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Bogota Financial Corp. Reports Results for the Three and Nine Months Ended September 30, 2022

Bogota Financial Corp. (NASDAQ: BSBK) (the “Company”), the holding company for Bogota Savings Bank (the “Bank”), reported net income for the three months ended September 30, 2022 of $1.9 million, compared to net income of $1.0 million for the comparable prior year period. The Company reported net income for the nine months ended September 30, 2022 of $5.0 million compared to net income of $5.5 million for the comparable prior year period. During the nine months ended September 30, 2021, the Company recorded a bargain purchase gain of $1.9 million, and merger-related expenses of $392,000, each of which was associated with the acquisition of Gibraltar Bank. Excluding the bargain purchase gain and the merger-related expenses in 2021, net income for the nine months ended September 30, 2021 was $3.9 million, compared to the $5.0 million for the current year nine-month period1.

On April 11, 2022, the Company announced it completed its initial 5% buyback plan, purchasing 296,044 shares at an average cost of $10.82 per share. On May 25, 2022, the Company announced that it had received regulatory approval for the repurchase of up to 292,568 shares of its common stock, which was approximately 5% of its then outstanding common stock. On September 21, 2022, the Company completed the second buyback plan by repurchasing 292,568 shares at an average cost of $11.14 per share. On October 3, 2022, the Company announced that it had received regulatory approval for the repurchase of up to 556,631 shares of its common stock, which was approximately 10% of its then outstanding common stock.

Other Financial Highlights:

  • Total assets increased $108.8 million, or 13.0%, to $946.2 million at September 30, 2022 from $837.4 million at December 31, 2021, due to an increase in loans and securities, which was primarily funded by cash and cash equivalents, deposits and borrowings.
  • Net loans increased $136.9 million, or 24.0%, to $707.1 million at September 30, 2022 from $570.2 million at December 31, 2021.
  • Total deposits were $668.2 million, increasing $70.7 million, or 11.8%, as compared to $597.5 million at December 31, 2021, primarily due to a new $27.0 million municipal deposit relationship and $78.8 million in increased certificates of deposit. The average rate paid on deposits at September 30, 2022 increased 45 basis points to 1.06% at September 30, 2022 from 0.61% at December 31, 2021, due to higher interest rates.
  • Return on average assets was 0.76% for the nine-month period ended September 30, 2022 compared to 0.91% for the comparable period in 2021. Without the bargain purchase gain and merger-related expenses in 2021, the return on average assets would have been 0.65%1 for the nine-month period ended September 30, 2021.
  • Return on average equity was 4.62% for the nine-month period ended September 30, 2022 compared to 5.20% for the comparable period in 2021. Without the bargain purchase gain and merger-related expenses in 2021, the return on average equity would have been 3.74%1 for the nine-month period ended September 30, 2021.

[1] This number represents a non-GAAP financial measure. Please see “Reconciliation of GAAP to Non-GAAP” contained at the end of this release.

Joseph Coccaro, President and Chief Executive Officer, said, “We are pleased with our results for the first nine months of 2022. We had over $198 million in new loan originations, which increased our loan portfolio by $137 million during the year. We also continue to have strong credit quality as non-performing loans and criticized assets remain very low. We continue to see improvement in our net interest margin which rose 27 basis points and 28 basis points as compared to the three and nine months ended September 30, 2021, respectively.”

Mr. Coccaro further stated, "In 2021, we completed the acquisition of Gibraltar Bank, which included a business system conversion, and opened our sixth branch location in Hasbrouck Heights. We expect loan growth to slow in the fourth quarter as interest rates increase, higher inflation and the continued low inventory in housing will slow the market. This year, we exceeded our asset goal of $900 million."

Income Statement Analysis

Comparison of Operating Results for the Three Months Ended September 30, 2022 and September 30, 2021

Net income increased by $888,000, or 85.2%, to $1.9 million for the three months ended September 30, 2022 from $1.0 million for the three months ended September 30, 2021. The increase was due to an increase in net interest income of $1.1 million and a decrease of $137,000 in non-interest expense, offset by a decrease in non-interest income of $105,000 and an increase of $150,000 in provision for loan losses.

Interest income on cash and cash equivalents decreased $2,000, or 6.1%, to $31,000 for the three months ended September 30, 2022 from $33,000 for the three months ended September 30, 2021 due to a $95.5 million decrease in the average balance of cash and cash equivalents to $5.9 million for the three months ended September 30, 2022 from $101.5 million for the three months ended September 30, 2021, reflecting the use of excess liquidity to fund loan originations and purchase investment securities. This was offset by a 192 basis point increase in the average yield on cash and cash equivalents from 0.13% for the three months ended September 30, 2021 to 2.05% for the three months ended September 30, 2022 due to the higher interest rate environment.

Interest income on loans increased $1.1 million, or 17.6%, to $7.0 million for the three months ended September 30, 2022 compared to $6.0 million for the three months ended September 30, 2021 due primarily to an $85.4 million increase in the average balance of loans to $670.1 million for the three months ended September 30, 2022 from $584.8 million for the three months ended September 30, 2021 and, to a lesser extent, due to a ten basis point increase in the average yield on loans from 4.05% for the three months ended September 30, 2021 to 4.15% for the three months ended September 30, 2022.

Interest income on securities increased $637,000, or 150.2%, to $1.1 million for the three months ended September 30, 2022 from $424,000 for the three months ended September 30, 2021 due primarily to a $94.0 million increase in the average balance of securities to $182.6 million for the three months ended September 30, 2022 from $88.6 million for the three months ended September 30, 2021, reflecting the purchase of investments with excess liquidity, and to a lesser extent, due to a 41 basis point increase in the average yield from 1.91% for the three months ended September 30, 2021 to 2.32% for the three months ended September 30, 2022.

