30.07.2021 12:00:00

Community Bankers Trust Corporation Reports Results for Second Quarter 2021

RICHMOND, Va., July 30, 2021 /PRNewswire/ -- Community Bankers Trust Corporation (the "Company") (NASDAQ: ESXB), the holding company for Essex Bank (the "Bank"), today reported results for the quarter ended June 30, 2021.

Community Bankers Trust Corporation logo. (PRNewsFoto/Community Bankers Trust Corporation) (PRNewsfoto/COMMUNITY BANKERS TRUST CORP.)

FINANCIAL HIGHLIGHTS

  • Net income was $5.4 million for the quarter ended June 30, 2021, compared with net income of $6.6 million in the first quarter of 2021 and net income of $4.2 million in the second quarter of 2020.
  • There was no provision for loan losses recorded for the quarter. In the first quarter of 2021 the allowance for loan losses reflected a reserve recovery of $1.4 million.
  • Net interest income was $14.5 million for the second quarter of 2021, a linked quarter increase of $419,000, or 3.0%.
  • Interest on deposits declined $218,000 on a linked quarter basis, and the associated cost of funds declined from 0.58% to 0.48%.
  • Merger related expenses of $570,000 were incurred in the second quarter.
  • Diluted earnings per share were $0.24 for the second quarter of 2021 compared with $0.30 for the first quarter of 2021 and $0.18 for the second quarter of 2020.
  • Return on average assets (ROA) was 1.28% for the second quarter of 2021 compared with 1.60% for the first quarter of 2021 and 1.06% for the second quarter of 2020. For the first six months, the ROA was 1.44% in 2021 and 0.88% for 2020.
  • Return on average equity (ROE) was 12.46% for the second quarter of 2021 compared with 15.46% for the first quarter of 2021 and 10.46% for the second quarter of 2020. For the first six months, the ROE was 13.95% for 2021 compared with 8.30% for 2020.

OPERATING HIGHLIGHTS

  • Loans, excluding purchased credit impaired (PCI) loans, declined $10.9 million, or 0.9%, during the second quarter of 2021. Loans grew $26.5 million, or 2.3%, year over year.
  • In April 2021, the Company sold an item included in other real estate owned at March 31, 2021 in the amount of $3.8 million.
  • Nonperforming assets were $3.9 million at June 30, 2021, $4.8 million lower than one year earlier. The ratio of nonperforming assets to loans and other real estate was 0.33% at June 30, 2021 compared with 0.65% at March 31, 2021 and 0.74% one year earlier.
  • Deposits grew $49.5 million, or 3.4%, during the second quarter of 2021, and have grown $125.2 million, or 9.2%, year over year.
  • Noninterest bearing deposits grew $60.9 million, or 21.9%, year over year.
  • Net interest margin was 3.58% in the second quarter of 2021 compared with 3.66% in the first quarter of 2021 and 3.40% in the second quarter of 2020. The net interest margin was 3.62% for the first six months of 2021 compared with 3.53% for the same period in 2020.
  • PPP loan balances, net of fees, decreased $15.7 million during the second quarter of 2021 and were $52.0 million at June 30, 2021 compared with $49.3 million at December 31, 2020 and $83.5 million at June 30, 2020.
  • As a result of the deposit growth noted above, total securities and cash and equivalents grew $76.4 million during the second quarter and substantially increased liquidity.

On June 2, 2021, the Company entered into a merger agreement with United Bankshares, Inc. ("United"), the parent company of United Bank.  Under the merger agreement, United will acquire 100% of the outstanding shares of the Company's common stock in exchange for shares of United's common stock.  The exchange ratio will be fixed at 0.3173 of United's shares for each share of the Company.  The merger is expected to close in the fourth quarter of 2021, subject to satisfaction of customary closing conditions, including receipt of regulatory approvals and approval by the Company's shareholders.  Upon closing, the Company will merge into United, and Essex Bank will merge into United Bank, with United and United Bank being the surviving entities. 

MANAGEMENT COMMENTS 

Rex L. Smith, III, President and Chief Executive Officer, stated, "The balance sheet continues to strengthen with asset quality and liquidity at the best levels in the history of the Company.  Net interest margin continues to improve and while year to date loan growth is below expectations we remain positive for the rest of 2021."

Smith added, "Noninterest expenses were up for the quarter as we prepare for the pending merger.  We are excited to become a part of United Bank as their enhanced product offerings and size will make us much more competitive in our markets. The merger is expected to become effective in December of this year, pending all closing conditions."

RESULTS OF OPERATIONS

Overview

Linked Quarter Basis
Net income was $5.4 million for the second quarter of 2021, compared with net income of $6.6 million in the first quarter of 2021. Earnings per share were $0.24 basic and fully diluted for the second quarter of 2021 and $0.30 basic and fully diluted for the first quarter of 2021. Provision for loan losses reflected a credit of $1.4 million for the first quarter of 2021 compared with no provision in the second quarter of 2021. Continued improvement in credit quality and loan risk ratings was the driver behind the recapture in the first quarter of previous provision. There was a more stable economic climate in the first and second quarters of 2021 compared with each quarter in 2020. Net interest income increased by $419,000 in the second quarter compared with the first quarter of 2021. Net interest income was positively affected by a continuation of decreasing costs in interest expense, which declined $215,000 on a linked quarter basis, and by an increase of $204,000 in interest and dividend income. Noninterest income decreased $167,000 on a linked quarter basis while noninterest expenses increased by $437,000, driven by merger related expenses of $570,000. Income tax expense decreased $368,000 in the second quarter of 2021 compared with the prior quarter. Details of the linked quarter financial performance of the Company are presented below.

Year-over-Year Second Quarter
Net income in the second quarter of 2021 increased $1.3 million when compared to the same period in 2020.  Net income was $5.4 million in the second quarter of 2021, with earnings per share of $0.24 basic and fully diluted.  Net income for the second quarter of 2020 was $4.2 million, with earnings per share of $0.19 basic and $0.18 fully diluted. There was an increase of $2.1 million in net interest income, primarily from a decline in interest expense of $1.8 million in the second quarter of 2021 compared with the same period one year earlier. Provision for loan losses decreased $900,000 year over year and is reflective of no provision taken during the second quarter of 2021. Offsetting these increases to net income were an increase of $1.3 million in noninterest expenses and a decrease of $155,000 in noninterest income. There was also an increase of $297,000 in income tax expense year over year. Details of the year-over-year financial performance of the Company are presented below.

Year-over-Year Six Months
Net income of $12.1 million for the first six months of 2021 reflects an increase of $6.5 million, or 116.5%, over net income of $5.6 million for the same period in 2020. Provision for loan losses reflects a reserve recovery of $1.4 million for the first six months of 2021 compared with a provision of $4.2 million during the early stage of the COVID-19 pandemic for the first six months of 2020. Interest expense declined $3.8 million and was $3.3 million for the first six months of 2021 compared with $7.1 million for the first six months of 2020. Smaller increases were in interest and dividend income, which increased $227,000, and in noninterest income, which increased $138,000 in the first six months of 2021 compared with the same period in 2020. Offsetting these increases to net income were an increase of $1.5 million in noninterest expenses, which were $17.9 million for the first six months of 2021, and $1.7 million greater expense in income taxes, which were $3.0 million for the first six months of 2021.

The following table presents summary income statements for the three months ended June 30, 2021, March 31, 2021 and June 30, 2020 and six months ended June 30, 2021 and June 30, 2020.

