprehensive loss, net of tax | (6,398 | ) | (551 | ) | (15,028 | ) | (17,473 | ) | ||||||||
Treasury stock-at cost, 2,617,826 shares at March 31, 2022 and at December 31, 2021 | (5,326 | ) | (5,326 | ) | ||||||||||||
Treasury stock-at cost, 2,617,826 shares at March 31, 2023 and at December 31, 2022 | (5,326 | ) | (5,326 | ) | ||||||||||||
Total Broadway Financial Corporation and Subsidiary stockholders’ equity | 136,213 | 141,000 | 279,676 | 279,482 | ||||||||||||
Non-controlling interest | 124 | 100 | 192 | 170 | ||||||||||||
Total liabilities and stockholders’ equity | $ | 1,131,125 | $ | 1,093,505 | $ | 1,205,061 | $ | 1,184,293 |
Three Months Ended March 31, | ||||||||||||||||
2022 | 2021 | Three Months Ended March 31, | ||||||||||||||
(In thousands, except per share) | 2023 | 2022 | ||||||||||||||
Interest income: | ||||||||||||||||
Interest and fees on loans receivable | $ | 7,336 | $ | 3,644 | $ | 8,666 | $ | 7,336 | ||||||||
Interest on investment securities | 591 | 56 | ||||||||||||||
Interest on available-for-sale securities | 2,180 | 591 | ||||||||||||||
Other interest income | 84 | 77 | 328 | 84 | ||||||||||||
Total interest income | 8,011 | 3,777 | 11,174 | 8,011 | ||||||||||||
Interest expense: | ||||||||||||||||
Interest on deposits | 350 | 383 | 1,303 | 350 | ||||||||||||
Interest on borrowings | 489 | 549 | 1,597 | 489 | ||||||||||||
Total interest expense | 839 | 932 | 2,900 | 839 | ||||||||||||
Net interest income | 7,172 | 2,845 | 8,274 | 7,172 | ||||||||||||
Loan loss provision | 148 | 0 | ||||||||||||||
Net interest income after loan loss provision | 7,024 | 2,845 | ||||||||||||||
Provision for credit losses | 88 | 148 | ||||||||||||||
Net interest income after provision for credit losses | 8,186 | 7,024 | ||||||||||||||
Non-interest income: | ||||||||||||||||
Service charges | 64 | 93 | 61 | 64 | ||||||||||||
Other | 217 | 30 | 228 | 217 | ||||||||||||
Total non-interest income | 281 | 123 | 289 | 281 | ||||||||||||
Non-interest expense: | ||||||||||||||||
Compensation and benefits | 3,619 | 5,390 | 3,749 | 3,619 | ||||||||||||
Occupancy expense | 442 | 308 | 303 | 442 | ||||||||||||
Information services | 865 | 241 | 715 | 865 | ||||||||||||
Professional services | 364 | 1,939 | 505 | 364 | ||||||||||||
Supervisory costs | 94 | 157 | ||||||||||||||
Office services and supplies | 157 | 95 | 22 | 61 | ||||||||||||
Advertising and promotional expense | 68 | 50 | ||||||||||||||
Corporate insurance | 61 | 246 | 62 | 53 | ||||||||||||
Amortization of investment in affordable housing limited partnership | 53 | 26 | ||||||||||||||
Appraisal and other loan expense | 43 | 30 | ||||||||||||||
Amortization of core deposit intangible | 109 | 0 | 98 | 109 | ||||||||||||
Travel expense | 78 | 27 | ||||||||||||||
Other | 290 | 382 | 469 | 183 | ||||||||||||
Total non-interest expense | 5,960 | 8,627 | 6,206 | 5,960 | ||||||||||||
Income (loss) before income taxes | 1,345 | (5,659 | ) | |||||||||||||
Income before income taxes | 2,269 | 1,345 | ||||||||||||||
Income tax expense | 674 | 363 | ||||||||||||||
Net income | $ | 1,595 | $ | 982 | ||||||||||||
Less: Net income attributable to non-controlling interest | 22 | 24 | ||||||||||||||
Net income attributable to Broadway Financial Corporation | $ | 1,573 | $ | 958 | ||||||||||||
Other comprehensive income, net of tax: | ||||||||||||||||
Unrealized gains (losses) on securities available-for-sale arising during the period | $ | 3,433 | $ | (8,154 | ) | |||||||||||
Income tax expense (benefit) | 363 | (2,172 | ) | 988 | (2,307 | ) | ||||||||||
Net income (loss) | $ | 982 | $ | (3,487 | ) | |||||||||||
Less: Net income attributable to non-controlling interest | 24 | 0 | ||||||||||||||
Net income (loss) attributable to Broadway Financial Corporation | $ | 958 | $ | (3,487 | ) | |||||||||||
Other comprehensive income (loss), net of tax | 2,445 | (5,847 | ) | |||||||||||||
Other comprehensive loss, net of tax: | ||||||||||||||||
Unrealized loss on securities available-for-sale arising during the period | $ | (8,154 | ) | $ | (158 | ) | ||||||||||
Income tax benefit | (2,307 | ) | (47 | ) | ||||||||||||
Other comprehensive loss, net of tax | (5,847 | ) | (111 | ) | ||||||||||||
Comprehensive income (loss) | $ | 4,018 | $ | (4,889 | ) | |||||||||||
Comprehensive loss | $ | (4,889 | ) | $ | (3,598 | ) | ||||||||||
Income (loss) per common share-basic | $ | 0.01 | $ | (0.13 | ) | |||||||||||
Income (loss) per common share-diluted | $ | 0.01 | $ | (0.13 | ) | |||||||||||
Earnings per common share-basic | $ | 0.02 | $ | 0.01 | ||||||||||||
Earnings per common share-diluted | $ | 0.02 | $ | 0.01 |
Three Months Ended March 31, | Three Months Ended March 31, | |||||||||||||||
2022 | 2021 | 2023 | 2022 | |||||||||||||
(In thousands) | (In thousands) | |||||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net income (loss) | $ | 982 | $ | (3,487 | ) | |||||||||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||||||||||
Loan loss provision | 148 | 0 | ||||||||||||||
Net income | $ | 1,595 | $ | 982 | ||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||
Provision for credit losses | 88 | 148 | ||||||||||||||
Depreciation | 30 | 53 | 172 | 30 | ||||||||||||
Net change in amortization of deferred loan origination costs | (148 | ) | (21 | ) | ||||||||||||
Net amortization of premiums on available for sale securities | 118 | 10 | ||||||||||||||
Net change of deferred loan origination costs | (223 | ) | (148 | ) | ||||||||||||
Net amortization of premiums & discounts on available-for-sale securities | (253 | ) | 118 | |||||||||||||
Amortization of purchase accounting marks on loans | – | (465 | ) | |||||||||||||
Amortization of core deposit intangible | 109 | 0 | 98 | 109 | ||||||||||||
Amortization of purchase accounting marks on loans | (465 | ) | 0 | |||||||||||||
Director compensation expense-common stock | 84 | 45 | 96 | 84 | ||||||||||||
Accretion of premium on FHLB advances | (11 | ) | 0 | 1 | (11 | ) | ||||||||||
Stock-based compensation expense | 15 | 168 | 38 | 15 | ||||||||||||
ESOP compensation expense | 18 | 23 | (202 | ) | 18 | |||||||||||
Change in deferred taxes on goodwill | 138 | 0 | ||||||||||||||
Earnings on bank owned life insurance | (10 | ) | (10 | ) | (9 | ) | (10 | ) | ||||||||
Change in assets and liabilities: | ||||||||||||||||
Net change in deferred taxes | 96 | (1,413 | ) | 569 | 234 | |||||||||||
Net change in accrued interest receivable | 923 | 45 | (246 | ) | 923 | |||||||||||
Net change in other assets | (3,524 | ) | (1,176 | ) | 42 | (3,524 | ) | |||||||||
Net change in other liabilities | (311 | ) | 3,705 | |||||||||||||
Net cash used in operating activities | (1,808 | ) | (2,058 | ) | ||||||||||||
Net change in accrued expenses and other liabilities | 2,035 | (311 | ) | |||||||||||||
Net cash provided by (used in) operating activities | 3,801 | (1,808 | ) | |||||||||||||
Cash flows from investing activities: | ||||||||||||||||
Net change in loans receivable held for investment | (4,396 | ) | (2,370 | ) | (9,681 | ) | (4,396 | ) | ||||||||
Principal payments on available-for-sale securities | 4,724 | 507 | 3,409 | 4,724 | ||||||||||||
Purchase of available-for-sale securities | (26,908 | ) | 0 | – | (26,908 | ) | ||||||||||
Purchase of FHLB stock | (1,765 | ) | – | |||||||||||||
Proceeds from redemption of FHLB stock | 351 | 0 | – | 351 | ||||||||||||
Proceeds from redemption of FRB stock | 1,721 | – | ||||||||||||||
Purchase of office properties and equipment | (67 | ) | (15 | ) | (3 | ) | (67 | ) | ||||||||
Net cash used in investing activities | (26,296 | ) | (1,878 | ) | (6,319 | ) | (26,296 | ) | ||||||||
Cash flows from financing activities: | ||||||||||||||||
Net change in deposits | 51,662 | (3,315 | ) | (29,374 | ) | 51,662 | ||||||||||
Net increase in securities sold under agreements to repurchase | 4,043 | 0 | ||||||||||||||
Net change in securities sold under agreements to repurchase | 7,470 | 4,043 | ||||||||||||||
Increase in unreleased ESOP shares | (2,500 | ) | – | |||||||||||||
Dividends paid on preferred stock | (15 | ) | 0 | – | (15 | ) | ||||||||||
