Randolph Bancorp, Inc. Announces Second Quarter 2022 Financial Results

QUINCY, Mass., July 27, 2022 (GLOBE NEWSWIRE) -- Randolph Bancorp, Inc. (the “Company”) (NASDAQ Global Market: RNDB), the holding company for Envision Bank (the “Bank”), today announced net income of $248,000, or $0.05 per basic and diluted share, for the three months ended June 30, 2022 compared to a net loss of $235,000, or $0.05 per basic and diluted share, for the three months ended March 31, 2022 and net income of $1.6 million, or $0.32 per basic share and $0.31 per diluted share, for the three months ended June 30, 2021. Excluding $357,000 in merger expenses, net income on a non-GAAP basis was $605,000, or $0.12 per diluted share, for the three months ended June 30, 2022. Excluding $240,000 in severance expenses, $588,000 in merger expenses, and $290,000 for the reversal of a cease use liability, net income on a non-GAAP basis was $318,000, or $0.06 per diluted share, for the three months ended March 31, 2022. Excluding $145,000 in severance expenses, $71,000 in other outsourcing expenses, and $29,000 in losses on disposals of fixed assets, net income on a non-GAAP basis was $1.8 million, or $0.34 per diluted share, for the three months ended June 30, 2021. Please see the tables attached hereto for a reconciliation of these and other non-GAAP financial measures.

For the six months ended June 30, 2022, net income was $13,000 or $0.00 per basic and diluted share, compared to net income of $5.7 million, or $1.14 per basic share and $1.10 per diluted share, for the six months ended June 30, 2021. Net income on a non-GAAP basis, excluding certain nonrecurring items, was $923,000, or $0.18 per diluted share, for the six months ended June 30, 2022, compared to net income on a non-GAAP basis, excluding other certain nonrecurring items, of $5.9 million, or $1.15 per diluted share, for the six months ended June 30, 2021. Please see the tables attached hereto for a reconciliation of these and other non-GAAP financial measures.

At June 30, 2022, total assets amounted to $774.8 million, compared to $770.3 million at March 31, 2022, an increase of $4.5 million, or 0.6%. Total loans increased by $78.1 million, or 13.3%, to $662.9 million at June 30, 2022 from $584.8 million at March 31, 2022, and loans held for sale decreased by $13.0 million to $9.7 million at June 30, 2022 from $22.7 million at March 31, 2022. Cash and cash equivalents decreased to $14.9 million at June 30, 2022, a decrease of $56.2 million, or 79.0% from $71.1 million as of March 31, 2022, as a result of loan growth and a decrease in Federal Home Loan Bank of Boston (“FHLB”) borrowings of $12.1 million, partially offset by a decrease in loans held for sale. Compared to June 30, 2021, total assets grew $30.6 million, or 4.1%, from $744.1 million. The growth from the prior year period was driven by an increase in total loans of $116.5 million, or 21.3%, partially offset by a decrease in loans held for sale of $64.5 million, or 86.9% and a decrease in cash and cash equivalents of $20.0 million, or 57.3%.

William M. Parent, President and Chief Executive Officer, stated, “During the quarter, we were pleased to obtain shareholder approval for the proposed merger with Hometown Financial Group, Inc. (“Hometown”). We are excited to be joining Hometown and becoming part of a larger organization. I want to thank our employees for their dedication and hard work during this time of transition as we maintain a business-as-usual environment for our customers.”

Second Quarter Operating ResultsNet interest income increased by $744,000, or 14.1%, to $6.0 million for the three months ended June 30, 2022 from $5.3 million for the three months ended March 31, 2022. This increase was primarily due to a 16.6% increase in average balances of 1-4 family residential loans and a 14 basis point improvement in the average yield earned on these loans. The yield earned on interest-earning assets increased by 53 basis points from the prior quarter, and the rate paid on interest-bearing liabilities decreased by 1 basis point from the prior quarter. The net interest margin increased by 53 basis points to 3.39% for the second quarter from 2.86% for the first quarter.

Net interest income increased by $812,000, or 15.6%, to $6.0 million for the three months ended June 30, 2022, from $5.2 million in the same period in the prior year. Relative to the prior year quarter, the net interest margin increased by 38 basis points to 3.39% from 3.01%. The improvement reflects average loan growth of $41.3 million from the prior year quarter and an increase of 18 basis points in the average yield earned on loans, while the cost of interest-bearing liabilities decreased by 10 basis points.

The Company recognized a provision for loan losses of $269,000 for the quarter ended June 30, 2022, driven by loan growth of $78.1 million from the prior quarter. The allowance for loan losses as a percentage of total loans was 1.00%, 1.09% and 1.19% at June 30, 2022, March 31, 2022 and June 30, 2021, respectively, and was 237.4%, 237.2% and 101.9% of non-performing assets at June 30, 2022, March 31, 2022 and June 30, 2021, respectively.

Non-interest income decreased $367,000, or 16.7%, to $1.8 million for the quarter ended June 30, 2022 from $2.2 million in the quarter ended March 31, 2022, due to a decrease of $780,000 in the net gain on loan origination and sale activities. Sold mortgages totaled $56.8 million in the second quarter of 2022, compared to $129.9 million in the first quarter of 2022. The second quarter of 2022 ended with a mortgage pipeline of $10.9 million, compared to a pipeline of $42.7 million at the end of the first quarter of 2022, and loans held for sale were $9.7 million as of June 30, 2022, compared to $22.7 million as of March 31, 2022. The decrease in the mortgage banking pipeline and loans held for sale, reflecting rising interest rates and lower margins on loans sold, contributed to the erosion in the gain on loan origination and sale activities from the prior quarter. Mortgage servicing fees increased $161,000, or 46.3%, to $509,000 for the second quarter of 2022 from $348,000 in the first quarter of 2022 because of a positive fair value adjustment of $286,000 in the second quarter of 2022, compared to a positive fair value adjustment of $135,000 for the first quarter of 2022, given declining prepayment speeds.

Non-interest income decreased $5.0 million, or 73.2%, to $1.8 million for the quarter ended June 30, 2022, from $6.8 million for the quarter ended June 30, 2021, principally due to a decrease of $5.3 million in the net gain on loan origination and sale activities. Sold mortgage loans totaled $56.8 million in the second quarter of 2022, compared to sold mortgage loans of $342.8 million during the second quarter of 2021. The second quarter of 2022 ended with a mortgage pipeline of $10.9 million, compared to a pipeline of $139.7 million at the end of the second quarter of 2021. Mortgage servicing fees increased $128,000 in the quarter ended June 30, 2022, principally due to a positive valuation adjustment to mortgage servicing rights of $286,000 in the quarter ended June 30, 2022.

Non-interest expenses decreased $1.2 million, or 14.0%, to $7.5 million in the quarter ended June 30, 2022 from $8.7 million in the quarter ended March 31, 2022. The decrease was due to a decrease in salaries and employee benefits expense of $740,000, or 14.4%, primarily attributed to lower headcount and the absence of severance expenses related to the reduction in force in the mortgage banking operation completed in the quarter ended March 31, 2022. In addition, professional fees and other non-interest expenses decreased by $707,000 from the prior quarter.

