LINKBANCORP, Inc. Announces Record First Quarter Earnings

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April 29, 2024 4:30 PM EDT

HARRISBURG, Pa., April 29, 2024 /PRNewswire/ -- LINKBANCORP, Inc. (NASDAQ: LNKB) (the "Company"), the parent company of LINKBANK (the "Bank") reported net income of $5.73 million, or $0.15 per diluted share, for the quarter ended March 31, 2024.  Excluding merger related expenses, adjusted earnings were $5.77 million1, or $0.161 per diluted share for the first quarter of 2024.

First Quarter 2024 Highlights

  • Net interest income before provision was $24.9 million for the first quarter of 2024, compared to $14.3 million in the fourth quarter of 2023. Net interest margin grew from 3.55% for the fourth quarter of 2023 to 4.03% for the first quarter of 2024.
  • Total deposits increased to $2.39 billion at March 31, 2024 from $2.30 billion at December 31, 2023 and $984.5 million at March 31, 2023. Total loans increased slightly to $2.25 billion at March 31, 2024, compared to $2.24 billion at December 31, 2023 and $945.4 million at March 31, 2023.
  • The Company enhanced its on-balance sheet liquidity with cash and cash equivalents at March 31, 2024 of $172.3 million, up from $80.2 million at December 31, 2023 and $51.7 million at March 31, 2023.
  • Asset quality remained strong as non-performing assets were $6.7 million, representing 0.25% of total assets at March 31, 2024, compared to $7.3 million, representing 0.27% of total assets at December 31, 2023. The allowance for credit losses-loans was 1.06% of total loans at March 31, 2024, unchanged from December 31, 2023.

Given that the merger with Partners Bancorp ("Partners") was completed on November 30, 2023 (the "Merger"), fourth quarter 2023 results do not represent a full quarter of comparable combined earnings.  Reported results prior to the fourth quarter of 2023 reflect legacy LINKBANCORP results only.

"We are very pleased by the strong results of the first quarter of 2024, which represents the first full quarter following completion of our merger with Partners Bancorp," said Andrew Samuel, Chief Executive Officer of LINKBANCORP.  "Following a very successful conversion during the fourth quarter, we have continued to make significant progress in integrating our institutions and executing on the actions needed to achieve the operational efficiencies and other benefits of this combination, including recognizing a 14% reduction in headcount since the close of the transaction and positive steps in implementing our bank-wide branch rationalization initiative."  He continued, "Loan activity during the quarter was consistent with our expectations and solid deposit growth will support growing loan pipelines."  

(1)

See Appendix A – Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP measure.

 

Income Statement
Net interest income before the provision for credit losses for the first quarter of 2024 increased to $24.9 million compared to $14.3 million in the fourth quarter of 2023. Net interest margin was 4.03% for the first quarter of 2024 compared to 3.55% for the fourth quarter of 2023.  The average yield on interest-earning assets increased by 56 basis points over the prior linked quarter, due to an increase in the average yield on loans of 45 basis points to 6.48% as well as a 61 basis points increase in the average yield on securities to 4.71%.  Cost of funds increased slightly to 2.33% for the first quarter of 2024 compared to 2.28% for the fourth quarter of 2023.  The increase in net interest income was primarily a result of the Merger, including the lower cost deposits from legacy Partners and the impact of purchase accounting accretion.

Noninterest income increased quarter-over-quarter to $1.7 million for the first quarter of 2024 compared to $1.2 million for the fourth quarter of 2023.  This increase was primarily related to a $395 thousand increase in service charges on deposit accounts resulting from the Merger, offset by a decrease in gain on sale of loans.  

Noninterest expense for the first quarter of 2024 was $19.3 million compared to $22.3 million for the fourth quarter of 2023.  Excluding one-time charges related to the Merger of $56 thousand in the first quarter of 2024 and $9.5 million in the fourth quarter of 2023, noninterest expense increased by $6.4 million to $19.2 million in the first quarter of 2024 from $12.8 million in the fourth quarter1.  This increase was primarily due to the increased headcount and infrastructure resulting from the Merger, and amortization of the core deposit intangible assets.  Salary and employee benefit expenses for the first quarter of 2024 included costs for personnel retained for post-conversion support through January 2024, as well as increased incentive compensation expense. 

Income tax expense was $1.6 million for the first quarter of 2024, reflecting an effective tax rate of 21.8%.

(1)

See Appendix A – Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP measure.