Interest expense on interest-bearing deposits increased $209,000, or 20.1%, to $1.2 million for the three months ended September 30, 2022 from $1.0 million for the three months ended September 30, 2021. The increase was due to a seven basis point increase in the average cost of interest-bearing deposits to 0.82% for the three months ended September 30, 2022 from 0.75% for the three months ended September 30, 2021. The increase in the average cost of deposits was due to higher average balances and higher average costs of certificates of deposit. This increase was also due to a $54.2 million increase in the average balance of total deposits to $602.2 million for the three months ended September 30, 2022 from $548.0 million for the three months ended September 30, 2021.

Interest expense on Federal Home Loan Bank borrowings increased $348,000, or 94.3%, from $369,000 for the three months ended September 30, 2021 to $717,000 for the three months ended September 30, 2022. The increase was due to an increase in the average cost of borrowings of 78 basis points to 2.30% for the three months ended September 30, 2022 from 1.52% for the three months ended September 30, 2021 due to the higher borrowing rates. The increase was also due to an increase in the average balance of borrowings of $32.5 million to $128.5 million for the three months ended September 30, 2022 from $96.0 million for the three months ended September 30, 2021.

Net interest income increased $1.1 million, or 22.3%, to $6.2 million for the three months ended September 30, 2022 from $5.1 million for the three months ended September 30, 2021. The increase reflected a 25 basis point increase in our net interest rate spread to 2.68% for the three months ended September 30, 2022 from 2.43% for the three months ended September 30, 2021. The net interest margin increased 27 basis points to 2.85% for the three months ended September 30, 2022 from 2.58% for the three months ended September 30, 2021.

We recorded a $175,000 provision for loan losses for the three months ended September 30, 2022 compared to a $25,000 provision for the three-month period ended September 30, 2021. Higher balances in residential and construction loans were the reason for the provision for the three months ended September 30, 2022. The Bank continues to have a low level of delinquent and non-accrual loans in the portfolio, as well as no charge-offs.

Non-interest income decreased by $105,000, or 28.0%, to $270,000 for the three months ended September 30, 2022 from $374,000 for the three months ended September 30, 2021. Gain on sale of loans decreased $127,000 as the Bank decided to portfolio loans rather than sell loans. This decrease was offset by a $28,000, or 17.8%, increase in bank-owned life insurance to $185,000 for the three months ended September 30, 2022 from $157,000 for the three months ended September 30, 2022 due to $5.0 million purchase of bank-owned life insurance during the nine months ended September 30, 2022.

For the three months ended September 30, 2022, non-interest expense decreased $137,000, or 3.6%, over the comparable 2021 period primarily due to the $370,000 of expense related to the data processing conversion in 2021. Salaries and employee benefits increased $125,000, or 6.2%, due to the stock compensation plan established in September 2021 and due to more employees due to the acquisition and the addition of a sixth branch office. Data processing expense increased $54,000, or 21.1%, due to higher costs associated with being a larger organization. Professional fees increased $35,000, or 27.2%, due in part to the settlement of a legal case in 2022. The increase in advertising expense of $96,000, or 160.2%, was due to additional promotions for branch locations and new promotions on deposit and loan products.

Comparison of Operating Results for the Nine Months Ended September 30, 2022 and September 30, 2021

Net income decreased by $514,000, or 9.4%, to $5.0 million for the nine months ended September 30, 2022 from $5.5 million for the nine months ended September 30, 2021. The decrease was due to a decrease in non-interest income of $2.4 million, an increase in provision for loan losses of $363,000, and an increase of $412,000 in income taxes, offset by an increase in net interest income of $2.6 million. Excluding the one-time bargain purchase gain of $1.9 million that occurred in 2021 in connection with the Gibraltar Bank acquisition and the $392,000 merger-related expenses, net income was $3.9 million for the nine months ended September 30, 2021 compared to $5.0 million for the current year period1.

Interest income on cash and cash equivalents decreased $31,000, or 26.1%, to $88,000 for the nine months ended September 30, 2022 from $119,000 for the nine months ended September 30, 2021 due to a $65.1 million decrease in the average balance of cash and cash equivalents to $32.5 million for the nine months ended September 30, 2022 from $97.6 million for the nine months ended September 30, 2021, reflecting the use of excess liquidity to fund loan originations and purchase investment securities. This was offset by a 20 basis point increase in the average yield on cash and cash equivalents from 0.16% for the nine months ended September 30, 2021 to 0.36% for the nine months ended September 30, 2022 due to the higher interest rate environment.

Interest income on loans increased $1.3 million, or 7.5%, to $18.4 million for the nine months ended September 30, 2022 compared to $17.1 million for the nine months ended September 30, 2021 due primarily to a $27.1 million increase in the average balance of loans to $612.3 million for the nine months ended September 30, 2022 from $585.2 million for the nine months ended September 30, 2021 and, to a lesser extent, due to a ten basis point increase in the average yield on loans from 3.91% for the nine months ended September 30, 2021 to 4.01% for the nine months ended September 30, 2022.

[1] This number represents a non-GAAP financial measure. Please see “Reconciliation of GAAP to Non-GAAP” contained at the end of this release.

Interest income on securities increased $1.2 million, or 78.4%, to $2.7 million for the nine months ended September 30, 2022 from $1.5 million for the nine months ended September 30, 2021 due to a $86.2 million increase in the average balance of securities to $168.1 million for the nine months ended September 30, 2022 from $81.9 million for the nine months ended September 30, 2021, reflecting the purchase of investments with excess liquidity. The increase was offset by a 32 basis point decrease in the average yield from 2.46% for the nine months ended September 30, 2021 to 2.14% for the nine months ended September 30, 2022.