Proceeds from FHLB advances | 40,500 | – | ||||||||||||||
Repayments of FHLB advances | (13,000 | ) | 0 | (35 | ) | (13,000 | ) | |||||||||
Stock cancelled for income tax withholding | 0 | (447 | ) | |||||||||||||
Repayments of junior subordinated debentures | 0 | (255 | ) | |||||||||||||
Net cash provided by (used in) financing activities | 42,690 | (4,017 | ) | |||||||||||||
Net cash provided by financing activities | 16,061 | 42,690 | ||||||||||||||
Net change in cash and cash equivalents | 14,586 | (7,953 | ) | 13,543 | 14,586 | |||||||||||
Cash and cash equivalents at beginning of the period | 231,520 | 96,109 | 16,105 | 231,520 | ||||||||||||
Cash and cash equivalents at end of the period | $ | 246,106 | $ | 88,156 | $ | 29,648 | $ | 246,106 | ||||||||
Supplemental disclosures of cash flow information: | ||||||||||||||||
Cash paid for interest | $ | 822 | $ | 809 | $ | 2,882 | $ | 822 | ||||||||
Cash paid for income taxes | 0 | 39 | – | – | ||||||||||||
Supplemental disclosures of non-cash investing and financing activities: | ||||||||||||||||
Conversion of preferred shares into Class A common shares | 3,000 | 0 | ||||||||||||||
Supplemental non-cash disclosures: | ||||||||||||||||
Common stock issued in exchange for preferred stock | – | 3,000 |
Three Months Ended March 31, 2022 and 2021 | ||||||||||||||||||||||||||||||||||||||||
Preferred Stock Non-Voting | Common Stock Voting | Common Stock Non-Voting | Additional Paid‑in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Substantially Restricted) | Unearned ESOP Shares | Treasury Stock | Non-controlling Interest | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2022 | $ | 3,000 | $ | 463 | $ | 281 | $ | 140,289 | $ | (551 | ) | $ | 3,673 | $ | (829 | ) | $ | (5,326 | ) | $ | 100 | $ | 141,100 | |||||||||||||||||
Net income for the three months ended March 31, 2022 | 0 | 0 | 0 | 0 | 0 | 958 | 0 | 0 | 24 | 982 | ||||||||||||||||||||||||||||||
Conversion of preferred stock into common stock | (3,000 | ) | 12 | 0 | 2,988 | 0 | ||||||||||||||||||||||||||||||||||
Conversion of non-voting common shares into voting common shares | 9 | (9 | ) | 0 | ||||||||||||||||||||||||||||||||||||
Release of unearned ESOP shares | 0 | 0 | 0 | 2 | 0 | 0 | 16 | 0 | 0 | 18 | ||||||||||||||||||||||||||||||
Dividends paid on preferred stock | 0 | 0 | 0 | 0 | 0 | (15 | ) | 0 | 0 | 0 | (15 | ) | ||||||||||||||||||||||||||||
Stock awarded to directors | 0 | 0 | 0 | 84 | 0 | 0 | 0 | 0 | 0 | 84 | ||||||||||||||||||||||||||||||
Restricted stock compensation expense | 0 | 5 | 0 | 10 | 0 | 0 | 0 | 0 | 0 | 15 | ||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | 0 | 0 | 0 | 0 | (5,847 | ) | 0 | 0 | 0 | 0 | (5,847 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | 0 | $ | 489 | $ | 272 | $ | 143,373 | $ | (6,398 | ) | $ | 4,616 | $ | (813 | ) | $ | (5,326 | ) | $ | 124 | $ | 136,337 | |||||||||||||||||
Balance at January 1, 2021 | $ | 0 | $ | 219 | $ | 87 | $ | 46,851 | $ | 164 | $ | 7,783 | $ | (893 | ) | $ | (5,326 | ) | $ | 0 | $ | 48,885 | ||||||||||||||||||
Net loss for the three months ended March 31, 2021 | 0 | 0 | 0 | 0 | 0 | (3,487 | ) | 0 | 0 | 0 | (3,487 | ) | ||||||||||||||||||||||||||||
Release of unearned ESOP shares | 0 | 0 | 0 | 7 | 0 | 0 | 16 | 0 | 0 | 23 | ||||||||||||||||||||||||||||||
Restricted stock compensation expense | 0 | 0 | 0 | 162 | 0 | 0 | 0 | 0 | 0 | 162 | ||||||||||||||||||||||||||||||
Common stock cancelled for payment of tax withholding | 0 | (1 | ) | 0 | (446 | ) | 0 | 0 | 0 | 0 | 0 | (447 | ) | |||||||||||||||||||||||||||
Stock awarded to directors | 0 | 0 | 0 | 45 | 0 | 0 | 0 | 0 | 0 | 45 | ||||||||||||||||||||||||||||||
Stock option compensation expense | 0 | 0 | 0 | 6 | 0 | 0 | 0 | 0 | 0 | 6 | ||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | 0 | 0 | 0 | 0 | (111 | ) | 0 | 0 | 0 | 0 | (111 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2021 | $ | 0 | $ | 218 | $ | 87 | $ | 46,625 | $ | 53 | $ | 4,296 | $ | (877 | ) | $ | (5,326 | ) | $ | 0 | $ | 45,076 |
Three-Month Period Ended March 31, 2023 and 2022 | ||||||||||||||||||||||||||||||||||||||||
Preferred Stock Non-Voting | Common Stock Voting | Common Stock Non-Voting | Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) | Retained Earnings | Unearned ESOP Shares | Treasury Stock | Non-Controlling Interest | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2023 | $ | 150,000 | $ | 513 | $ | 248 | $ | 143,491 | $ | (17,473 | ) | $ | 9,294 | $ | (1,265 | ) | $ | (5,326 | ) | $ | 170 | $ | 279,652 | |||||||||||||||||
Cumulative effect of change related to adoption of ASU 2016-13 | – | – | – | – | – | (1,256 | ) | – | – | – | (1,256 | ) | ||||||||||||||||||||||||||||
Adjusted balance, January 1, 2023 | 150,000 | 513 | 248 | 143,491 | (17,473 | ) | 8,038 | (1,265 | ) | (5,326 | ) | 170 | 278,396 | |||||||||||||||||||||||||||
Net income | – | – | – | – | – | 1,573 | – | – | 22 | 1,595 | ||||||||||||||||||||||||||||||
Release of unearned ESOP shares | – | – | – | (4 | ) | – | – | (198 | ) | – | – | (202 | ) | |||||||||||||||||||||||||||
Increase in unreleased shares | – | – | – | – | – | – | (2,500 | ) | – | – | (2,500 | ) | ||||||||||||||||||||||||||||
Stock-based compensation expense | – | – | – | 38 | – | – | – | – | – | 38 | ||||||||||||||||||||||||||||||
Director stock compensation expense | – | – | – | 96 | – | – | – | – | – | 96 | ||||||||||||||||||||||||||||||
Other comprehensive income, net of tax | – | – | – | – | 2,445 | – | – | – | – | 2,445 | ||||||||||||||||||||||||||||||
Balance at March 31, 2023 | $ | 150,000 | $ | 513 | $ | 248 | $ | 143,621 | $ | (15,028 | ) | $ | 9,611 | $ | (3,963 | ) | $ | (5,326 | ) | $ | 192 | $ | 279,868 | |||||||||||||||||
Balance at January 1, 2022 | $ | 3,000 | $ | 463 | $ | 281 | $ | 140,289 | $ | (551 | ) | $ | 3,673 | $ | (829 | ) | $ | (5,326 | ) | $ | 100 | $ | 141,100 | |||||||||||||||||
Net income | – | – | – | – | – | 958 | – | – | 24 | 982 | ||||||||||||||||||||||||||||||
Conversion of preferred stock into common stock | (3,000 | ) | 12 | – | 2,988 | – | – | – | – | – | – | |||||||||||||||||||||||||||||
Conversion of non-voting common shares into voting common shares | – | 9 | (9 | ) | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
Release of unearned ESOP shares | – | – | – | 2 | – | – | 16 | – | – | 18 | ||||||||||||||||||||||||||||||
Dividends paid on preferred stock | – | – | – | – | – | (15 | ) | – | – | – | (15 | ) | ||||||||||||||||||||||||||||
Director stock compensation expense | – | – | – | 84 | – | – | – | – | – | 84 | ||||||||||||||||||||||||||||||
Stock-based compensation expense | – | 5 | – | 10 | – | – | – | – | – | 15 | ||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | – | – | – | – | (5,847 | ) | – | – | – | – | (5,847 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | – | $ | 489 | $ | 272 | $ | 143,373 | $ | (6,398 | ) | $ | 4,616 | $ | (813 | ) | $ | (5,326 | ) | $ | 124 | $ | 136,337 |
Pre-CECL Adoption | Impact of CECL Adoption | As Reported Under CECL | ||||||||||
(In thousands) | ||||||||||||
Assets: | ||||||||||||
Allowance for credit losses on available-for-sale securities | $ | – | $ | – | $ | – | ||||||
Allowance for credit losses on loans | 4,388 | 1,809 | 6,197 | |||||||||
Deferred tax assets | 11,872 | 508 | 12,380 | |||||||||
Liabilities: | ||||||||||||
Allowance for credit losses on off-balance sheet exposures | 412 | (45 | ) | 367 | ||||||||
Stockholders’ equity: | ||||||||||||
Retained earnings | 9,294 | (1,256 | ) | 8,038 |
CFBanc Book Value | Fair Value Adjustments | Fair Value | ||||||||||
Assets acquired | (In thousands) | |||||||||||
Cash and cash equivalents | $ | 84,745 | $ | 0 | $ | 84,745 | ||||||
Securities available-for-sale | 150,052 | (77 | ) | 149,975 | ||||||||
Loans receivable held for investment: | ||||||||||||
Gross loans receivable held for investment | 227,669 | (1,784 | ) | 225,885 | ||||||||
Deferred fees and costs | (315 | ) | 315 | 0 | ||||||||
Allowance for loan losses | (2,178 | ) | 2,178 | 0 | ||||||||
225,176 | 709 | 225,885 | ||||||||||