SUMMARY INCOME STATEMENT











(Unaudited)

(Dollars in thousands)













For the three months ended


For the six months ended



30-Jun-21


31-Mar-21


30-Jun-20


30-Jun-21


30-Jun-20

Interest income

$

16,064

$

15,860

$

15,751

$

31,924

$

31,697

Interest expense


1,567


1,782


3,391


3,349


7,099

Net interest income


14,497


14,078


12,360


28,575


24,598

(Recovery of) provision for loan losses


0


(1,400)


900


(1,400)


4,200

Net interest income after (recovery of ) provision for loan losses


14,497


15,478


11,460


29,975


20,398

Noninterest income


1,461


1,628


1,616


3,089


2,951

Noninterest expense


9,192


8,755


7,873


17,947


16,467

Income before income taxes


6,766


8,351


5,203


15,117


6,882

Income tax expense


1,340


1,708


1,043


3,048


1,307

Net income

$

5,426

$

6,643

$

4,160

$

12,069

$

5,575












EPS Basic

$

0.24

$

0.30

$

0.19

$

0.54

$

0.25

EPS Diluted

$

0.24

$

0.30

$

0.18

$

0.53

$

0.25

Fully Diluted share count


22,733


22,416


22,508


22,574


22,550












Return on average assets, annualized


1.28%


1.60%


1.06%


1.44%


0.88%

Return on average equity, annualized


12.46%


15.46%


10.46%


13.95%


8.30%

Net Interest Income

Linked Quarter Basis
Net interest income was $14.5 million for the quarter ended June 30, 2021. This was a linked quarter increase of $419,000, or 3.0%. Interest and dividend income on a linked quarter basis increased $204,000, or 1.3%, to $16.1 million for the second quarter of 2021.  Interest and dividend income on taxable securities increased $228,000 in the second quarter compared with the first quarter of 2021 and was $1.7 million. Excess liquidity was invested in the second quarter, and the average balance of taxable securities increased by $37.6 million, or 16.0%, over the prior quarter. Interest income with respect to loans, excluding PCI loans, increased $46,000, or 0.3%, during the second quarter of 2021 when compared with the first quarter of 2021. Interest income on PCI loans decreased $72,000 on a linked quarter basis as the average balance declined $3.4 million.

The average balance of loans, excluding PCI loans, increased by $13.3 million, or 1.1%, on a linked quarter basis, to $1.205 billion for the second quarter of 2021. However, loans that paid off late in the second quarter of 2021 reduced the period end balance below the average for the second quarter, and loans totaled $1.192 billion at period end.  The yield on loans for the second quarter of 2021 was 4.39% compared with 4.48% in the first quarter of 2021. The yield on all loans for the second quarter of 2021 was 4.58% and 4.68% for the first quarter of 2021.

Interest income on securities was $2.0 million in the second quarter of 2021 compared with $1.8 million in the first quarter of 2021. Interest bearing bank balances income was $54,000 in the second quarter of 2021 compared with $60,000 in the first quarter of 2021.

Interest income on securities on a tax-equivalent basis equaled $2.1 million for the second quarter of 2021 and $1.9 million for the first quarter of 2021. The tax-equivalent yield on the securities portfolio was 2.63% in the second quarter of 2021 compared with 2.65% in the first quarter of 2021. The average balance of securities increased $38.7 million during the second quarter of 2021 as excess liquidity was invested by the Company. As a result of these changes in rate and volume, the yield on earning assets decreased from 4.12% in the first quarter of 2021 to 3.97% in the second quarter of 2021.

Interest expense of $1.6 million in the second quarter of 2021 was a decrease of $215,000, or 12.1%, on a linked quarter basis.  Interest on deposits decreased $218,000, or 13.9%. The cost of interest bearing deposits decreased from 0.58% in the first quarter of 2021 to 0.48% in the second quarter of 2021. The Company's cost of interest bearing liabilities of 0.52% in the second quarter of 2021 was a decrease of 10 basis points from the prior quarter when the cost of interest bearing liabilities was 0.62%. 

With the changes in net interest income noted above, the tax-equivalent net interest margin decreased on a linked quarter basis and was 3.58% in the second quarter of 2021 compared with 3.66% in the first quarter of 2021. The interest spread was 3.45% for the current quarter compared with 3.50% in the prior quarter. The Company also examined the effects on the net interest margin without the effects of PPP net fees, interest income and average balances. Excluding these PPP related items from the net interest margin calculation would have resulted in a margin of 3.54% in the second quarter of 2021 compared with the actual margin of 3.58%.  The same exclusion of PPP related items would have resulted in a margin of 3.59% in the first quarter of 2021 compared with the actual margin of 3.66%. The yield on the loan portfolio would have been 4.38% in the second quarter of 2021 when excluding the PPP related items versus the actual yield of 4.39%. The yield on the loan portfolio would have been 4.43% in the first quarter of 2021 when excluding the PPP related items versus the actual yield of 4.48% with the PPP related items. The yield on earning assets would have been 3.94% without the PPP related items as opposed to the actual yield of 3.97% when including the PPP related items.  For the first quarter of 2021, the yield on earning assets would have been 4.07% without the PPP related items as opposed to the actual yield of 4.12% when including the PPP related items.

Year-over-Year Second Quarter
Net interest income increased $2.1 million, or 17.3%, from the second quarter of 2020 to the second quarter of 2021. Net interest income was $14.5 million in the second quarter of 2021 compared with $12.4 million for the same period in 2020.  Interest and dividend income increased $313,000, or 2.0%, over this time period. In the second quarter of 2021, $562,000 in PPP net origination fees were recognized as income versus $304,000 in the same period of 2020. Interest and fees on loans were $13.2 million in the second quarter of 2021, an increase of $184,000, or 1.4%, over the same period in 2020. Interest and fees on PCI loans decreased by $278,000 and were $784,000 in the second quarter of 2021. Securities income was $2.0 million in the second quarter of 2021, an increase of $394,000 over the same period in 2020. Income on interest on deposits in other banks increased by $13,000 year over year.

The average balance of the loan portfolio, excluding PCI loans, increased by $58.7 million year over year and averaged $1.205 billion for the second quarter of 2021. The average balance of the PCI portfolio declined $10.2 million during the year-over-year comparison period. The average balance of securities increased by $82.8 million in the second quarter of 2021 compared with the same period one year earlier. The average balance of total earning assets increased $165.0 million, or 11.2%, from the second quarter of 2020 to the second quarter of 2021. The yield on earning assets decreased from 4.33% in the second quarter of 2020 to 3.97% in the second quarter of 2021. The change in yield on earning assets was the culmination of decreases in the yield on all loans, from 4.80% in the second quarter of 2020 to 4.58% in the second quarter of 2021, in the tax-equivalent yield on securities, from 2.88% in the second quarter of 2020 to 2.63% in the second quarter of 2021, and in the yield on interest bearing bank balances, from 0.31% to 0.25% year over year.  

Interest expense decreased $1.8 million, or 53.8%, when comparing the second quarter of 2021 and the second quarter of 2020. Interest expense on deposits decreased $1.8 million, or 57.7%, as the cost declined from 1.20% in the second quarter of 2020 to 0.48% for the same period in 2021. The average balance of interest bearing deposits increased $60.2 million, or 5.6%. This growth was from non-maturity deposit sources. First, there was an increase of $86.7 million, or 47.7%, in the average balance of interest bearing checking accounts, which averaged $268.5 million in the second quarter of 2021. Additionally, there was an increase of $81.5 million in the average balance of savings and money market accounts from the second quarter of 2020 to the same period in 2021. Offsetting these increases was a decrease of $108.0 million in the average balance of time deposits, to $535.5 million for the second quarter of 2021. FHLB and other borrowings costs were stable over the time frame and were 1.22% in the second quarter of 2021 compared with 1.15% for the same period in 2020. All of the above contributed to the reduction of interest expense for interest bearing liabilities by $1.8 million despite an increase of $60.1 million in the average amount outstanding. Also noteworthy is that, although not an interest bearing category, a sizeable amount of funding was generated in the second quarter of 2021 by a year-over-year average balance increase of $83.7 million in noninterest bearing deposits. The amount of liquidity in the banking system, along with lower interest rates and a shift in deposit balances, decreased the cost of interest bearing liabilities from 1.19% in the second quarter of 2020 to 0.52% in the second quarter of 2021.