Non-interest expenses decreased $3.1 million to $7.5 million in the quarter ended June 30, 2022 from $10.6 million in the quarter ended June 30, 2021. The decrease was principally due to a decrease in salaries and employee benefits of $2.9 million, primarily attributed to lower commissions and incentives associated with lower residential loan production and reduced headcount.

The income tax benefit was $165,000 for the three months ended June 30, 2022, compared to $1.1 million for the three months ended March 31, 2022 and $162,000 for the three months ended June 30, 2021.

Year-to-Date Operating ResultsNet interest income increased by $1.0 million, or 9.6%, to $11.3 million for the six months ended June 30, 2022 from $10.3 million for the six months ended June 30, 2021. The change reflects loan growth and higher average yields earned on loans, as well as the downward pricing and improved composition of funding liabilities. An increase in the average balance of loans of $16.9 million, or 2.8%, and an 11 basis point improvement in loan yields contributed to a $678,000 improvement in total interest and dividend income. The composition of our funding base improved with an increase of $21.3 million, or 18.4%, in the average balance of non-interest bearing deposits and a decrease of $21.5 million, or 35.1%, in the average balance of borrowings. The composition change contributed to a 15 basis point decrease in the cost of interest-bearing liabilities.

The Company recognized a provision for loan losses of $340,000 for the six months ended June 30, 2022 compared to a credit for loan losses of $240,000 in the prior year period. For the six months ended June 30, 2022, loan growth was the primary contributor to the provision for loan losses.

Non-interest income decreased $15.2 million, or 79.1%, to $4.0 million for the six months ended June 30, 2022 from $19.2 million in the prior year period, principally due to a decrease of $15.0 million in the net gain on loan origination and sale activities, and a decrease in mortgage servicing fees, net, of $303,000. Mortgage loans sold were $186.6 million during the six months ended June 30, 2022, compared to $846.0 million during the prior year period. Net gain on loan origination and sale activities decreased as a result of both lower volume and margin on loan sales and the impact of a shrinking mortgage banking pipeline during the first six months of 2022. Mortgage servicing fees decreased $303,000 for the six months ended June 30, 2022 to $857,000 from $1.2 million for the six months ended June 30, 2021, primarily due to the recording of sub-servicer expenses during the six months ended June 30, 2022 of $620,000.

Non-interest expenses decreased $6.4 million, or 28.3%, to $16.2 million for the six months ended June 30, 2022 from $22.6 million for the six months ended June 30, 2021. Salaries and benefits decreased $6.2 million, or 39.2%, to $9.6 million, as a result of lower commissions and incentives associated with a normalization of residential loan production and reduced headcount. Included in salaries and benefits were severance expenses of $240,000 and $254,000 in the six months ended June 30, 2022 and 2021, respectively, relating to a reduction in force in the mortgage banking operation in 2022 and the outsourcing of residential loan servicing in 2021. Occupancy and equipment expenses decreased $441,000 as compared to the prior year period, as the Company migrated to a hybrid work environment and reduced its overall real estate footprint by closing six loan production offices and reducing the office space for the Bank’s headquarters and loan operations since the prior year, and decreased COVID-19 pandemic related spending.

The income tax benefit was $1.2 million for the six months ended June 30, 2022 compared to income tax expense of $1.5 million for the six months ended June 30, 2021. Non-qualified stock option exercises during the six months ended June 30, 2022 contributed to the income tax benefit, in addition to the pre-tax loss generated during the period.

Balance SheetAt June 30, 2022, total assets amounted to $774.8 million, compared to $770.3 million at March 31, 2022, an increase of $4.5 million, or 0.6%. A $78.1 million increase in total loans from the prior quarter was partially offset by a $13.0 million decrease in loans held for sale and a $56.2 million decrease in total cash and cash equivalents. Deposits increased by $16.7 million, or 2.7%, in the quarter, whereas FHLB advances decreased by $12.1 million, or 26.8%.

Total assets at June 30, 2022 increased $30.6 million, or 4.1%, from $744.1 million at June 30, 2021. Contributing to asset growth was an increase of $117.0 million in net loans to $657.6 million at June 30, 2022 from $540.7 million at June 30, 2021. Commercial real estate loans increased by $21.6 million, or 12.9%, as we focused on diversifying our loan mix. Cash and cash equivalents decreased by $20.0 million, or 57.3%, to $14.9 million at June 30, 2022 from $34.9 million at June 30, 2021, principally due to loan growth. FHLB advances decreased by $17.1 million to $32.9 million at June 30, 2022, from $50.0 million at June 30, 2021.

Total stockholders’ equity was $89.3 million at June 30, 2022 compared to $88.5 million at March 31, 2022. The increase of $800,000 reflects net income of $248,000 and earned ESOP compensation and the commitment of ESOP shares to be released of $946,000, and net proceeds from the exercise of stock options of $272,000, partially offset by other comprehensive losses, of $915,000.

Total stockholders’ equity was $89.3 million at June 30, 2022 compared to $100.7 million at June 30, 2021. The decrease of $11.4 million relates mainly to share repurchases of $4.9 million and dividend payments of $12.0 million, partially offset by net income from the previous twelve months of $3.9 million.

Proposed Transaction with Hometown FinancialOn March 28, 2022, the Company and Hometown Financial Group, Inc. (“Hometown”) entered into an Agreement and Plan of Merger (the “merger agreement”) pursuant to which, through a series of transactions, Hometown will acquire the Company (the “merger”) in a cash transaction for total consideration valued at approximately $146.5 million. Under the terms of the merger agreement, Company shareholders will receive $27.00 for each share of Company common stock. The shareholders of the Company approved the proposed merger at a special meeting of shareholders held on June 29, 2022. The merger is expected to close in the fourth quarter of 2022 and is subject to regulatory approvals and customary closing conditions.

About Randolph Bancorp, Inc.Randolph Bancorp, Inc. is the holding company for Envision Bank and its Envision Mortgage Division. Envision Bank is a full-service community bank with five retail branch locations, loan operations centers in North Attleboro and Quincy, Massachusetts, three loan production offices located in Massachusetts and one loan production office in Southern New Hampshire.

Forward Looking StatementsCertain statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the SEC, in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward-looking statements by the use of the words “believe”, “expect”, “anticipate”, “intend”, “estimate”, “assume”, “outlook”, “will”, “should”, and other expressions that predict or indicate future events and trends and which do not relate to historical matters. Forward-looking statements involve risks and uncertainties. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, failure to obtain necessary regulatory approvals for the proposed transaction with Hometown; failure to satisfy any of the conditions to the proposed transaction with Hometown on a timely basis or at all or other delays in completing the merger; the risk that the merger agreement may be terminated in certain circumstances; the outcome of any legal proceedings that may be instituted against the Company and/or others related to the merger agreement or the merger; disruptions to the Company’s business as a result of the announcement and pendency of the merger; the reputational risks and the reaction of Randolph’s customers to the proposed transaction; ongoing disruptions due to the COVID-19 pandemic and the measures taken to contain its spread on the Company’s employees, customers, business operations, credit quality, financial position, liquidity and results of operations; changes in the general business and economic conditions on a national basis and in the local markets in which the Company operates, including changes that adversely affect borrowers’ ability to service and repay the Company’s loans; changes in interest rates; competition; inflation; changes in consumer behavior due to changing political, business and economic conditions or legislative or regulatory initiatives; reputational risk relating to the Company’s participation in pandemic-related legislative and regulatory initiatives and programs; ongoing turbulence in the capital and debt markets and the impact of such conditions on the Company’s business activities; and the risk factors described in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the SEC. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

Non-GAAP Financial MeasuresThe Company uses certain non-GAAP financial measures, such as return on average assets, return on average equity, the efficiency ratio, profit percentage, tangible book value per share, non-interest income to total income and, where applicable, as adjusted for non-recurring items. These non-GAAP financial measures provide information for investors to effectively analyze financial trends of on-going business activities, and to enhance comparability with peers across the financial services sector.