Interest expense on interest-bearing deposits decreased $430,000, or 12.8%, to $2.9 million for the nine months ended September 30, 2022 from $3.4 million for the nine months ended September 30, 2021. The decrease was due primarily to an 18 basis point decrease in the average cost of interest-bearing deposits to 0.67% for the nine months ended September 30, 2022 from 0.85% for the nine months ended September 30, 2021. The decrease in the average cost of deposits was due to a higher average balance of core deposits, offset by a decrease in the average balance and average cost of certificates of deposit. This decrease was offset by a $50.6 million increase in the average balance of deposits to $581.0 million for the nine months ended September 30, 2022 from $530.3 million for the nine months ended September 30, 2021, primarily due to a $47.4 million increase in the average balance of NOW and money market accounts from $99.3 million for the nine months ended September 30, 2021 to $146.7 million for the nine months ended September 30, 2022.

Interest expense on Federal Home Loan Bank borrowings increased $226,000, or 19.2%, from $1.2 million for the nine months ended September 30, 2021 to $1.4 million for the nine months ended September 30, 2022. The increase was due to an increase in the average cost of borrowings of 37 basis points to 1.92% for the nine months ended September 30, 2022 from 1.55% for the nine months ended September 30, 2021 due to the higher new borrowing rates. The increase was offset by a decrease in the average balance of borrowings of $3.7 million to $97.6 million for the nine months ended September 30, 2022 from $101.2 million for the nine months ended September 30, 2021.

Net interest income increased $2.6 million, or 18.1%, to $17.0 million for the nine months ended September 30, 2022 from $14.4 million for the nine months ended September 30, 2021. The increase reflected a 30 basis point increase in the net interest rate spread to 2.63% for the nine months ended September 30, 2022 from 2.33% for the nine months ended September 30, 2021. The net interest margin increased 28 basis points to 2.78% for the nine months ended September 30, 2022 from 2.50% for the nine months ended September 30, 2021.

We recorded a $275,000 provision for loan losses the nine months ended September 30, 2022 compared to a $88,000 credit for the nine months ended September 30, 2021. Higher balances in residential and construction loans were the reason for the provision for the nine months ended September 30, 2022. The Bank continues to have a low level of delinquent and non-accrual loans in the portfolio, as well as no charge-offs.

Non-interest income decreased by $2.4 million, or 73.1%, to $868,000 for the nine months ended September 30, 2022 from $3.2 million for the nine months ended September 30, 2021. For the nine months ended September 30, 2021, there was a $1.9 million bargain purchase gain recognized in the Gibraltar Bank acquisition in 2021. Gain on sale of loans decreased $560,000 or 86.6% to $87,000 for the nine months ended September 30, 2022 from $647,000 for the nine months ended September 30, 2021. Bank-owned life insurance income increased $119,000, or 30.3%, to $511,000 for the nine months ended September 30, 2022 from $392,000 for the nine months ended September 30, 2021 due to a $5.0 million purchase of bank-owned life insurance during the nine months ended September 30, 2022.

For the nine months ended September 30, 2022, non-interest expense decreased $12,000, or 0.1%, to $10.8 million, over the comparable 2021 period. Salaries and employee benefits increased $713,000, or 12.7%, due to stock compensation plan implemented in September 2021 and due to more employees due to the acquisition and the addition of a sixth branch office. Data processing expense increased $143,000, or 18.3%, due to higher data processing expense associated with a larger company. Advertising expense increased $188,000 due to additional promotions for branch locations and new promotions for loan and deposit products. Professional fees decreased $137,000, or 23.0%, due to lower consulting expense. Merger fees and core conversion costs were $1.1 million in 2021. The increase in equipment and occupancy expenses of $134,000, or 14.9%, was mainly due to the additional branch locations.

Balance Sheet Analysis

Total assets were $946.2 million at September 30, 2022, representing an increase of $108.8 million, or 13.0%, from December 31, 2021. Cash and cash equivalents decreased $91.7 million during the period primarily due to funding of loan originations and investment purchases with excess liquidity. Net loans increased $136.9 million, or 24.0%, due to new production of $198.1 million, consisting of a mainly residential real estate loans and construction real estate loans offset by $61.2 million in repayments. Securities held to maturity increased $10.1 million due to the purchase of corporate bonds and mortgage-backed securities with excess cash. Securities available for sale increased $46.3 million due to the purchase of mortgage-backed securities and corporate bonds with excess cash. Bank-owned life insurance increased $5.5 million, or 22.4%, due to a $5.0 million new purchase of bank-owned life insurance during the nine months ended September 30, 2022.

Delinquent loans decreased $544,000, or 20.7%, during the nine-month period ended September 30, 2022, finishing at $2.0 million or 0.28% of total loans. During the same timeframe, non-performing assets remained unchanged at $1.9 million and were 0.20% of total assets at September 30, 2022. The Company’s allowance for loan losses was 0.36% of total loans and 128.8% of non-performing loans at September 30, 2022 compared to 0.37% of total loans and 114.20% of non-performing loans at September 30, 2021.