Balance Sheet
Total assets were $2.78 billion at March 31, 2024 compared to $2.67 billion at December 31, 2023 and $1.21 billion at March 31, 2023.  Deposits and net loans as of March 31, 2024 totaled $2.39 billion and $2.22 billion, respectively, compared to deposits and net loans of $2.30 billion and $2.22 billion, respectively, at December 31, 2023 and $984.5 million and $934.8 million, respectively, at March 31, 2023.

Total loans increased $4.3 million during the first quarter of 2024 to $2.25 billion at March 31, 2024, with muted net loan growth reflecting the continued integration following the completion of the Merger and introduction of the Company to new markets.  Total commercial loan commitments for the first quarter of 2024 were $77.0 million with funded balances of $45.2 million.  The average commercial loan commitment originated during the first quarter of 2024 totaled approximately $664 thousand with an average outstanding funded balance of $390 thousand.

Cash and cash equivalents increased $92.1 million to $172.3 million at March 31, 2024 compared to $80.2 million at December 31, 2023 and $51.7 million at March 31, 2023.  The increase was due to deposit growth outpacing net loan growth, as well as an increase in long term FHLB borrowings as the Company took steps to extend the maturity of its liabilities.

Deposits at March 31, 2024 totaled $2.39 billion, an increase of $87.6 million compared to $2.30 billion at December 31, 2023. This increase was driven by significant growth in interest bearing deposits, including a $14.5 million increase in money market and savings accounts and $39.4 million increase in retail time deposits.  Additionally, brokered certificates of deposits increased by $27.2 million to $146.7 million at March 31, 2024, as compared to at December 31, 2023, which includes $75 million related to an interest rate swap executed in 2023.  

Shareholders' equity increased from $265.8 million at December 31, 2023 to $268.2 million at March 31, 2024 primarily as a result of a $2.9 million increase in retained earnings.  Book value per share increased to $7.18 at March 31, 2024 compared to $7.12 at December 31, 2023.  Tangible book value per share increased $0.10 to $5.00 at March 31, 2024 compared to $4.90 at December 31, 20231.

(1)

See Appendix A – Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP measure.

Asset Quality
In the first quarter of 2024, the Company recorded a provision for credit losses of $40 thousand, compared to a $9.8 million provision for credit losses in the fourth quarter of 2023, which included $9.7 million associated with the day one accounting provision required for loans acquired not designated as purchase credit deteriorated in the Merger.

Asset quality metrics remain strong. As of March 31, 2024, the Company's non-performing assets were $6.7 million, representing 0.25% of total assets.  Loans 30-89 days past due at March 31, 2024 were $15.3 million, representing 0.68% of total loans.  

The allowance for credit losses-loans was $23.8 million, or 1.06% of total loans at March 31, 2024, which remained consistent quarter over quarter with the allowance for credit losses-loans of $23.8 million, or 1.06% of total loans at December 31, 2023.  The allowance for credit losses-loans to nonperforming assets was 357.18% at March 31, 2024, compared to 327.82% at December 31, 2023.

Capital
The Bank's regulatory capital ratios were well in excess of regulatory minimums to be considered "well capitalized" as of March 31, 2024. The Bank's Total Capital Ratio and Tier 1 Capital Ratio were 11.04% and 10.24%, respectively, at March 31, 2024, compared to 10.62% and 9.92%, respectively, at December 31, 2023 and 13.53% and 12.32%, respectively, at March 31, 2023. The Company's ratio of Tangible Common Equity to Tangible Assets was 6.91%1 at March 31, 2024.

(1)

See Appendix A – Reconciliation to Non-GAAP Financial Measures for the computation of this non-GAAP measure.

ABOUT LINKBANCORP, Inc.
LINKBANCORP, Inc. was formed in 2018 with a mission to positively impact lives through community banking. Its subsidiary bank, LINKBANK, is a Pennsylvania state-chartered bank serving individuals, families, nonprofits and business clients throughout Pennsylvania, Maryland, Delaware, Virginia, and New Jersey through 29 client solutions centers and www.linkbank.com. LINKBANCORP, Inc. common stock is traded on the Nasdaq Capital Market under the symbol "LNKB". For further company information, visit ir.linkbancorp.com.

Forward Looking Statements
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of current or historical fact and involve substantial risks and uncertainties. Words such as "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "projects," "may," "will," "should," and other similar expressions can be used to identify forward-looking statements. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. Among the risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements include, but are not limited to the following: costs or difficulties associated with newly developed or acquired operations; risks related to the integration of the merger with Partners; changes in general economic trends, including inflation and changes in interest rates; increased competition; changes in consumer demand for financial services; our ability to control costs and expenses; adverse developments in borrower industries and, in particular, declines in real estate values; changes in and compliance with federal and state laws that regulate our business and capital levels; our ability to raise capital as needed; and the effects of any cybersecurity breaches. The Company does not undertake, and specifically disclaims, any obligation to publicly revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements, except as required by law. Accordingly, you should not place undue reliance on forward-looking statements. 