The tax-equivalent net interest margin increased 18 basis points, from 3.40% in the second quarter of 2020 to 3.58% in the second quarter of 2021. Likewise, the interest spread increased from 3.14% to 3.45% over the same time period.  The increase in the margin was precipitated by a decrease of 36 basis points in the yield on earning assets compared with a greater decline of 67 basis points in the cost of interest bearing liabilities applied against growth of $165.0 million, or 11.2%, in earning assets. As noted in the linked quarter discussion above, without the effects of PPP related items the net interest margin would have been 3.54% in the second quarter of 2021.

Year-over-Year Six Months
Net interest income was $28.6 million for the first six months of 2021.  This is an increase of $4.0 million, or 16.2%, from net interest income of $24.6 million for the first six months of 2020. Interest and dividend income increased by $227,000 over this time frame. Interest and dividend income was impacted by volume increases offset by a decline in yield. First, there was an increase of $248,000, or 1.0%, in interest and fees on loans, which increased as a result of growth of $92.5 million, or 8.4%, in the average balance of loans in 2021 over 2020. The yield on loans declined from 4.73% for the first six months of 2020 to 4.43% for the same period in 2021.  Interest and fees on PCI loans declined by $519,000, or 24.0%. The yield on the PCI portfolio was 15.16% for the first six months of 2021 compared with 13.94% for the first six months of 2020. Interest and dividends on securities increased by $494,000 in the first six months of 2021 compared with the same period in 2020. The average balance of the securities portfolio increased $67.7 million, or 28.7%, and the yield declined from 2.98% for the first six months of 2020 to 2.64% for the same period in 2021. The yield on earning assets was 4.04% for the first six months of 2021, a decline of 50 basis points from 4.54% in the first six months of 2020. The yield on total loans, which includes PCI loans and PPP loans, declined from 4.99% for the first six months of 2020 compared to 4.63% for the same period in 2021.

Interest expense of $3.3 million for the first six months of 2021 was a decrease of $3.8 million, or 52.8%, from interest expense of $7.1 million for the first six months of 2020. The cost of interest bearing liabilities decreased over this time frame from 1.28% for the first six months of 2020 to 0.57% for the same period in 2021. Interest on deposits decreased $3.7 million due to a decline in the rate paid from 1.27% for the first six months of 2020 to 0.53% for the first six months of 2021. The average balance of interest bearing liabilities increased over this time frame by $64.7 million, or 5.8%. Short term borrowing expense decreased by $23,000, and the cost of FHLB and other borrowings decreased by $38,000, or 8.0%, as the rate paid decreased from 1.36% for the first six months of 2020 to 1.23% for the first six months of 2021.

The changes noted to interest income and interest expense led to an increase in the net interest margin from 3.53% for the first six months of 2020 to 3.62% for the same period in 2021. The interest spread also increased over this time frame from 3.26% in 2020 to 3.47% in 2021. Excluding PPP related items from the net interest margin calculation would have resulted in a margin of 3.57% for the first six months of 2021 compared with the actual margin of 3.62%. Excluding PPP related items from the net interest margin calculation for the first six months of 2020 would have resulted in a margin of 3.54% for the first six months of 2020 compared with the actual margin of 3.53%.  The yield on the loan portfolio for the first six months of 2021 would have been 4.40% excluding PPP related items versus the actual yield of 4.43%. The yield on the loan portfolio for the first six months of 2020 would have been 4.78% excluding PPP related items versus the actual yield of 4.73% with PPP related items. The yield on earning assets for the first six months of 2021 would have been 4.00% without PPP related items as opposed to the actual yield of 4.04%. The yield on earning assets for the first six months of 2020 would have been 4.58% without PPP related items as opposed to the actual yield of 4.54% that included the PPP related items.

The following table compares the Company's net interest margin, on a tax-equivalent basis, for the three months ended June 30, 2021, March 31, 2021 and June 30, 2020 and the six months ended June 30 2021 and June 30, 2020.

NET INTEREST MARGIN










(Unaudited)

(Dollars in thousands)












For the three months ended




30-Jun-21



31-Mar-21



30-Jun-20


Average interest earning assets

$

1,633,672


$

1,569,107


$

1,468,702


Interest income

$

16,064


$

15,860


$

15,751


Interest income - tax-equivalent

$

16,153


$

15,947


$

15,844


Yield on interest earning assets


3.97

%


4.12

%


4.33

%

Average interest bearing liabilities

$

1,199,036


$

1,162,577


$

1,138,908


Interest expense

$

1,567


$

1,782


$

3,391


Cost of interest bearing liabilities


0.52

%


0.62

%


1.19

%

Net interest income

$

14,497


$

14,078


$

12,360


Net interest income - tax-equivalent

$

14,586


$

14,165


$

12,453


Interest spread


3.45

%


3.50

%


3.14

%

Net interest margin


3.58

%


3.66

%


3.40

%










 

 



For the six months ended






30-Jun-21



30-Jun-20





Average interest earning assets

$

1,601,567


$

1,406,804





Interest income

$

31,924


$

31,697





Interest income - tax-equivalent

$

32,100


$

31,881





Yield on interest earning assets


4.04

%


4.54

%




Average interest bearing liabilities

$

1,180,908


$

1,116,246





Interest expense

$

3,349


$

7,099





Cost of interest bearing liabilities


0.57

%


1.28

%




Net interest income

$

28,575


$

24,598





Net interest income - tax-equivalent

$

28,751


$

24,782





Interest spread


3.47

%


3.26

%




Net interest margin


3.62

%


3.53

%




Provision for Loan Losses

The Company records a separate provision for loan losses for its loan portfolio, excluding PCI loans, and the PCI loan portfolio.  There was no provision for loan losses in the second quarter of 2021 compared with a recovery of $1.4 million in the first quarter of 2021 on the loan portfolio, excluding PCI loans. This compares with $900,000 in provision for loan losses for the second quarter of 2020. The recovery of $1.4 million of provision for loan losses for the first six months of 2021 compares with a provision of $4.2 million for the first six months of 2020.  

The recovery of provision recorded in the first quarter of 2021 was due to continued improvement in the quality of the loan portfolio and an overall improvement in the risks associated with the potential economic impact of the COVID-19 pandemic, which continued through the second quarter of 2021. Beginning in the first quarter of 2020, management performs a review of each loan within the portfolio to identify, and monitor on a going forward basis, those borrowers that management believed to be possibly impacted by the economy. Loans identified with increased risk are aggregated by loan type. During the first quarter of 2020, this analysis indicated a risk grade migration in a number of loan categories that led to a heightened risk level in the loan portfolio. The impact of the loans' risk grade migration was applied to the allowance for loan loss calculation, which led to the provision for loan losses of $3.3 million for the first quarter of 2020. The Company determined that no provision was necessary for the third or fourth quarters of 2020 after a similar analysis and review process. Despite the stay-at-home orders, shut downs, higher than historical unemployment levels and slow growth, the loan portfolio has exhibited a trend over the last year of lower nonaccrual loans, lower other real estate loans and very low charge-offs.

With respect to the PCI portfolio, no provision was recorded during the first six months of 2021 or 2020 due to the stable nature of the portfolio's performance. Additional discussion of loan quality is presented below.

Noninterest Income

Linked Quarter Basis
Noninterest income was $1.5 million for the second quarter of 2021, a $167,000 decrease compared with the first quarter of 2021. Mortgage loan income decreased $85,000 on a linked quarter basis and was $235,000 in the second quarter of 2021 compared with $320,000 in the prior quarter. Gain (loss) on securities transactions, net were losses totaling $28,000 in the second quarter of 2021 compared with gains of $16,000 in the first quarter of 2021. Service charges and fees of $651,000 in the second quarter of 2021 declined $28,000 on a linked quarter basis. Other noninterest income decreased $12,000 on a linked quarter basis and was $435,000 for the first quarter of 2021. Income on bank owned life insurance was $168,000 in the second quarter of 2021 and $166,000 in the first quarter of 2021.