Total liabilities increased $115.3 million, or 16.7%, to $805.1 million mainly due to an increase in deposits, reflecting a new $27.0 million municipal relationship, a $78.8 increase in certificates of deposit and a $43.1 million increase in borrowings. Total deposits increased $70.7 million, or 11.8%, to $668.2 million at September 30, 2022 from $597.5 million at December 31, 2021. The increase in deposits reflected an increase in interest-bearing deposits of $73.4 million, or 13.1%, to $631.5 million as of September 30, 2022 from $558.2 million at December 31, 2021, primarily due to increases in certificates of deposit, which increased by $78.8 million from $366.4 million at December 31, 2021 to $445.2 million at September 30, 2022 and in NOW accounts, which increased by $11.2 million to $81.1 million from $69.9 million at December 31, 2021. These increases were offset by a decrease in non-interest bearing deposits of $2.7 million, or 6.8%, to $36.6 million as of September 30, 2022 from $39.3 million as of December 31, 2021. Federal Home Loan Bank advances increased $43.1 million, or 50.6%, due to new advances for loan funding.

Stockholders’ equity decreased $6.5 million to $141.1 million, due to increased accumulated other comprehensive loss for securities available for sale of $6.4 million and the repurchase of 546,421 shares of stock during the year at a cost of $6.0 million, offset by net income of $5.0 million for the nine months ended September 30, 2022. At September 30, 2022, the Company’s ratio of average stockholders’ equity-to-total assets was 17.08%, compared to 17.43% at September 30, 2021.

About Bogota Financial Corp.

Bogota Financial Corp. is a Maryland corporation organized as the mid-tier holding company of Bogota Savings Bank and is the majority-owned subsidiary of Bogota Financial, MHC. Bogota Savings Bank is a New Jersey chartered stock savings bank that has served the banking needs of its customers in northern and central New Jersey since 1893. It operates from six offices located in Bogota, Hasbrouck Heights, Newark, Oak Ridge, Parsippany and Teaneck, New Jersey and operates a loan production office in Spring Lake, New Jersey.

Forward-Looking Statements

This press release contains certain forward-looking statements about the Company and the Bank. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements, by their nature, are subject to risks and uncertainties. Certain factors that could cause actual results to differ materially from expected results include increased competitive pressures, changes in the interest rate environment, inflation, general economic conditions or conditions within the securities markets, changes in the quality of our loan and security portfolios, increases in non-performing and classified loans, and legislative, accounting and regulatory changes that could adversely affect the business in which the Company and the Bank are engaged.

In addition, the COVID-19 pandemic has had, and may continue to have, an adverse impact on the Company, its clients and the communities it serves. Given its dynamic nature, it is difficult to predict the full impact of the COVID-19 pandemic on the Company’s business.

The Company undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.

BOGOTA FINANCIAL CORP.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

 

 

 

As of

 

 

As of

 

 

 

September 30, 2022

 

 

December 31, 2021

 

Assets

 

(unaudited)

 

 

 

 

Cash and due from banks

 

$

8,885,168

 

 

$

14,446,792

 

Interest-bearing deposits in other banks

 

 

4,440,605

 

 

 

90,621,993

 

Cash and cash equivalents

 

 

13,325,773

 

 

 

105,068,785

 

Securities available for sale

 

 

88,091,340

 

 

 

41,838,798

 

Securities held to maturity (fair value of $76,552,406 and $74,081,059,

respectively)

 

 

84,128,385

 

 

 

74,053,099

 

Loans held for sale

 

 

 

 

 

1,152,500

 

Loans, net of allowance of $2,428,174 and $2,153,174, respectively

 

 

707,119,408

 

 

 

570,209,669

 

Premises and equipment, net

 

 

7,954,437

 

 

 

8,127,979

 

Federal Home Loan Bank (FHLB) stock and other restricted securities

 

 

6,663,500

 

 

 

4,851,300

 

Accrued interest receivable

 

 

3,411,329

 

 

 

2,712,605

 

Core deposit intangibles

 

 

283,802

 

 

 

336,364

 

Bank-owned life insurance

 

 

30,021,952

 

 

 

24,524,122

 

Other assets

 

 

5,205,892

 

 

 

4,486,366

 

Total Assets

 

$

946,205,818

 

 

$

837,361,587

 

Liabilities and Equity

 

 

 

 

 

 

Non-interest bearing deposits

 

$

36,635,406

 

 

$

39,317,500

 

Interest bearing deposits

 

 

631,524,062

 

 

 

558,162,278

 

Total Deposits

 

 

668,159,468

 

 

 

597,479,778

 

FHLB advances

 

 

128,111,317

 

 

 

85,051,736

 

Advance payments by borrowers for taxes and insurance

 

 

3,921,880

 

 

 

2,856,120

 

Other liabilities

 

 

4,894,794

 

 

 

4,397,742

 

Total liabilities

 

 

805,087,459

 

 

 

689,785,376

 

 

 

 

 

 

 

 

Stockholders’ Equity

 

 

 

 

 

 

Preferred stock $0.01 par value 1,000,000 shares authorized, none

issued and outstanding at September 30, 2022 and December 31, 2021

 

 

 

 

 

 

Common stock $0.01 par value, 30,000,000 shares authorized,

14,059,388 issued and outstanding at September 30, 2022 and

14,605,809 at December 31, 2021

 

 

140,593

 

 

 

146,057

 

Additional paid-in capital

 

 

62,978,243

 

 

 

68,247,204

 

Retained earnings

 

 

89,853,322

 

 

 

84,879,812

 

Unearned ESOP shares (443,236 shares at September 30, 2022 and

463,239 shares at December 31, 2021)

 

 

(5,198,303

)

 

 

(5,424,206

)

Accumulated other comprehensive loss

 

 

(6,655,496

)

 

 

(272,656

)

Total stockholders’ equity

 

 

141,118,359

 

 

 

147,576,211

 

Total liabilities and stockholders’ equity

 

$

946,205,818

 

 

$

837,361,587

 

BOGOTA FINANCIAL CORP.

CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

 

 

 

Three months ended

September 30,

 

 

Nine months ended

September 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Interest income

 

 

 

 

 

 

 

 

 

 

 

 

Loans

 

$

7,018,200

 

 

$

5,967,013

 

 

$

18,403,802

 

 

$

17,116,855

 

Securities

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

1,013,034

 

 

 

410,867

 

 

 

2,582,869

 

 

 

1,473,018

 

Tax-exempt

 

 

48,027

 

 

 

13,411

 

 

 

115,305

 

 

 

38,794

 

Other interest-earning assets

 

 

96,139

 

 

 

94,343

 

 

 

263,634

 

 

 

332,603

 

Total interest income

 

 

8,175,400

 

 

 

6,485,634

 

 

 

21,365,610

 

 

 

18,961,270

 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

1,249,693

 

 

 

1,040,669

 

 

 

2,925,685

 

 

 

3,354,897

 

FHLB advances

 

 

716,705

 

 

 

369,352

 

 

 

1,402,741

 

 

 

1,176,985

 

Total interest expense

 

 

1,966,398

 

 

 

1,410,021

 

 

 

4,328,426

 

 

 

4,531,882

 

Net interest income

 

 

6,209,002

 

 

 

5,075,613

 

 

 

17,037,184

 

 

 

14,429,388

 

Provision (credit) for loan losses

 

 

175,000

 

 

 

25,000

 

 

 

275,000

 

 

 

(88,000

)

Net interest income after provision for loan losses

 

 

6,034,002

 

 

 

5,050,613

 

 

 

16,762,184

 

 

 

14,517,388

 

Non-interest income

 

 

 

 

 

 

 

 

 

 

 

 

Fees and service charges

 

 

47,090

 

 

 

53,696

 

 

 

136,886

 

 

 

98,989

 

(Loss) gain on sale of loans

 

 

 

 

 

127,111

 

 

 

86,913

 

 

 

647,213

 

Bargain purchase gain

 

 

 

 

 

 

 

 

 

 

 

1,933,397

 

Bank-owned life insurance

 

 

185,085

 

 

 

156,992

 

 

 

510,527

 

 

 

391,825

 

Other

 

 

37,336

 

 

 

36,613

 

 

 

133,325

 

 

 

154,882

 

Total non-interest income

 

 

269,511

 

 

 

374,412

 

 

 

867,651

 

 

 

3,226,306

 

Non-interest expense

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

2,154,654

 

 

 

2,029,021

 

 

 

6,316,898

 

 

 

5,603,408

 

Occupancy and equipment

 

 

347,036

 

 

 

338,604

 

 

 

1,033,846

 

 

 

899,777

 

FDIC insurance assessment

 

 

54,000

 

 

 

49,000

 

 

 

162,000

 

 

 

163,300

 

Data processing

 

 

311,106

 

 

 

256,953

 

 

 

920,293

 

 

 

777,789

 

Advertising

 

 

156,145

 

 

 

60,000

 

 

 

368,435

 

 

 

180,000

 

Director fees

 

 

189,424

 

 

 

207,012

 

 

 

607,749

 

 

 

622,131

 

Professional fees

 

 

163,500

 

 

 

128,514

 

 

 

459,253

 

 

 

596,280

 

Merger fees

 

 

 

 

 

 

 

 

 

 

 

392,197

 

Core conversion costs

 

 

 

 

 

370,000

 

 

 

 

 

 

730,000

 

Other

 

 

262,890

 

 

 

337,002

 

 

 

905,428

 

 

 

820,803

 

Total non-interest expense

 

 

3,638,755

 

 

 

3,776,106

 

 

 

10,773,902

 

 

 

10,785,685

 

Income before income taxes

 

 

2,664,758

 

 

 

1,648,919

 

 

 

6,855,933

 

 

 

6,958,009

 

Income tax expense

 

 

734,152

 

 

 

606,744

 

 

 

1,882,423

 

 

 

1,470,803

 

Net income

 

$

1,930,606

 

 

$

1,042,175

 

 

$

4,973,510

 

 

$

5,487,206

 

Earnings per Share - basic

 

$

0.14

 

 

$

0.07

 

 

$

0.36

 

 

$

0.40

 

Earnings per Share - diluted

 

$

0.14

 

 

$

0.07

 

 

$

0.36

 

 

$

0.40

 

Weighted average shares outstanding - basic

 

 

13,468,751

 

 

 

14,019,317

 

 

 

13,661,851

 

 

 

13,694,117

 

Weighted average shares outstanding - diluted

 

 

13,529,857

 

 

 

14,019,317

 

 

 

13,704,688

 

 

 

13,694,117

 

BOGOTA FINANCIAL CORP.

SELECTED RATIOS

(unaudited)

 

 

 

 

 

 

 

At or For the Three Months

Ended September 30,

 

 

At or For the Nine Months

Ended September 30,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Performance Ratios (1):

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (2)

 

0.95

%

 

 

0.49

%

 

 

0.76

%

 

 

0.91

%

Return on average equity (3)

 

5.56

%

 

 

2.81

%

 

 

4.62

%

 

 

5.20

%

Interest rate spread (4)

 

2.73

%

 

 

2.43

%

 

 

2.63

%

 

 

2.33

%

Net interest margin (5)

 

2.85

%

 

 

2.58

%

 

 

2.78

%

 

 

2.50

%

Efficiency ratio (6)

 

56.17

%

 

 

69.29

%

 

 

60.17

%

 

 

61.06

%

Average interest-earning assets to average interest-bearing liabilities

 

120.42

%

 

 

