Tri-County Financial Group, Inc. Reports Fourth Quarter 2022 Financial Results

TYFG,TYFG

MENDOTA, Ill., Feb. 13, 2023 /PRNewswire/ -- Tri-County Financial Group, Inc. (The Company) (OTCQX: TYFG) today announced financial results for the fourth quarter of 2022.

Net income for the fourth quarter of 2022 was $2.3 million ($0.92 per share), compared to $1.9 million ($0.79 per share) during the fourth quarter of 2021.

Net interest income was $10.7 million during the quarter ended December 31, 2022, compared to $10.8 million in the same period of 2021, a decrease of 1%. The net interest margin was 3.27% for the fourth quarter of 2022, compared to 3.32% for the fourth quarter of 2021. 

Noninterest income was $2.5 million for the quarter ended December 31, 2022, a decrease of $1.4 million, or 36%, compared to $3.9 million during the quarter ended December 31, 2021. The decrease can be primarily attributed to lower mortgage volume from the prior year.  First State Mortgage standalone had a net loss of $2.3 million as of December 31, 2022, compared to net income of $3.1 million at December 31, 2021. 

Noninterest expense was $10.2 million during the quarter ended December 31, 2022, compared to $11.8 million for the fourth quarter of 2021, a decrease of $1.6 million, or 14%.  The decrease is primarily related to lower levels of mortgage production costs in 2022. 

Total loans increased $187.3 million, or 19%, to $1.211 billion at December 31, 2022, from $1.024 billion at December 31, 2021.  Commercial real estate and agricultural lending activity increased compared to the prior year.  Nonperforming loans as a percent of total loans were 0.25% as of December 31, 2022, down from 0.31% at December 31, 2021.

There was no provision for loan loss during the quarter ended December 31, 2022.  The allowance for loan loss ended at $13.1 million at December 31, 2022 and represented 1.09% of gross loans compared to 1.60% at December 31, 2021.  During the beginning of COVID, the provision was increased to account for potential losses and an increase in default payments.  However, asset quality continues to remain strong over two years later and a $4 million negative provision was made during the year to account for the excess in our reserve and as we prepare for the Current Expected Credit Losses (CECL) new accounting standards that was adopted on January 1, 2023.

Deposits decreased $68.9 million, or 6%, year-over-year.  The investment portfolio rose $84.9 million or 62% year over year and totaled $221.6 million at December 31, 2022.

The Company's capital levels remain solid as of December 31, 2022, with a Tier 1 leverage ratio of 9.20%, down from 9.26% last year.

On December 13, 2022, the Board of Directors declared a regular dividend of $0.20 per share and a special dividend of $0.10 per share, payable January 12, 2023, to shareholders of record on December 31, 2022.

In announcing the results, President and CEO, Tim McConville, stated "Our fourth quarter numbers again represented solid earnings performance for 2022 despite a slowdown in the mortgage banking industry.  Asset quality as measured by nonperforming loans to total loans is stable as we continue to see strong performance with our borrowers. We continue to monitor our local competition to offer competitive rates as our main focus is to provide exceptional community banking services.  Our main goal is to focus on increasing shareholder value in the years to come.  We continue to believe that our diversified balance sheet and lines of business are well positioned with increases in short term rates.  Overall, we anticipate loan demand to remain strong, and we look forward to supporting the credit needs of our businesses and communities."

Tri-County Financial Group, Inc. is the parent holding company for First State Bank, with offices in Mendota, Batavia, Bloomington, Champaign, Geneva, LaMoille, McNabb, North Aurora, Ottawa, Peru, Princeton, Rochelle, Shabbona, St. Charles, Streator, Sycamore, Waterman and West Brooklyn. First State Bank is the parent company of First State Mortgage, LLC and First State Insurance. Tri-County Financial Group, Inc. shares are quoted under the symbol TYFG and traded on OTCQX.

 

TRI COUNTY FINANCIAL GROUP, INC. & SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

QUARTER ENDED DECEMBER 31ST

(000s omitted, except share data)



















2022



2021













Interest Income





$    14,629



$    12,036

Interest Expense





3,891



1,203

Net Interest Income





10,738



10,833

Provision for Loan Losses





0



450

Net Interest Income After Provision for Loan Losses



10,738



10,383













Other Income





2,462



3,938

FDIC Assessments





102



73

Other Expenses





10,133



11,697

Income Before Income Taxes





2,965



2,551













Applicable Income Taxes





684



608

Security Gains (Losses)





-



-

Net Income (Loss)





$      2,281



$      1,943













Basic Net Income Per Share





$        0.92



$        0.79

Weighted Average Shares Outstanding



2,489,871



2,474,226



** Certain reclassifications have been made to preserve consistency between the periods presented.

 

TRI-COUNTY FINANCIAL GROUP, INC. & SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(000s omitted, except share data)











ASSETS



12/31/2022



12/31/2021

Cash and Due from Banks



$             35,008



$           172,804

Federal Funds Sold



1,803



13,097

Investment Securities



221,578



136,719

Loans and Leases



1,211,203



1,023,940

  Less:  Reserve for Loan Losses



(13,089)



(16,121)

Loans, Net



1,198,114



1,007,819

Bank Premises & Equipment



27,443



27,014

Intangibles



8,759



8,817

Other Real Estate Owned



132



2,117

Accrued Interest Receivable



5,951



4,674

Other Assets



39,450



31,514











        TOTAL ASSETS



$        1,538,238



$        1,404,575











LIABILITIES









Demand Deposits



184,826



177,943

Interest-bearing Demand Deposits



421,584



413,694

Savings Deposits



254,765



276,528

Time Deposits



277,606



339,541

        Total Deposits



1,138,781



1,207,706

Repurchase Agreements



23,374



26,401

Fed Funds Purchased



0



0

FHLB and Other Borrowings



220,000



5,000

Interest Payable



73



76

Subordinated Debt



9,785



9,761

         Total Repos & Borrowings



253,232



41,238

Other Liabilities



12,384



18,238

Dividends Payable



757



752

           TOTAL LIABILITIES



$        1,405,154



$        1,267,934











CAPITAL









Common Stock



2,491



2,476

Surplus



25,437



25,518

Preferred Stock



0



0

Retained Earnings



116,664



106,664

FASB 115 Adjustment



(11,508)



1,983

            TOTAL CAPITAL



133,084



136,641











TOTAL LIABILITIES AND CAPITAL



$        1,538,238



$        1,404,575











Book Value Per Share



$              53.43



$              55.17

Tangible Book Value Per Share



$              49.92



$              51.61

Bid Price



$              48.70



$              48.59

Period End Outstanding Shares



2,490,623



2,476,553

 

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SOURCE Tri-County Financial Group, Inc.