Exhibit 99.1
Clinton, NJ, April 14, 2022 - Unity Bancorp, Inc. (NASDAQ: UNTY), parent company of Unity Bank, reported net income of $9.1 million, or $0.85 per diluted share, for the quarter ended March 31, 2022, a 7.2 percent increase compared to net income of $8.5 million, or $0.80 per diluted share for the prior year’s first quarter.
First Quarter Earnings Highlights
● | Net interest income, our primary driver of earnings, increased $1.9 million to $19.9 million for the quarter ended March 31, 2022, compared to $18.0 million for the prior year’s quarter, primarily due to commercial loan growth and residential construction loan growth. During the quarter ended March 31, 2022, the Company earned $688 thousand on SBA PPP fees. |
● | Net interest margin (“NIM”) increased 2 basis points to 4.11% for the quarter ended March 31, 2022, compared to the prior year’s quarter. |
● | Noninterest income decreased $1.5 million to $2.2 million compared to the prior year’s quarter. The decreases were primarily due to a decline in the gains on residential mortgage loan sales and a decrease in the fair market value of our equity securities, partially offset by an increase in in the net gain on sale of SBA loans. For the quarter ended March 31, 2022, SBA loan sales totaled $6.8 million with net gains of $852 thousand. |
● | Noninterest expense increased $608 thousand to $10.4 million compared to the prior year’s quarter, primarily due to increased compensation expenses. |
● | The effective tax rate was 23.5% compared to 25.7% in the prior year’s quarter. |
Balance Sheet Highlights
● | Total loans increased $51.9 million, or 3.1%, from year-end 2021 due to increases in commercial loans, residential mortgage loans and residential construction loans. SBA PPP loans decreased $17.8 million due to loans being forgiven and paid off. At March 31, 2022, $1.9 million in loans, or 0.11% of the total loan portfolio, were on deferral, compared to, $8.4 million in loans, or 0.51% of the total loan portfolio at December 31, 2021. |
● | Total deposits increased $12.3 million from year-end 2021 to $1.8 billion at March 31, 2022. The Company’s deposit composition at March 31, 2022 consisted of 39.9% in savings deposits, 30.6% in noninterest-bearing demand deposits, 15.9% in time deposits and 13.6% in interest-bearing demand deposits. |
● | Borrowed funds and subordinated debentures remained flat at $50.3 million compared to the prior year’s quarter. |
● | Shareholders’ equity was $214.9 million at March 31, 2022 compared to $205.7 million at year-end 2021. |
● | Book value per common share was $20.48 as of March 31, 2022, compared to $19.80 as of December 31, 2021. |
● | At March 31, 2022, the Community Bank Leverage Ratio was 10.67%, compared to 10.51% at December 31, 2021. |
● | Nonperforming assets were $9.3 million at March 31, 2022, compared to $9.6 million at December 31, 2021. The allowance to total loans ratio was 1.30% at March 31, 2022. |
Other Highlights
Mr. Allen Tucker, who has served more than 25 years on the Board of Directors, expects to retire following the conclusion of the 2022 Annual Meeting. The Board as well as all Unity Bank employees commemorate Mr. Tucker for his invaluable service.
Unity Bank has launched a partnership program with America’s Grow-A-Row (AGAR), donating $25,000 as the lead sponsor of the Pittstown non-profit organization’s 2022 Farm to Fork Volunteer Sponsorship program, supporting the activities of more than 9,000 volunteers who help to harvest and distribute over 2.4 million pounds of free fresh produce to people in need in nine states. Unity employees also volunteer several times a year at AGAR’s four Hunterdon County farms.
For the second year in a row, Unity Bank has donated $5,000 to the NID Housing Counseling Agency (NID-HCA), a U.S. Department of Housing and Urban Development (HUD) approved national network of housing counselors and community-development consultants. Unity is partnering with the agency to supplement the bank’s Low-Moderate Income Mortgage Program.
Unity Bancorp, Inc. is a financial services organization headquartered in Clinton, New Jersey, with approximately $2.1 billion in assets and $1.8 billion in deposits. Unity Bank, the Company’s wholly owned subsidiary, provides financial services to retail, corporate and small business customers through its 19 retail service centers located in Bergen, Hunterdon, Middlesex, Somerset, Union and Warren Counties in New Jersey and Northampton County in Pennsylvania. For additional information about Unity, visit our website at www.unitybank.com , or call 800- 618-BANK.
This news release contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader in understanding anticipated future financial performance. These statements may be identified by use of the words “believe”, “expect”, “intend”, “anticipate”, “estimate”, “project” or similar expressions. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond the company’s control and could impede its ability to achieve these goals. These factors include those items included in our Annual Report on Form 10-K under the heading “Item IA-Risk Factors” as amended or supplemented by our subsequent filings with the SEC, as well as general economic conditions, trends in interest rates, the ability of our borrowers to repay their loans, our ability to manage and reduce the level of our nonperforming assets, results of regulatory exams, and the impact of COVID-19 on the Bank, its employees and customers, among other factors.
UNITY BANCORP, INC.