Accrued interest receivable | 1,637 | 0 | 1,637 | |||||||||
FHLB and FRB stock | 1,061 | 0 | 1,061 | |||||||||
Office properties and equipment | 5,152 | 1,801 | 6,953 | |||||||||
Deferred tax assets, net | 890 | (1,608 | ) | (718 | ) | |||||||
Core deposit intangible | 0 | 3,329 | 3,329 | |||||||||
Other assets | 2,290 | 0 | 2,290 | |||||||||
Total assets | $ | 471,003 | $ | 4,154 | $ | 475,157 | ||||||
Liabilities assumed | ||||||||||||
Deposits | $ | 353,671 | $ | 51 | $ | 353,722 | ||||||
Securities sold under agreements to repurchase | 59,945 | 0 | 59,945 | |||||||||
FHLB advances | 3,057 | 109 | 3,166 | |||||||||
Notes payable | 14,000 | 0 | 14,000 | |||||||||
Accrued expenses and other liabilities | 4,063 | 0 | 4,063 | |||||||||
Total liabilities | $ | 434,736 | $ | 160 | $ | 434,896 | ||||||
Excess of assets acquired over liabilities assumed | $ | 36,267 | $ | 3,994 | $ | 40,261 | ||||||
Consideration paid | $ | 66,257 | ||||||||||
Goodwill recognized | $ | 25,996 |
Acquired Loans | ||||
(In thousands) | ||||
Contractual amounts due | $ | 231,432 | ||
Cash flows not expected to be collected | (3,666 | ) | ||
Expected cash flows | 227,766 | |||
Interest component of expected cash flows | (1,881 | ) | ||
Fair value of acquired loans | $ | 225,885 |
Contractual amounts due | $ | 1,825 | ||
Non-accretable difference (cash flows not expected to be collected) | (634 | ) | ||
Expected cash flows | 1,191 | |||
Accretable yield | (346 | ) | ||
Fair value of PCI acquired loans | $ | 845 |
Three months Ended | ||||||||
March 31, 2022 | March 31, 2021 | |||||||
(Dollars in thousands, except per share amounts) | ||||||||
Net interest income | $ | 7,172 | $ | 5,197 | ||||
Net income (loss) | 958 | (4,277 | ) | |||||
Basic earnings per share | $ | 0.01 | $ | (0.08 | ) | |||
Diluted earnings per share | $ | 0.01 | $ | (0.08 | ) |
For the three months ended March 31, | ||||||||
2022 | 2021 | |||||||
(In thousands, except share and per share data) | ||||||||
Net income (loss) attributable to Broadway Financial Corporation | $ | 958 | $ | (3,487 | ) | |||
Less net income attributable to participating securities | 7 | 0 | ||||||
Income (loss) available to common stockholders | $ | 951 | $ | (3,487 | ) | |||
Weighted average common shares outstanding for basic earnings (loss) per common share | 72,039,378 | 27,357,750 | ||||||
Add: dilutive effects of stock options | 50,195 | 0 | ||||||
Add: dilutive effects of unvested restricted stock awards | 490,372 | 0 | ||||||
Weighted average common shares outstanding for diluted earnings (loss) per common share | 72,579,945 | 27,357,750 | ||||||
Income (loss) per common share - basic | $ | 0.01 | $ | (0.13 | ) | |||
Income (loss) per common share - diluted | $ | 0.01 | $ | (0.13 | ) |
Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
(Dollars in thousands, except share and per share data) | ||||||||
Net income attributable to Broadway Financial Corporation | $ | 1,573 | $ | 958 | ||||
Less net income attributable to participating securities | 7 | 7 | ||||||
Income available to common stockholders | $ | 1,566 | $ | 951 | ||||
Weighted average common shares outstanding for basic earnings per common share | 71,442,163 | 72,039,378 | ||||||
Add: dilutive effects of unvested restricted stock awards | 323,024 | 50,195 | ||||||
Add: dilutive effects of assumed exercise of stock options | – | 490,372 | ||||||
Weighted average common shares outstanding for diluted earnings per common share | 71,765,187 | 72,579,945 | ||||||
Earnings per common share - basic | $ | 0.02 | $ | 0.01 | ||||
Earnings per common share - diluted | $ | 0.02 | $ | 0.01 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||||||||
March 31, 2022: | ||||||||||||||||||||||||||||||||
March 31, 2023: | ||||||||||||||||||||||||||||||||
Federal agency mortgage-backed securities | $ | 79,222 | $ | 31 | $ | (4,368 | ) | $ | 74,885 | $ | 82,834 | $ | 2 | $ | (9,819 | ) | $ | 73,017 | ||||||||||||||
Federal agency collateralized mortgage obligations (“CMO”) | 8,910 | 11 | (373 | ) | 8,548 | 27,077 | – | (1,328 | ) | 25,749 | ||||||||||||||||||||||
Federal agency debt | 42,035 | 58 | (1,826 | ) | 40,267 | 55,734 | – | (3,704 | ) | 52,030 | ||||||||||||||||||||||
Municipal bonds | 4,890 | 0 | (354 | ) | 4,536 | 4,858 | – | (559 | ) | 4,299 | ||||||||||||||||||||||
U. S. Treasuries | 28,168 | 0 | (1,104 | ) | 27,064 | |||||||||||||||||||||||||||
U.S. Treasuries | 166,255 | – | (4,159 | ) | 162,096 | |||||||||||||||||||||||||||
SBA pools | 15,770 | 18 | (780 | ) | 15,008 | 13,415 | 9 | (1,589 | ) | 11,835 | ||||||||||||||||||||||
Total available-for-sale securities | $ | 178,995 | $ | 118 | $ | (8,805 | ) | $ | 170,308 | $ | 350,173 | $ | 11 | $ | (21,158 | ) | $ | 329,026 | ||||||||||||||
December 31, 2021: | ||||||||||||||||||||||||||||||||
December 31, 2022: | ||||||||||||||||||||||||||||||||
Federal agency mortgage-backed securities | $ | 70,078 | $ | 196 | $ | (244 | ) | $ | 70,030 | $ | 84,955 | $ | 2 | $ | (10,788 | ) | $ | 74,169 | ||||||||||||||
Federal agency CMOs | 9,391 | 11 | (115 | ) | 9,287 | 27,776 | – | (1,676 | ) | 26,100 | ||||||||||||||||||||||
Federal agency debt | 38,152 | 106 | (270 | ) | 37,988 | 55,687 | 26 | (4,288 | ) | 51,425 | ||||||||||||||||||||||
Municipal bonds | 4,898 | 40 | (23 | ) | 4,915 | 4,866 | – | (669 | ) | 4,197 | ||||||||||||||||||||||
U.S. Treasuries | 18,169 | 0 | (218 | ) | 17,951 | 165,997 | – | (5,408 | ) | 160,589 | ||||||||||||||||||||||
SBA pools | 16,241 | 122 | (138 | ) | 16,225 | 14,048 | 9 | (1,788 | ) | 12,269 | ||||||||||||||||||||||
Total available-for-sale securities | $ | 156,929 | $ | 475 | $ | (1,008 | ) | $ | 156,396 | $ | 353,329 | $ | 37 | $ | (24,617 | ) | $ | 328,749 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||||||||||
(In thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Due in one year or less | $ | 1,009 | $ | 0 | $ | (5 | ) | $ | 1,004 | $ | 24,876 | $ | – | $ | (493 | ) | $ | 24,383 | ||||||||||||||
Due after one year through five years | 49,938 | 0 | (2,086 | ) | 47,852 | 194,958 | – | (6,682 | ) | 188,276 | ||||||||||||||||||||||
Due after five years through ten years | 19,373 | 8 | (1,075 | ) | 18,306 | 35,270 | – | (2,839 | ) | 32,431 | ||||||||||||||||||||||
Due after ten years (1) | 108,675 | 110 | (5,639 | ) | 103,146 | 95,069 | 11 | (11,144 | ) | 83,936 | ||||||||||||||||||||||
$ | 178,995 | $ | 118 | $ | (8,805 | ) | $ | 170,308 | $ | 350,173 | $ | 11 | $ | (21,158 | ) | $ | 329,026 |
(1) | Mortgage-backed securities, collateralized mortgage obligations and SBA pools do not have a single stated maturity date and therefore have been included in the “Due after ten years” category. |
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
March 31, 2023: | ||||||||||||||||||||||||
Federal agency mortgage-backed securities | $ | 13,826 | $ | (562 | ) | $ | 58,935 | $ | (9,257 | ) | $ | 72,761 | $ | (9,819 | ) | |||||||||
Federal agency CMOs | 20,691 | (663 | ) | 5,058 | (665 | ) | 25,749 | (1,328 | ) | |||||||||||||||
Federal agency debt | 23,548 | (580 | ) | 28,482 | (3,124 | ) | 52,030 | (3,704 | ) | |||||||||||||||
Municipal bonds | – | – | 4,299 | (559 | ) | 4,299 | (559 | ) | ||||||||||||||||
U. S. Treasuries | 135,522 | (2,615 | ) | 26,574 | (1,544 | ) | 162,096 | (4,159 | ) | |||||||||||||||
SBA pools | – | – | 10,106 | (1,589 | ) | 10,106 | (1,589 | ) | ||||||||||||||||
Total unrealized loss position investment securities | $ | 193,587 | $ | (4,420 | ) | $ | 133,454 | $ | (16,738 | ) | $ | 327,041 | $ | (21,158 | ) | |||||||||
December 31, 2022: | ||||||||||||||||||||||||
Federal agency mortgage-backed securities | $ | 38,380 | $ | (4,807 | ) | $ | 35,526 | $ | (5,981 | ) | $ | 73,906 | $ | (10,788 | ) | |||||||||
Federal agency CMOs | 20,997 | (885 | ) | 5,103 | (791 | ) | 26,100 | (1,676 | ) | |||||||||||||||
Federal agency debt | 26,383 | (1,529 | ) | 21,956 | (2,759 | ) | 48,339 | (4,288 | ) | |||||||||||||||
Municipal bonds | 2,176 | (315 | ) | 2,021 | (354 | ) | 4,197 | (669 | ) | |||||||||||||||
U. S. Treasuries | 143,989 | (3,884 | ) | 16,600 | (1,524 | ) | 160,589 | (5,408 | ) | |||||||||||||||
