Hingham Institution for Savings : Form 10-Q~Quarterly Report

Published: 2023-08-04 17:15:42 ET HIFS

FEDERAL DEPOSIT INSURANCE CORPORATION

Washington, D.C., 20429

FORM 10-Q

(Mark one)

Commission File Number: FDIC Certificate No. 90211

HINGHAM INSTITUTION FOR SAVINGS

(Exact name of registrant as specified in its charter)

Massachusetts

04-1442480

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

55 Main Street, Hingham, Massachusetts

02043

(Address of principal offices)

(781) 749-2200

(Zip Code)

(Registrant's telephone number,

including area code)

Securities Registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $1.00 par value per share

HIFS

NASDAQ Stock Market, LLC

Securities registered under Section 12(g) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

◻

Accelerated filer

⌧

Non-accelerated filer

◻

Smaller reporting company

◻

Emerging Growth Company

◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ◻ No ⌧

The number of shares outstanding of each of the registrant's common stock, $1.00 par value per share, outstanding as of August 4, 2023 was 2,150,400.

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1

- Financial Statements

Consolidated Balance Sheets

Consolidated Statements of Net Income and Comprehensive Income

Consolidated Statements of Changes in Stockholders' Equity

Consolidated Statements of Cash Flows

Notes to Unaudited Consolidated Financial Statements

Item 2

- Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 3

- Quantitative and Qualitative Disclosures About Market Risk

Item 4

- Controls and Procedures

PART II - OTHER INFORMATION

Item 1 - Legal Proceedings

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

Signatures

Certifications

Certifications pursuant to 18U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements

HINGHAM INSTITUTION FOR SAVINGS AND SUBSIDIARIES

Consolidated Balance Sheets

December 31,

June 30,

2022

2023

(Unaudited)

(In Thousands, Except Share Amounts)

ASSETS

6,764

Cash and due from banks

7,936

Federal Reserve and other short-term investments

354,097

347,320

Cash and cash equivalents

362,033

354,084

Equity securities, at fair value

63,196

73,973

Securities held to maturity, at amortized cost

3,500

Federal Home Loan Bank stock, at cost

52,606

60,897

Loans, net of allowance for credit losses of

$24,989 at December 31, 2022 and

3,761,572

$26,140 at June 30, 2023

3,657,782

Bank-owned life insurance

13,312

13,478

Premises and equipment, net

17,859

18,383

Accrued interest receivable

7,122

7,388

Deferred income tax asset, net

4,061

2,236

Other assets

12,328

15,216

Total assets

4,193,799

4,310,727

LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits:

2,049,918

Interest-bearing

2,118,045

Non-interest-bearing

387,244

363,827

Total deposits

2,505,289

2,413,745

Federal Home Loan Bank advances

1,276,000

1,470,000

Mortgagors' escrow accounts

12,323

13,248

Accrued interest payable

4,527

6,355

Other liabilities

9,694

7,526

Total liabilities

3,807,833

3,910,874

Stockholders' equity:

Preferred stock, $1.00 par value,

2,500,000 shares authorized; none issued

Common stock, $1.00 par value, 5,000,000 shares authorized;

2,147,500 shares issued and outstanding at December 31, 2022 and

2,150

2,150,400 shares issued and outstanding at June 30, 2023

2,147

Additional paid-in capital

13,061

13,288

Undivided profits

370,758

384,415

Total stockholders' equity

385,966

399,853

Total liabilities and stockholders' equity

4,193,799

4,310,727

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Item 1 - Financial Statements (continued)

HINGHAM INSTITUTION FOR SAVINGS AND SUBSIDIARIES

Consolidated Statements of Net Income and Comprehensive Income

Three Months Ended

Six Months Ended

June 30,

2022

2023

2022

2023

(Unaudited)

(In Thousands, except per share amounts)

Interest and dividend income:

37,806

74,222

Loans

32,406

62,166

Debt securities

Equity securities

286

1,044

544

1,947

Federal Reserve and other short-term investments

519

3,106

629

6,480

Total interest and dividend income

33,244

41,989

63,405

82,715

Interest expense:

16,808

30,608

Deposits

2,102

3,606

Federal Home Loan Bank and Federal Reserve Bank advances

1,431

12,151

1,923

24,166

Total interest expense

3,533

28,959

5,529

54,774

Net interest income

29,711

13,030

57,876

27,941

Provision for credit losses

2,449

450

3,607

606

Net interest income, after provision for credit losses

27,262

12,580

54,269

27,335

Other income (loss):

141

279

Customer service fees on deposits

140

315

Increase in cash surrender value of bank-owned life

166

insurance

170

Gain (loss) on equity securities, net

(15,482)

5,390

(19,639)

8,938

Miscellaneous

117

Total other income (loss)

(15,245)

5,668

(19,108)

9,500

Operating expenses:

4,185

8,491

Salaries and employee benefits

3,862

7,506

Occupancy and equipment

315

380

689

771

Data processing

648

746

1,262

1,399

Deposit insurance

518

590

801

1,240

Marketing

315

277

506

489

Foreclosure and related

(13)

(48)

Other general and administrative

713

1,120

1,837

1,964

Total operating expenses

6,379

7,324

12,588

14,306

Income before income taxes

5,638

10,924

22,573

22,529

Income tax provision

2,447

2,676

7,518

5,770

Net income and comprehensive income

3,191

8,248

15,055

16,759

Weighted average common shares outstanding:

2,149

2,148

Basic

2,145

2,144

Diluted

2,203

2,191

2,204

2,196

Earnings per share:

3.84

7.80

Basic

1.49

7.02

Diluted

1.45

3.76

6.83

7.63

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Item 1 - Financial Statements (continued)

HINGHAM INSTITUTION FOR SAVINGS AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders' Equity

For the Six Months Ended

June 30, 2022 and 2023

Additional

Total

Common

Paid-In

Undivided

Stockholders'

Stock

Capital

Profits

Equity

(Unaudited)

(In Thousands)

Balance at December 31, 2021

2,142

12,728

339,742

354,612

Comprehensive income

15,055

Share-based compensation expense

Stock options exercised

171

174

Cash dividends declared - common

($1.16 per share)

(2,490)

Balance at June 30, 2022

2,145

12,908

352,307

367,360

Balance at December 31, 2022

2,147

13,061

370,758

385,966

Comprehensive income

16,759

Cumulative effect of accounting changes (Note 1)

(392)

Share-based compensation expense

Stock options exercised

210

213

Cash dividends declared - common

($1.26 per share)

(2,710)

Balance at June 30, 2023

2,150

13,288

384,415

399,853

The accompanying notes are an integral part of these unaudited consolidated financial statements.

Disclaimer

Hingham Institution for Savings published this content on 04 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 August 2023 21:14:23 UTC.