Year-over-Year Second Quarter
Noninterest income of $1.5 million in the second quarter of 2021 was a decrease of $155,000, or 9.6%, over the second quarter of 2020. Gains (losses) on securities transactions decreased $270,000 year over year as securities losses of $28,000 were recognized in the second quarter of 2021 compared with gains of $242,000 in the second quarter of 2020. Mortgage loan income of $235,000 in the second quarter of 2021 was a decrease of $138,000 year over year. Offsetting these decreases to noninterest income was an increase of $139,000 in other noninterest income, which was $435,000 in the second quarter of 2021. The increase was driven mainly by an increase of $199,000 in partnership investment income, partially offset by decreases of $39,000 and $48,000 in swap fee and brokerage/commission fee income, respectively. Additionally, there was an increase of $119,000 in service charges and fees, which were $651,000.

Year-over-Year Six Months
Noninterest income was $3.1 million for the first six months of 2021, an increase of $138,000, or 4.7%, over noninterest income of $3.0 million for the first six months of 2020. Other noninterest income was $882,000 for the first six months of 2021, an increase of $290,000 over the same period in 2020. The increase was the result of increases of $312,000 and $141,000 in partnership income and insurance commissions, respectively, net against a decrease of $120,000 in swap fee income. Service charges and fees of $1.3 million for the first six months of 2021 was an increase of $126,000 over the same period in 2020. These increases were primarily offset by a decrease of $215,000 in gain (loss) on securities transactions, net, which were losses of $12,000 for the first six months of 2021 compared with gains of $203,000 for the first six months of 2020. Mortgage loan income was $555,000 for the first six months of 2021, a decrease of $39,000 over the same period in 2020.

Noninterest Expenses

Linked Quarter Basis
Noninterest expenses totaled $9.2 million for the second quarter of 2021, as compared with $8.8 million for the first quarter of 2021, an increase of $437,000, or 5.0%. Other operating expenses increased $752,000, from $1.6 million in the first quarter of 2021 to $2.3 million in the second quarter of 2021. The increase includes $570,000 in merger related expenses from legal, professional and director fees during the second quarter of 2021. Also, there was an assessment of the fair value of a low income housing tax credit investment that resulted in a downward adjustment of $154,000.  Salaries and employee expenses of $5.4 million in the second quarter of 2021 was an increase of $144,000, or 2.8%, on a linked quarter basis. Data processing fees of $741,000 in the second quarter of 2021 is an increase of $133,000 over the linked quarter. Offsetting these increases to noninterest expenses was a decrease of $442,000 in other real estate expenses, net, which were a credit of $431,000 in the second quarter of 2021 and reflect gains on the disposition of other real estate owned in the second quarter of 2021. FDIC assessment of $108,000 in the second quarter of 2021 was a linked quarter decrease of $104,000, reflecting retroactive rate adjustments by the FDIC. Occupancy expenses decreased by $75,000, from $836,000 in the first quarter of 2021 to $761,000 in the second quarter of 2021.

Year-over-Year Second Quarter
Noninterest expenses were $9.2 million for the second quarter of 2021. This is an increase of $1.3 million, or 16.8%, from noninterest expenses of $7.9 million for the second quarter of 2020. The largest component of the increase was an increase in other noninterest expenses, which were $2.3 million in the second quarter of 2021, an increase of $932,000 over the same quarter one year earlier. The increase reflects $570,000 of merger related expenses noted above along with increases of $105,000 and $73,000 in legal and professional fees, respectively. Salaries and employee benefits of $5.4 million in the second quarter of 2021 increased $739,000 over the second quarter of 2020. The second quarter of 2020 was positively affected by credits to internal costs for the volume of PPP loans that were booked in the quarter. Data processing fees of $741,000 in the second quarter of 2021 reflected an increase of $168,000 year over year. Offsetting these increases was a year-over-year decline of $427,000 in other real estate expenses, net, which reflect gains on the disposition of other real estate owned in the second quarter of 2021, in which they were a credit of $431,000. Also offsetting these increases year over year were a decrease of $48,000 in FDIC assessment, which was $108,000 in the second quarter of 2021, a decrease of $28,000 in equipment expenses, which was $317,000, and a decrease of $17,000 in occupancy expenses, which was $761,000.

Year-over-Year Six Months
Noninterest expenses were $17.9 million for the six months ended June 30, 2021, an increase of $1.5 million, or 9.0%, year over year.  Other operating expenses were $3.9 million and increased by $1.0 million in the first six months of 2021 compared with the same period in 2020. Part of the increase is attributed to $570,000 in merger related expenses, $154,000 for the low income housing tax credit investment adjustment, $201,000 increase in legal fees, and $114,000 increase in professional fees incurred during the second quarter of 2021. Salaries and employee benefits of $10.6 million were an increase of $795,000 for the first six months of 2021 over the same period in 2020. Another portion of the increase, $559,000, was the result of the large loan volume of PPP loans in the second quarter of 2020 that generated ASC 310-20 credits to salaries and employee benefits. Data processing fees, which were $1.3 million, increased by $184,000, or 15.8%, for the first six months of 2021 over the same period in 2020. Offsetting these increases was a decrease of $422,000 in other real estate expenses, net, as a result of gains recognized in the second quarter of 2021 on the disposition of other real estate owned. Also offsetting these increases was a decline of $112,000 in equipment expenses, which was $605,000 for the first half of 2021.

The following table compares the Company's other operating expenses included in noninterest expenses for the three months ended June 30, 2021, March 31, 2021, December 31, 2020 and June 30, 2020.

OTHER OPERATING EXPENSES







(Unaudited)

(Dollars in thousands)


For the three months ended



30-Jun-21


31-Mar-21


31-Dec-20


30-Jun-20

Bank franchise tax

$

257

$

257

$

237

$

237

Stationery, printing and supplies


152


168


138


185

Marketing expense


140


89


89


111

Credit expense


92


157


114


162

Outside vendor fees


110


182


146


190

Other expenses


1,593


739


726


527

Total other operating expenses

$

2,344

$

1,592

$

1,450

$

1,412

Income Taxes

Income tax expense was $1.3 million for the second quarter of 2021, compared with income tax expense of $1.7 million and $1.0 million for the first quarter of 2021 and second quarter of 2020, respectively. The effective tax rate for the second quarter of 2021 was 19.8% compared with 20.5% for the first quarter of 2021 and 20.0% for the second quarter of 2020.

Income tax expense was $3.0 million for the first six months of 2021 compared with $1.3 million for the same period in 2020.  The effective tax rate was 20.2% for the first half of 2021 compared with an effective tax rate of 19.0% for the first half of 2020.

FINANCIAL CONDITION

Total assets were $1.754 billion at June 30, 2021 and increased $109.4 million, or 6.7%, when compared with December 31, 2020.  Total loans, excluding PCI loans, were $1.192 billion at June 30, 2021, increasing $9.5 million, or 0.8%, from year end 2020. Total PCI loans were $17.9 million at June 30, 2021 versus $24.0 million at December 31, 2020.

At June 30, 2021, there were $33.5 million in loans under COVID-19 related payment relief. PCI loans comprised $1.4 million of this total.