SBA pools | 3,743 | (365 | ) | 6,763 | (1,423 | ) | 10,506 | (1,788 | ) | |||||||||||||||
Total unrealized loss position investment securities | $ | 235,668 | $ | (11,785 | ) | $ | 87,969 | $ | (12,832 | ) | $ | 323,637 | $ | (24,617 | ) |
March 31, 2022 | December 31, 2021 | March 31, 2023 | December 31, 2022 | |||||||||||||
(In thousands) | (In thousands) | |||||||||||||||
Real estate: | ||||||||||||||||
Single family | $ | 40,145 | $ | 45,372 | $ | 29,216 | $ | 30,038 | ||||||||
Multi-family | 401,252 | 393,704 | 509,514 | 502,141 | ||||||||||||
Commercial real estate | 90,402 | 93,193 | 129,031 | 114,574 | ||||||||||||
Church | 21,365 | 22,503 | 13,983 | 15,780 | ||||||||||||
Construction | 33,938 | 32,072 | 59,143 | 40,703 | ||||||||||||
Commercial – other | 53,880 | 46,539 | 37,354 | 64,841 | ||||||||||||
SBA loans | 15,488 | 18,837 | ||||||||||||||
SBA loans (1) | 3,565 | 3,601 | ||||||||||||||
Consumer | 146 | 0 | 10 | 11 | ||||||||||||
Gross loans receivable before deferred loan costs and premiums | 656,616 | 652,220 | 781,816 | 771,689 | ||||||||||||
Unamortized net deferred loan costs and premiums | 1,674 | 1,526 | 1,532 | 1,755 | ||||||||||||
Gross loans receivable | 658,290 | 653,746 | 783,348 | 773,444 | ||||||||||||
Credit and interest marks on purchased loans, net | (1,376 | ) | (1,842 | ) | (1,010 | ) | (1,010 | ) | ||||||||
Allowance for loan losses | (3,539 | ) | (3,391 | ) | ||||||||||||
Allowance for credit losses (2) | (6,285 | ) | (4,388 | ) | ||||||||||||
Loans receivable, net | $ | 653,375 | $ | 648,513 | $ | 776,053 | $ | 768,046 |
(1) | Including Paycheck Protection Program (PPP) loans. |
(2) | The allowance for credit losses as of December 31, 2022 was accounted for under ASC 450 and ASC 310, which is reflective of probable incurred losses as of the date of the consolidated statement of financial condition. Effective January 1, 2023, the allowance for credit losses is accounted for under ASC 326, which is reflective of estimated expected lifetime credit losses. |
March 31, 2022 | December 31, 2021 | |||||||
(In thousands) | ||||||||
Real estate: | ||||||||
Single family | $ | 56 | $ | 558 | ||||
Commercial real estate | 0 | 221 | ||||||
Commercial – other | 109 | 104 | ||||||
$ | 165 | $ | 883 |
March 31, 2023 | December 31, 2022 | |||||||
Real estate: | (In thousands) | |||||||
Single family | $ | 68 | $ | 68 | ||||
Commercial – other | 57 | 57 | ||||||
$ | 125 | $ | 125 |
March 31, 2022 | ||||||||||||
(In thousands) | March 31, 2023 | March 31, 2022 | ||||||||||
(In thousands) | ||||||||||||
Balance at the beginning of the period | $ | 883 | $ | 165 | $ | 883 | ||||||
Deduction due to Payoffs | (707 | ) | ||||||||||
Deduction due to payoffs | – | (707 | ) | |||||||||
Accretion | 11 | – | (11 | ) | ||||||||
Balance at the end of the period | $ | 165 | $ | 165 | $ | 165 |
March 31, 2023 | ||||||||||||||||||||||||
Beginning Balance | Impact of CECL Adoption | Charge-offs | Recoveries | Provision (benefit) | Ending Balance | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Loans receivable held for investment: | ||||||||||||||||||||||||
Single family | $ | 109 | $ | 214 | $ | – | $ | – | $ | (62 | ) | $ | 261 | |||||||||||
Multi-family | 3,273 | 603 | – | – | 56 | 3,932 | ||||||||||||||||||
Commercial real estate | 449 | 466 | – | – | 97 | 1,012 | ||||||||||||||||||
Church | 65 | 37 | – | – | (10 | ) | 92 | |||||||||||||||||
Construction | 313 | 219 | – | – | 61 | 593 | ||||||||||||||||||
Commercial - other | 175 | 254 | – | – | (72 | ) | 357 | |||||||||||||||||
SBA loans | – | 20 | – | – | 18 | 38 | ||||||||||||||||||
Consumer | 4 | (4 | ) | – | – | – | – | |||||||||||||||||
Total | $ | 4,388 | $ | 1,809 | $ | – | $ | – | $ | 88 | $ | 6,285 |
For the Three Months Ended March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the three months ended March 31, 2022 | Real Estate | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate | Single Family | Multi- Family | Commercial Real Estate | Church | Construction | Commercial - Other | Consumer | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Single family | Multi- family | Commercial real estate | Church | Construction | Commercial - other | Consumer | Total | (In thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | 145 | $ | 2,657 | $ | 236 | $ | 103 | $ | 212 | $ | 23 | $ | 15 | $ | 3,391 | $ | 145 | $ | 2,657 | $ | 236 | $ | 103 | $ | 212 | $ | 23 | $ | 15 | $ | 3,391 | ||||||||||||||||||||||||||||||||
Provision for (recapture of) loan losses | 12 | 114 | (20 | ) | (40 | ) | 25 | 57 | 0 | 148 | 12 | 114 | (20 | ) | (40 | ) | 25 | 57 | – | 148 | ||||||||||||||||||||||||||||||||||||||||||||
Recoveries | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||||||||||||||
Loans charged off | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | 157 | $ | 2,771 | $ | 217 | $ | 63 | $ | 236 | $ | 95 | $ | 0 | $ | 3,539 | $ | 157 | $ | 2,771 | $ | 216 | $ | 63 | $ | 237 | $ | 80 | 15 | 3,539 |
For the three months ended March 31, 2021 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Single family | Multi- family | Commercial real estate | Church | Construction | Commercial - other | Consumer | Total | |||||||||||||||||||||||||
Beginning balance | $ | 296 | $ | 2,433 | $ | 222 | $ | 237 | $ | 22 | $ | 4 | $ | 1 | $ | 3,215 | ||||||||||||||||
Provision for (recapture of) loan losses | (21 | ) | 40 | (3 | ) | (16 | ) | 0 | 1 | (1 | ) | 0 | ||||||||||||||||||||
Recoveries | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
Loans charged off | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
Ending balance | $ | 275 | $ | 2,473 | $ | 219 | $ | 221 | $ | 0 | $ | 5 | $ | 0 | $ | 3,215 |
March 31, 2023 | ||||||||||||||||||||
Single Family | Condominium | Church | Business Assets | Total | ||||||||||||||||
Real estate: | (In thousands) | |||||||||||||||||||
Single family | $ | 53 | $ | 112 | $ | – | $ | – | $ | 165 | ||||||||||
Commercial real estate | – | – | 78 | – | 78 | |||||||||||||||
Church | – | – | 695 | – | 695 | |||||||||||||||
Commercial – other | – | – | – | 281 | 281 | |||||||||||||||
Total | $ | 53 | $ | 112 | $ | 773 | $ | 281 | $ | 1,219 |
March 31, 2022 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Single family | Multi- family | Commercial real estate | Church | Construction | Commercial - other | SBA | Total | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Allowance for loan losses: | ||||||||||||||||||||||||||||||||
Ending allowance balance attributable to loans: | ||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 3 | $ | 0 | $ | 0 | $ | 4 | $ | 0 | $ | 0 | $ | 0 | $ | 7 | ||||||||||||||||
Collectively evaluated for impairment | 154 | 2,771 | 217 | 59 | 236 | 95 | 0 | 3,532 | ||||||||||||||||||||||||
Total ending allowance balance | $ | 157 | $ | 2,771 | $ | 217 | $ | 63 | $ | 236 | $ | 95 | $ | 0 | $ | 3,539 | ||||||||||||||||
Loans: | ||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 64 | $ | 277 | $ | 0 | $ | 1,907 | $ | 0 | $ | 0 | $ | 0 | $ | 2,248 | ||||||||||||||||
Loans collectively evaluated for impairment | 31,151 | 368,647 | 24,594 | 8,062 | 26,606 | 17,281 | 0 | 476,341 | ||||||||||||||||||||||||
Subtotal | 31,215 | 368,924 | 24,594 | 9,969 | 26,606 | 17,281 | 0 | 478,589 | ||||||||||||||||||||||||
Loans acquired in the Merger | 8,930 | 34,002 | 65,808 | 11,396 | 7,332 | 36,599 | 15,488 | 179,701 | ||||||||||||||||||||||||
Total ending loans balance | $ | 40,145 | $ | 402,926 | $ | 90,402 | $ | 21,365 | $ | 33,938 | $ | 53,880 | $ | 15,488 | $ | 658,290 |
December 31, 2021 | December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate | Real Estate | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Single family | Multi- family | Commercial real estate | Church | Construction | Commercial - other | SBA | Total | Single Family | Multi- Family | Commercial Real Estate | Church | Construction | Commercial - Other | Consumer | Total | |||||||||||||||||||||||||||||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for loan losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending allowance balance attributable to loans: | Ending allowance balance attributable to loans: | Ending allowance balance attributable to loans: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 3 | $ | 0 | $ | 0 | $ | 4 | $ | 0 | $ | 0 | $ | 0 | $ | 7 | $ | 3 | $ | – | $ | – | $ | 4 | $ | – | $ | – | $ | – | $ | 7 | ||||||||||||||||||||||||||||||||