122.40

%

 

 

120.59

%

 

 

122.40

%

Net loans to deposits

 

105.83

%

 

 

98.09

%

 

 

105.83

%

 

 

98.09

%

Equity to assets (7)

 

14.91

%

 

 

17.39

%

 

 

16.52

%

 

 

17.39

%

Capital Ratios:

 

 

 

 

 

 

 

 

 

 

 

Tier 1 capital to average assets

 

 

 

 

 

 

 

17.08

%

 

 

17.67

%

Asset Quality Ratios:

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses as a percent of total loans

 

 

 

 

 

 

 

0.36

%

 

 

0.37

%

Allowance for loan losses as a percent of non-performing loans

 

 

 

 

 

 

 

128.84

%

 

 

114.20

%

Net recoveries to average outstanding loans during the period

 

 

 

 

 

 

 

0.00

%

 

 

0.00

%

Non-performing loans as a percent of total loans

 

 

 

 

 

 

 

0.27

%

 

 

0.32

%

Non-performing assets as a percent of total assets

 

 

 

 

 

 

 

0.20

%

 

 

0.23

%

 

 

 

 

 

 

 

 

 

 

 

 

(1)

 

Performance ratios are annualized.

(2)

 

Represents net income divided by average total assets.

(3)

 

Represents net income divided by average stockholders' equity.

(4)

 

Represents the difference between the weighted average yield on average interest-earning assets and the weighted average

cost of average interest-bearing liabilities.  Tax exempt income is reported on a tax equivalent basis using a combined federal

and state marginal tax rate of 30%.

(5)

 

Represents net interest income as a percent of average interest-earning assets.  Tax exempt income is reported on a tax

equivalent basis using a combined federal and state marginal tax rate of 30% for 2022 and 2021.

(6)

 

Represents non-interest expenses divided by the sum of net interest income and non-interest income.

(7)

 

Represents average stockholders' equity divided by average total assets.

LOANS

Loans are summarized as follows at September 30, 2022 and December 31, 2021:

 

 

September 30,

2022

 

 

December 31,

2021

 

Real estate:

 

(unaudited)

 

Residential

 

$

452,252,121

 

 

$

319,968,234

 

Commercial and multi-family real estate

 

 

167,043,470

 

 

 

175,375,419

 

Construction

 

 

59,957,043

 

 

 

41,384,687

 

Commercial and industrial

 

 

1,908,487

 

 

 

7,905,524

 

Consumer:

 

 

 

 

 

 

Home equity and other

 

 

28,386,461

 

 

 

27,728,979

 

Total loans

 

 

709,547,582

 

 

 

572,362,843

 

Allowance for loan losses

 

 

(2,428,174

)

 

 

(2,153,174

)

Net loans

 

$

707,119,408

 

 

$

570,209,669

 

The following tables set forth the distribution of total deposit accounts, by account type, at the dates indicated.

 

 

At September 30,

 

At December

 

 

 

 

 

 

2022

 

 

2021

 

 

 

 

 

 

Amount

 

 

Percent

 

 

Average

Rate

 

 

Amount

 

 

Percent

 

 

Average

Rate

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest bearing demand

accounts

 

$

36,838

 

 

 

6.93

%

 

 

%

 

$

39,318

 

 

 

6.58

%

 

 

%

NOW accounts

 

 

81,096

 

 

 

12.14

 

 

 

0.49

 

 

 

69,940

 

 

 

11.71

 

 

0.82

 

Money market accounts

 

 

45,442

 

 

 

6.80

 

 

 

0.33

 

 

 

57,541

 

 

 

9.63

 

 

 

0.34

 

Savings accounts

 

 

59,592

 

 

 

8.92

 

 

0.26

 

 

 

64,285

 

 

 

10.76

 

 

0.26

 

Certificates of deposit

 

 

445,191

 

 

 

66.63

 

 

 

1.44

 

 

 

366,396

 

 

 

61.32

 

 

 

0.74

 

Total

 

$

668,159

 

 

 

100.00

%

 

 

1.06

%

 

$

597,480

 

 

 

100.00

%

 

 

0.61

%

Average Balance Sheets and Related Yields and Rates

The following tables present information regarding average balances of assets and liabilities, the total dollar amounts of interest income and dividends from average interest-earning assets, the total dollar amounts of interest expense on average interest-bearing liabilities, and the resulting annualized average yields and costs. The yields and costs for the periods indicated are derived by dividing income or expense by the average balances of assets or liabilities, respectively, for the periods presented. Average balances have been calculated using daily balances. Nonaccrual loans are included in average balances only. Loan fees are included in interest income on loans and are not material.

 

 

Three Months Ended September 30,

 

 

 

2022

 

 

2021

 

 

 

Average

Balance

 

 

Interest and

Dividends

 

 

Yield/

Cost (3)

 

 

Average

Balance

 

 

Interest and

Dividends

 

 

Yield/

Cost (3)

 

 

 

(Dollars in thousands)

 

Assets:

 

(unaudited)

 

Cash and cash equivalents

 

$

5,912

 

 

$

31

 

 

 

2.05

%

 

$

101,453

 

 

$

33

 

 

 

0.13

%

Loans

 

 

670,145

 

 

 

7,019

 

 

 

4.15

%

 

 

584,754

 

 

 

5,967

 

 

 

4.05

%

Securities

 

 

182,626

 

 

 

1,061

 

 

 

2.32

%

 

 

88,619

 

 

 

424

 

 

 

1.91

%

Other interest-earning assets

 

 

6,629

 

 

 

65

 

 

 

3.99

%

 

 

5,521

 

 

 

62

 

 

 