LB-E
LB-D

LINKBANCORP, Inc. and Subsidiaries

Consolidated Balance Sheet (Unaudited)














March 31, 2024


December 31, 2023


September 30, 2023


June 30, 2023


March 31, 2023

(In Thousands, except share and per share data)











ASSETS











Noninterest-bearing cash equivalents


$             13,552


$                  13,089


$                    5,447


$             4,736


$                 4,545

Interest-bearing deposits with other institutions


158,731


67,101


62,532


118,438


47,190

Cash and cash equivalents


172,283


80,190


67,979


123,174


51,735

Certificates of deposit with other banks


—


—


249


498


745

Securities available for sale, at fair value


133,949


115,490


78,779


83,620


86,804

Securities held to maturity, net of allowance for credit losses


36,109


36,223


37,266


38,220


38,986

Loans receivable, gross


2,245,817


2,241,533


978,912


969,533


945,371

Allowance for credit losses - loans


(23,842)


(23,767)


(9,964)


(10,228)


(10,526)

Loans receivable, net


2,221,975


2,217,766


968,948


959,305


934,845

Investments in restricted bank stock


4,286


3,965


3,107


5,544


4,134

Premises and equipment, net


22,233


22,279


6,414


6,292


6,497

Right-of-Use Asset – Premises


14,663


15,598


9,727


9,896


10,058

Bank-owned life insurance


49,230


48,847


24,732


24,554


24,384

Goodwill and other intangible assets


81,494


82,701


36,715


36,774


36,833

Deferred tax asset


23,463


24,153


6,880


6,571


6,749

Accrued interest receivable and other assets


24,579


22,113


14,899


14,024


12,188

TOTAL ASSETS


$        2,784,264


$             2,669,325


$             1,255,695


$      1,308,472


$          1,213,958

LIABILITIES











Deposits:











Demand, noninterest bearing


$           653,719


$                655,953


$                210,404


$         240,729


$             204,495

Interest bearing


1,732,310


1,642,520


831,368


794,113


780,003

Total deposits


2,386,029


2,298,473


1,041,772


1,034,842


984,498

Other Borrowings


40,499


10,590


15,000


74,899


31,250

Subordinated Debt


61,573


61,444


40,354


40,398


40,441

Lease liabilities


15,445


16,464


9,728


9,896


10,058

Accrued interest payable and other liabilities


12,475


16,558


7,490


5,985


6,130

TOTAL LIABILITIES


2,516,021


2,403,529


1,114,344


1,166,020


1,072,377

SHAREHOLDERS' EQUITY











Preferred stock


—


—


—


—


—

Common stock


369


369


162


162


250

Surplus


263,577


263,310


127,856


127,818


127,659

Retained earnings


7,724


4,843


19,062


19,039


18,911

Accumulated other comprehensive loss


(3,427)


(3,209)


(5,729)


(4,567)


(5,239)

          Total equity attributable to parent


268,243


265,313


141,351


142,452


141,581

         Noncontrolling interest in consolidated subsidiary


—


483


—


—


—

TOTAL SHAREHOLDERS' EQUITY


268,243


265,796


141,351


142,452


141,581

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY


$        2,784,264


$             2,669,325


$             1,255,695


$      1,308,472


$          1,213,958

Common shares outstanding


37,348,151


37,340,700


16,235,871


16,228,440


16,221,692












 

LINKBANCORP, Inc. and Subsidiaries

Consolidated Statements of Operations (Unaudited)










Three Months Ended



3/31/2024


12/31/2023


3/31/2023

(In Thousands, except share and per share data)







INTEREST AND DIVIDEND INCOME







Loans receivable, including fees


$           36,125


$           21,461


$           11,762

Other


2,650


1,642


1,228

Total interest and dividend income


38,775


23,103


12,990

INTEREST EXPENSE







Deposits


11,847


7,445


4,517

Other Borrowings


1,152


727


87

Subordinated Debt


892


615


432

Total interest expense


13,891


8,787


5,036

NET INTEREST INCOME BEFORE
   PROVISION FOR CREDIT LOSSES


24,884


14,316


7,954

Provision for credit losses


40


9,844


293

NET INTEREST INCOME AFTER
   PROVISION FOR CREDIT LOSSES


24,844


4,472


7,661

NONINTEREST INCOME







Service charges on deposit accounts


780


385


199

Bank-owned life insurance


383


250


140

Net realized losses on the sale of debt securities


—


—


(2,370)