Collectively evaluated for impairment | 142 | 2,657 | 236 | 99 | 212 | 23 | 15 | 3,384 | 106 | 3,273 | 449 | 61 | 313 | 175 | 4 | 4,381 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total ending allowance balance | $ | 145 | $ | 2,657 | $ | 236 | $ | 103 | $ | 212 | $ | 23 | $ | 15 | $ | 3,391 | $ | 109 | $ | 3,273 | $ | 449 | $ | 65 | $ | 313 | $ | 175 | $ | 4 | $ | 4,388 | ||||||||||||||||||||||||||||||||
Loans: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans individually evaluated for impairment | $ | 65 | $ | 282 | $ | 0 | $ | 1,954 | $ | 0 | $ | 0 | $ | 0 | $ | 2,301 | $ | 57 | $ | – | $ | – | $ | 1,655 | $ | – | $ | – | $ | – | $ | 1,712 | ||||||||||||||||||||||||||||||||
Loans collectively evaluated for impairment | 32,599 | 353,179 | 25,507 | 9,058 | 24,225 | 3,124 | 0 | 447,692 | 20,893 | 462,539 | 63,929 | 9,008 | 38,530 | 29,558 | 11 | 624,468 | ||||||||||||||||||||||||||||||||||||||||||||||||
Subtotal | 32,664 | 353,461 | 25,507 | 11,012 | 24,225 | 3,124 | 0 | 449,993 | 20,950 | 462,539 | 63,929 | 10,663 | 38,530 | 29,558 | 11 | 626,180 | ||||||||||||||||||||||||||||||||||||||||||||||||
Loans acquired in the Merger | 12,708 | 41,769 | 67,686 | 11,491 | 7,847 | 43,415 | 18,837 | 203,753 | 9,088 | 41,357 | 50,645 | 5,117 | 2,173 | 38,884 | – | 147,264 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total ending loans balance | $ | 45,372 | $ | 395,230 | $ | 93,193 | $ | 22,503 | $ | 32,072 | $ | 46,539 | $ | 18,837 | $ | 653,746 | $ | 30,038 | $ | 503,896 | $ | 114,574 | $ | 15,780 | $ | 40,703 | $ | 68,442 | $ | 11 | $ | 773,444 |
March 31, 2022 | December 31, 2021 | December 31, 2022 | ||||||||||||||||||||||||||||||||||
Unpaid Principal Balance | Recorded Investment | Allowance for Loan Losses Allocated | Unpaid Principal Balance | Recorded Investment | Allowance for Loan Losses Allocated | Unpaid Principal Balance | Recorded Investment | Allowance for Loan Losses Allocated | ||||||||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||||||
Multi-family | $ | 277 | $ | 277 | $ | - | $ | 282 | $ | 282 | $ | - | ||||||||||||||||||||||||
Church | 1,811 | 1,810 | - | 1,854 | 1,854 | - | $ | 1,572 | $ | 1,572 | $ | – | ||||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||||||
Single family | 64 | 64 | 3 | 65 | 65 | 3 | 57 | 57 | 3 | |||||||||||||||||||||||||||
Church | 96 | 96 | 4 | 100 | 100 | 4 | 83 | 83 | 4 | |||||||||||||||||||||||||||
Total | $ | 2,248 | $ | 2,248 | $ | 7 | $ | 2,301 | $ | 2,301 | $ | 7 | $ | 1,712 | $ | 1,712 | $ | 7 |
Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2022 | ||||||||||||||||||||||
Average Recorded Investment | Cash Basis Interest Income Recognized | Average Recorded Investment | Cash Basis Interest Income Recognized | Average Recorded Investment | Cash Basis Interest Income Recognized | |||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||
Single family | $ | 64 | $ | 1 | $ | 571 | $ | 7 | $ | 64 | $ | 1 | ||||||||||||
Multi-family | 279 | 5 | 296 | 5 | 279 | 5 | ||||||||||||||||||
Church | 2,535 | 25 | 3,789 | 63 | 2,535 | 25 | ||||||||||||||||||
Commercial – other | 0 | 0 | 46 | 1 | ||||||||||||||||||||
Total | $ | 2,878 | $ | 31 | $ | 4,702 | $ | 76 | $ | 2,878 | $ | 31 |
March 31, 2023 | ||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Loans receivable held for investment: | ||||||||||||||||||||||||
Single family | $ | – | $ | – | $ | – | $ | – | $ | 29,216 | $ | 29,216 | ||||||||||||
Multi-family | 406 | – | – | 406 | 510,640 | 511,046 | ||||||||||||||||||
Commercial real estate | – | – | – | – | 129,031 | 129,031 | ||||||||||||||||||
Church | – | – | – | – | 13,983 | 13,983 | ||||||||||||||||||
Construction | – | – | – | – | 59,143 | 59,143 | ||||||||||||||||||
Commercial - other | – | – | – | – | 37,354 | 37,354 | ||||||||||||||||||
SBA loans | – | – | – | – | 3,565 | 3,565 | ||||||||||||||||||
Consumer | – | – | – | – | 10 | 10 | ||||||||||||||||||
Total | $ | 406 | $ | – | $ | – | $ | 406 | $ | 782,942 | $ | 783,348 |
December 31, 2022 | ||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Loans receivable held for investment: | ||||||||||||||||||||||||
Single family | $ | – | $ | – | $ | – | $ | – | $ | 30,038 | $ | 30,038 | ||||||||||||
Multi-family | – | – | – | – | 503,896 | 503,896 | ||||||||||||||||||
Commercial real estate | – | – | – | – | 114,574 | 114,574 | ||||||||||||||||||
Church | – | – | – | – | 15,780 | 15,780 | ||||||||||||||||||
Construction | – | – | – | – | 40,703 | 40,703 | ||||||||||||||||||
Commercial - other | – | – | – | – | 64,841 | 64,841 | ||||||||||||||||||
SBA loans | – | – | – | – | 3,601 | 3,601 | ||||||||||||||||||
Consumer | – | – | – | – | 11 | 11 | ||||||||||||||||||
Total | $ | – | $ | – | $ | – | $ | – | $ | 773,444 | $ | 773,444 |
March 31, 2023 | December 31, 2022 | |||||||
(In thousands) | ||||||||
Loans receivable held for investment: | ||||||||
Church | $ | – | $ | 144 | ||||
Total non-accrual loans | $ | – | $ | 144 |
March 31, 2022 | ||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Loans receivable held for investment: | ||||||||||||||||||||||||
Single family | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 40,145 | $ | 40,145 | ||||||||||||
Multi-family | 0 | 0 | 0 | 0 | 402,926 | 402,926 | ||||||||||||||||||
Commercial real estate | 2,944 | 0 | 0 | 2,944 | 87,458 | 90,402 | ||||||||||||||||||
Church | 0 | 0 | 0 | 0 | 21,365 | 21,365 | ||||||||||||||||||
Construction | 0 | 0 | 0 | 0 | 33,938 | 33,938 | ||||||||||||||||||
Commercial - other | 0 | 0 | 0 | 0 | 53,880 | 53,880 | ||||||||||||||||||
SBA loans | 0 | 0 | 0 | 0 | 15,488 | 15,488 | ||||||||||||||||||
Consumer | 0 | 0 | 0 | 0 | 146 | 146 | ||||||||||||||||||
Total | $ | 2,944 | $ | 0 | $ | 0 | $ | 2,944 | $ | 655,346 | $ | 658,290 |
December 31, 2021 | ||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Loans receivable held for investment: | ||||||||||||||||||||||||
Single family | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 45,372 | $ | 45,372 | ||||||||||||
Multi-family | 0 | 0 | 0 | 0 | 395,230 | 395,230 | ||||||||||||||||||
Commercial real estate | 0 | 2,423 | 0 | 2,423 | 90,770 | 93,193 | ||||||||||||||||||
Church | 0 | 0 | 0 | 0 | 22,503 | 22,503 | ||||||||||||||||||
Construction | 0 | 0 | 0 | 0 | 32,072 | 32,072 | ||||||||||||||||||
Commercial - other | 0 | 0 | 0 | 0 | 46,539 | 46,539 | ||||||||||||||||||
SBA | 0 | 0 | 0 | 0 | 18,837 | 18,837 | ||||||||||||||||||
Total | $ | 0 | $ | 2,423 | $ | 0 | $ | 2,423 | $ | 651,323 | $ | 653,746 |
March 31, 2022 | December 31, 2021 | |||||||
(In thousands) | ||||||||
Loans receivable held for investment: | ||||||||
Church | 653 | 684 | ||||||
Total non-accrual loans | $ | 653 | $ | 684 |
● | Watch. Loans classified as watch exhibit weaknesses that could threaten the current net worth and paying capacity of the obligors. Watch graded loans are generally performing and are not more than 59 days past due. A watch rating is used when a material deficiency exists, but correction is anticipated within an acceptable time frame. |
● | Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date. |
● | Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. |
● | Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. |
● | Loss. Loans classified as loss are considered uncollectible and of such little value that to continue to carry the loan as an active asset is no longer warranted. |
Term Loans Amortized Cost Basis by Origination Year - As of March 31, 2023 | ||||||||||||||||||||||||||||||||
2023 | 2022 | 2021 | 2020 | 2019 | Prior | Revolving Loans | Total | |||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||||||
Single family: | ||||||||||||||||||||||||||||||||