Loans, net of fees that the Bank originated under the PPP were $52.0 million at June 30, 2021 compared with $67.7 million at March 31, 2021, $49.3 million at December 31, 2020 and $83.5 million at June 30, 2020 during the peak of PPP activity. All of these balances are included in commercial loans.  As a result of the economic conditions that existed during 2020 and the first half of 2021, commercial loans, excluding PPP loans, declined by $3.7 million since December 31, 2020 and $7.0 million since June 30, 2020. Commercial real estate loans, the largest category of loans at $507.0 million, or 42.5% of gross loans outstanding at June 30, 2021, increased $32.1 million, or 6.8%, since December 31, 2020. Residential 1 – 4 family loans declined during the first half of 2021 by $14.3 million, or 7.2%, and ended the period at $182.9 million, or 15.4% of the portfolio.  

The following table shows the composition of the Company's loan portfolio, excluding PCI loans, at June 30, 2021, March 31, 2021, December 31, 2020 and June 30, 2020.

LOANS (excluding PCI loans)

















(Unaudited)

















(Dollars in thousands)

30-Jun-21


31-Mar-21


31-Dec-20


30-Jun-20





Amount

% of
Loans



Amount

% of
Loans



Amount

% of
Loans



Amount

% of
Loans


Mortgage loans on real estate:


















Residential 1-4 family

$

182,929

15.35

%

$

184,286

15.32

%

$

197,228

16.68

%

$

205,787

17.66

%


Commercial


506,951

42.53



504,846

41.98



474,856

40.16



443,923

38.09



Construction and land development


180,215

15.12



161,825

13.45



182,277

15.42



151,529

13.00



Second mortgages


6,893

0.58



6,526

0.54



6,360

0.54



6,136

0.53



Multifamily


72,918

6.12



87,624

7.29



78,158

6.61



76,587

6.57



Agriculture


7,841

0.66



7,947

0.66



6,662

0.56



7,122

0.61



Total real estate loans


957,747

80.36



953,054

79.24



945,541

79.97



891,084

76.46


Commercial loans


224,437

18.83



239,782

19.94



225,386

19.06



262,955

22.57


Consumer installment loans


8,452

0.71



8,595

0.71



9,996

0.85



10,257

0.88


All other loans


1,205

0.10



1,292

0.11



1,439

0.12



1,014

0.09



Gross loans


1,191,841

100.00

%


1,202,723

100.00

%


1,182,362

100.00

%


1,165,310

100.00

%

Allowance for loan losses


(11,006)




(10,828)




(12,340)




(12,238)



Loans, net of unearned income

$

1,180,835



$

1,191,895



$

1,170,022



$

1,153,072



The Company's securities portfolio, excluding restricted equity securities, was $341.6 million at June 30, 2021 and increased $49.1 million during the first half of 2021 and $90.5 million since June 30, 2020. U.S. Treasury issues decreased by $13.3 million during the first half of 2021. U.S. Government agencies increased $21.9 million during the first half of 2021 and were $47.8 million at June 30, 2021. State, county and municipal securities, the largest investment category totaling $171.1 million at June 30, 2021, increased by $24.2 million during the first two quarters of 2021. Asset backed securities, consisting of student loan pools 97% guaranteed by the U.S. Government, increased $10.3 million during the first two quarters of 2021 and were $47.8 million at June 30, 2021. Mortgage backed securities were $38.0 million at June 30, 2021 and have grown by $5.8 million during 2021. Corporate securities were $26.7 million at June 30, 2021.

The Company had cash and cash equivalents of $123.6 million at June 30, 2021 compared with $63.2 million at year end 2020. The majority of this category growth, $56.9 million, occurred in interest bearing bank balances, which were $102.0 million at June 30, 2021, as large amounts of liquidity have been funneled into the banking system through the facilitation of PPP loans by the banking industry and stimulus checks issued by the U.S. Treasury under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act").  

The following table shows the composition of the Company's securities portfolio, excluding equity securities, restricted, at June 30, 2021, December 31, 2020 and June 30, 2020.

SECURITIES PORTFOLIO













 (Unaudited)

(Dollars in thousands)


30-Jun-21


31-Dec-20


30-Jun-20



Amortized
Cost


Fair 
Value


Amortized
Cost


Fair 
Value


Amortized
Cost


Fair 
Value

Securities Available for Sale


























U.S. Treasury issue

$

10,166


10,229

$

23,500

$

23,499

$

21,750

$

21,749

U.S. Government agencies


47,757


47,760


25,880


25,853


20,700


20,281

State, county, and municipal


145,483


151,309


118,612


125,720


103,963


109,669

Mortgage backed securities


36,888


38,024


30,434


32,189


30,391


32,243

Asset backed securities


46,882


47,767


36,841


37,488


23,467


23,150

Corporate


26,150


26,670


26,136


26,598


19,306


19,775

Total securities available for sale

$

313,326


321,759

$

261,403

$

271,347

$

219,577

$

226,867
















30-Jun-21


31-Dec-20


30-Jun-20



Amortized
Cost


Fair
Value


Amortized
Cost


Fair
Value


Amortized
Cost


Fair
Value

Securities Held to Maturity













State, county, and municipal

$

19,824


20,698

$

21,176

$

22,257

$

24,169

$

25,282

Total securities held to maturity

$

19,824


20,698

$

21,176

$

22,257

$

24,169

$

25,282

Interest bearing deposits at June 30, 2021 were $1.149 billion, an increase of $49.3 million, or 4.5%, from December 31, 2020. Interest bearing checking accounts of $285.0 million grew by $45.4 million, or 19.0%, during the first six months of 2021 and $89.6 million, or 45.8%, year over year. Money market deposit accounts were $182.7 million at June 30, 2021 and grew $28.2 million, or 18.3%, during the first six months of 2021 and $34.7 million, or 23.4%, year over year. Savings accounts totaled $142.1 million at June 30, 2021 and grew $17.7 million, or 14.3%, during the first half of 2021. Strong growth in these non-maturity categories for the year has allowed the Bank to react to lower interest rates through proactive repricing in certificates of deposit, the highest costing deposit category.  As a result, there has been a decline in time deposits less than or equal to $250,000, which decreased by $27.0 million, or 6.0%, in the first half of 2021 and were $425.8 million at June 30, 2021. Year over year, time deposits less than or equal to $250,000 declined $66.9 million, or 13.6%. Time deposits over $250,000 declined $15.0 million in the first half of 2021 and were $113.4 million at June 30, 2021. Year over year, time deposits over $250,000 declined by $26.6 million, or 19.0%. Time deposit balances combined were 46.9% of interest bearing deposits at June 30, 2021 and 36.2% of all deposit balances. This is a decline from 52.9% of interest bearing balances and 41.6% of all deposit balances at December 31, 2020. At June 30, 2020, time deposit balances were 58.3% of interest bearing deposits and 46.4% of all deposit balances. The growth in interest bearing checking accounts, money market accounts and savings accounts, as well as in noninterest bearing checking accounts, was $132.2 million during the first half of 2021. A portion of this growth was associated with the PPP loans originated during 2020 and 2021 and stimulus checks issued under the CARES Act, as well as previously postponed business activity that resulted from the COVID-19 stay-at-home orders.

The following table compares the mix of interest bearing deposits at June 30, 2021, March 31, 2021, December 31, 2020 and June 30, 2020.

INTEREST BEARING DEPOSITS









(Unaudited)









(Dollars in thousands)











30-Jun-21


31-Mar-21


31-Dec-20


30-Jun-20

Interest Bearing Checking

$

285,044

$

261,536

$

239,628

$

195,441

MMDA


182,702


171,932


154,503


148,050

Savings


142,110


137,507


124,384


108,602

Time deposits less than or equal to $250,000


425,837


422,372


452,885


492,749

Time deposits over $250,000


113,423


112,038


128,400


140,027

Total interest bearing deposits


1,149,116

$

1,105,385

$

1,099,800

$

1,084,869

FHLB borrowings were $67.5 million at June 30, 2021 compared with $57.8 million at December 31, 2020 and $68.2 million at June 30, 2020. The stable level of FHLB borrowings during 2020 and into 2021 has been due to the FHLB swiftly responding to the March 16, 2020 rate cut of 1.50% to the discount rate by repricing advances downward to ensure low cost liquidity for the banking system. As a result, the Bank has found this level of borrowing to be a stable source of low cost funding. The average rate paid on FHLB borrowings was 1.23% during the first half of 2021. There were no Federal funds purchased at June 30, 2021 or December 31, 2020.    