Randolph Bancorp, Inc.Consolidated Balance Sheet(Dollars in thousands)(Unaudited)

														% Change
		June 30,				March 31,				June 30,				Jun 2022 vs.				Jun 2022 vs.
			2022				2022				2021			Mar 2022				Jun 2021
Assets
Cash and cash equivalents		$	14,891			$	71,072			$	34,876				(79.0	)%			(57.3	)%
Securities available for sale, at fair value			47,142				48,836				50,212				(3.5	)%			(6.1	)%
Loans held for sale, at fair value			9,736				22,698				74,277				(57.1	)%			(86.9	)%
Loans:
1-4 family residential			354,922				271,755				263,992				30.6	%			34.4	%
Home equity			65,210				58,501				50,555				11.5	%			29.0	%
Commercial real estate			189,334				199,255				167,691				(5.0	)%			12.9	%
Construction			33,877				32,544				29,140				4.1	%			16.3	%
Total real estate loans			643,343				562,055				511,378				14.5	%			25.8	%
Commercial and industrial			13,162				15,478				25,826				(15.0	)%			(49.0	)%
Consumer			6,353				7,267				9,194				(12.6	)%			(30.9	)%
Total loans			662,858				584,800				546,398				13.3	%			21.3	%
Allowance for loan losses			(6,602	)			(6,357	)			(6,523	)			3.9	%			1.2	%
Net deferred loan costs and fees, and purchase premiums			1,362				1,148				785				18.6	%			73.5	%
Loans, net			657,618				579,591				540,660				13.5	%			21.6	%
Federal Home Loan Bank of Boston stock, at cost			1,778				2,734				2,855				(35.0	)%			(37.7	)%
Accrued interest receivable			1,699				1,434				1,523				18.5	%			11.6	%
Mortgage servicing rights, net			15,093				15,378				15,375				(1.9	)%			(1.8	)%
Premises and equipment, net			7,669				7,718				5,115				(0.6	)%			49.9	%
Bank-owned life insurance			8,865				8,824				8,703				0.5	%			1.9	%
Other assets			10,262				11,999				10,546				(14.5	)%			(2.7	)%
Total assets		$	774,753			$	770,284			$	744,142				0.6	%			4.1	%
Liabilities and Stockholders' Equity
Deposits:
Non-interest bearing		$	146,635			$	142,793			$	124,683				2.7	%			17.6	%
Savings accounts			195,107				196,145				190,584				(0.5	)%			2.4	%
NOW accounts			51,928				53,329				51,059				(2.6	)%			1.7	%
Money market accounts			98,331				92,769				73,967				6.0	%			32.9	%
Term certificates			102,002				106,515				74,631				(4.2	)%			36.7	%
Interest bearing brokered			47,361				33,128				57,059				43.0	%			(17.0	)%
Total deposits			641,364				624,679				571,983				2.7	%			12.1	%
Federal Home Loan Bank of Boston advances			32,946				45,000				50,016				(26.8	)%			(34.1	)%
Mortgagors' escrow accounts			2,546				2,773				1,783				(8.2	)%			42.8	%
Post-employment benefit obligations			2,055				2,064				2,226				(0.4	)%			(7.7	)%
Other liabilities			6,564				7,290				17,424				(10.0	)%			(62.3	)%
Total liabilities			685,475				681,806				643,432				0.5	%			6.5	%
Stockholders' Equity:
Common stock			52				52				52				0.0	%			0.0	%
Additional paid-in capital			45,501				44,904				46,740				1.3	%			(2.7	)%
Retained earnings			49,290				49,042				57,378				0.5	%			(14.1	)%
ESOP-Unearned compensation			(2,651	)			(3,521	)			(3,662	)			(24.7	)%			(27.6	)%
Accumulated other comprehensive income (loss), net of tax			(2,914	)			(1,999	)			202				45.8	%			(1542.6	)%
Total stockholders' equity			89,278				88,478				100,710				0.9	%			(11.4	)%
Total liabilities and stockholders' equity		$	774,753			$	770,284			$	744,142				0.6	%			4.1	%

Randolph Bancorp, Inc.Consolidated Balance Sheet Trend(Dollars in thousands)(Unaudited)

		June 30,				March 31,				December 31,				September 30,				June 30,
		2022				2022				2021				2021				2021
Assets
Cash and cash equivalents		$	14,891			$	71,072			$	115,449			$	12,876			$	34,876
Securities available for sale, at fair value			47,142				48,836				51,666				51,725				50,212
Loans held for sale, at fair value			9,736				22,698				44,766				75,400				74,277
Loans:
1-4 family residential			354,922				271,755				236,364				265,561				263,992
Home equity			65,210				58,501				57,295				56,124				50,555
Commercial real estate			189,334				199,255				197,423				185,100				167,691
Construction			33,877				32,544				33,961				34,479				29,140
Total real estate loans			643,343				562,055				525,043				541,264				511,378
Commercial and industrial			13,162				15,478				17,242				19,896				25,826
Consumer			6,353				7,267				7,552				8,860				9,194
Total loans			662,858				584,800				549,837				570,020				546,398
Allowance for loan losses			(6,602	)			(6,357	)			(6,289	)			(6,432	)			(6,523	)
Net deferred loan costs and fees, and purchase premiums			1,362				1,148				1,073				1,031				785
Loans, net			657,618				579,591				544,621				564,619				540,660
Federal Home Loan Bank of Boston stock, at cost			1,778				2,734				2,940				3,239				2,855
Accrued interest receivable			1,699				1,434				1,500				1,763				1,523
Mortgage servicing rights, net			15,093				15,378				15,616				15,402				15,375
Premises and equipment, net			7,669				7,718				7,684				6,462				5,115
Bank-owned life insurance			8,865				8,824				8,784				8,744				8,703
Other assets			10,262				11,999				10,252				10,867				10,546
Total assets		$	774,753			$	770,284			$	803,278			$	751,097			$	744,142
Liabilities and Stockholders' Equity
Deposits:
Non-interest bearing		$	146,635			$	142,793			$	145,666			$	134,058			$	124,683
Savings accounts			195,107				196,145				191,712				188,346				190,584
NOW accounts			51,928				53,329				53,996				53,804				51,059
Money market accounts			98,331				92,769				90,544				73,562				73,967
Term certificates			102,002				106,515				106,112				73,519				74,631
Interest bearing brokered			47,361				33,128				50,117				50,116				57,059
Total deposits			641,364				624,679				638,147				573,405				571,983
Federal Home Loan Bank of Boston advances			32,946				45,000				50,000				62,900				50,016
Mortgagors' escrow accounts			2,546				2,773				2,128				1,905				1,783
Post-employment benefit obligations			2,055				2,064				2,222				2,182				2,226
Other liabilities			6,564				7,290				9,878				10,108				17,424
Total liabilities			685,475				681,806				702,375				650,500				643,432
Stockholders' Equity:
Common stock			52				52				50				50				52
Additional paid-in capital			45,501				44,904				44,078				43,574				46,740
Retained earnings			49,290				49,042				60,524				60,504				57,378
ESOP-Unearned compensation			(2,651	)			(3,521	)			(3,568	)			(3,615	)			(3,662	)
Accumulated other comprehensive income (loss), net of tax			(2,914	)			(1,999	)			(181	)			84				202
Total stockholders' equity			89,278				88,478				100,903				100,597				100,710
Total liabilities and stockholders' equity		$	774,753			$	770,284			$	803,278			$	751,097			$	744,142