SUMMARY FINANCIAL HIGHLIGHTS
March 31, 2022
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | March 31, 2022 vs. | | ||
| | | | | | | | | | | | Dec. 31, 2021 | | Mar. 31, 2021 | |
(In thousands, except percentages and per share amounts) | | Mar. 31, 2022 | | Dec. 31, 2021 | | Mar. 31, 2021 | | | % | | % | | |||
BALANCE SHEET DATA | | | | | | | | | | | | | | | |
Total assets | | $ | 2,067,692 | | $ | 2,033,713 | | $ | 2,004,818 | | | 1.7 | % | 3.1 | % |
Total deposits | | | 1,771,168 | | | 1,758,881 | | | 1,628,393 | | | 0.7 | | 8.8 | |
Total loans | | | 1,701,384 | | | 1,649,448 | | | 1,668,448 | | | 3.1 | | 2.0 | |
Total securities | | | 116,254 | | | 79,322 | | | 34,551 | | | 46.6 | | 236.5 | |
Total shareholders' equity | | | 214,928 | | | 205,729 | | | 181,186 | | | 4.5 | | 18.6 | |
Allowance for loan losses | | | 22,168 | | | 22,302 | | | 22,965 | | | (0.6) | | (3.5) | |
| | | | | | | | | | | | | | | |
FINANCIAL DATA - QUARTER TO DATE | | | | | | | | | | | | | | | |
Income before provision for income taxes | | $ | 11,911 | | $ | 13,132 | | $ | 11,442 | | | (9.3) | | 4.1 | |
Provision for income taxes | | | 2,803 | | | 3,386 | | | 2,946 | | | (17.2) | | (4.9) | |
Net income | | $ | 9,108 | | $ | 9,746 | | $ | 8,496 | | | (6.5) | | 7.2 | |
| | | | | | | | | | | | | | | |
Net income per common share - Basic | | $ | 0.87 | | $ | 0.94 | | $ | 0.81 | | | (7.4) | | 7.4 | |
Net income per common share - Diluted | | | 0.85 | | | 0.93 | | | 0.80 | | | (8.6) | | 6.2 | |
| | | | | | | | | | | | | | | |
PERFORMANCE RATIOS - QUARTER TO DATE | | | | | | | | | | | | | | | |
Return on average assets | | | 1.80 | % | | 1.90 | % | | 1.85 | % | | | | | |
Return on average equity | | | 17.64 | | | 19.23 | | | 19.51 | | | | | | |
Efficiency ratio | | | 45.86 | | | 45.55 | | | 45.74 | | | | | | |
Net interest margin | | | 4.11 | | | 4.24 | | | 4.09 | | | | | | |
Noninterest expense to average assets | | | 2.06 | | | 2.08 | | | 2.13 | | | | | | |
| | | | | | | | | | | | | | | |
SHARE INFORMATION | | | | | | | | | | | | | | | |
Market price per share | | $ | 27.98 | | $ | 26.25 | | $ | 22.00 | | | 6.6 | | 27.2 | |
Dividends paid | | | 0.10 | | | 0.10 | | | 0.08 | | | - | | 25.0 | |
Book value per common share | | | 20.48 | | | 19.80 | | | 17.38 | | | 3.4 | | 17.8 | |
Average diluted shares outstanding (QTD) | | | 10,664 | | | 10,555 | | | 10,565 | | | 1.0 | | 0.9 | |
| | | | | | | | | | | | | | | |
CAPITAL RATIOS | | | | | | | | | | | | | | | |
Total equity to total assets | | | 10.39 | % | | 10.12 | % | | 9.04 | % | | | | | |
Community bank leverage ratio | | | 10.67 | | | 10.51 | | | 10.19 | | | | | | |
| | | | | | | | | | | | | | | |
CREDIT QUALITY AND RATIOS | | | | | | | | | | | | | | | |
Nonperforming assets | | $ | 9,301 | | $ | 9,686 | | $ | 11,788 | | | (4.0) | | (21.1) | |
QTD net chargeoffs (recoveries) to QTD average loans | | | 0.01 | % | | 0.02 | % | | (0.16) | % | | | | | |
Allowance for loan losses to total loans | | | 1.30 | | | 1.35 | | | 1.38 | | | | | | |
Nonperforming loans to total loans | | | 0.55 | | | 0.59 | | | 0.71 | | | | | | |
Nonperforming assets to total assets | | | 0.45 | | | 0.48 | | | 0.59 | | | | | | |
UNITY BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | March 31, 2022 vs. | | ||
| | | | | | | | | | | | Dec. 31, 2021 | | Mar. 31, 2021 | |
(In thousands, except percentages) | | Mar. 31, 2022 | | Dec. 31, 2021 | | Mar. 31, 2021 | | | % | | % | | |||
ASSETS | | | | | | | | | | | | | | | |
Cash and due from banks | | $ | 26,728 | | $ | 26,053 | | $ | 25,911 | | | 2.6 | % | 3.2 | % |
Interest-bearing deposits | | | 160,998 | | | 218,765 | | | 213,666 | | | (26.4) | | (24.6) | |
Cash and cash equivalents | | | 187,726 | | | 244,818 | | | 239,577 | | | (23.3) | | (21.6) | |
Securities: | | | | | | | | | | | | | | | |
Debt securities available for sale | | | 77,878 | | | 56,480 | | | 32,330 | | | 37.9 | | 140.9 | |
Securities held to maturity | | | 30,367 | | | 14,276 | | | - | | | 112.7 | | 100.0 | |
Equity securities with readily determinable fair values | | | 8,009 | | | 8,566 | | | 2,221 | | | (6.5) | | 260.6 | |
Total securities | | | 116,254 | | | 79,322 | | | 34,551 | | | 46.6 | | 236.5 | |
Loans: | | | | | | | | | | | | | | | |
SBA loans held for sale | | | 25,282 | | | 27,373 | | | 8,809 | | | (7.6) | | 187.0 | |
SBA loans held for investment | | | 33,048 | | | 36,075 | | | 38,296 | | | (8.4) | | (13.7) | |
SBA PPP loans | | | 28,618 | | | 46,450 | | | 169,117 | | | (38.4) | | (83.1) | |
Commercial loans | | | 979,911 | | | 931,726 | | | 853,078 | | | 5.2 | | 14.9 | |
Residential mortgage loans | | | 427,165 | | | 409,355 | | | 448,149 | | | 4.4 | | (4.7) | |
Consumer loans | | | 77,702 | | | 77,944 | | | 60,502 | | | (0.3) | | 28.4 | |