Shareholders' equity was $179.7 million at June 30, 2021, or 10.3% of total assets, compared with $169.7 million, or 10.3% of total assets, at December 31, 2020.  

Asset Quality – excluding PCI loans

Nonperforming loans were $3.6 million at June 30, 2021, a decrease of $950,000 from December 31, 2020. Nonperforming loans declined $670,000 year over year. Total non-performing assets totaled $3.9 million at June 30, 2021 compared with $8.9 million at December 31, 2020. Non-performing assets declined $4.8 million, or 55.0%, year over year. On April 7, 2021, the Company sold an item included in other real estate owned at March 31, 2021 in the amount of $3.8 million, and this sale was the primary reason for the decline in non-performing assets. There were net recoveries of $66,000 in the first half of 2021.  

The allowance for loan losses equaled 309.6% of nonaccrual loans at June 30, 2021 compared with 276.7% at December 31, 2020. The ratio of nonperforming assets to loans and other real estate owned (OREO) was 0.33% at June 30, 2021 compared with 0.75% at December 31, 2020.

The allowance for loan losses to total loans was 0.92% at June 30, 2021 compared with 1.04% at December 31, 2020 and 1.05% at June 30, 2020. The volume of PPP loans originated since the second quarter of 2020 impacted the ratio.  PPP loans, net of fees, were $52.0 million at June 30, 2021 and $49.3 million at December 31, 2020. At June 30, 2021, when excluding PPP loans, the allowance for loan losses to total loans would have been 0.97%. These loans are fully guaranteed by the SBA in accordance with the CARES Act; therefore, no allowance is required. The Company monitors and adjusts the allowance for loan losses based on loans requiring a reserve. 

The following table reconciles the activity in the Company's allowance for loan losses, by quarter, for the past five quarters.

ALLOWANCE FOR LOAN LOSSES












(Unaudited)












(Dollars in thousands)


2021



2020



Second


First



Fourth


Third


Second



Quarter


Quarter



Quarter


Quarter


Quarter

Allowance for loan losses:












Beginning of period

$

10,828

$

12,340


$

12,328

$

12,238

$

11,819

Provision for loan losses


-


(1,400)



-


-


900

Net (charge-offs) recoveries


178


(112)



12


90


(481)

End of period

$

11,006

$

10,828


$

12,340

$

12,328

$

12,238

The following table sets forth selected asset quality data, excluding PCI loans, and ratios for the dates indicated.

ASSET QUALITY (excluding PCI loans)














(Unaudited)














(Dollars in thousands)








30-Jun-21



31-Mar-21



31-Dec-20


30-Sep-20


30-Jun-20


Nonaccrual loans

$

3,555


$

3,496


$

4,460

$

4,214

$

4,225


Loans past due 90 days and accruing interest


-



33



45


-


-


Total nonperforming loans


3,555



3,529



4,505


4,214


4,225


Other real estate owned


364



4,313



4,361


4,416


4,486


Total nonperforming assets

$

3,919


$

7,842


$

8,866

$

8,630

$

8,711
















Allowance for loan losses to loans


0.92

%


0.90

%


1.04

%

1.05

%

1.05

%

Allowance for loan losses to nonaccrual loans


309.59



309.73



276.68


292.55


289.66


Nonperforming assets to loans and other real estate


0.33



0.65



0.75


0.73


0.74


Net charge-offs/(recoveries) to average loans


(0.06)

%


0.04

%


0.03

%

0.04

%

0.07

%

A further breakout of nonaccrual loans, excluding PCI loans, at June 30, 2021, March 31, 2021, December 31, 2020, and June 30, 2020 is below.

NONACCRUAL LOANS (excluding PCI loans)









(Unaudited)













(Dollars in thousands)
















30-Jun-21


31-Mar-21


31-Dec-20


30-Jun-20

Mortgage loans on real estate:














Residential 1-4 family


$

1,316


$

1,422


$

1,357


$

1,697


Commercial



953



711



730



636


Construction and land development



2



5



44



1,122


Agriculture



-



45



45



51


Total real estate loans


$

2,271


$

2,183


$

2,176


$

3,506

Commercial loans



1,284



1,301



2,264



707

Consumer installment loans



-


$

12



20



12


Gross loans


$

3,555


$

3,496


$

4,460


$

4,225

Capital Requirements

The Bank's ratio of total risk-based capital was 14.1% at June 30, 2021 compared with 13.6% at December 31, 2020.  The tier 1 risk-based capital ratio was 13.3% at June 30, 2021 and 12.7% at December 31, 2020. The Bank's tier 1 leverage ratio was 10.3% at June 30, 2021 and 10.1% at December 31, 2020.  All capital ratios exceed regulatory minimums to be considered well capitalized.  BASEL III introduced the common equity tier 1 capital ratio, which was 13.3% at June 30, 2021 and 12.7% at December 31, 2020.

Earnings Conference Call and Webcast

The Company will host a conference call for interested parties on  Friday, July 30, 2021, at 10:00 a.m. Eastern Time to discuss the financial results for the second quarter of 2021. The public is invited to listen to this conference call by dialing 866-374-8379 at least five minutes prior to the call.  Interested parties may also listen to this conference call through the internet by accessing the "Corporate Overview – Corporate Profile" page of the Company's internet site at www.cbtrustcorp.com.

A replay of the conference call will be available from 12:00 noon Eastern Time on July 30, 2021, until 9:00 a.m. Eastern Time on August 20, 2021. The replay will be available by dialing 877-344-7529 and entering access code 10158479 or through the internet by accessing the "Corporate Overview – Corporate Profile" page of the Company's internet site at www.cbtrustcorp.com.

About Community Bankers Trust Corporation and Essex Bank

Community Bankers Trust Corporation is the holding company for Essex Bank, a Virginia state bank with 24 full-service offices, 18 of which are in Virginia and six of which are in Maryland.  The Bank also operates two loan production offices.

Additional information on the Bank is available on the Bank's website at www.essexbank.com.  For information on Community Bankers Trust Corporation, please visit its website at www.cbtrustcorp.com.

Forward-Looking Statements

This release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. These forward-looking statements include, without limitation, statements with respect to the Company's operations, performance, future strategy and goals. Actual results may differ materially from those included in the forward-looking statements due to a number of factors, including, without limitation, the effects of and changes in the following: the quality or composition of the Company's loan or investment portfolios, including collateral values and the repayment abilities of borrowers and issuers; assumptions that underlie the Company's allowance for loan losses; general economic and market conditions, either nationally or in the Company's market areas; unusual and infrequently occurring events, such as weather-related disasters, terrorist acts or public health events (such as the current COVID-19 pandemic), and of governmental and societal responses to them; the pending merger with United, including its closing on the expected terms and schedule, the costs associated with completing it and integrating the businesses, and the impact on business operations until and through its closing; the interest rate environment; competitive pressures among banks and financial institutions or from companies outside the banking industry; real estate values; the demand for deposit, loan and investment products and other financial services; the demand, development and acceptance of new products and services; the performance of vendors or other parties with which the Company does business; time and costs associated with de novo branching, acquisitions, dispositions and similar transactions; the realization of gains and expense savings from acquisitions, dispositions and similar transactions; consumer profiles and spending and savings habits; levels of fraud in the banking industry; the level of attempted cyber-attacks in the banking industry; the securities and credit markets; costs associated with the integration of banking and other internal operations; the soundness of other financial institutions with which the Company does business; inflation; technology; and legislative and regulatory requirements.  Many of these factors and additional risks and uncertainties are described in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 and other reports filed from time to time by the Company with the Securities and Exchange Commission. This press release speaks only as of its date, and the Company disclaims any duty to update the information in it.