Randolph Bancorp, Inc.Consolidated Statements of Operations(Dollars in thousands except per share amounts)(Unaudited)

		Three Months Ended												% Change
		June 30,				March 31,				June 30,				Jun 2022 vs.				Jun 2022 vs.
		2022				2022				2021				Mar 2022				Jun 2021
Interest and dividend income:
Loans		$	6,182			$	5,467			$	5,505				13.1	%			12.3	%
Securities-taxable			221				216				223				2.3	%			(0.9	)%
Securities-tax exempt			4				4				6				0.0	%			(33.3	)%
Interest-bearing deposits and certificates of deposit			45				42				8				7.1	%			462.5	%
Total interest and dividend income			6,452				5,729				5,742				12.6	%			12.4	%
Interest expense:
Deposits			342				315				345				8.6	%			(0.9	)%
Borrowings			99				147				198				(32.7	)%			(50.0	)%
Total interest expense			441				462				543				(4.5	)%			(18.8	)%
Net interest income			6,011				5,267				5,199				14.1	%			15.6	%
Provision (credit) for loan losses			269				71				(27	)			278.9	%			(1096.3	)%
Net interest income after provision (credit) for loan losses			5,742				5,196				5,226				10.5	%			9.9	%
Non-interest income:
Customer service fees			372				365				419				1.9	%			(11.2	)%
Gain on loan origination and sale activities, net			484				1,264				5,740				(61.7	)%			(91.6	)%
Mortgage servicing fees, net			509				348				381				46.3	%			33.6	%
Increase in cash surrender value of life insurance			41				40				41				2.5	%			0.0	%
Other			419				175				235				139.4	%			78.3	%
Total non-interest income			1,825				2,192				6,816				(16.7	)%			(73.2	)%
Non-interest expenses:
Salaries and employee benefits			4,414				5,154				7,310				(14.4	)%			(39.6	)%
Occupancy and equipment			559				365				621				53.2	%			(10.0	)%
Data processing			378				345				301				9.6	%			25.6	%
Professional fees			578				1,025				323				(43.6	)%			78.9	%
Marketing			151				157				200				(3.8	)%			(24.5	)%
FDIC insurance			62				58				54				6.9	%			14.8	%
Other non-interest expenses			1,342				1,602				1,818				(16.2	)%			(26.2	)%
Total non-interest expenses			7,484				8,706				10,627				(14.0	)%			(29.6	)%
Income (loss) before income taxes			83				(1,318	)			1,415				(106.3	)%			(94.1	)%
Income tax expense (benefit)			(165	)			(1,083	)			(162	)			(84.8	)%			1.9	%
Net income (loss)		$	248			$	(235	)		$	1,577				(205.5	)%			(84.3	)%
Net income (loss) per share:
Basic		$	0.05			$	(0.05	)		$	0.32
Diluted		$	0.05			$	(0.05	)		$	0.31
Weighted average shares outstanding:
Basic			4,839,796				4,815,325				4,921,182
Diluted			5,076,181				5,014,538				5,135,582
Dividends declared per share		$	-			$	2.15			$	-

Randolph Bancorp, Inc.Consolidated Statements of Operations(Dollars in thousands except per share amounts)(Unaudited)

		Year to Date								% Change
		June 30,				June 30,				Jun 2022 vs.
		2022				2021				Jun 2021
Interest and dividend income:
Loans		$	11,649			$	11,013				5.8	%
Securities-taxable			437				463				(5.6	)%
Securities-tax exempt			8				12				(33.3	)%
Interest-bearing deposits and certificates of deposit			87				15				480.0	%
Total interest and dividend income			12,181				11,503				5.9	%
Interest expense:
Deposits			657				783				(16.1	)%
Borrowings			246				430				(42.8	)%
Total interest expense			903				1,213				(25.6	)%
Net interest income			11,278				10,290				9.6	%
Provision (credit) for loan losses			340				(240	)			(241.7	)%
Net interest income after provision (credit) for loan losses			10,938				10,530				3.9	%
Non-interest income:
Customer service fees			737				786				(6.2	)%
Gain on loan origination and sale activities, net			1,748				16,733				(89.6	)%
Mortgage servicing fees, net			857				1,160				(26.1	)%
Increase in cash surrender value of life insurance			81				81				0.0	%
Other			594				479				24.0	%
Total non-interest income			4,017				19,239				(79.1	)%
Non-interest expenses:
Salaries and employee benefits			9,568				15,747				(39.2	)%
Occupancy and equipment			924				1,365				(32.3	)%
Data processing			723				564				28.2	%
Professional fees			1,603				884				81.3	%
Marketing			308				370				(16.8	)%
FDIC insurance			120				108				11.1	%
Other non-interest expenses			2,944				3,540				(16.8	)%
Total non-interest expenses			16,190				22,578				(28.3	)%
Income (loss) before income taxes			(1,235	)			7,191				(117.2	)%
Income tax expense (benefit)			(1,248	)			1,502				(183.1	)%
Net income		$	13			$	5,689				(99.8	)%
Net income per share:
Basic		$	0.00			$	1.14
Diluted		$	0.00			$	1.10
Weighted average shares outstanding:
Basic			4,827,628				4,988,283
Diluted			5,046,444				5,193,643
Dividends declared per share		$	2.15			$	-

Randolph Bancorp, Inc.Consolidated Statements of Operations Trend(Dollars in thousands except per share amounts)(Unaudited)