4.49

%

Total interest-earning assets

 

 

865,312

 

 

 

8,176

 

 

 

3.75

%

 

 

780,347

 

 

 

6,486

 

 

 

3.30

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest-earning assets

 

 

51,273

 

 

 

 

 

 

 

 

 

52,346

 

 

 

 

 

 

 

Total assets

 

$

916,585

 

 

 

 

 

 

 

 

$

832,693

 

 

 

 

 

 

 

Liabilities and equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market accounts

 

$

138,015

 

 

$

173

 

 

 

0.50

%

 

$

108,411

 

 

$

148

 

 

 

0.54

%

Savings accounts

 

 

60,912

 

 

 

40

 

 

 

0.26

%

 

 

64,076

 

 

 

36

 

 

 

0.22

%

Certificates of deposit

 

 

403,223

 

 

 

1,037

 

 

 

1.02

%

 

 

375,495

 

 

 

857

 

 

 

0.91

%

Total interest-bearing deposits

 

 

602,150

 

 

 

1,250

 

 

 

0.82

%

 

 

547,982

 

 

 

1,041

 

 

 

0.75

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Federal Home Loan Bank

advances

 

 

128,534

 

 

 

717

 

 

 

2.30

%

 

 

96,041

 

 

 

369

 

 

 

1.52

%

Total interest-bearing liabilities

 

 

730,684

 

 

 

1,967

 

 

 

1.08

%

 

 

644,023

 

 

 

1,410

 

 

 

0.87

%

Non-interest-bearing deposits

 

 

40,028

 

 

 

 

 

 

 

 

 

33,330

 

 

 

 

 

 

 

Other non-interest-bearing

liabilities

 

 

4,232

 

 

 

 

 

 

 

 

 

10,246

 

 

 

 

 

 

 

Total liabilities

 

 

774,944

 

 

 

 

 

 

 

 

 

687,599

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total equity

 

 

141,641

 

 

 

 

 

 

 

 

 

145,094

 

 

 

 

 

 

 

Total liabilities and equity

 

$

916,585

 

 

 

 

 

 

 

 

$

832,693

 

 

 

 

 

 

 

Net interest income

 

 

 

 

$

6,209

 

 

 

 

 

 

 

 

$

5,076

 

 

 

 

Interest rate spread (1)

 

 

 

 

 

 

 

 

2.68

%

 

 

 

 

 

 

 

 

2.43

%

Net interest margin (2)

 

 

 

 

 

 

 

 

2.85

%

 

 

 

 

 

 

 

 

2.58

%

Average interest-earning assets

to average interest-bearing

liabilities

 

 

118.42

%

 

 

 

 

 

 

 

 

121.17

%

 

 

 

 

 

 

1.

 

Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

2.

 

Net interest margin represents net interest income divided by average total interest-earning assets.

3.

 

Annualized.

Rate/Volume Analysis

 

 

Nine Months Ended September 30,

 

 

 

2022

 

 

2021

 

 

 

Average

Balance

 

 

Interest and

Dividends

 

 

Yield/

Cost (3)

 

 

Average

Balance

 

 

Interest and

Dividends

 

 

Yield/

Cost (3)

 

 

 

(Dollars in thousands)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

32,485

 

 

$

88

 

 

 

0.36

%

 

$

97,579

 

 

$

119

 

 

 

0.16

%

Loans

 

 

612,252

 

 

 

18,404

 

 

 

4.01

%

 

 

585,156

 

 

 

17,117

 

 

 

3.91

%

Securities

 

 

168,081

 

 

 

2,698

 

 

 

2.14

%

 

 

81,900

 

 

 

1,512

 

 

 

2.46

%

Other interest-earning assets

 

 

5,458

 

 

 

175

 

 

 

4.30

%

 

 

5,785

 

 

 

213

 

 

 

4.92

%

Total interest-earning assets

 

 

818,276

 

 

 

21,365

 

 

 

3.49

%

 

 

770,420

 

 

 

18,961

 

 

 

3.29

%

Non-interest-earning assets

 

 

52,040

 

 

 

 

 

 

 

 

 

40,177

 

 

 

 

 

 

 

Total assets

 

$

870,316

 

 

 

 

 

 

 

 

$

810,597

 

 

 

 

 

 

 

Liabilities and equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market accounts

 

$

146,653

 

 

$

610

 

 

 

0.56

%

 

$

99,261

 

 

$

427

 

 

 

0.57

%

Savings accounts

 

 

64,509

 

 

 

126

 

 

 

0.26

%

 

 

56,982

 

 

 

84

 

 

 

0.20

%

Certificates of deposit

 

 

369,808

 

 

 

2,189

 

 

 

0.79

%

 

 

374,101

 

 

 

2,844

 

 

 

1.02

%

Total interest-bearing deposits

 

 

580,970

 

 

 

2,925

 

 

 

0.67

%

 

 

530,344

 

 

 

3,355

 

 

 

0.85

%

Federal Home Loan Bank

advances

 

 

97,571

 

 

 

1,403

 

 

 

1.92

%

 

 

101,249

 

 

 

1,177

 

 

 

1.55

%

Total interest-bearing liabilities

 

 

678,541

 

 

 

4,328

 

 

 

0.85

%

 

 

631,593

 

 

 

4,532

 

 

 

0.96

%

Non-interest-bearing deposits

 

 

44,256

 

 

 

 

 

 

 

 

 

28,602

 

 

 

 

 

 

 

Other non-interest-bearing

liabilities

 

 

3,705

 

 

 

 

 

 

 

 

 

9,458

 

 

 

 

 

 

 

Total liabilities

 

 

726,502

 

 