Gain on sale of loans


50


166


—

Other


516


374


178

Total noninterest income


1,729


1,175


(1,853)

NONINTEREST EXPENSE







Salaries and employee benefits


11,118


8,262


4,120

Occupancy


1,578


911


707

Equipment and data processing


1,826


1,201


693

Professional fees


748


536


381

FDIC insurance


352


198


159

Bank Shares Tax


591


323


278

Intangible amortization


1,206


484


61

Merger & system conversion related expenses


56


9,496


587

Other


1,775


874


751

Total noninterest expense


19,250


22,285


7,737

Income (loss) before income tax expense (benefit)


7,323


(16,638)


(1,929)

Income tax expense (benefit)


1,597


(3,641)


(376)

NET  INCOME (LOSS)


$             5,726


$         (12,997)


$           (1,553)








EARNINGS (LOSS) PER SHARE, BASIC


$               0.15


$             (0.56)


$             (0.10)

 EARNINGS (LOSS) PER SHARE, DILUTED


$               0.15


$             (0.56)


$             (0.10)

WEIGHTED-AVERAGE COMMON SHARES
   OUTSTANDING,







BASIC


36,962,005


23,063,202


15,480,951

DILUTED


37,038,230


23,063,202


15,480,951








 

LINKBANCORP, Inc. and Subsidiaries

Financial Highlights (Unaudited)












For the Three Months Ended



('Dollars In Thousands, except per share data)

3/31/2024


12/31/2023


3/31/2023





Operating Highlights










Net Income (loss)

$                 5,726


$              (12,997)


$            (1,553)





Net Interest Income

24,884


14,316


7,954





Provision for Credit Losses

40


9,844


293





Non-Interest Income

1,729


1,175


(1,853)





Non-Interest Expense

19,250


22,285


7,737





Earnings (loss) per Share, Basic

0.15


(0.56)


(0.10)





Adjusted Earnings per Share, Basic (2)

0.16


0.09


0.05





Earnings (loss) per Share, Diluted

0.15


(0.56)


(0.10)





Adjusted Earnings per Share, Diluted (2)

0.16


0.09


0.05















Selected Operating Ratios










Net Interest Margin

4.03 %


3.55 %


2.95 %





Annualized Return on Assets ("ROA")

0.86 %


-2.96 %


-0.53 %





Adjusted ROA2

0.86 %


0.49 %


0.27 %





Annualized Return on Equity ("ROE")

8.63 %


-28.24 %


-4.56 %





Adjusted ROE2

8.70 %


4.70 %


2.30 %





Efficiency Ratio

72.33 %


143.86 %


126.82 %





Adjusted Efficiency Ratio3

72.12 %


82.56 %


84.41 %





Noninterest Income to Avg. Assets

0.26 %


0.27 %


-0.63 %





Noninterest Expense to Avg. Assets

2.88 %


5.08 %


2.65 %


























3/31/2024


12/31/2023


9/30/2023


6/30/2023


3/31/2023

Financial Condition Data










Total Assets

$           2,784,264


$           2,669,325


$       1,255,695


$          1,308,472


$        1,213,958

Loans Receivable, Net

2,221,975


2,217,766


968,948


959,305


934,845











     Noninterest-bearing Deposits

653,719


655,953


210,404


240,729


204,495

     Interest-bearing Deposits

1,732,310


1,642,520


831,368


794,113


780,003

Total Deposits

2,386,029


2,298,473


1,041,772


1,034,842


984,498











Selected Balance Sheet Ratios










Total Capital Ratio1

11.04 %


10.62 %


12.92 %


12.88 %


13.53 %

Tier 1 Capital Ratio1

10.24 %


9.92 %


12.37 %


12.29 %


12.32 %

Common Equity Tier 1 Capital Ratio1

10.24 %


9.92 %


12.37 %


12.29 %


12.32 %

Leverage Ratio1

9.23 %


14.13 %


10.71 %


10.41 %


10.78 %

Tangible Common Equity to Tangible Assets4

6.91 %


7.08 %


8.58 %


8.31 %


8.90 %

Tangible Book Value per Share5

$                   5.00


$                   4.90


$               6.44


$                  6.51


$                6.46











Asset Quality Data










Non-performing Assets

$                 6,675


$                 7,250


$             2,958


$                2,856


$              2,398

Non-performing Assets to Total Assets

0.25 %


0.27 %


0.24 %


0.22 %


0.20 %

Non-performing Loans to Total Loans

0.30 %


0.32 %


0.30 %


0.29 %


0.25 %

Allowance for Credit Losses - Loans ("ACLL")

$               23,842


$               23,767


$             9,964


$              10,228


$             10,526

ACLL to Total Loans

1.06 %


1.06 %


1.02 %


1.05 %


1.11 %

ACLL to Nonperforming Assets

357.18 %


327.82 %


336.85 %


358.12 %


438.95 %

Net chargeoffs (recoveries)

$                      70


$                    195


$                (12)


$                   (97)


$                   (2)












(1) - These capital ratios have been calculated using bank-level capital

(2) - This is a non-GAAP financial measure.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.