Residential construction loans | | | 129,658 | | | 120,525 | | | 90,497 | | | 7.6 | | 43.3 | |
Total loans | | | 1,701,384 | | | 1,649,448 | | | 1,668,448 | | | 3.1 | | 2.0 | |
Allowance for loan losses | | | (22,168) | | | (22,302) | | | (22,965) | | | (0.6) | | (3.5) | |
Net loans | | | 1,679,216 | | | 1,627,146 | | | 1,645,483 | | | 3.2 | | 2.1 | |
Premises and equipment, net | | | 19,593 | | | 19,914 | | | 20,043 | | | (1.6) | | (2.2) | |
Bank owned life insurance ("BOLI") | | | 26,652 | | | 26,608 | | | 26,535 | | | 0.2 | | 0.4 | |
Deferred tax assets | | | 9,928 | | | 10,040 | | | 9,116 | | | (1.1) | | 8.9 | |
Federal Home Loan Bank ("FHLB") stock | | | 3,541 | | | 3,550 | | | 9,269 | | | (0.3) | | (61.8) | |
Accrued interest receivable | | | 9,568 | | | 9,586 | | | 9,831 | | | (0.2) | | (2.7) | |
Goodwill | | | 1,516 | | | 1,516 | | | 1,516 | | | - | | - | |
Prepaid expenses and other assets | | | 13,698 | | | 11,213 | | | 8,897 | | | 22.2 | | 54.0 | |
Total assets | | $ | 2,067,692 | | $ | 2,033,713 | | $ | 2,004,818 | | | 1.7 | % | 3.1 | % |
LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | | | | | |||
Liabilities: | | | | | | | | | | | | | | | |
Deposits: | | | | | | | | | | | | | | | |
Noninterest-bearing demand | | $ | 541,990 | | $ | 529,227 | | $ | 465,511 | | | 2.4 | % | 16.4 | % |
Interest-bearing demand | | | 240,757 | | | 244,073 | | | 217,714 | | | (1.4) | | 10.6 | |
Savings | | | 707,498 | | | 694,161 | | | 502,300 | | | 1.9 | | 40.9 | |
Time, under $100,000 | | | 186,260 | | | 194,961 | | | 272,298 | | | (4.5) | | (31.6) | |
Time, $100,000 to $250,000 | | | 60,569 | | | 62,668 | | | 94,933 | | | (3.3) | | (36.2) | |
Time, $250,000 and over | | | 34,094 | | | 33,791 | | | 75,637 | | | 0.9 | | (54.9) | |
Total deposits | | | 1,771,168 | | | 1,758,881 | | | 1,628,393 | | | 0.7 | | 8.8 | |
Borrowed funds | | | 40,000 | | | 40,000 | | | 170,000 | | | - | | (76.5) | |
Subordinated debentures | | | 10,310 | | | 10,310 | | | 10,310 | | | - | | - | |
Accrued interest payable | | | 132 | | | 129 | | | 255 | | | 2.3 | | (48.2) | |
Accrued expenses and other liabilities | | | 31,154 | | | 18,664 | | | 14,674 | | | 66.9 | | 112.3 | |
Total liabilities | | | 1,852,764 | | | 1,827,984 | | | 1,823,632 | | | 1.4 | | 1.6 | |
Shareholders' equity: | | | | | | | | | | | | | | | |
Common stock | | | 94,855 | | | 94,003 | | | 92,180 | | | 0.9 | | 2.9 | |
Retained earnings | | | 131,100 | | | 123,037 | | | 98,331 | | | 6.6 | | 33.3 | |
Treasury stock, at cost | | | (11,637) | | | (11,633) | | | (8,791) | | | - | | (32.4) | |
Accumulated other comprehensive income (loss) | | | 610 | | | 322 | | | (534) | | | NM* | | NM* | |
Total shareholders' equity | | | 214,928 | | | 205,729 | | | 181,186 | | | 4.5 | | 18.6 | |
Total liabilities and shareholders' equity | | $ | 2,067,692 | | $ | 2,033,713 | | $ | 2,004,818 | | | 1.7 | % | 3.1 | % |
COMMON SHARES AT PERIOD END: | | | | | | | | | | | | | |||
Shares issued | | | 11,196 | | | 11,094 | | | 10,996 | | | | | | |
Shares outstanding | | | 10,493 | | | 10,391 | | | 10,422 | | | | | | |
Treasury shares | | | 703 | | | 703 | | | 574 | | | | | | |
| | | | | | | | | | | | | | | |
*NM=Not meaningful | | | | | | | | | | | | | | | |
UNITY BANCORP, INC.
QTD CONSOLIDATED STATEMENTS OF INCOME
March 31, 2022
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| | | | | | | | | | | | Mar. 31, 2022 vs. | | ||||||||||
| | For the three months ended | | | Dec. 31, 2021 | | Mar. 31, 2021 | | |||||||||||||||
(In thousands, except percentages and per share amounts) | | Mar. 31, 2022 | | Dec. 31, 2021 | | Mar. 31, 2021 | | | $ | | % | | $ | | % | | |||||||
INTEREST INCOME | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing deposits | | $ | 96 | | $ | 89 | | $ | 24 | | | $ | 7 | | | 7.9 | % | $ | 72 | | | 300.0 | % |
FHLB stock | | | 33 | | | 41 | | | 63 | | | | (8) | | | (19.5) | | | (30) | | | (47.6) | |
Securities: | | | | | | | | | | | | | | | | | | | | | | | |
Taxable | | | 652 | | | 460 | | | 292 | | | | 192 | | | 41.7 | | | 360 | | | 123.3 | |
Tax-exempt | | | 6 | | | 5 | | | 10 | | | | 1 | | | 20.0 | | | (4) | | | (40.0) | |
Total securities | | | 658 | | | 465 | | | 302 | | | | 193 | | | 41.5 | | | 356 | | | 117.9 | |
Loans: | | | | | | | | | | | | | | | | | | | | | | | |
SBA loans | | | 923 | | | 828 | | | 783 | | | | 95 | | | 11.5 | | | 140 | | | 17.9 | |
SBA PPP loans | | | 777 | | | 1,978 | | | 1,730 | | | | (1,201) | | | (60.7) | | | (953) | | | (55.1) | |
Commercial loans | | | 11,497 | | | 11,677 | | | 10,474 | | | | (180) | | | (1.5) | | | 1,023 | | | 9.8 | |
Residential mortgage loans | | | 4,390 | | | 4,587 | | | 5,128 | | | | (197) | | | (4.3) | | | (738) | | | (14.4) | |