		Three Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2022				2022				2021				2021				2021
Interest and dividend income:
Loans		$	6,182			$	5,467			$	5,923			$	6,226			$	5,505
Securities-taxable			221				216				217				219				223
Securities-tax exempt			4				4				4				4				6
Interest-bearing deposits and certificates of deposit			45				42				13				4				8
Total interest and dividend income			6,452				5,729				6,157				6,453				5,742
Interest expense:
Deposits			342				315				308				299				345
Borrowings			99				147				155				178				198
Total interest expense			441				462				463				477				543
Net interest income			6,011				5,267				5,694				5,976				5,199
Provision (credit) for loan losses			269				71				(108	)			(90	)			(27	)
Net interest income after provision (credit) for loan losses			5,742				5,196				5,802				6,066				5,226
Non-interest income:
Customer service fees			372				365				422				410				419
Gain on loan origination and sale activities, net			484				1,264				3,723				7,229				5,740
Mortgage servicing fees, net			509				348				257				274				381
Increase in cash surrender value of life insurance			41				40				41				41				41
Other			419				175				92				195				235
Total non-interest income			1,825				2,192				4,535				8,149				6,816
Non-interest expenses:
Salaries and employee benefits			4,414				5,154				6,084				6,381				7,310
Occupancy and equipment			559				365				713				714				621
Data processing			378				345				237				367				301
Professional fees			578				1,025				325				490				323
Marketing			151				157				245				134				200
FDIC insurance			62				58				55				54				54
Other non-interest expenses			1,342				1,602				1,562				1,719				1,818
Total non-interest expenses			7,484				8,706				9,221				9,859				10,627
Income (loss) before income taxes			83				(1,318	)			1,116				4,356				1,415
Income tax expense (benefit)			(165	)			(1,083	)			330				1,230				(162	)
Net income (loss)		$	248			$	(235	)		$	786			$	3,126			$	1,577
Net income (loss) per share:
Basic		$	0.05			$	(0.05	)		$	0.17			$	0.64			$	0.32
Diluted		$	0.05			$	(0.05	)		$	0.16			$	0.62			$	0.31
Weighted average shares outstanding:
Basic			4,839,796				4,815,325				4,743,833				4,869,155				4,921,182
Diluted			5,076,181				5,014,538				4,993,750				5,074,676				5,135,582
Dividends declared per share		$	-			$	2.15			$	0.15			$	-			$	-

Randolph Bancorp, Inc.Average Balances/Yields(Dollars in thousands)(Unaudited)

	Three Months Ended
	June 30, 2022												March 31, 2022												June 30, 2021
	Average				Interest				Average				Average				Interest				Average				Average				Interest				Average
	Outstanding				Earned/				Yield/				Outstanding				Earned/				Yield/				Outstanding				Earned/				Yield/
(Dollars in thousands)	Balance				Paid				Rate (7)				Balance				Paid				Rate (7)				Balance				Paid				Rate (7)
Interest-earning assets:
Loans:
1-4 family residential (1)	$	320,545			$	2,941				3.68	%		$	274,883			$	2,400				3.54	%		$	319,087			$	2,763				3.47	%
Home equity		62,406				574				3.69	%			57,046				470				3.34	%			49,789				412				3.32	%
Commercial real estate		197,928				2,025				4.10	%			197,330				1,921				3.95	%			159,423				1,666				4.19	%
Construction		32,095				314				3.92	%			32,734				296				3.67	%			29,902				289				3.88	%
Total real estate loans		612,974				5,854				3.83	%			561,993				5,087				3.67	%			558,201				5,130				3.69	%
Commercial and industrial		14,123				234				6.65	%			16,631				277				6.75	%			25,497				266				4.18	%
Consumer		6,924				94				5.45	%			7,617				103				5.48	%			9,052				109				4.83	%
Total loans		634,021				6,182				3.91	%			586,241				5,467				3.78	%			592,750				5,505				3.73	%
Investment securities(2) (3)		49,426				226				1.83	%			52,930				221				1.69	%			55,376				230				1.67	%
Interest-earning deposits		27,803				45				0.65	%			107,866				42				0.16	%			43,888				8				0.07	%
Total interest-earning assets		711,250				6,453				3.64	%			747,037				5,730				3.11	%			692,014				5,743				3.33	%
Noninterest-earning assets		41,971												41,939												40,257
Total assets	$	753,221											$	788,976											$	732,271
Interest-bearing liabilities:
Savings accounts		194,944				76				0.16	%			194,120				72				0.15	%			192,434				89				0.19	%
NOW accounts		52,890				49				0.37	%			62,039				43				0.28	%			69,730				38				0.22	%
Money market accounts		98,813				79				0.32	%			93,174				36				0.16	%			72,469				43				0.24	%
Term certificates		141,279				138				0.39	%			143,320				164				0.46	%			104,604				175				0.67	%
Total interest-bearing deposits		487,926				342				0.28	%			492,653				315				0.26	%			439,237				345				0.32	%
FHLBB and FRB advances		31,058				99				1.28	%			48,333				147				1.23	%			51,502				198				1.54	%
Total interest-bearing liabilities		518,984				441				0.34	%			540,986				462				0.35	%			490,739				543				0.44	%
Noninterest-bearing liabilities:
Noninterest-bearing deposits		133,915												140,454												124,656
Other noninterest-bearing liabilities		10,642												11,559												13,606
Total liabilities		663,541												692,999												629,001
Total stockholders' equity		89,680												95,977												103,270
Total liabilities and stockholders' equity	$	753,221											$	788,976											$	732,271
Net interest income					$	6,012											$	5,268											$	5,200
Interest rate spread(4)										3.30	%											2.76	%											2.89	%
Net interest-earning assets(5)	$	192,266											$	206,051											$	201,275
Net interest margin(6)										3.39	%											2.86	%											3.01	%
Cost of deposits (8)										0.22	%											0.20	%											0.25	%
Cost of funds (9)										0.27	%											0.27	%											0.35	%
Ratio of interest-earning assets to interest-bearing liabilities		137.05	%											138.09	%											141.01	%

(1) Includes nonaccruing loan balances and interest received on such loans, in addition to loans held for sale.(2) Includes carrying value of securities classified as available-for-sale and FHLBB stock.(3) Includes tax equivalent adjustments for municipal securities, based on a statutory tax rate of 21%, of $1,000, $1,000 and $1,000 for the three months ended June 30, 2022, March 31, 2022, and June 30, 2021, respectively.(4) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.(6) Net interest margin represents net interest income divided by average total interest-earning assets.(7) During the fourth quarter of 2021, the Company changed the yield calculation method from the “30/360” to the “Actual/Actual” method. Management believes that the “Actual/Actual” method provides a more consistent and relevant metric for yield performance comparisons.(8) Cost of deposits represents the total interest paid on deposits, divided by total interest-bearing deposits plus total noninterest-bearing deposits.(9) Cost of funds represents the total interest paid on liabilities, divided by total interest-bearing liabilities plus total noninterest-bearing deposits.