(3) - The efficiency ratio, as adjusted represents noninterest expense divided by the sum of net interest income and noninterest income, excluding gains or losses from securities sales and merger related expenses.  This is a non-GAAP financial measure.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.

(4) - We calculate tangible common equity as total shareholders' equity less goodwill and other intangibles, and we calculate tangible assets as total assets less goodwill and other intangibles.  This is a non-GAAP financial measure.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.

(5) - We calculate tangible book value per common share as total shareholders' equity less goodwill and other intangibles, divided by the outstanding number of shares of our common stock at the end of the relevant period.  Tangible book value per common share is a non-GAAP financial measure, and, as we calculate tangible book value per common share, the most directly comparable GAAP financial measure is book value per common share.  See our reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures at the end of this release.











 

LINKBANCORP, Inc. and Subsidiaries

Net Interest Margin - Quarter-To-Date (Unaudited)
















For the Three Months Ended March 31,



2024


2023

(Dollars in thousands)


Avg Bal


Interest (2)


Yield/Rate


Avg Bal


Interest (2)


Yield/Rate

Int. Earn. Cash


$                  82,420


$                       898


4.38 %


$                  36,470


$                       275


3.06 %

Securities













Taxable (1)


114,896


1,391


4.87 %


81,899


653


3.23 %

Tax-Exempt


42,984


457


4.28 %


38,368


377


3.98 %

Total Securities


157,880


1,848


4.71 %


120,267


1,030


3.47 %

Total Cash Equiv. and Investments


240,300


2,746


4.60 %


156,737


1,305


3.38 %

Total Loans (3)


2,240,714


36,125


6.48 %


936,510


11,762


5.09 %

Total Earning Assets


2,481,014


38,871


6.30 %


1,093,247


13,067


4.85 %

Other Assets


210,826






90,938





Total Assets


$             2,691,840






$             1,184,185





Interest bearing demand


$                424,781


$                    1,942


1.84 %


$                251,103


$                    1,188


1.92 %

Money market demand


587,455


3,174


2.17 %


245,563


1,350


2.23 %

Time deposits


608,192


6,731


4.45 %


290,605


1,979


2.76 %

Total Borrowings


140,621


2,044


5.85 %


49,246


519


4.27 %

Total Interest-Bearing Liabilities


1,761,049


13,891


3.17 %


836,517


5,036


2.44 %

Non Int Bearing Deposits


632,637






192,135





Total Cost of Funds


$             2,393,686


$                  13,891


2.33 %


$             1,028,652


$                    5,036


1.99 %

Other Liabilities


31,359






17,508





Total Liabilities


$             2,425,045






$             1,046,160





Shareholders' Equity


$                266,795






$                138,025





Total Liabilities & Shareholders' Equity


$             2,691,840






$             1,184,185





Net Interest Income/Spread (FTE)




24,980


3.13 %




8,031


2.41 %

Tax-Equivalent Basis Adjustment




(96)






(77)



Net Interest Income




$                  24,884






$                    7,954



Net Interest Margin






4.03 %






2.95 %


(1) Taxable income on securities includes income from available for sale securities and income from certificates of deposits with other banks.

(2) Income stated on a tax equivalent basis which is a non-GAAP measure and reconciled to GAAP at the bottom of the table

(3) Includes the balances of nonaccrual loans














 

LINKBANCORP, Inc. and Subsidiaries

Net Interest Margin - Linked Quarter-To-Date (Unaudited)
















For the Three Months Ended



March 31, 2024


December 31, 2023

(Dollars in thousands)


Avg Bal


Interest (2)


Yield/Rate


Avg Bal


Interest (2)


Yield/Rate

Int. Earn. Cash


$                   82,420


$               898


4.38 %


$         63,572


$                405


2.53 %

Securities













Taxable (1)