Consumer loans | | | 921 | | | 871 | | | 857 | | | | 50 | | | 5.7 | | | 64 | | | 7.5 | |
Residential construction loans | | | 1,824 | | | 1,734 | | | 1,215 | | | | 90 | | | 5.2 | | | 609 | | | 50.1 | |
Total loans | | | 20,332 | | | 21,675 | | | 20,187 | | | | (1,343) | | | (6.2) | | | 145 | | | 0.7 | |
Total interest income | | | 21,119 | | | 22,270 | | | 20,576 | | | | (1,151) | | | (5.2) | | | 543 | | | 2.6 | |
INTEREST EXPENSE | | | | | | | | | | | | | | | | | | | | | | | |
Interest-bearing demand deposits | | | 164 | | | 210 | | | 309 | | | | (46) | | | (21.9) | | | (145) | | | (46.9) | |
Savings deposits | | | 345 | | | 444 | | | 431 | | | | (99) | | | (22.3) | | | (86) | | | (20.0) | |
Time deposits | | | 480 | | | 541 | | | 1,463 | | | | (61) | | | (11.3) | | | (983) | | | (67.2) | |
Borrowed funds and subordinated debentures | | | 226 | | | 226 | | | 355 | | | | - | | | - | | | (129) | | | (36.3) | |
Total interest expense | | | 1,215 | | | 1,421 | | | 2,558 | | | | (206) | | | (14.5) | | | (1,343) | | | (52.5) | |
Net interest income | | | 19,904 | | | 20,849 | | | 18,018 | | | | (945) | | | (4.5) | | | 1,886 | | | 10.5 | |
Provision for loan losses | | | (178) | | | (319) | | | 500 | | | | 141 | | | 44.2 | | | (678) | | | (135.6) | |
Net interest income after provision for loan losses | | | 20,082 | | | 21,168 | | | 17,518 | | | | (1,086) | | | (5.1) | | | 2,564 | | | 14.6 | |
NONINTEREST INCOME | | | | | | | | | | | | | | | | | | | | | | | |
Branch fee income | | | 275 | | | 273 | | | 295 | | | | 2 | | | 0.7 | | | (20) | | | (6.8) | |
Service and loan fee income | | | 584 | | | 820 | | | 625 | | | | (236) | | | (28.8) | | | (41) | | | (6.6) | |
Gain on sale of SBA loans held for sale, net | | | 852 | | | - | | | 245 | | | | 852 | | | 10,000.0 | | | 607 | | | 247.8 | |
Gain on sale of mortgage loans, net | | | 521 | | | 782 | | | 1,750 | | | | (261) | | | (33.4) | | | (1,229) | | | (70.2) | |
BOLI income | | | 163 | | | 289 | | | 129 | | | | (126) | | | (43.6) | | | 34 | | | 26.4 | |
Net security (losses) gains | | | (557) | | | 73 | | | 310 | | | | (630) | | | (863.0) | | | (867) | | | (279.7) | |
Other income | | | 401 | | | 387 | | | 372 | | | | 14 | | | 3.6 | | | 29 | | | 7.8 | |
Total noninterest income | | | 2,239 | | | 2,624 | | | 3,726 | | | | (385) | | | (14.7) | | | (1,487) | | | (39.9) | |
NONINTEREST EXPENSE | | | | | | | | | | | | | | | | | | | | | | | |
Compensation and benefits | | | 6,508 | | | 6,655 | | | 6,063 | | | | (147) | | | (2.2) | | | 445 | | | 7.3 | |
Processing and communications | | | 752 | | | 747 | | | 807 | | | | 5 | | | 0.7 | | | (55) | | | (6.8) | |
Occupancy | | | 775 | | | 670 | | | 706 | | | | 105 | | | 15.7 | | | 69 | | | 9.8 | |
Furniture and equipment | | | 576 | | | 655 | | | 649 | | | | (79) | | | (12.1) | | | (73) | | | (11.2) | |
Other loan expenses | | | 135 | | | 163 | | | 143 | | | | (28) | | | (17.2) | | | (8) | | | (5.6) | |
Professional services | | | 447 | | | 402 | | | 380 | | | | 45 | | | 11.2 | | | 67 | | | 17.6 | |
Advertising | | | 225 | | | 304 | | | 268 | | | | (79) | | | (26.0) | | | (43) | | | (16.0) | |
Deposit insurance | | | 269 | | | 206 | | | 214 | | | | 63 | | | 30.6 | | | 55 | | | 25.7 | |
Director fees | | | 233 | | | 210 | | | 208 | | | | 23 | | | 11.0 | | | 25 | | | 12.0 | |
Loan collection expenses (recoveries) | | | 58 | | | 69 | | | (49) | | | | (11) | | | (15.9) | | | 107 | | | 218.4 | |
Other expenses | | | 432 | | | 579 | | | 413 | | | | (147) | | | (25.4) | | | 19 | | | 4.6 | |
Total noninterest expense | | | 10,410 | | | 10,660 | | | 9,802 | | | | (250) | | | (2.3) | | | 608 | | | 6.2 | |
Income before provision for income taxes | | | 11,911 | | | 13,132 | | | 11,442 | | | | (1,221) | | | (9.3) | | | 469 | | | 4.1 | |
Provision for income taxes | | | 2,803 | | | 3,386 | | | 2,946 | | | | (583) | | | (17.2) | | | (143) | | | (4.9) | |
Net income | | $ | 9,108 | | $ | 9,746 | | $ | 8,496 | | | $ | (638) | | | (6.5) | % | $ | 612 | | | 7.2 | % |
| | | | | | | | | | | | | | | | | | | | | | | |
Effective tax rate | | | 23.5 | % | | 25.8 | % | | 25.7 | % | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Net income per common share - Basic | | $ | 0.87 | | $ | 0.94 | | $ | 0.81 | | | | | | | | | | | | | | |
Net income per common share - Diluted | | | 0.85 | | | 0.93 | | | 0.80 | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Weighted average common shares outstanding - Basic | | | 10,446 | | | 10,376 | | | 10,437 | | | | | | | | | | | | | | |
Weighted average common shares outstanding - Diluted | | | 10,664 | | | 10,555 | | | 10,565 | | | | | | | | | | | | | | |
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*NM=Not meaningful | | | | | | | | | | | | | | | | | | | | | | | |
UNITY BANCORP, INC.