Pass | $ | – | $ | 2,517 | $ | 2,663 | $ | 4,399 | $ | 1,833 | $ | 16,798 | $ | – | $ | 28,210 | ||||||||||||||||
Watch | – | – | – | – | – | 349 | – | 349 | ||||||||||||||||||||||||
Special Mention | – | – | – | – | – | 258 | – | 258 | ||||||||||||||||||||||||
Substandard | – | – | – | – | – | 399 | – | 399 | ||||||||||||||||||||||||
Total | $ | – | $ | 2,517 | $ | 2,663 | $ | 4,399 | $ | 1,833 | $ | 17,804 | $ | – | $ | 29,216 | ||||||||||||||||
Multi-family: | ||||||||||||||||||||||||||||||||
Pass | $ | 13,179 | $ | 187,621 | $ | 154,166 | $ | 27,839 | $ | 46,232 | $ | 57,980 | $ | – | $ | 487,017 | ||||||||||||||||
Watch | – | 3,300 | 915 | – | – | 3,453 | – | 7,668 | ||||||||||||||||||||||||
Special Mention | – | – | – | – | – | 1,775 | – | 1,775 | ||||||||||||||||||||||||
Substandard | – | – | – | – | 760 | 13,826 | – | 14,586 | ||||||||||||||||||||||||
Total | $ | 13,179 | $ | 190,921 | $ | 155,081 | $ | 27,839 | $ | 46,992 | $ | 77,034 | $ | – | $ | 511,046 | ||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||||||
Pass | $ | 2,835 | $ | 22,571 | $ | 26,181 | $ | 30,678 | $ | 6,430 | $ | 32,719 | $ | – | $ | 121,414 | ||||||||||||||||
Watch | – | 432 | – | – | 740 | 1,101 | – | 2,273 | ||||||||||||||||||||||||
Special Mention | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Substandard | – | – | – | $ | – | $ | – | 5,344 | $ | – | $ | 5,344 | ||||||||||||||||||||
Total | $ | 2,835 | $ | 23,003 | $ | 26,181 | $ | 30,678 | $ | 7,170 | $ | 39,164 | $ | – | $ | 129,031 | ||||||||||||||||
Church: | ||||||||||||||||||||||||||||||||
Pass | $ | – | $ | – | $ | 2,247 | $ | 1,785 | $ | – | $ | 7,188 | $ | – | $ | 11,220 | ||||||||||||||||
Watch | – | – | – | – | 649 | 1,120 | – | 1,769 | ||||||||||||||||||||||||
Special Mention | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Substandard | – | – | – | – | – | 994 | – | 994 | ||||||||||||||||||||||||
Total | $ | – | $ | – | $ | 2,247 | $ | 1,785 | $ | 649 | $ | 9,302 | $ | – | $ | 13,983 | ||||||||||||||||
Construction: | ||||||||||||||||||||||||||||||||
Pass | $ | 995 | $ | – | $ | 1,219 | $ | – | $ | – | $ | 2,154 | $ | – | $ | 4,368 | ||||||||||||||||
Watch | 17,495 | 30,012 | 7,268 | – | – | – | – | 54,775 | ||||||||||||||||||||||||
Special Mention | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Substandard | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Total | $ | 18,490 | $ | 30,012 | $ | 8,487 | $ | – | $ | – | $ | 2,154 | $ | – | $ | 59,143 | ||||||||||||||||
Commercial – others: | ||||||||||||||||||||||||||||||||
Pass | $ | – | $ | 7,611 | $ | 175 | $ | 1,404 | $ | 4,300 | $ | 5,784 | $ | 6,568 | $ | 25,842 | ||||||||||||||||
Watch | – | 1,205 | 107 | 1,500 | 2,250 | 5,532 | 637 | 11,231 | ||||||||||||||||||||||||
Special Mention | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Substandard | – | – | – | – | – | 281 | – | 281 | ||||||||||||||||||||||||
Total | $ | – | $ | 8,816 | $ | 282 | $ | 2,904 | $ | 6,550 | $ | 11,597 | $ | 7,205 | $ | 37,354 | ||||||||||||||||
SBA: | ||||||||||||||||||||||||||||||||
Pass | $ | – | $ | 148 | $ | 2,723 | $ | – | $ | 28 | $ | 128 | $ | – | $ | 3,027 | ||||||||||||||||
Watch | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Special Mention | – | – | – | 538 | – | – | – | 538 | ||||||||||||||||||||||||
Substandard | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Total | $ | – | $ | 148 | $ | 2,723 | $ | 538 | $ | 28 | $ | 128 | $ | – | $ | 3,565 | ||||||||||||||||
Consumer: | ||||||||||||||||||||||||||||||||
Pass | $ | 10 | $ | – | $ | – | $ | – | $ | – | $ | – | $ | – | $ | 10 | ||||||||||||||||
Watch | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Special Mention | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Substandard | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Total | $ | 10 | $ | – | $ | – | $ | – | $ | – | $ | – | $ | – | $ | 10 | ||||||||||||||||
Total loans: | ||||||||||||||||||||||||||||||||
Pass | $ | 17,019 | $ | 220,468 | $ | 189,374 | $ | 66,105 | $ | 58,823 | $ | 122,751 | $ | 6,568 | $ | 681,108 | ||||||||||||||||
Watch | 17,495 | 34,949 | 8,290 | 1,500 | 3,639 | 11,555 | 637 | 78,065 | ||||||||||||||||||||||||
Special Mention | – | – | – | 538 | – | 2,033 | – | 2,571 | ||||||||||||||||||||||||
Substandard | – | – | – | – | 760 | 20,844 | – | 21,604 | ||||||||||||||||||||||||
Total loans | $ | 34,514 | $ | 255,417 | $ | 197,664 | $ | 68,143 | $ | 63,222 | $ | 157,183 | $ | 7,205 | $ | 783,348 |
March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | Watch | Special Mention | Substandard | Doubtful | Loss | Total | December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||
(In thousands) | Pass | Watch | Special Mention | Substandard | Doubtful | Loss | Total | |||||||||||||||||||||||||||||||||||||||||||||||||
Single family | $ | 38,135 | $ | 1,328 | $ | 268 | $ | 414 | $ | 0 | $ | 0 | $ | 40,145 | $ | 29,022 | $ | 354 | $ | 260 | $ | 402 | $ | – | $ | – | $ | 30,038 | ||||||||||||||||||||||||||||
Multi-family | 385,748 | 6,428 | 2,540 | 8,210 | 0 | 0 | 402,926 | 479,182 | 9,855 | 14,859 | – | – | – | 503,896 | ||||||||||||||||||||||||||||||||||||||||||
Commercial real estate | 70,078 | 9,589 | 5,970 | 4,765 | 0 | 0 | 90,402 | 104,066 | 4,524 | 1,471 | 4,513 | – | – | 114,574 | ||||||||||||||||||||||||||||||||||||||||||
Church | 16,795 | 931 | 0 | 3,639 | 0 | 0 | 21,365 | 14,505 | 728 | – | 547 | – | – | 15,780 | ||||||||||||||||||||||||||||||||||||||||||
Construction | 9,158 | 24,780 | 0 | 0 | 0 | 0 | 33,938 | 2,173 | 38,530 | – | – | – | – | 40,703 | ||||||||||||||||||||||||||||||||||||||||||
Commercial - other | 41,397 | 12,167 | 0 | 307 | 9 | 0 | 53,880 | |||||||||||||||||||||||||||||||||||||||||||||||||
Commercial – others | 53,396 | 11,157 | – | 288 | – | – | 64,841 | |||||||||||||||||||||||||||||||||||||||||||||||||
SBA | 14,668 | 657 | 163 | 0 | 0 | 0 | 15,488 | 3,032 | 569 | – | – | – | – | 3,601 | ||||||||||||||||||||||||||||||||||||||||||
Consumer | 146 | 0 | 0 | 0 | 0 | 0 | 146 | 11 | – | – | – | – | – | 11 | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 576,125 | $ | 55,880 | $ | 8,941 | $ | 17,335 | $ | 9 | $ | 0 | $ | 658,290 | $ | 685,387 | $ | 65,717 | $ | 16,590 | $ | 5,750 | $ | – | $ | – | $ | 773,444 |
December 31, 2021 | ||||||||||||||||||||||||||||
Pass | Watch | Special Mention | Substandard | Doubtful | Loss | Total | ||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||||||
Single family | $ | 42,454 | $ | 1,343 | $ | 271 | $ | 1,304 | $ | 0 | $ | 0 | $ | 45,372 | ||||||||||||||
Multi-family | 378,141 | 7,987 | 575 | 8,527 | 0 | 0 | 395,230 | |||||||||||||||||||||
Commercial real estate | 69,257 | 7,034 | 9,847 | 7,055 | 0 | 0 | 93,193 | |||||||||||||||||||||
Church | 20,021 | 0 | 0 | 2,482 | 0 | 0 | 22,503 | |||||||||||||||||||||
Construction | 10,522 | 21,550 | 0 | 0 | 0 | 0 | 32,072 | |||||||||||||||||||||
Commercial - other | 33,988 | 12,551 | 0 | 0 | 0 | 0 | 46,539 | |||||||||||||||||||||
SBA | 18,665 | 0 | 172 | 0 | 0 | 0 | 18,837 | |||||||||||||||||||||
Total | $ | 573,048 | $ | 50,465 | $ | 10,865 | $ | 19,368 | $ | 0 | $ | 0 | $ | 653,746 |
Goodwill | Core Deposit Intangible | Goodwill | Core Deposit Intangible | |||||||||||||
(In thousands) | (In thousands) | |||||||||||||||
Balance at the beginning of the period | $ | 25,996 | $ | 2,936 | $ | 25,858 | $ | 2,501 | ||||||||
Additions | 0 | 0 | – | – | ||||||||||||
Change in deferred tax estimate | (138 | ) | (109 | ) | – | – | ||||||||||
Impairment | 0 | 0 | ||||||||||||||
Amortization | – | (98 | ) | |||||||||||||
Balance at the end of the period | $ | 25,858 | $ | 2,827 | $ | 25,858 | $ | 2,403 |
Core deposit intangible acquired | $ | 3,329 | ||
Less: accumulated amortization | (926 | ) | ||
$ | 2,403 |
(In thousands) | ||||||||
2022 | $ | 326 | ||||||
2023 | 390 | $ | 292 | |||||
2024 | 336 | 336 | ||||||
2025 | 315 | 315 | ||||||
2026 | 304 | 304 | ||||||
2027 | 291 | |||||||
Thereafter | 1,156 | 865 | ||||||
$ | 2,827 | $ | 2,403 |
Fair Value Measurement | Fair Value Measurement | |||||||||||||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||||||||
At March 31, 2022: | ||||||||||||||||||||||||||||||||