114,896


1,391


4.87 %


88,632


951


4.26 %

Tax-Exempt


42,984


457


4.28 %


38,269


362


3.75 %

Total Securities


157,880


1,848


4.71 %


126,901


1,313


4.10 %

Total Cash Equiv. and Investments


240,300


2,746


4.60 %


190,473


1,718


3.58 %

Total Loans (3)


2,240,714


36,125


6.48 %


1,411,129


21,461


6.03 %

Total Earning Assets


2,481,014


38,871


6.30 %


1,601,602


23,179


5.74 %

Other Assets


210,826






138,537





Total Assets


$              2,691,840






$    1,740,139





Interest bearing demand


$                 424,781


$            1,942


1.84 %


$       328,342


$             1,746


2.11 %

Money market demand


587,455


3,174


2.17 %


367,821


2,287


2.47 %

Time deposits


608,192


6,731


4.45 %


348,580


3,412


3.88 %

Total Borrowings


140,621


2,044


5.85 %


113,492


1,342


4.69 %

Total Interest-Bearing Liabilities


1,761,049


13,891


3.17 %


1,158,235


8,787


3.01 %

Non Int Bearing Deposits


632,637






371,051





Total Cost of Funds


$              2,393,686


$          13,891


2.33 %


$    1,529,286


$             8,787


2.28 %

Other Liabilities


31,359






28,244





Total Liabilities


$              2,425,045






$    1,557,530





Shareholders' Equity


$                 266,795






$       182,609





Total Liabilities & Shareholders' Equity


$              2,691,840






$    1,740,139





Net Interest Income/Spread (FTE)




24,980


3.13 %




14,392


2.73 %

Tax-Equivalent Basis Adjustment




(96)






(76)



Net Interest Income




$          24,884






$           14,316



Net Interest Margin






4.03 %






3.55 %


(1) Taxable income on securities includes income from available for sale securities and income from certificates of deposits with other banks.

(2) Income stated on a tax equivalent basis which is a non-GAAP measure and reconciled to GAAP at the bottom of the table

(3) Includes the balances of nonaccrual loans














 

LINKBANCORP, Inc. and Subsidiaries

Loans Receivable Detail (Unaudited)












(In Thousands)


March 31, 2024


December 31,  2023


September 30, 2023


June 30, 2023


March 31, 2023

 Agriculture and farmland loans


$        67,359


$          65,861


$          50,584


$          50,552


$    53,301

 Construction loans


194,391


178,483


65,836


75,628


67,934

 Commercial & industrial loans


218,724


238,343


115,572


104,869


99,356

 Commercial real estate loans











      Multifamily


190,146


180,788


111,853


113,254


111,461

      Owner occupied


489,467


501,732


160,929


154,520


151,407

      Non-owner occupied


589,731


580,972


257,344


254,691


249,638

 Residential real estate loans











      First liens


403,300


402,433


172,481


170,271


166,478

      Second liens and lines of credit


71,060


70,747


27,870


30,148


30,720

 Consumer and other loans


16,810


16,756


11,869


11,308


10,472

 Municipal loans


4,473


5,244


4,137


3,929


4,292



2,245,461


2,241,359


978,475


969,170


945,059

Deferred costs


356


174


437


363


312

Total loans receivable


$   2,245,817


$     2,241,533


$        978,912


$        969,533


$  945,371












 

LINKBANCORP, Inc. and Subsidiaries



Investments in Securities Detail (Unaudited)














March 31, 2024



(In Thousands)


Amortized
Cost


Net
Unrealized Gains
(Losses)


Fair
Value



Available for Sale:









US Government Agency securities


$        12,743


$                   106


$        12,849



US Government Treasury securities


4,942


2


4,944



Obligations of state and political subdivisions


49,231


(3,264)


45,967



Mortgage-backed securities in government-sponsored entities


71,276


(3,316)


67,960



Other securities


2,250


(21)


2,229





$      140,442


$              (6,493)


$      133,949














 Amortized
Cost


 Net Unrealized Gains
(Losses)


 Fair Value


 Allowance for
Credit Losses

Held to Maturity:









Corporate debentures


$        15,000


$              (1,455)


$        13,545


$            (507)

Structured mortgage-backed securities


21,616


(892)


20,724


-



$        36,616


$              (2,347)


$        34,269


$            (507)












December 31, 2023



(In Thousands)


Amortized
Cost


Net
Unrealized Gains
(Losses)


Fair
Value



Available for Sale:









US Government Agency securities


$        12,711


$                   274


$        12,985



US Government Treasury securities


4,925


17


4,942



Obligations of state and political subdivisions


49,640


(2,595)


47,045



Mortgage-backed securities in government-sponsored entities


50,795


(2,614)