QUARTER TO DATE NET INTEREST MARGIN
March 31, 2022
(Dollar amounts in thousands, interest amounts and interest rates/yields on a fully tax-equivalent basis)
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| | For the three months ended | | |||||||||||||||||||||||||||
| | March 31, 2022 | | March 31, 2021 | | |||||||||||||||||||||||||
| | Average Balance | | Interest | | Rate/Yield | | Average Balance | | Interest | | Rate/Yield | | |||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | |||||||||||
Interest-earning assets: | | | | | | | | | | | | | | | | | | | | |||||||||||
Interest-bearing deposits | | $ | 210,601 | | $ | 96 | | | 0.18 | % | $ | 90,830 | | $ | 24 | | | 0.11 | % | |||||||||||
FHLB stock | | | 3,550 | | | 33 | | | 3.81 | | | 5,167 | | | 63 | | | 4.98 | | |||||||||||
Securities: | | | | | | | | | | | | | | | | | | | | |||||||||||
Taxable | | | 84,739 | | | 653 | | | 3.12 | | | 38,741 | | | 292 | | | 3.06 | | |||||||||||
Tax-exempt | | | 990 | | | 8 | | | 3.07 | | | 2,405 | | | 12 | | | 2.03 | | |||||||||||
Total securities (A) | | | 85,729 | | | 661 | | | 3.12 | | | 41,146 | | | 304 | | | 3.00 | | |||||||||||
Loans: | | | | | | | | | | | | | | | | | | | | |||||||||||
SBA loans | | | 63,543 | | | 923 | | | 5.89 | | | 48,845 | | | 783 | | | 6.50 | | |||||||||||
SBA PPP loans | | | 36,989 | | | 777 | | | 8.52 | | | 142,581 | | | 1,730 | | | 4.92 | | |||||||||||
Commercial loans | | | 949,948 | | | 11,497 | | | 4.91 | | | 849,065 | | | 10,474 | | | 5.00 | | |||||||||||
Residential mortgage loans | | | 413,308 | | | 4,390 | | | 4.31 | | | 455,782 | | | 5,128 | | | 4.56 | | |||||||||||
Consumer loans | | | 78,989 | | | 921 | | | 4.73 | | | 63,440 | | | 857 | | | 5.48 | | |||||||||||
Residential construction loans | | | 122,993 | | | 1,824 | | | 6.01 | | | 88,992 | | | 1,215 | | | 5.54 | | |||||||||||
Total loans (B) | | | 1,665,770 | | | 20,332 | | | 4.95 | | | 1,648,705 | | | 20,187 | | | 4.97 | | |||||||||||
Total interest-earning assets | | $ | 1,965,650 | | $ | 21,122 | | | 4.36 | % | $ | 1,785,848 | | $ | 20,578 | | | 4.67 | % | |||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||
Noninterest-earning assets: | | | | | | | | | | | | | | | | | | | | |||||||||||
Cash and due from banks | | | 23,679 | | | | | | | | | 23,781 | | | | | | | | |||||||||||
Allowance for loan losses | | | (22,331) | | | | | | | | | (23,308) | | | | | | | | |||||||||||
Other assets | | | 79,631 | | | | | | | | | 76,309 | | | | | | | | |||||||||||
Total noninterest-earning assets | | | 80,979 | | | | | | | | | 76,782 | | | | | | | | |||||||||||
Total assets | | $ | 2,046,629 | | | | | | | | $ | 1,862,630 | | | | | | | | |||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | | | | | | | | | | | | |||||||||||
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | |||||||||||
Total interest-bearing demand deposits | | $ | 249,329 | | $ | 164 | | | 0.27 | % | $ | 209,020 | | $ | 309 | | | 0.60 | % | |||||||||||
Total savings deposits | | | 701,281 | | | 345 | | | 0.20 | | | 476,463 | | | 431 | | | 0.37 | | |||||||||||
Total time deposits | | | 288,155 | | | 480 | | | 0.68 | | | 438,250 | | | 1,463 | | | 1.35 | | |||||||||||
Total interest-bearing deposits | | | 1,238,765 | | | 989 | | | 0.32 | | | 1,123,733 | | | 2,203 | | | 0.80 | | |||||||||||
Borrowed funds and subordinated debentures | | | 50,310 | | | 226 | | | 1.82 | | | 89,699 | | | 355 | | | 1.61 | | |||||||||||
Total interest-bearing liabilities | | $ | 1,289,075 | | $ | 1,215 | | | 0.38 | % | $ | 1,213,432 | | $ | 2,558 | | | 0.85 | % | |||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||
Noninterest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | |||||||||||
Noninterest-bearing demand deposits | | | 526,931 | | | | | | | | | 455,146 | | | | | | | | |||||||||||
Other liabilities | | | 21,217 | | | | | | | | | 17,418 | | | | | | | | |||||||||||
Total noninterest-bearing liabilities | | | 548,148 | | | | | | | | | 472,564 | | | | | | | | |||||||||||
Total shareholders' equity | | | 209,406 | | | | | | | | | 176,634 | | | | | | | | |||||||||||
Total liabilities and shareholders' equity | | $ | 2,046,629 | | | | | | | | $ | 1,862,630 | | | | | | | | |||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||
Net interest spread | | | | | $ | 19,907 | | | 3.98 | % | | | | $ | 18,020 | | | 3.82 | % | |||||||||||
Tax-equivalent basis adjustment | | | | | | (2) | | | | | | | | | (2) | | | | | |||||||||||
Net interest income | | | | | $ | 19,905 | | | | | | | | $ | 18,018 | | | | |
Net interest margin | | | | | | | | | 4.11 | % | | | | | | | | 4.09 | % | |||||||||||
| | | | | | | | | | | | | | | | | | | |
(A) | Yields related to securities exempt from federal and state income taxes are stated on a fully tax-equivalent basis. They are reduced by the nondeductable portion of interest expense, assuming a federal tax rate of 21 percent and applicable state rates. |
(B) | The loan averages are stated net of unearned income, and the averages include loans on which the accrual of interest has been discontinued. |
UNITY BANCORP, INC.