Randolph Bancorp, Inc.Average Balances/Yields(Dollars in thousands)(Unaudited)

	Year to Date
	June 30, 2022												June 30, 2021
	Average				Interest				Average				Average				Interest				Average
	Outstanding				Earned/				Yield/				Outstanding				Earned/				Yield/
(Dollars in thousands)	Balance				Paid				Rate (7)				Balance				Paid				Rate (7)
Interest-earning assets:
Loans:
1-4 family residential (1)	$	297,840			$	5,341				3.62	%		$	327,897			$	5,737				3.53	%
Home equity		59,740				1,044				3.52	%			49,090				845				3.47	%
Commercial real estate		197,631				3,946				4.03	%			153,088				3,072				4.05	%
Construction		32,413				610				3.80	%			30,125				584				3.91	%
Total real estate loans		587,624				10,941				3.75	%			560,200				10,238				3.69	%
Commercial and industrial		15,370				511				6.70	%			23,689				540				4.60	%
Consumer		7,268				197				5.47	%			9,493				235				4.99	%
Total loans		610,262				11,649				3.85	%			593,382				11,013				3.74	%
Investment securities(2) (3)		51,168				447				1.76	%			56,590				477				1.70	%
Interest-earning deposits		67,613				87				0.26	%			39,713				15				0.08	%
Total interest-earning assets		729,043				12,183				3.37	%			689,685				11,505				3.36	%
Noninterest-earning assets		41,958												41,146
Total assets	$	771,001											$	730,831
Interest-bearing liabilities:
Savings accounts		194,535				148				0.15	%			191,379				187				0.20	%
NOW accounts		57,439				92				0.32	%			69,621				86				0.25	%
Money market accounts		96,009				115				0.24	%			74,222				97				0.26	%
Term certificates		142,294				302				0.43	%			100,812				413				0.83	%
Total interest-bearing deposits		490,277				657				0.27	%			436,034				783				0.36	%
FHLBB and FRB advances		39,648				246				1.25	%			61,126				430				1.42	%
Total interest-bearing liabilities		529,925				903				0.34	%			497,160				1,213				0.49	%
Noninterest-bearing liabilities:
Noninterest-bearing deposits		137,167												115,841
Other noninterest-bearing liabilities		11,098												14,486
Total liabilities		678,190												627,487
Total stockholders' equity		92,811												103,344
Total liabilities and stockholders' equity	$	771,001											$	730,831
Net interest income					$	11,280											$	10,292
Interest rate spread(4)										3.03	%											2.87	%
Net interest-earning assets(5)	$	199,118											$	192,525
Net interest margin(6)										3.12	%											3.01	%
Cost of deposits (8)										0.21	%											0.29	%
Cost of funds (9)										0.27	%											0.40	%
Ratio of interest-earning assets to interest-bearing liabilities		137.57	%											138.72	%

(1) Includes nonaccruing loan balances and interest received on such loans, in addition to loans held for sale.(2) Includes carrying value of securities classified as available-for-sale and FHLBB stock.(3) Includes tax equivalent adjustments for municipal securities, based on a statutory tax rate of 21%, of $2,000 and $2,000 for the six months ended June 30, 2022 and 2021, respectively.(4) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.(6) Net interest margin represents net interest income divided by average total interest-earning assets.(7) During the fourth quarter of 2021, the Company changed the yield calculation method from the “30/360” to the “Actual/Actual” method. Management believes that the “Actual/Actual” method provides a more consistent and relevant metric for yield performance comparisons.(8) Cost of deposits represents the total interest paid on deposits, divided by total interest-bearing deposits plus total noninterest-bearing deposits.(9) Cost of funds represents the total interest paid on liabilities, divided by total interest-bearing liabilities plus total noninterest-bearing deposits.

Randolph Bancorp, Inc.Average Balances Trend(Dollars in thousands)(Unaudited)

		Three Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2022				2022				2021				2021				2021
Interest-earning assets:
Loans:
1-4 family residential		$	320,545			$	274,883			$	319,855			$	345,576			$	319,087
Home equity			62,406				57,046				57,183				53,345				49,789
Commercial real estate			197,928				197,330				186,943				174,319				159,423
Construction			32,095				32,734				34,246				32,690				29,902
Total real estate loans			612,974				561,993				598,227				605,930				558,201
Commercial and industrial			14,123				16,631				18,311				22,693				25,497
Consumer			6,924				7,617				8,313				12,820				9,052
Total loans			634,021				586,241				624,851				641,443				592,750
Investment securities			49,426				52,930				54,314				54,229				55,376
Interest-earning deposits			27,803				107,866				41,161				11,002				43,888
Total interest-earning assets			711,250				747,037				720,326				706,674				692,014
Non-interest earning assets			41,971				41,939				43,478				44,614				40,257
Total assets		$	753,221			$	788,976			$	763,804			$	751,288			$	732,271
Interest-bearing liabilities:
Savings accounts		$	194,944			$	194,120			$	191,464			$	189,254			$	192,434
NOW accounts			52,890				62,039				62,838				61,951				69,730
Money market accounts			98,813				93,174				77,140				73,662				72,469
Term certificates			141,279				143,320				135,406				113,787				104,604
Total interest-bearing deposits			487,926				492,653				466,848				438,654				439,237
FHLBB and FRB advances			31,058				48,333				53,592				64,047				51,502
Total interest-bearing liabilities			518,984				540,986				520,440				502,701				490,739
Noninterest-bearing liabilities:
Noninterest-bearing deposits			133,915				140,454				127,486				126,165				124,656
Other noninterest-bearing liabilities			10,642				11,559				13,305				19,021				13,606
Total liabilities			663,541				692,999				661,231				647,887				629,001
Total stockholders' equity			89,680				95,977				102,573				103,401				103,270
Total liabilities and stockholders' equity		$	753,221			$	788,976			$	763,804			$	751,288			$	732,271

Randolph Bancorp, Inc.Interest Earned and Paid Trend(Dollars in thousands)(Unaudited)

		Three Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2022				2022				2021				2021				2021
Interest-earning assets:
Loans:
1-4 family residential		$	2,941			$	2,400			$	2,790			$	3,021			$	2,763
Home equity			574				470				480				475				412
Commercial real estate			2,025				1,921				1,880				1,809				1,666
Construction			314				296				331				310				289
Total real estate loans			5,854				5,087				5,481				5,615				5,130
Commercial and industrial			234				277				331				493				266
Consumer			94				103				111				118				109
Total loans			6,182				5,467				5,923				6,226				5,505
Investment securities			226				221				222				224				230
Interest-earning deposits			45				42				13				4				8
Total interest-earning assets			6,453				5,730				6,158				6,454				5,743
Interest-bearing liabilities:
Savings accounts		$	76			$	72			$	72			$	76			$	89
NOW accounts			49				43				29				23				38
Money market accounts			79				36				36				41				43
Term certificates			138				164				171				159				175
Total interest-bearing deposits			342				315				308				299				345
FHLBB and FRB advances			99				147				155				178				198
Total interest-bearing liabilities			441				462				463				477				543
Net interest income			6,012				5,268				5,695				5,977				5,200

Randolph Bancorp, Inc.Average Yield Trend(1)(Dollars in thousands)(Unaudited)