Securities available for sale: | ||||||||||||||||||||||||||||||||
At March 31, 2023: | ||||||||||||||||||||||||||||||||
Securities available-for-sale: | ||||||||||||||||||||||||||||||||
Federal agency mortgage-backed | $ | 0 | $ | 79,222 | $ | 0 | $ | 79,222 | $ | – | $ | 73,017 | $ | – | $ | 73,017 | ||||||||||||||||
Federal agency CMO | 0 | 8,910 | 0 | 8,910 | – | 25,749 | – | 25,749 | ||||||||||||||||||||||||
Federal agency debt | 0 | 42,035 | 0 | 42,035 | – | 52,030 | – | 52,030 | ||||||||||||||||||||||||
Municipal bonds | 0 | 4,890 | 0 | 4,890 | – | 4,299 | – | 4,299 | ||||||||||||||||||||||||
U. S. Treasuries | 0 | 26,168 | 0 | 26,168 | ||||||||||||||||||||||||||||
U.S. Treasuries | 162,096 | – | – | 162,096 | ||||||||||||||||||||||||||||
SBA pools | 0 | 15,770 | 0 | 15,770 | – | 11,835 | – | 11,835 | ||||||||||||||||||||||||
At December 31, 2021: | ||||||||||||||||||||||||||||||||
Securities available for sale: | ||||||||||||||||||||||||||||||||
At December 31, 2022: | ||||||||||||||||||||||||||||||||
Securities available-for-sale: | ||||||||||||||||||||||||||||||||
Federal agency mortgage-backed | $ | 0 | $ | 70,030 | $ | 0 | $ | 70,030 | $ | – | $ | 74,169 | $ | – | $ | 74,169 | ||||||||||||||||
Federal agency CMO | 0 | 9,287 | 0 | 9,287 | – | 26,100 | – | 26,100 | ||||||||||||||||||||||||
Federal agency debt | 0 | 37,988 | 0 | 37,988 | – | 51,425 | – | 51,425 | ||||||||||||||||||||||||
Municipal bonds | 0 | 4,915 | 0 | 4,915 | – | 4,197 | – | 4,197 | ||||||||||||||||||||||||
U. S. Treasuries | 0 | 17,951 | 0 | 17,951 | ||||||||||||||||||||||||||||
U.S. Treasuries | 160,589 | – | – | 160,589 | ||||||||||||||||||||||||||||
SBA pools | 0 | 16,225 | 0 | 16,225 | – | 12,269 | – | 12,269 |
Fair Value Measurements at March 31, 2022 | Fair Value Measurements at March 31, 2023 | |||||||||||||||||||||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||||||||||||||||
Financial Assets: | ||||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 246,106 | $ | 246,106 | $ | 0 | $ | 0 | $ | 246,106 | $ | 29,648 | $ | 29,648 | $ | – | $ | – | $ | 29,648 | ||||||||||||||||||||
Securities available-for-sale | 170,308 | 0 | 170,308 | 0 | 170,308 | 329,026 | 162,096 | 166,930 | – | 329,026 | ||||||||||||||||||||||||||||||
Loans receivable held for investment | 653,375 | 0 | 0 | 598,354 | 598,354 | 776,053 | – | – | 636,286 | 636,286 | ||||||||||||||||||||||||||||||
Accrued interest receivable | 2,449 | 1 | 266 | 2,182 | 2,449 | |||||||||||||||||||||||||||||||||||
Accrued interest receivables | 4,219 | 612 | 635 | 2,972 | 4,219 | |||||||||||||||||||||||||||||||||||
Bank owned life insurance | 3,200 | 3,200 | 0 | 0 | 3,200 | 3,242 | 3,242 | – | – | 3,242 | ||||||||||||||||||||||||||||||
Financial Liabilities: | ||||||||||||||||||||||||||||||||||||||||
Deposits | $ | 839,714 | $ | 0 | $ | 784,698 | $ | 0 | $ | 784,698 | $ | 657,542 | $ | – | $ | 596,064 | $ | – | $ | 596,064 | ||||||||||||||||||||
Federal Home Loan Bank advances | 73,001 | 0 | 72,037 | 0 | 72,037 | |||||||||||||||||||||||||||||||||||
FHLB advances | 168,810 | – | 167,175 | – | 167,175 | |||||||||||||||||||||||||||||||||||
Securities sold under agreements to repurchase | 56,003 | 0 | 52,873 | 0 | 52,873 | 70,941 | – | 67,423 | – | 67,423 | ||||||||||||||||||||||||||||||
Notes payable | 14,000 | 0 | 14,000 | 0 | 14,000 | |||||||||||||||||||||||||||||||||||
Note payable | 14,000 | – | – | 14,000 | 14,000 | |||||||||||||||||||||||||||||||||||
Accrued interest payable | 135 | 0 | 135 | 0 | 135 | 368 | – | 368 | – | 368 |
Fair Value Measurements at December 31, 2021 | Fair Value Measurements at December 31, 2022 | |||||||||||||||||||||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||
(In thousands) | (In thousands) | |||||||||||||||||||||||||||||||||||||||
Financial Assets: | ||||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 231,520 | $ | 231,520 | $ | 0 | $ | 0 | $ | 231,520 | $ | 16,105 | $ | 16,105 | $ | – | $ | – | $ | 16,105 | ||||||||||||||||||||
Securities available-for-sale | 156,396 | 0 | 156,396 | 0 | 156,396 | 328,749 | 160,589 | 168,160 | – | 328,749 | ||||||||||||||||||||||||||||||
Loans receivable held for investment | �� | 648,513 | 0 | 0 | 623,778 | 623,778 | 768,046 | – | – | 641,088 | 641,088 | |||||||||||||||||||||||||||||
Accrued interest receivable | 3,372 | 19 | 1,089 | 2,264 | 3,372 | |||||||||||||||||||||||||||||||||||
Accrued interest receivables | 3,973 | 442 | 793 | 2,738 | 3,973 | |||||||||||||||||||||||||||||||||||
Bank owned life insurance | 3,190 | 3,190 | 0 | 0 | 3,190 | 3,233 | 3,233 | – | – | 3,233 | ||||||||||||||||||||||||||||||
Financial Liabilities: | ||||||||||||||||||||||||||||||||||||||||
Deposits | $ | 788,052 | $ | 0 | $ | 754,181 | $ | 0 | $ | 754,181 | $ | 686,916 | $ | – | $ | 673,615 | $ | – | $ | 673,615 | ||||||||||||||||||||
Federal Home Loan Bank advances | 85,952 | 0 | 87,082 | 0 | 87,082 | |||||||||||||||||||||||||||||||||||
FHLB advances | 128,344 | – | 126,328 | – | 126,328 | |||||||||||||||||||||||||||||||||||
Securities sold under agreements to repurchase | 51,960 | 0 | 51,960 | 0 | 51,960 | 63,471 | – | 60,017 | – | 60,017 | ||||||||||||||||||||||||||||||
Notes payable | 14,000 | 0 | 14,000 | 0 | 14,000 | |||||||||||||||||||||||||||||||||||
Note payable | 14,000 | – | – | 14,000 | 14,000 | |||||||||||||||||||||||||||||||||||
Accrued interest payable | 119 | 0 | 119 | 0 | 119 | 453 | – | 453 | – | 453 |
Three months Ended March 31, 2022 | Three months Ended March 31, 2021 | March 31, 2023 | ||||||||||||||||||||||
Number Outstanding | Weighted Average Exercise Price | Number Outstanding | Weighted Average Exercise Price | Number Outstanding | Weighted Average Exercise Price | |||||||||||||||||||
Outstanding at beginning of period | 450,000 | $ | 1.62 | 450,000 | $ | 1.62 | 250,000 | $ | 1.62 | |||||||||||||||
Granted during period | 0 | 0 | 0 | 0 | – | – | ||||||||||||||||||
Exercised during period | 0 | 0 | 0 | 0 | – | – | ||||||||||||||||||
Forfeited or expired during period | 0 | 0 | 0 | 0 | – | – | ||||||||||||||||||
Outstanding at end of period | 450,000 | $ | 1.62 | 450,000 | $ | 1.62 | 250,000 | $ | 1.62 | |||||||||||||||
Exercisable at end of period | 450,000 | $ | 1.62 | 450,000 | $ | 1.62 | 250,000 | $ | 1.62 |
Outstanding | Exercisable | |||||||||||||||||||||||
Number Outstanding | Weighted Average Remaining Contractual Life | Weighted Average Exercise Price | Aggregate Intrinsic Value | Number Outstanding | Weighted Average Exercise Price | Aggregate Intrinsic Value | ||||||||||||||||||
450,000 | $ | 1.62 | 450,000 | $ | 1.62 | |||||||||||||||||||
450,000 | 4.40 years | $ | 1.62 | $ | 0 | 450,000 | $ | 1.62 | $ | 0 |
Outstanding | Exercisable | ||||||||||||||||||||||
Number Outstanding | Weighted Average Remaining Contractual Life | Weighted Average Exercise Price | Aggregate Intrinsic Value | Number Outstanding | Weighted Average Exercise Price | Aggregate Intrinsic Value | |||||||||||||||||
250,000 | 2.88 years | $ | 1.62 | $ | – | 250,000 | $ | 1.62 | $ | – |
March 31, 2022 | December 31, 2021 | March 31, 2023 | December 31, 2022 | |||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||
Allocated to participants | 1,087,216 | 1,087,216 | 1,057,504 | 1,057,504 | ||||||||||||
Committed to be released | 20,128 | 10,064 | 19,784 | 9,892 | ||||||||||||
Suspense shares | 512,554 | 521,618 | 3,003,938 | 948,488 | ||||||||||||
Total ESOP shares | 1,619,898 | 1,618,898 | 4,081,226 | 2,015,884 | ||||||||||||
Fair value of unearned shares | $ | 933 | $ | 1,454 | $ | 3,545 | $ | 1,015 |
Actual | Minimum Required to Be Well Capitalized Under Prompt Corrective Action Provisions | Actual | Minimum Required to Be Well Capitalized Under Prompt Corrective Action Provisions | ||||||||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | ||||||||||||||||||||||||||||||||
March 31, 2022: | |||||||||||||||||||||||||||||||||
March 31, 2023: | |||||||||||||||||||||||||||||||||
Community Bank Leverage Ratio | $ | 99,993 | 9.45 | % | $ | 95,129 | 9.00 | % | $ | 181,562 | 15.69 | % | $ | 104,174 | 9.00 | % | |||||||||||||||||