48,181



Other securities


2,301


36


2,337





$      120,372


$              (4,882)


$      115,490














Amortized
Cost


Net Unrealized Gains
(Losses)


Fair Value


Allowance for
Credit Losses

Held to Maturity:









Corporate debentures


$        15,000


$              (1,592)


$        13,408


$            (512)

Structured mortgage-backed securities


21,735


(907)


20,828


-



$        36,735


$              (2,499)


$        34,236


$            (512)










 

LINKBANCORP, Inc. and Subsidiaries

Deposits Detail (Unaudited)












(In Thousands)


March 31, 2024


December 31, 2023


September 30, 2023


June 30, 2023


March 31, 2023

Demand, noninterest-bearing


$      653,719


$      655,953


$      210,404


$     240,729


$   204,495

Demand, interest-bearing


447,412


438,765


273,673


237,114


250,944

Money market and savings


591,982


577,448


258,334


254,632


241,858

Time deposits, $250 and over


147,898


134,324


51,563


57,194


51,855

Time deposits, other


398,365


372,572


172,798


185,121


165,310

Brokered deposits


146,653


119,411


75,000


60,052


70,036



$   2,386,029


$   2,298,473


$   1,041,772


$  1,034,842


$   984,498























Average Deposits Detail, for the Three Months Ended (Unaudited)












(In Thousands)


March 31, 2024


December 31, 2023


September 30, 2023


June 30, 2023


March 31, 2023

Demand, noninterest-bearing


$      632,637


$      371,051


$      209,054


$     209,072


$   192,135

Demand, interest-bearing


424,781


328,342


254,725


243,539


251,103

Money market and savings


587,455


367,821


254,849


244,355


245,563

Time deposits


518,929


317,747


236,869


236,059


212,478

Brokered deposits


89,263


30,832


28,705


63,339


78,127



$   2,253,065


$   1,415,793


$      984,202


$     996,364


$   979,406












 

Appendix A – Reconciliation to Non-GAAP Financial Measures

This document contains supplemental financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Management uses these non-GAAP measures in its analysis of the Company's performance. These measures should not be considered a substitute for GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with GAAP. Management believes the presentation of non-GAAP financial measures that exclude the impact of specified items provide useful supplemental information that is essential to a proper understanding of the Company's financial condition and results. Non-GAAP measures are not formally defined under GAAP, and other entities may use calculation methods that differ from those used by us. As a complement to GAAP financial measures, our management believes these non-GAAP financial measures assist investors in comparing the financial condition and results of operations of financial institutions due to the industry prevalence of such non-GAAP measures. See the tables below for a reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures.

Adjusted Return on Average Assets


For the Three Months Ended

(Dollars in thousands)

3/31/2024


12/31/2023


3/31/2023

Net income (loss)

$             5,726


$         (12,997)


$           (1,553)

Average assets

2,691,840


1,740,139


1,184,185

Return on average assets (annualized)

0.86 %


-2.96 %


-0.53 %

Net income (loss)

5,726


(12,997)


(1,553)

Net losses on sale of securities

-


-


2,370

Tax effect at 21%

-


-


(498)

Merger & system conversion related expenses

56


9,496


587

Tax effect at 21%

(12)


(1,994)


(123)

Non-purchase credit deteriorated provision for credit losses

-


9,694


-

Tax effect at 21%

-


(2,036)


-

Adjusted Net Income (Non-GAAP)

5,770


2,163


783

Average assets

2,691,840


1,740,139


1,184,185

Adjusted return on average assets (annualized) (Non-GAAP)

0.86 %


0.49 %


0.27 %







 

Adjusted Return on Average Shareholders' Equity


For the Three Months Ended

(Dollars in thousands)

3/31/2024


12/31/2023


3/31/2023

Net income (loss)

$          5,726


$    (12,997)


$      (1,553)

Average shareholders' equity

266,795


182,609


138,025

Return on average shareholders' equity (annualized)

8.63 %


-28.24 %


-4.56 %

Net income (loss)

5,726


(12,997)


(1,553)

Net losses (gains) on sale of securities

-


-


2,370

Tax effect at 21%

-


-


(498)

Merger & system conversion related expenses

56


9,496


587

Tax effect at 21%

(12)


(1,994)


(123)

Non-purchase credit deteriorated provision for credit losses

-


9,694


-

Tax effect at 21%

-


(2,036)


-

Adjusted Net Income (Non-GAAP)

5,770


2,163


783

Average shareholders' equity

266,795


182,609


138,025

Adjusted return on average shareholders' equity (annualized) (Non-GAAP)