		Three Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2022				2022				2021				2021				2021
Interest-earning assets:
Loans:
1-4 family residential			3.68	%			3.54	%			3.46	%			3.47	%			3.47	%
Home equity			3.69	%			3.34	%			3.33	%			3.53	%			3.32	%
Commercial real estate			4.10	%			3.95	%			3.99	%			4.12	%			4.19	%
Construction			3.92	%			3.67	%			3.83	%			3.76	%			3.88	%
Total real estate loans			3.83	%			3.67	%			3.63	%			3.68	%			3.69	%
Commercial and industrial			6.65	%			6.75	%			7.17	%			8.62	%			4.18	%
Consumer			5.45	%			5.48	%			5.30	%			3.65	%			4.83	%
Total loans			3.91	%			3.78	%			3.76	%			3.85	%			3.73	%
Investment securities			1.83	%			1.69	%			1.62	%			1.64	%			1.67	%
Interest-earning deposits			0.65	%			0.16	%			0.13	%			0.14	%			0.07	%
Total interest-earning assets			3.64	%			3.11	%			3.39	%			3.62	%			3.33	%
Interest-bearing liabilities:
Savings accounts			0.16	%			0.15	%			0.15	%			0.16	%			0.19	%
NOW accounts			0.37	%			0.28	%			0.18	%			0.15	%			0.22	%
Money market accounts			0.32	%			0.16	%			0.19	%			0.22	%			0.24	%
Term certificates			0.39	%			0.46	%			0.50	%			0.55	%			0.67	%
Total interest-bearing deposits			0.28	%			0.26	%			0.26	%			0.27	%			0.32	%
FHLBB and FRB advances			1.28	%			1.23	%			1.15	%			1.10	%			1.54	%
Total interest-bearing liabilities			0.34	%			0.35	%			0.35	%			0.38	%			0.44	%
Interest rate spread			3.30	%			2.76	%			3.04	%			3.24	%			2.89	%
Net interest rate margin			3.39	%			2.86	%			3.14	%			3.36	%			3.01	%
Cost of deposits			0.22	%			0.20	%			0.21	%			0.21	%			0.25	%
Cost of funds			0.27	%			0.27	%			0.28	%			0.30	%			0.35	%
Ratio of interest-earning assets to interest-bearing liabilities			137.05	%			138.09	%			138.41	%			140.58	%			141.01	%

(1) During the fourth quarter of 2021, the Company changed the yield calculation method from the “30/360” to the “Actual/Actual” method. Management believes that the “Actual/Actual” method provides a more consistent and relevant metric for yield performance comparisons.

Randolph Bancorp, Inc.Rate/Volume Analysis(Dollars in thousands)(Unaudited)

		Three Months Ended
		June 30, 2022 vs. March 31, 2022
		Increase (Decrease)								Total
		Due to Changes in								Increase
		Volume				Rate				(Decrease)
Interest-earning assets:
Loans:
1-4 family residential		$	360			$	181				541
Home equity			39				65				104
Commercial real estate			4				100				104
Construction			(5	)			23				18
Total real estate loans			398				369				767
Commercial and industrial			(39	)			(4	)			(43	)
Consumer			(8	)			(1	)			(9	)
Total loans			351				364				715
Investment securities			(14	)			19				5
Interest-earning deposits			(12	)			15				3
Total interest-earning assets			325				398				723
Interest-bearing liabilities:
Savings accounts			-				4				4
NOW accounts			(5	)			11				6
Money market accounts			2				41				43
Term certificates			(2	)			(24	)			(26	)
Total interest-bearing deposits			(5	)			32				27
FHLBB and FRB advances			(53	)			5				(48	)
Total interest-bearing liabilities			(58	)			37				(21	)
Change in net interest income		$	383			$	361			$	744

Randolph Bancorp, Inc.Rate/Volume Analysis(Dollars in thousands)(Unaudited)

		Three Months Ended
		June 30, 2022 vs. 2021
		Increase (Decrease)								Total
		Due to Changes in								Increase
		Volume				Rate				(Decrease)
Interest-earning assets:
Loans:
1-4 family residential		$	13			$	165				178
Home equity			96				66				162
Commercial real estate			395				(36	)			359
Construction			21				4				25
Total real estate loans			525				199				724
Commercial and industrial			(89	)			57				(32	)
Consumer			(24	)			9				(15	)
Total loans			412				265				677
Investment securities			(24	)			20				(4	)
Interest-earning deposits			(2	)			39				37
Total interest-earning assets			386				324				710
Interest-bearing liabilities:
Savings accounts			1				(14	)			(13	)
NOW accounts			(7	)			18				11
Money market accounts			13				23				36
Term certificates			50				(87	)			(37	)
Total interest-bearing deposits			57				(60	)			(3	)
FHLBB and FRB advances			(69	)			(30	)			(99	)
Total interest-bearing liabilities			(12	)			(90	)			(102	)
Change in net interest income		$	398			$	414			$	812

Randolph Bancorp, Inc.Rate/Volume Analysis(Dollars in thousands)(Unaudited)

		Year to Date
		June 30, 2022 vs. 2021
		Increase (Decrease)								Total
		Due to Changes in								Increase
		Volume				Rate				(Decrease)
Interest-earning assets:
Loans:
1-4 family residential		$	(516	)		$	120				(396	)
Home equity			180				19				199
Commercial real estate			889				(15	)			874
Construction			43				(17	)			26
Total real estate loans			596				107				703
Commercial and industrial			(152	)			123				(29	)
Consumer			(51	)			13				(38	)
Total loans			393				243				636
Investment securities			(45	)			15				(30	)
Interest-earning deposits			5				67				72
Total interest-earning assets			353				325				678
Interest-bearing liabilities:
Savings accounts			3				(42	)			(39	)
NOW accounts			(13	)			19				6
Money market accounts			26				(8	)			18
Term certificates			132				(243	)			(111	)
Total interest-bearing deposits			148				(274	)			(126	)
FHLBB and FRB advances			(138	)			(46	)			(184	)
Total interest-bearing liabilities			10				(320	)			(310	)
Change in net interest income		$	343			$	645			$	988

Randolph Bancorp, Inc.Quarterly Trend in Mortgage Banking Income(Dollars in thousands)(Unaudited)

		Three Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2022				2022				2021				2021				2021
Gain on loan origination and sale activities, net
Gain on sale of mortgages and realized gain from derivative financial instruments, net		$	632			$	3,093			$	4,818			$	6,339			$	6,545
Net change in fair value of loans held for sale and portfolio loans accounted for at fair value			218				(1,559	)			(1,360	)			549				1,091
Capitalized residential mortgage loan servicing rights			160				377				942				783				1,476
Net change in fair value of derivative loan commitments and forward loan sale commitments			(526	)			(647	)			(677	)			(442	)			(3,372	)
Gain on loan origination and sales activities, net		$	484			$	1,264			$	3,723			$	7,229			$	5,740
Mortgage servicing fees, net
Residential mortgage loan servicing fees		$	1,259			$	1,277			$	1,355			$	1,282			$	1,205
Amortization of residential mortgage loan servicing rights			(731	)			(749	)			(831	)			(795	)			(759	)
Release (provision) to the valuation allowance of mortgage loan servicing rights			286				135				43				39				(65	)
Sub-servicer expenses (1)			(305	)			(315	)			(310	)			(252	)			-
Mortgage servicing fees, net		$	509			$	348			$	257			$	274			$	381
Total gain on loan origination and sales activities and mortgage servicing fees		$	993			$	1,612			$	3,980			$	7,503			$	6,121
Principal balance of loans originated for sale		$	71,626			$	110,371			$	222,644			$	260,519			$	309,033
Principal balance of loans sold		$	56,752			$	129,858			$	297,316			$	260,473			$	342,762
Ending notional amount of derivative loan commitments		$	10,913			$	42,678			$	85,887			$	158,085			$	139,748
Loans held for sale, at fair value		$	9,736			$	22,698			$	44,766			$	75,400			$	74,277
Margin on loans sold (2)			1.40	%			2.67	%			1.94	%			2.73	%			2.34	%

(1) Sub-servicer expenses were first incurred during the three months ended September 30, 2021, due to a conversion of the Company’s mortgage loan servicing activities. Previously, all expenses related to servicing mortgage loans serviced for others were included in non-interest expenses.(2) Margin on loans sold is calculated as the sum of the gain on sale of mortgages and realized gain from derivative financial instruments, net, plus capitalized residential mortgage loan servicing rights divided by the principal balance of loans sold.