QUARTER TO DATE NET INTEREST MARGIN
March 31, 2022
(Dollar amounts in thousands, interest amounts and interest rates/yields on a fully tax-equivalent basis)
| | | | | | | | | | | | | | | | | | | | |||||||||
| | For the three months ended | | |||||||||||||||||||||||||
| | March 31, 2022 | | December 31, 2021 | | |||||||||||||||||||||||
| | Average Balance | | Interest | | Rate/Yield | | Average Balance | | Interest | | Rate/Yield | | |||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | |||||||||
Interest-earning assets: | | | | | | | | | | | | | | | | | | | | |||||||||
Interest-bearing deposits | | $ | 210,601 | | $ | 96 | | | 0.18 | % | $ | 222,683 | | $ | 89 | | | 0.16 | % | |||||||||
FHLB stock | | | 3,550 | | | 33 | | | 3.81 | | | 3,526 | | | 41 | | | 4.58 | | |||||||||
Securities: | | | | | | | | | | | | | | | | | | | | |||||||||
Taxable | | | 84,739 | | | 653 | | | 3.12 | | | 60,087 | | | 460 | | | 3.04 | | |||||||||
Tax-exempt | | | 990 | | | 8 | | | 3.07 | | | 1,033 | | | 6 | | | 2.39 | | |||||||||
Total securities (A) | | | 85,729 | | | 661 | | | 3.12 | | | 61,120 | | | 466 | | | 3.03 | | |||||||||
Loans: | | | | | | | | | | | | | | | | | | | | |||||||||
SBA loans | | | 63,543 | | | 923 | | | 5.89 | | | 58,718 | | | 828 | | | 5.60 | | |||||||||
SBA PPP loans | | | 36,989 | | | 777 | | | 8.52 | | | 61,854 | | | 1,978 | | | 12.68 | | |||||||||
Commercial loans | | | 949,948 | | | 11,497 | | | 4.91 | | | 936,078 | | | 11,678 | | | 4.95 | | |||||||||
Residential mortgage loans | | | 413,308 | | | 4,390 | | | 4.31 | | | 414,955 | | | 4,587 | | | 4.39 | | |||||||||
Consumer loans | | | 78,989 | | | 921 | | | 4.73 | | | 74,207 | | | 871 | | | 4.65 | | |||||||||
Residential construction loans | | | 122,993 | | | 1,824 | | | 6.01 | | | 116,305 | | | 1,734 | | | 5.91 | | |||||||||
Total loans (B) | | | 1,665,770 | | | 20,332 | | | 4.95 | | | 1,662,117 | | | 21,676 | | | 5.17 | | |||||||||
Total interest-earning assets | | $ | 1,965,650 | | $ | 21,122 | | | 4.36 | % | $ | 1,949,446 | | $ | 22,272 | | | 4.53 | % | |||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||
Noninterest-earning assets: | | | | | | | | | | | | | | | | | | | | |||||||||
Cash and due from banks | | | 23,679 | | | | | | | | | 25,065 | | | | | | | | |||||||||
Allowance for loan losses | | | (22,331) | | | | | | | | | (22,572) | | | | | | | | |||||||||
Other assets | | | 79,631 | | | | | | | | | 80,810 | | | | | | | | |||||||||
Total noninterest-earning assets | | | 80,979 | | | | | | | | | 83,303 | | | | | | | | |||||||||
Total assets | | $ | 2,046,629 | | | | | | | | $ | 2,032,749 | | | | | | | | |||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | | | | | | | | | | | | |||||||||
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | |||||||||
Total interest-bearing demand deposits | | $ | 249,329 | | $ | 164 | | | 0.27 | % | $ | 255,083 | | $ | 210 | | | 0.33 | % | |||||||||
Total savings deposits | | | 701,281 | | | 345 | | | 0.20 | | | 684,215 | | | 444 | | | 0.26 | | |||||||||
Total time deposits | | | 288,155 | | | 480 | | | 0.68 | | | 302,088 | | | 541 | | | 0.71 | | |||||||||
Total interest-bearing deposits | | | 1,238,765 | | | 989 | | | 0.32 | | | 1,241,386 | | | 1,195 | | | 0.38 | | |||||||||
Borrowed funds and subordinated debentures | | | 50,310 | | | 226 | | | 1.82 | | | 50,799 | | | 227 | | | 1.77 | | |||||||||
Total interest-bearing liabilities | | $ | 1,289,075 | | $ | 1,215 | | | 0.38 | % | $ | 1,292,185 | | $ | 1,422 | | | 0.44 | % | |||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||
Noninterest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | |||||||||
Noninterest-bearing demand deposits | | | 526,931 | | | | | | | | | 519,709 | | | | | | | | |||||||||
Other liabilities | | | 21,217 | | | | | | | | | 19,824 | | | | | | | | |||||||||
Total noninterest-bearing liabilities | | | 548,148 | | | | | | | | | 539,533 | | | | | | | | |||||||||
Total shareholders' equity | | | 209,406 | | | | | | | | | 201,031 | | | | | | | | |||||||||
Total liabilities and shareholders' equity | | $ | 2,046,629 | | | | | | | | $ | 2,032,749 | | | | | | | | |||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||
Net interest spread | | | | | $ | 19,907 | | | 3.98 | % | | | | $ | 20,850 | | | 4.10 | % | |||||||||
Tax-equivalent basis adjustment | | | | | | (2) | | | | | | | | | (1) | | | | | |||||||||
Net interest income | | | | | $ | 19,905 | | | | | | | | $ | 20,849 | | | | | |||||||||
Net interest margin | | | | | | | | | 4.11 | % | | | | | | | | 4.24 | % |
| | | | | | | | | | | | | | | | | | | |
(C) | Yields related to securities exempt from federal and state income taxes are stated on a fully tax-equivalent basis. They are reduced by the nondeductable portion of interest expense, assuming a federal tax rate of 21 percent and applicable state rates. |
(D) | The loan averages are stated net of unearned income, and the averages include loans on which the accrual of interest has been discontinued. |
UNITY BANCORP, INC.