December 31, 2021: | |||||||||||||||||||||||||||||||||
December 31, 2022: | |||||||||||||||||||||||||||||||||
Community Bank Leverage Ratio | $ | 98,590 | 9.32 | % | $ | 89,871 | 8.50 | % | $ | 181,304 | 15.75 | % | $ | 103,591 | 9.00 | % |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
For the three months ended | ||||||||||||||||||||||||
March 31, 2022 | March 31, 2021 | |||||||||||||||||||||||
(Dollars in Thousands) | Average Balance | Interest | Average Yield/ Cost | Average Balance | Interest | Average Yield/ Cost | ||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Interest-earning deposits | $ | 220,266 | $ | 84 | 0.15 | % | $ | 98,183 | $ | 35 | 0.14 | % | ||||||||||||
Securities | 160,968 | 553 | 1.37 | % | 10,414 | 56 | 2.15 | % | ||||||||||||||||
Loans receivable (1) | 653,493 | 7,336 | 4.49 | % | 361,487 | 3,644 | 4.03 | % | ||||||||||||||||
FRB and FHLB stock | 3,046 | 38 | 4.99 | % | 3,431 | 42 | 4.90 | % | ||||||||||||||||
Total interest-earning assets | 1,037,773 | $ | 8,011 | 3.09 | % | 473,515 | $ | 3,777 | 3.19 | % | ||||||||||||||
Non-interest-earning assets | 74,542 | 11,064 | ||||||||||||||||||||||
Total assets | $ | 1,112,315 | $ | 484,579 | ||||||||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Money market deposits | $ | 207,078 | $ | 189 | 0.37 | % | $ | 76,750 | $ | 81 | 0.42 | % | ||||||||||||
Passbook deposits | 66,825 | 8 | 0.05 | % | 64,044 | 57 | 0.36 | % | ||||||||||||||||
NOW and other demand deposits | 230,461 | 39 | 0.07 | % | 54,650 | 7 | 0.05 | % | ||||||||||||||||
Certificate accounts | 201,446 | 114 | 0.23 | % | 120,857 | 238 | 0.79 | % | ||||||||||||||||
Total deposits | 705,810 | 350 | 0.20 | % | 316,301 | 383 | 0.48 | % | ||||||||||||||||
FHLB advances | 77,849 | 342 | 1.76 | % | 110,500 | 527 | 1.91 | % | ||||||||||||||||
Junior subordinated debentures | - | - | 0.00 | % | 3,275 | 22 | 2.69 | % | ||||||||||||||||
Other borrowings | 68,019 | 147 | 0.86 | % | - | - | 0.00 | % | ||||||||||||||||
Total borrowings | 145,868 | 489 | 1.34 | % | 113,775 | 549 | 1.93 | % | ||||||||||||||||
Total interest-bearing liabilities | 851,678 | $ | 839 | 0.39 | % | 430,076 | $ | 932 | 0.87 | % | ||||||||||||||
Non-interest-bearing liabilities | 121,912 | 5,832 | ||||||||||||||||||||||
Stockholders’ equity | 138,725 | 48,671 | ||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,112,315 | $ | 484,579 | ||||||||||||||||||||
Net interest rate spread (2) | $ | 7,172 | 2.70 | % | $ | 2,845 | 2.32 | % | ||||||||||||||||
Net interest rate margin (3) | 2.76 | % | 2.40 | % | ||||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | 121.85 | % | 110.10 | % |
For the Three Months Ended | ||||||||||||||||||||||||
March 31, 2023 | March 31, 2022 | |||||||||||||||||||||||
(Dollars in Thousands) | Average Balance | Interest | Average Yield/Cost | Average Balance | Interest | Average Yield/Cost | ||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Interest-earning deposits | $ | 17,044 | $ | 119 | 2.79 | % | $ | 220,266 | $ | 84 | 0.15 | % | ||||||||||||
Securities | 328,767 | 2,180 | 2.65 | % | 160,968 | 553 | 1.37 | % | ||||||||||||||||
Loans receivable (1) | 762,669 | 8,535 | 4.48 | % | 653,493 | 7,336 | 4.49 | % | ||||||||||||||||
FRB and FHLB stock | 10,665 | 209 | 7.84 | % | 3,046 | 38 | 4.99 | % | ||||||||||||||||
Total interest-earning assets | 1,119,145 | $ | 11,043 | 3.95 | % | 1,037,773 | $ | 8,011 | 3.09 | % | ||||||||||||||
Non-interest-earning assets | 67,947 | 74,542 | ||||||||||||||||||||||
Total assets | $ | 1,187,092 | $ | 1,112,315 | ||||||||||||||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Money market deposits | $ | 134,047 | $ | 771 | 2.30 | % | $ | 207,078 | $ | 189 | 0.37 | % | ||||||||||||
Savings deposits | 61,317 | 13 | 0.08 | % | 66,825 | 8 | 0.05 | % | ||||||||||||||||
Interest checking and other demand deposits | 239,024 | 77 | 0.13 | % | 230,461 | 39 | 0.07 | % | ||||||||||||||||
Certificate accounts | 147,260 | 442 | 1.20 | % | 201,446 | 114 | 0.23 | % | ||||||||||||||||
Total deposits | 581,648 | 1,303 | 0.90 | % | 705,810 | 350 | 0.20 | % | ||||||||||||||||
FHLB advances | 145,201 | 1,323 | 3.64 | % | 77,849 | 342 | 1.76 | % | ||||||||||||||||
Other borrowings | 69,618 | 143 | 0.82 | % | 68,019 | 147 | 0.86 | % | ||||||||||||||||
Total borrowings | 214,819 | 1,466 | 2.73 | % | 145,868 | 489 | 1.34 | % | ||||||||||||||||
Total interest-bearing liabilities | 796,467 | $ | 2,769 | 1.39 | % | 851,678 | $ | 839 | 0.39 | % | ||||||||||||||
Non-interest-bearing liabilities | 109,955 | 121,912 | ||||||||||||||||||||||
Stockholders’ equity | 280,670 | 138,725 | ||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 1,187,092 | $ | 1,112,315 | ||||||||||||||||||||
Net interest rate spread (2) | $ | 8,274 | 2.56 | % | $ | 7,172 | 2.69 | % | ||||||||||||||||
Net interest rate margin (3) | 2.96 | % | 2.76 | % | ||||||||||||||||||||
Ratio of interest-earning assets to interest-bearing liabilities | 140.51 | % | 121.85 | % |
(1) | Amount is net of deferred loan fees, loan discounts and loans in process, and includes deferred origination costs and loan premiums. |
(2) | Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities. |
(3) | Net interest rate margin represents net interest income as a percentage of average interest-earning assets. |
Common Equity Capital | Shares Outstanding | Per Share Amount | Common Equity Capital | Shares Outstanding | Per Share Amount | |||||||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||
March 31, 2022: | ||||||||||||||||||||||||
March 31, 2023: | ||||||||||||||||||||||||
Common book value | $ | 136,213 | 73,504,185 | $ | 1.85 | $ | 129,385 | 73,503,292 | $ | 1.76 | ||||||||||||||
Less: | ||||||||||||||||||||||||
Goodwill | 25,858 | 25,858 | ||||||||||||||||||||||
Net unamortized core deposit intangible | 2,827 | 2,403 | ||||||||||||||||||||||
Tangible book value | $ | 107,541 | 73,504,185 | $ | 1.46 | $ | 101,124 | 73,503,292 | $ | 1.38 | ||||||||||||||
December 31, 2021: | ||||||||||||||||||||||||
December 31, 2022: | ||||||||||||||||||||||||
Common book value | $ | 138,000 | 71,768,419 | $ | 1.92 | $ | 129,482 | 73,432,517 | $ | 1.76 | ||||||||||||||
Less: | ||||||||||||||||||||||||
Goodwill | 25,996 | 25,858 | ||||||||||||||||||||||
Net unamortized core deposit intangible | 2,936 | 2,501 | ||||||||||||||||||||||
Tangible book value | $ | 109,068 | 71,768,419 | $ | 1.52 | $ | 101,123 | $ | 73,432,517 | $ | 1.38 |
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 4. | CONTROLS AND PROCEDURES |
Item 1A. | RISK FACTORS |
Item 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Item 3. | DEFAULTS UPON SENIOR SECURITIES |
Item 4. | MINE SAFETY DISCLOSURES |
Item 5. | OTHER INFORMATION |
Item 6. | EXHIBITS |
Exhibit Number* | |
Amended and Restated Certificate of Incorporation of | |
Bylaws of Registrant (Exhibit 3.2 to Form 8-K filed by Registrant on August 24, 2020) | |
Certificate of Designations of Senior Non-Cumulative Perpetual Preferred Stock, Series C (Exhibit 3.1 to Form 8-K filed by Registrant on June 8, 2022) | |
Certification of Chief Executive Officer pursuant to | |
Certification of Chief Financial Officer pursuant to | |
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of | |
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of | |
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
101.SCH | Inline XBRL Taxonomy Extension Schema Document |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF | Inline XBRL Taxonomy Extension Definitions Linkbase Document |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
104 |
* | Exhibits followed by a parenthetical reference are incorporated by reference herein from the document filed by the Registrant with the SEC described therein. Except as otherwise indicated, the SEC File No. for each incorporated document is 000-27464. |
** | Management contract or compensatory plan or arrangement. |
Date: May 16, | By: | /s/ Brian Argrett |
Brian Argrett | ||
Chief Executive Officer | ||
Date: May 16, | By: | /s/ Brenda J. Battey |
Brenda J. Battey | ||
Chief Financial Officer |