COMMUNITY BANKERS TRUST CORPORATION









CONSOLIDATED BALANCE SHEETS









UNAUDITED









(Dollars in thousands, except per share data)











30-Jun-21


31-Mar-21


31-Dec-20


30-Jun-20

Assets









Cash and due from banks

$

21,414

$

20,836

$

17,845

$

20,530

Interest bearing bank deposits


101,996


74,337


45,118


64,796

Federal funds sold


234


234


222


-

Total cash and cash equivalents


123,644


95,407


63,185


85,326










Securities available for sale, at fair value


321,759


273,126


271,347


226,867

Securities held to maturity, at cost


19,824


20,271


21,176


24,169

Equity securities, restricted, at cost


8,049


8,049


8,436


8,875

Total securities


349,632


301,446


300,959


259,911










Loans held for sale


-


-


-


396










Loans


1,191,841


1,202,723


1,182,362


1,165,310

Purchased credit impaired (PCI) loans


17,943


22,465


24,040


29,507

Allowance for loan losses


(11,006)


(10,828)


(12,340)


(12,238)

Allowance for loan losses – PCI loans


(156)


(156)


(156)


(156)

Net loans


1,198,622


1,214,204


1,193,906


1,182,423










Bank premises and equipment, net


27,297


27,582


27,897


28,713

Bank premises and equipment held for sale


1,507


1,507


1,507


1,589

Right-of-use lease assets


5,053


5,292


5,530


5,999

Other real estate owned


364


4,313


4,361


4,486

Bank owned life insurance


30,363


30,195


30,029


29,687

Other assets


17,731


18,862


17,435


16,474

Total assets

$

1,754,213

$

1,698,808

$

1,644,809

$

1,615,004










Liabilities









Deposits:









Noninterest bearing

$

339,712

$

333,910

$

298,901

$

278,780

Interest bearing


1,149,116


1,105,385


1,099,800


1,084,869

Total deposits


1,488,828


1,439,295


1,398,701


1,363,649










Federal funds purchased


-


-


-


3,268

Federal Home Loan Bank borrowings


67,500


67,667


57,833


68,167

Trust preferred capital notes


4,124


4,124


4,124


4,124

Lease liabilities


5,297


5,545


5,787


6,264

Other liabilities


8,733


9,701


8,710


8,751

Total liabilities


1,574,482


1,526,332


1,475,155


1,454,223










Shareholders' Equity









Common stock (200,000,000 shares authorized $0.01 par value; 22,451,463, 22,219,926, and 22,200,929 shares issued and outstanding, respectively)


225


222


222


223

Additional paid in capital


151,522


150,039


149,822


150,428

Retained earnings


22,811


18,729


13,419


5,900

Accumulated other comprehensive income


5,173


3,486


6,191


4,230

Total shareholders' equity


179,731


172,476


169,654


160,781

Total liabilities and shareholders' equity

$

1,754,213

$

1,698,808

$

1,644,809

$

1,615,004



















 

COMMUNITY BANKERS TRUST CORPORATION









CONSOLIDATED STATEMENTS OF INCOME









UNAUDITED
















(Dollars in thousands)

YTD


Three months ended


YTD


Three months ended


2021


30-Jun-21

31-Mar-21


2020


30-Jun-20

31-Mar-20

Interest and dividend income
















Interest and fees on loans

$

26,346


$

13,196

$

13,150


$

26,098


$

13,012

$

13,086

Interest and fees on PCI loans


1,640



784


856



2,159



1,062


1,097

Interest on deposits in other banks


114



54


60



110



41


69

Interest and dividends on securities
















  Taxable


3,162



1,695


1,467



2,638



1,287


1,351

  Nontaxable


662



335


327



692



349


343

Total interest and dividend income


31,924



16,064


15,860



31,697



15,751


15,946

Interest expense
















Interest on deposits


2,912



1,347


1,565



6,601



3,182


3,419

Interest on borrowed funds


437



220


217



498



209


289

Total interest expense


3,349



1,567


1,782



7,099



3,391


3,708

















Net interest income


28,575



14,497


14,078



24,598



12,360


12,238

(Recovery of) provision for loan losses


(1,400)



-


(1,400)



4,200



900


3,300

Net interest income after (recovery of )

provision for loan losses


29,975



14,497


15,478



20,398



11,460


8,938

















Noninterest income
















Service charges and fees


1,330



651


679



1,204



532


672

Gain (loss) on securities transactions, net


(12)



(28)


16



203



242


(39)

Gain on sale of loans


-



-


-



11



-


11

Income on bank owned life insurance


334



168


166



347



173


174

Mortgage loan income


555



235


320



594



373


221

Other


882



435


447



592



296


296

Total noninterest income


3,089



1,461


1,628



2,951



1,616


1,335

















Noninterest expense
















Salaries and employee benefits


10,560



5,352


5,208



9,765



4,613


5,152

Occupancy expenses


1,597



761


836



1,605



778


827

Equipment expenses


605



317


288



717



345


372

FDIC assessment


320



108


212



281



156


125

Data processing fees


1,349



741


608



1,165



573


592

Other real estate expenses, net


(420)



(431)


11



2



(4)


6

Other operating expenses


3,936



2,344


1,592



2,932



1,412


1,520

Total noninterest expense


17,947



9,192


8,755



16,467



7,873


8,594

















Income before income taxes


15,117



6,766


8,351



6,882



5,203


1,679

Income tax expense


3,048



1,340


1,708



1,307



1,043


264

Net income

$

12,069


$

5,426

$

6,643


$

5,575


$

4,160

$

1,415

 

COMMUNITY BANKERS TRUST CORPORATION







CONSOLIDATED STATEMENTS OF INCOME







UNAUDITED











(Dollars in thousands)

Three months ended


30-Jun-21


31-Mar-21


31-Dec-20


30-Sep-20


30-Jun-20

Interest and dividend income











Interest and fees on loans

$

13,196

$

13,150

$

13,622

$

12,760

$

13,012

Interest and fees on PCI loans


784


856


932


962


1,062

Interest on deposits in other banks


54


60


107


121


41

Interest and dividends on securities











  Taxable


1,695


1,467


1,373


1,362


1,287

  Nontaxable


335


327


337


344


349

Total interest and dividend income


16,064


15,860


16,371


15,549


15,751

Interest expense











Interest on deposits


1,347


1,565


2,151


2,614


3,182

Interest on borrowed funds


220


217


221


222


209

Total interest expense


1,567


1,782


2,372


2,836


3,391












Net interest income


14,497


14,078


13,999


12,713


12,360

(Recovery of) provision for loan losses


-


(1,400)


-


-


900

Net interest income after (recovery of ) provision for loan losses


14,497


15,478


13,999


12,713


11,460












Noninterest income











Service charges and fees


651


679


777


613


532

Gain (loss) on securities transactions, net


(28)


16


3


78


242

Gain on sale of loans


-


-


-


-


-

Income on bank owned life insurance


168


166


171


171


173

Mortgage loan income


235


320


294


228


373

Other


435


447


280


382


296

Total noninterest income


1,461


1,628


1,525


1,472


1,616












Noninterest expense











Salaries and employee benefits


5,352


5,208


5,332


5,041


4,613

Occupancy expenses


761


836


758


815


778

Equipment expenses


317


288


320


330


345

FDIC assessment


108


212


184


174


156

Data processing fees


741


608


632


656


573

Other real estate expenses, net


(431)


11


63


87


(4)

Other operating expenses


2,344


1,592


1,450


1,423


1,412

Total noninterest expense


9,192


8,755


8,739


8,526


7,873












Income before income taxes


6,766


8,351


6,785


5,659


5,203

Income tax expense


1,340


1,708


1,328


1,143


1,043

Net income

$

5,426

$

6,643

$

5,457

$

4,516

$

4,160

 

