BNCC
____________________________
Quarterly Report
____________________________
For the quarter ended June 30, 2023
BNCCORP, INC.
(OTCQX: BNCC)
322 East Main Avenue
Bismarck, North Dakota 58501
(701) 250-3040
BNCCORP, INC.
INDEX TO QUARTERLY REPORT
June 30, 2023
TABLE OF CONTENTS
Page
Financial Statements (Interim periods are unaudited)
Consolidated Balance Sheets as of June 30, 2023, and December 31, 2022
3
Consolidated Statements of Income for the Three and Six Months Ended June 30, 2023, and 2022
4
Consolidated Statements of Comprehensive (Loss) Income for the Three and Six Months Ended
June 30, 2023, and 2022
5
Consolidated Statements of Stockholders' Equity for the Six Months Ended June 30, 2023, and
2022
6
Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2023, and 2022
7
Notes to Consolidated Financial Statements
9
Management's Discussion and Analysis of Financial Condition and Results of Operations
Comparison of Results for the Three and Six Months Ended June 30, 2023, and 2022
34
Comparison of Financial Condition as of June 30, 2023, and December 31, 2022
41
Quantitative and Qualitative Disclosures about Market Risk
48
Legal Proceedings
50
Submission of Matters to a Vote of Stockholders
50
2
Financial Statements
BNCCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (In thousands, except share data)
June 30,
December 31,
2023
2022
ASSETS
(unaudited)
Cash and cash equivalents
$
16,640
$
73,968
Debt securities available for sale
165,745
174,876
Federal Reserve Bank and Federal Home Loan Bank stock
2,938
3,063
Loans held for sale-mortgage banking
67,228
37,764
Loans held for investment
640,989
616,645
Allowance for credit losses (1)
(9,000)
(8,831)
Net loans held for investment
631,989
607,814
Premises and equipment, net
11,247
11,764
Operating lease right of use asset
867
1,521
Accrued interest receivable
3,458
3,312
Other
29,661
29,239
Total assets
$
929,773
$
943,321
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits:
Non-interest-bearing
$
181,508
$
207,232
Interest-bearing -
Savings, interest checking and money market
563,878
554,577
Time deposits
59,111
57,775
Total deposits
804,497
819,584
Guaranteed preferred beneficial interest in Company's subordinated
debentures
15,000
15,000
Accrued interest payable
451
312
Accrued expenses
4,987
5,482
Operating lease liabilities
986
1,660
Other
1,026
937
Total liabilities
826,947
842,975
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value - Authorized 11,300,000 shares; 3,561,334
and 3,559,334 shares issued and outstanding
36
36
Capital surplus - common stock
26,634
26,399
Retained earnings
89,528
87,575
Treasury stock (107,319 and 109,319 shares, respectively)
(1,664)
(1,622)
Accumulated other comprehensive loss
(11,708)
(12,042)
Total stockholders' equity
102,826
100,346
Total liabilities and stockholders' equity
$
929,773
$
943,321
3
BNCCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(In thousands, except per share data, unaudited)
For the Three Months
For the Six Months
Ended June 30,
Ended June 30,
2023
2022
2023
2022
INTEREST INCOME:
Interest and fees on loans
$
8,942
$
6,504
$
17,101
$
12,671
Interest and dividends on investments
Taxable
1,719
1,195
3,511
2,235
Tax-exempt
-
57
19
115
Dividends
36
37
72
73
Total interest income
10,697
7,793
20,703
15,094
INTEREST EXPENSE:
Deposits
2,405
325
3,733
658
Federal Home Loan Bank advances
-
1
6
1
Subordinated debentures
249
89
480
148
Total interest expense
2,654
415
4,219
807
Net interest income
8,043
7,378
16,484
14,287
PROVISION (CREDIT) FOR CREDIT LOSSES:
165
-
405
(550)
Net interest income after provision for credit losses
7,878
7,378
16,079
14,837
NON-INTEREST INCOME:
Bank charges and service fees
885
753
1,977
1,353
Wealth management revenues
483
492
970
1,028
Mortgage banking revenues, net
2,292
3,782
4,148
7,924
Gains on sales of loans, net
2
219
10
239
Gains on sales of debt securities, net
-
-
12
-
Other
50
532
226
746
Total non-interest income
3,712
5,778
7,343
11,290
NON-INTEREST EXPENSE:
Salaries and employee benefits
5,061
5,219
10,004
11,160
Professional services
1,689
966
2,586
1,916
Data processing fees
1,064
998
2,053
1,971
Marketing and promotion
1,360
1,437
2,729
2,792
Occupancy
482
527
994
1,110
Regulatory costs
94
121
200
240
Depreciation and amortization
284
306
577
617
Office supplies and postage
132
107
228
217
Other
674
849
1,375
1,552
Total non-interest expense
10,840
10,530
20,746
21,575
Income before income taxes
750
2,626
2,676
4,552
Income tax expense
176
617
629
1,070
NET INCOME
$
574
$
2,009
$
2,047
$
3,482
Basic earnings per common share
$
0.16
$
0.56
$
0.57
$
0.97
Diluted earnings per common share
$
0.16
$
0.56
$
0.57
$
0.97
See accompanying notes to consolidated financial statements.
4
BNCCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Comprehensive (Loss) Income
(In thousands, unaudited)
For the Three Months
For the Six Months
Ended June 30,
Ended June 30,
2023
2022
2023
2022
NET INCOME
$
574
$
2,009
$
2,047
$
3,482
Unrealized (loss) gain on
debt securities available
for sale
$
(2,060)
$
(5,518)
$
455
$ (14,498)
Reclassification adjustment
for gains included in net
income
-
-
(12)
-
Other comprehensive
(loss) income before
tax
(2,060)
(5,518)
443
(14,498)
Income tax benefit
(expense) related to items
of other comprehensive
(loss) income
507
1,160
(109)
3,567
Other comprehensive (loss)
income
$
(1,553)
(1,553)
$
(4,358)
(4,358)
$
334
334
$ (10,931)
(10,931)
TOTAL COMPREHENSIVE
(LOSS) INCOME
$
(979)
$
(2,349)
$
2,381
$
(7,449)
See accompanying notes to consolidated financial statements.
5
Disclaimer
BNCCORP Inc. published this content on 11 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 August 2023 19:09:06 UTC.