 

 

 

 

 

 

 

669,653

 

 

 

 

 

 

 

Total equity

 

 

143,814

 

 

 

 

 

 

 

 

 

140,944

 

 

 

 

 

 

 

Total liabilities and equity

 

$

870,316

 

 

 

 

 

 

 

 

$

810,597

 

 

 

 

 

 

 

Net interest income

 

 

 

 

$

17,037

 

 

 

 

 

 

 

 

$

14,429

 

 

 

 

Interest rate spread (1)

 

 

 

 

 

 

 

 

2.63

%

 

 

 

 

 

 

 

 

2.33

%

Net interest margin (2)

 

 

 

 

 

 

 

 

2.78

%

 

 

 

 

 

 

 

 

2.50

%

Average interest-earning assets

to average interest-bearing

liabilities

 

 

120.59

%

 

 

 

 

 

 

 

 

121.98

%

 

 

 

 

 

 

Rate/Volume Analysis

The following table sets forth the effects of changing rates and volumes on net interest income. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the prior columns. Changes attributable to changes in both rate and volume that cannot be segregated have been allocated proportionally based on the changes due to rate and the changes due to volume.

 

 

Three Months Ended September 30,

2022 Compared to Three

Months Ended September 30, 2021

 

 

Nine Months Ended September 30,

2022 Compared to Nine Months

Ended September 30, 2021

 

 

 

Increase (Decrease) Due to

 

 

Increase (Decrease) Due to

 

 

 

Volume

 

 

Rate

 

 

Net

 

 

Volume

 

 

Rate

 

 

Net

 

 

 

(In thousands)

 

Interest income:

 

(unaudited)

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

(234

)

 

$

232

 

 

$

(2

)

 

$

(147

)

 

$

116

 

 

$

(31

)

Loans receivable

 

 

900

 

 

 

152

 

 

 

1,052

 

 

 

829

 

 

 

458

 

 

 

1,287

 

Securities

 

 

530

 

 

 

107

 

 

 

637

 

 

 

1,522

 

 

 

(336

)

 

 

1,186

 

Other interest earning assets

 

 

37

 

 

 

(34

)

 

 

3

 

 

 

(12

)

 

 

(26

)

 

 

(38

)

Total interest-earning assets

 

 

1,233

 

 

 

457

 

 

 

1,690

 

 

 

2,192

 

 

 

212

 

 

 

2,404

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and money market accounts

 

 

88

 

 

 

(63

)

 

 

25

 

 

 

196

 

 

 

(13

)

 

 

183

 

Savings accounts

 

 

(10

)

 

 

14

 

 

 

4

 

 

 

13

 

 

 

29

 

 

 

42

 

Certificates of deposit

 

 

68

 

 

 

112

 

 

 

180

 

 

 

(32

)

 

 

(623

)

 

 

(655

)

Federal Home Loan Bank advances

 

 

138

 

 

 

210

 

 

 

348

 

 

 

(69

)

 

 

295

 

 

 

226

 

Total interest-bearing liabilities

 

 

284

 

 

 

273

 

 

 

557

 

 

 

108

 

 

 

(312

)

 

 

(204

)

Net increase (decrease) in net

interest income

 

$

949

 

 

$

184

 

 

$

1,133

 

 

$

2,084

 

 

$

524

 

 

$

2,608

 

BOGOTA FINANCIAL CORP.

RECONCILIATION OF GAAP TO NON-GAAP

The Company’s management believes that the presentation of net income on a non-GAAP basis, excluding nonrecurring items, provides useful information for evaluating the Company’s operating results and any related trends that may be affecting the Company’s business. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP.

 

 

 

 

 

 

 

 

 

 

Three months ended September 30, 2021

 

 

Income Before

Income Taxes

 

 

Provision for

Income Taxes

 

 

Net Income

 

GAAP basis

$

1,648,919

 

 

$

606,744

 

 

$

1,042,175

 

Add: merger-related expenses

$

-

 

 

$

-

 

 

$

-

 

Less: Bargain purchase gain

$

-

 

 

$

-

 

 

$

-

 

Non-GAAP basis

$

1,648,919

 

 

$

606,744

 

 

$

1,042,175

 

 

 

 

 

 

 

 

 

 

 

Nine months ended September 30, 2021

 

 

Income Before

Income Taxes

 

 

Provision for

Income Taxes

 

 

Net Income

 

GAAP basis

$

6,958,009

 

 

$

1,470,803

 

 

$

5,487,206

 

Add: merger and acquisition related expenses

 

392,197

 

 

 

 

 

 

392,197

 

Add: Charitable Foundation Contribution

 

 

 

 

 

 

 

 

Less: Bargain purchase gain

 

(1,933,397

)

 

 

 

 

 

(1,933,397

)

Non-GAAP basis

$

5,416,809

 

 

$

1,470,803

 

 

$

3,946,006

 

 

 

 

 

 

 

 

 

 

 

Nine months ended September 30,

 

Return on average assets (annualized):

2022

 

 

2021

 

 

 

 

GAAP

 

0.76

%

 

 

0.91

%

 

 

 

Adjustments

 

0.00

%

 

 

0.26

%

 

 

 

Non-GAAP

 

0.76

%

 

 

0.65

%

 

 

 

Return on average equity (annualized):

 

 

 

 

 

 

 

 

GAAP

 

4.62

%

 

 

5.20

%

 

 

 

Adjustments

 

0.00

%

 

 

1.46

%

 

 

 

Non-GAAP

 

4.62

%

 

 

3.74

%

 

 

 

 

Contacts

Joseph Coccaro – President & CEO, 201-862-0660 ext. 1110

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