8.70 %


4.70 %


2.30 %







 

Adjusted Efficiency Ratio


For the Three Months Ended

(Dollars in thousands)

3/31/2024


12/31/2023


3/31/2023

GAAP-based efficiency ratio

72.33 %


143.86 %


126.82 %

Net interest income

$      24,884


$      14,316


$           7,954

Noninterest income

1,729


1,175


(1,853)

Less: net gains (losses) on sales of securities

-


-


(2,370)

Adjusted revenue (Non-GAAP)

26,613


15,491


8,471

Total noninterest expense

19,250


22,285


7,737

Less: Merger & system conversion related expenses

56


9,496


587

Adjusted non-interest expense

19,194


12,789


7,150

Efficiency ratio, as adjusted (Non-GAAP)

72.12 %


82.56 %


84.41 %







 

Adjusted Earnings Per Share


For the Three Months Ended

(Dollars in thousands, except per share data)

3/31/2024


12/31/2023


3/31/2023

GAAP-Based Earnings  (Loss) Per Share, Basic

$              0.15


$        (0.56)


$           (0.10)

GAAP-Based  Earnings (Loss) Per Share, Diluted

$              0.15


$        (0.56)


$           (0.10)

Net  Income (Loss)

$            5,726


$    (12,997)


$         (1,553)

Net losses on sale of securities

-


-


2,370

Tax effect at 21%

-


-


(498)

Merger & system conversion related expenses

56


9,496


587

 Tax effect at 21%

(12)


(1,994)


(123)

Non-purchase credit deteriorated provision for credit losses

-


9,694


-

 Tax effect at 21%

-


(2,036)


-

Adjusted Net Income (Non-GAAP)

5,770


2,163


783

Adjusted Earnings per Share, Basic (Non-GAAP)

$              0.16


$          0.09


$             0.05

Adjusted Earnings per Share, Diluted (Non-GAAP)

$              0.16


$          0.09


$             0.05







 

Tangible Common Equity and Tangible Book Value



3/31/2024


12/31/2023


9/30/2023


6/30/2023


3/31/2023

Tangible Common Equity


(Dollars in thousands, except for share data)

Total shareholders' equity


$         268,243


$         265,796


$         141,351


$         142,452


$       141,581

Adjustments:











Goodwill


(56,968)


(56,968)


(35,842)


(35,842)


(35,842)

Other intangible assets


(24,526)


(25,733)


(873)


(932)


(991)

Tangible common equity (Non-GAAP)


$         186,749


$         183,095


$         104,636


$         105,678


$       104,748

Common shares outstanding


37,348,151


37,340,700


16,235,871


16,228,440


16,221,692

Book value per common share


$               7.18


$               7.12


$               8.71


$               8.78


$             8.73

Tangible book value per common share
(Non-GAAP)


$               5.00


$               4.90


$               6.44


$               6.51


$             6.46

Tangible Assets











Total assets


$      2,784,264


$      2,669,325


$      1,255,695


$      1,308,472


$    1,213,958

Adjustments:











Goodwill


(56,968)


(56,968)


(35,842)


(35,842)


(35,842)

Other intangible assets


(24,526)


(25,733)


(873)


(932)


(991)

Tangible assets (Non-GAAP)


$      2,702,770


$      2,586,624


$      1,218,980


$      1,271,698


$    1,177,125

Tangible common equity to tangible assets (Non-GAAP)


6.91 %


7.08 %


8.58 %


8.31 %


8.90 %












 

Adjusted Pre-tax, Pre-provision Net Income (Non-GAAP)


For the Three Months Ended

(Dollars in thousands, except per share data)

3/31/2024


12/31/2023


3/31/2023

Net Income (Loss) - GAAP

$            5,726


$    (12,997)


$         (1,553)

Net losses on sale of securities

-


-


2,370

Tax effect at 21%

-


-


(498)

Merger & system conversion related expenses

56


9,496


587

 Tax effect at 21%

(12)


(1,994)


(123)

Adjusted Net Income (Loss) (Non-GAAP)

5,770


(5,495)


783

Income tax expense (benefit)

1,597


(3,641)


(376)

 Provision for credit losses

40


9,844


293

Tax effect included in Adjusted Net Income

12


1,994


621

Adjusted Pre-tax, Pre-provision Net Income (Non-GAAP)

$            7,419


$        2,702


$           1,321







 

Contact:
Nicole Davis
Corporate and Investor Relations Officer
717.803.8895
[email protected] 

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/linkbancorp-inc-announces-record-first-quarter-earnings-302130596.html

SOURCE LINKBANCORP, Inc.


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