QUARTERLY ALLOWANCE FOR LOAN LOSSES AND LOAN QUALITY SCHEDULES
March 31, 2022
| | | | | | | | | | | | | | | |
Amounts in thousands, except percentages | | Mar. 31, 2022 | | Dec. 31, 2021 | | Sept. 30, 2021 | | Jun. 30, 2021 | | Mar. 31, 2021 | |||||
ALLOWANCE FOR LOAN LOSSES: | | | | | | | | | | | | | | | |
Balance, beginning of period | | $ | 22,302 | | $ | 22,537 | | $ | 22,801 | | $ | 22,965 | | $ | 23,105 |
Provision for loan losses charged to expense | | | (178) | | | (319) | | | - | | | - | | | 500 |
| | | 22,124 | | | 22,218 | | | 22,801 | | | 22,965 | | | 23,605 |
Less: Chargeoffs | | | | | | | | | | | | | | | |
SBA loans | | | - | | | - | | | 145 | | | 164 | | | 282 |
Commercial loans | | | - | | | - | | | 158 | | | 20 | | | 373 |
Residential mortgage loans | | | - | | | - | | | - | | | - | | | - |
Consumer loans | | | 6 | | | - | | | 3 | | | - | | | 1 |
Residential construction loans | | | - | | | - | | | - | | | - | | | - |
Total chargeoffs | | | 6 | | | - | | | 306 | | | 184 | | | 656 |
Add: Recoveries | | | | | | | | | | | | | | | |
SBA loans | | | 22 | | | 52 | | | - | | | 19 | | | 15 |
Commercial loans | | | 28 | | | 32 | | | - | | | 1 | | | 1 |
Residential mortgage loans | | | - | | | - | | | 42 | | | - | | | - |
Consumer loans | | | - | | | - | | | - | | | - | | | - |
Residential construction loans | | | - | | | - | | | - | | | - | | | - |
Total recoveries | | | 50 | | | 84 | | | 42 | | | 20 | | | 16 |
Net recoveries (chargeoffs) | | | 44 | | | 84 | | | (264) | | | (164) | | | (640) |
Balance, end of period | | $ | 22,168 | | $ | 22,302 | | $ | 22,537 | | $ | 22,801 | | $ | 22,965 |
| | | | | | | | | | | | | | | |
LOAN QUALITY INFORMATION: | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Nonperforming loans: | | | | | | | | | | | | | | | |
SBA loans | | $ | 537 | | $ | 510 | | $ | 660 | | $ | 1,713 | | $ | 1,560 |
Commercial loans | | | 2,292 | | | 2,582 | | | 2,879 | | | 1,637 | | | 952 |
Residential mortgage loans | | | 2,999 | | | 3,262 | | | 2,626 | | | 4,043 | | | 6,711 |
Consumer loans | | | 200 | | | 210 | | | - | | | 3 | | | - |
Residential construction loans | | | 3,273 | | | 3,122 | | | 2,637 | | | 2,289 | | | 2,565 |
Total nonperforming loans | | | 9,301 | | | 9,686 | | | 8,802 | | | 9,685 | | | 11,788 |
OREO | | | - | | | - | | | - | | | - | | | - |
Nonperforming assets | | | 9,301 | | | 9,686 | | | 8,802 | | | 9,685 | | | 11,788 |
Less: Amount guaranteed by SBA | | | 1,102 | | | 59 | | | 139 | | | 139 | | | 139 |
Net nonperforming assets | | $ | 8,199 | | $ | 9,627 | | $ | 8,663 | | $ | 9,546 | | $ | 11,649 |
| | | | | | | | | | | | | | | |
Loans 90 days past due & still accruing | | $ | 488 | | $ | - | | $ | 2,265 | | $ | 574 | | $ | 2,540 |
| | | | | | | | | | | | | | | |
Performing Troubled Debt Restructurings (TDRs) | | $ | 1,917 | | $ | 1,046 | | $ | 1,057 | | $ | 1,068 | | $ | 1,079 |
| | | | | | | | | | | | | | | |
Allowance for loan losses to: | | | | | | | | | | | | | | | |
Total nonperforming loans | | | 238.34 | | | 230.25 | | | 256.04 | | | 235.43 | | | 194.82 |
Nonperforming assets | | | 238.34 | | | 230.25 | | | 256.04 | | | 235.43 | | | 194.82 |
Net nonperforming assets | | | 270.37 | | | 231.66 | | | 260.15 | | | 238.85 | | | 197.14 |
UNITY BANCORP, INC.