COMMUNITY BANKERS TRUST CORPORATION















NET INTEREST MARGIN ANALYSIS
















AVERAGE BALANCE SHEETS


















(Unaudited)


















(Dollars in thousands)




















Three months ended June 30, 2021



Three months ended March 31, 2021




Average Balance 
Sheet


Interest
Income /
Expense


Average
Rates
Earned /
Paid



Average
Balance Sheet


Interest
Income /
Expense


Average
Rates
Earned /
Paid


ASSETS:



















Loans, including fees

$

1,204,691


$

13,196


4.39

%


$

1,191,395


$

13,150


4.48

%


PCI loans,  including fees


19,827



784


15.63




23,226



856


14.75



   Total loans


1,224,518



13,980


4.58




1,214,621



14,006


4.68



Interest bearing bank balances


86,130



54


0.25




70,192



60


0.34



Federal funds sold


208



-


0.08




198



-


0.07



Securities (taxable)


272,556



1,695


2.49




234,938



1,467


2.50



Securities (tax exempt)(1)


50,260



424


3.37




49,158



414


3.37



Total earning assets


1,633,672



16,153


3.97




1,569,107



15,947


4.12



Allowance for loan losses


(11,037)









(12,459)








Non-earning assets


104,716









105,946








   Total assets

$

1,727,351








$

1,662,594


























LIABILITIES AND



















SHAREHOLDERS' EQUITY



















Demand - interest bearing

$

268,525


$

119


0.18



$

250,888


$

138


0.22



Savings and money market


323,137



205


0.25




291,779



183


0.25



Time deposits


535,455



1,023


0.77




550,297



1,244


0.92



Total interest bearing deposits


1,127,117



1,347


0.48




1,092,964



1,565


0.58



Short-term borrowings


134



-


0.20




439



-


0.20



FHLB and other borrowings


71,785



220


1.22




69,174



217


1.26



Total interest bearing liabilities


1,199,036



1,567


0.52




1,162,577



1,782


0.62



Noninterest bearing deposits


337,907









314,979








Other liabilities


13,921









13,208








Total liabilities


1,550,864









1,490,764








Shareholders' equity


176,487









171,830








Total liabilities and



















   Shareholders' equity

$

1,727,351








$

1,662,594








Net interest earnings




$

14,586








$

14,165





Interest spread







3.45

%








3.50

%


Net interest margin







3.58

%








3.66

%





















Tax-equivalent adjustment:



















Securities





89









87























(1)  Income and yields are reported on a tax-equivalent basis assuming a federal tax rate of 21%

 

COMMUNITY BANKERS TRUST CORPORATION















NET INTEREST MARGIN ANALYSIS
















AVERAGE BALANCE SHEETS


















(Unaudited)


















(Dollars in thousands)




















Three months ended June 30, 2021



Three months ended June 30, 2020




Average Balance 
Sheet


Interest Income
/ Expense


Average
Rates
Earned /
Paid



Average
Balance Sheet


Interest
Income /
Expense


Average
Rates
Earned /
Paid


ASSETS:



















Loans, including fees

$

1,204,691


$

13,196


4.39

%


$

1,145,956


$

13,012


4.55

%


PCI loans,  including fees


19,827



784


15.63




29,978



1,062


14.01



   Total loans


1,224,518



13,980


4.58




1,175,934



14,074


4.80



Interest bearing bank balances


86,130



54


0.25




52,551



41


0.31



Federal funds sold


208



-


0.08




210




0.07



Securities (taxable)


272,556



1,695


2.49




189,378



1,287


2.72



Securities (tax exempt)(1)


50,260



424


3.37




50,629



442


3.49



Total earning assets


1,633,672



16,153


3.97




1,468,702



15,844


4.33



Allowance for loan losses


(11,037)









(12,007)








Non-earning assets


104,716









109,847








   Total assets

$

1,727,351








$

1,566,542


























LIABILITIES AND



















SHAREHOLDERS' EQUITY



















Demand - interest bearing

$

268,525


$

119


0.18



$

181,789



98


0.22



Savings and money market


323,137



205


0.25




241,646



228


0.38



Time deposits


535,455



1,023


0.77




643,465



2,856


1.78



Total interest bearing deposits


1,127,117



1,347


0.48




1,066,900



3,182


1.20



Short-term borrowings


134



-


0.20




323




0.20



FHLB and other borrowings


71,785



220


1.22




71,685



209


1.15



Total interest bearing liabilities


1,199,036



1,567


0.52




1,138,908



3,391


1.19



Noninterest bearing deposits


337,907









254,216








Other liabilities


13,921









14,396








Total liabilities


1,550,864









1,407,520








Shareholders' equity


176,487









159,022








Total liabilities and



















   Shareholders' equity

$

1,727,351








$

1,566,542








Net interest earnings




$

14,586








$

12,453





Interest spread







3.45

%








3.14

%


Net interest margin







3.58

%








3.40

%





















Tax-equivalent adjustment:



















Securities





89









93























(1)  Income and yields are reported on a tax-equivalent basis assuming a federal tax rate of 21%









 

COMMUNITY BANKERS TRUST CORPORATION















NET INTEREST MARGIN ANALYSIS

















AVERAGE BALANCE SHEETS


















(Unaudited)


















(Dollars in thousands)




















Six months ended June 30, 2021



Six months ended June 30, 2020




Average Balance 
Sheet


Interest
Income /
Expense


Average
Rates
Earned /
Paid



Average
Balance Sheet


Interest
Income /
Expense


Average
Rates
Earned /
Paid


ASSETS:



















Loans, including fees

$

1,198,080


$

26,346


4.43

%


$

1,105,612


$

26,098


4.73

%


PCI loans,  including fees


21,517



1,640


15.16




30,644



2,159


13.94



   Total loans


1,219,597



27,986


4.63




1,136,256



28,257


4.99



Interest bearing bank balances


78,204



114


0.29




34,503



110


0.64



Federal funds sold


203



0


0.07




176



0


0.47



Securities (taxable)


253,851



3,162


2.49




185,859



2,638


2.84



Securities (tax exempt)(1)


49,712



838


3.37




50,010



876


3.51



Total earning assets


1,601,567



32,100


4.04




1,406,804



31,881


4.54



Allowance for loan losses


(11,744)









(10,314)








Non-earning assets


105,329









107,694








   Total assets

$

1,695,152








$

1,504,184


























LIABILITIES AND



















SHAREHOLDERS' EQUITY



















Demand - interest bearing

$

259,755


$

257


0.20



$

176,034


$

192


0.22



Savings and money market


307,545



389


0.25




230,654



508


0.44



Time deposits


542,835



2,266


0.84




638,064



5,901


1.85



   Total interest bearing deposits


1,110,135



2,912


0.53




1,044,752



6,601


1.27



Short-term borrowings


286



0


0.20




2,254



23


2.06



FHLB and other borrowings


70,487



437


1.23




69,240



475


1.36



Total interest bearing liabilities


1,180,908



3,349


0.57




1,116,246



7,099


1.28



Noninterest bearing deposits


326,506









215,044








Other liabilities


13,567









14,290








Total liabilities


1,520,981









1,345,580








Shareholders' equity


174,171









158,604








Total liabilities and



















   shareholders' equity

$

1,695,152








$

1,504,184








Net interest earnings




$

28,751








$

24,782





Interest spread







3.47

%








3.26

%


Net interest margin







3.62

%








3.53

%





















Tax-equivalent adjustment:



















Securities





176









184























(1)  Income and yields are reported on a tax-equivalent basis assuming a federal tax rate of 21%.

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/community-bankers-trust-corporation-reports-results-for-second-quarter-2021-301345022.html

SOURCE Community Bankers Trust Corporation

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