QUARTERLY FINANCIAL DATA
March 31, 2022
| | | | | | | | | | | | | | | | |
(In thousands, except percentages and per share amounts) | | Mar. 31, 2022 | | Dec. 31, 2021 | | Sept. 30, 2021 | | Jun. 30, 2021 | | Mar. 31, 2021 | | |||||
SUMMARY OF INCOME: | | | | | | | | | | | | | | | | |
Total interest income | | $ | 21,119 | | $ | 22,271 | | $ | 21,254 | | $ | 20,680 | | $ | 20,576 | |
Total interest expense | | | 1,215 | | | 1,422 | | | 1,531 | | | 2,231 | | | 2,558 | |
Net interest income | | | 19,904 | | | 20,849 | | | 19,723 | | | 18,449 | | | 18,018 | |
Provision for loan losses | | | (178) | | | (319) | | | - | | | - | | | 500 | |
Net interest income after provision for loan losses | | | 20,082 | | | 21,168 | | | 19,723 | | | 18,449 | | | 17,518 | |
Total noninterest income | | | 2,239 | | | 2,624 | | | 2,809 | | | 2,895 | | | 3,726 | |
Total noninterest expense | | | 10,410 | | | 10,660 | | | 9,860 | | | 10,460 | | | 9,802 | |
Income before provision for income taxes | | | 11,911 | | | 13,132 | | | 12,672 | | | 10,884 | | | 11,442 | |
Provision for income taxes | | | 2,803 | | | 3,386 | | | 3,213 | | | 2,466 | | | 2,946 | |
Net income | | $ | 9,108 | | $ | 9,746 | | $ | 9,459 | | $ | 8,418 | | $ | 8,496 | |
| | | | | | | | | | | | | | | | |
Net income per common share - Basic | | $ | 0.87 | | $ | 0.94 | | $ | 0.91 | | $ | 0.81 | | $ | 0.81 | |
Net income per common share - Diluted | | | 0.85 | | | 0.92 | | | 0.90 | | | 0.80 | | | 0.80 | |
| | | | | | | | | | | | | | | | |
COMMON SHARE DATA: | | | | | | | | | | | | | | | | |
Market price per share | | $ | 27.98 | | $ | 26.25 | | $ | 23.40 | | $ | 22.05 | | $ | 22.00 | |
Dividends paid | | | 0.10 | | | 0.10 | | | 0.09 | | | 0.09 | | | 0.08 | |
Book value per common share | | | 20.48 | | | 19.80 | | | 18.94 | | | 18.12 | | | 17.38 | |
| | | | | | | | | | | | | | | | |
Weighted average common shares outstanding - Basic | | | 10,446 | | | 10,376 | | | 10,372 | | | 10,427 | | | 10,437 | |
Weighted average common shares outstanding - Diluted | | | 10,664 | | | 10,555 | | | 10,507 | | | 10,569 | | | 10,565 | |
Issued common shares | | | 11,196 | | | 11,094 | | | 11,063 | | | 11,031 | | | 10,996 | |
Outstanding common shares | | | 10,493 | | | 10,391 | | | 10,363 | | | 10,416 | | | 10,422 | |
Treasury shares | | | 703 | | | 703 | | | 700 | | | 615 | | | 574 | |
| | | | | | | | | | | | | | | | |
PERFORMANCE RATIOS (Annualized): | | | | | | | | | | | | | | | | |
Return on average assets | | | 1.80 | % | | 1.90 | % | | 1.96 | % | | 1.77 | % | | 1.85 | % |
Return on average equity | | | 17.64 | | | 19.23 | | | 19.57 | | | 18.29 | | | 19.51 | |
Efficiency ratio | | | 45.86 | | | 45.55 | | | 44.15 | | | 49.06 | | | 45.74 | |
Noninterest expense to average assets | | | 2.06 | | | 2.08 | | | 2.05 | | | 2.19 | | | 2.13 | |
| | | | | | | | | | | | | | | | |
BALANCE SHEET DATA: | | | | | | | | | | | | | | | | |
Total assets | | $ | 2,067,692 | | $ | 2,033,713 | | $ | 1,991,115 | | $ | 1,973,311 | | $ | 2,004,818 | |
Total deposits | | | 1,771,168 | | | 1,758,881 | | | 1,706,185 | | | 1,594,316 | | | 1,628,393 | |
Total loans | | | 1,701,384 | | | 1,649,448 | | | 1,664,891 | | | 1,653,988 | | | 1,668,448 | |
Total securities | | | 116,254 | | | 79,322 | | | 49,807 | | | 37,054 | | | 34,551 | |
Total shareholders' equity | | | 214,928 | | | 205,729 | | | 196,267 | | | 188,756 | | | 181,186 | |
Allowance for loan losses | | | 22,168 | | | 22,302 | | | 22,537 | | | 22,801 | | | 22,965 | |
| | | | | | | | | | | | | | | | |
TAX EQUIVALENT YIELDS AND RATES: | | | | | | | | | | | | | | | | |
Interest-earning assets | | | 4.36 | % | | 4.53 | % | | 4.60 | % | | 4.52 | % | | 4.67 | % |
Interest-bearing liabilities | | | 0.38 | | | 0.44 | | | 0.51 | | | 0.73 | | | 0.85 | |
Net interest spread | | | 3.98 | | | 4.10 | | | 4.09 | | | 3.79 | | | 3.82 | |
Net interest margin | | | 4.11 | | | 4.24 | | | 4.27 | | | 4.03 | | | 4.09 | |
| | | | | | | | | | | | | | | | |
CREDIT QUALITY: | | | | | | | | | | | | | | | | |
Nonperforming assets | | $ | 9,301 | | $ | 9,686 | | $ | 8,802 | | $ | 9,685 | | $ | 11,788 | |
QTD net recoveries (chargeoffs) (annualized) to QTD average loans | | | 0.01 | % | | 0.02 | % | | (0.06) | % | | (0.04) | % | | (0.16) | % |
Allowance for loan losses to total loans | | | 1.30 | | | 1.35 | | | 1.35 | | | 1.38 | | | 1.38 | |
Nonperforming loans to total loans | | | 0.55 | | | 0.59 | | | 0.53 | | | 0.59 | | | 0.71 | |
Nonperforming assets to total assets | | | 0.45 | | | 0.48 | | | 0.44 | | | 0.49 | | | 0.59 | |
| | | | | | | | | | | | | | | | |
CAPITAL RATIOS AND OTHER: | | | | | | | | | | | | | | | | |
Total equity to total assets | | | 10.39 | % | | 10.12 | % | | 9.86 | % | | 9.57 | % | | 9.04 | % |
Community bank leverage ratio | | | 10.67 | | | 10.51 | | | 10.70 | | | 10.31 | | | 10.19 | |
| | | | | | | | | | | | | | | | |
Number of banking offices | | | 19 | | | 19 | | | 19 | | | 19 | | | 19 | |
Number of ATMs | | | 20 | | | 20 | | | 20 | | | 20 | | | 20 | |
Number of employees | | | 209 | | | 211 | | | 208 | | | 208 | | | 209 | |