Randolph Bancorp, Inc.Year-to-Date Trend in Mortgage Banking Income(Dollars in thousands)(Unaudited)

		Year-to-Date
		June 30,				June 30,
		2022				2021
Gain on loan origination and sale activities, net
Gain on sale of mortgages and realized gain from derivative financial instruments, net		$	3,725			$	22,421
Net change in fair value of loans held for sale and portfolio loans accounted for at fair value			(1,341	)			(2,725	)
Capitalized residential mortgage loan servicing rights			537				4,273
Net change in fair value of derivative loan commitments and forward loan sale commitments			(1,173	)			(7,236	)
Gain on loan origination and sales activities, net		$	1,748			$	16,733
Mortgage servicing fees, net
Residential mortgage loan servicing fees		$	2,536			$	2,375
Amortization of residential mortgage loan servicing rights			(1,480	)			(1,571	)
Release (provision) to the valuation allowance of mortgage loan servicing rights			421				356
Sub-servicer expenses (1)			(620	)			-
Mortgage servicing fees, net		$	857			$	1,160
Total gain on loan origination and sales activities and mortgage servicing fees		$	2,605			$	17,893
Principal balance of loans originated for sale		$	181,997			$	796,708
Principal balance of loans sold		$	186,610			$	846,047
Ending notional amount of derivative loan commitments		$	10,913			$	139,748
Loans held for sale, at fair value		$	9,736			$	74,277
Margin on loans sold (2)			2.28	%			3.16	%

(1) Sub-servicer expenses were first incurred during the three months ended September 30, 2021, due to a conversion of the Company’s mortgage loan servicing activities. Previously, all expenses related to servicing mortgage loans serviced for others were included in non-interest expenses.(2) Margin on loans sold is calculated as the sum of the gain on sale of mortgages and realized gain from derivative financial instruments, net, plus capitalized residential mortgage loan servicing rights divided by the principal balance of loans sold.

Randolph Bancorp, Inc.Segment Information(Dollars in thousands)(Unaudited)

		For the Three Months Ended June 30, 2022
		Envision Bank				Envision Mortgage				Consolidated Total
Net interest income		$	5,741			$	270			$	6,011
Provision for loan losses			269				-				269
Net interest income after provision for loan losses			5,472				270				5,742
Non-interest income:
Customer service fees			365				7				372
Gain on loan origination and sale activities, net (1)			-				1,920				1,920
Mortgage servicing fees, net			(240	)			749				509
Other			369				91				460
Total non-interest income			494				2,767				3,261
Non-interest expenses:
Salaries and employee benefits			1,831				2,583				4,414
Occupancy and equipment			447				112				559
Other non-interest expenses(2)			1,357				1,154				2,511
Total non-interest expenses			3,635				3,849				7,484
Income (loss) before income taxes and elimination of inter-segment profit		$	2,331			$	(812	)			1,519
Elimination of inter-segment profit											(1,436	)
Income before income taxes											83
Income tax expense (benefit)											(165	)
Net income										$	248

(1) Before elimination of inter-segment profit.(2) Other non-interest expenses include $357,000 of merger expenses. The full amount of merger expenses was allocated to Envision Bank.

The information above was derived from the internal management reporting system used to measure performance of the segments.

Randolph Bancorp, Inc.Segment Information(Dollars in thousands)(Unaudited)

		For the Three Months Ended March 31, 2022
		Envision Bank				Envision Mortgage				Consolidated Total
Net interest income		$	5,011			$	256			$	5,267
Provision for loan losses			71				-				71
Net interest income after provision for loan losses			4,940				256				5,196
Non-interest income:
Customer service fees			355				10				365
Gain on loan origination and sale activities, net (1)			-				1,991				1,991
Mortgage servicing fees, net			(205	)			553				348
Other			99				116				215
Total non-interest income			249				2,670				2,919
Non-interest expenses:
Salaries and employee benefits			1,935				3,219				5,154
Occupancy and equipment			512				(147	)			365
Other non-interest expenses(2)			1,911				1,276				3,187
Total non-interest expenses			4,358				4,348				8,706
Income (loss) before income taxes and elimination of inter-segment profit		$	831			$	(1,422	)			(591	)
Elimination of inter-segment profit											(727	)
Income (loss) before income taxes											(1,318	)
Income tax expense (benefit)											(1,083	)
Net income (loss)										$	(235	)

(1) Before elimination of inter-segment profit.(2) Other non-interest expenses include $588,000 of merger expenses. The full amount of merger expenses was allocated to Envision Bank.

The information above was derived from the internal management reporting system used to measure performance of the segments.

Randolph Bancorp, Inc.Segment Information(Dollars in thousands)(Unaudited)

		For the Three Months Ended June 30, 2021
		Envision Bank				Envision Mortgage				Consolidated Total
Net interest income		$	4,535			$	664			$	5,199
Provision (credit) for loan losses			(27	)			-				(27	)
Net interest income after provision for loan losses			4,562				664				5,226
Non-interest income:
Customer service fees			393				26				419
Gain on loan origination and sale activities, net (1)			-				6,558				6,558
Mortgage servicing fees, net			(94	)			475				381
Other			158				118				276
Total non-interest income			457				7,177				7,634
Non-interest expenses:
Salaries and employee benefits			1,746				5,564				7,310
Occupancy and equipment			407				214				621
Other non-interest expenses			1,265				1,431				2,696
Total non-interest expenses			3,418				7,209				10,627
Income (loss) before income taxes and elimination of inter-segment profit		$	1,601			$	632				2,233
Elimination of inter-segment profit											(818	)
Income before income taxes											1,415
Income tax expense (benefit)											(162	)
Net income										$	1,577

(1) Before elimination of inter-segment profit.The information above was derived from the internal management reporting system used to measure performance of the segments.

Randolph Bancorp, Inc.Segment Information(Dollars in thousands)(Unaudited)

		For the Six Months Ended June 30, 2022
		Envision Bank				Envision Mortgage				Consolidated Total
Net interest income		$	10,751			$	527			$	11,278
Provision (credit) for loan losses			340				-				340
Net interest income after provision (credit) for loan losses			10,411				527				10,938
Non-interest income:
Customer service fees			720				17				737
Gain on loan origination and sale activities, net (1)			-				3,911				3,911
Mortgage servicing fees, net			(445	)			1,302				857
Other			468				207				675
Total non-interest income			743				5,437				6,180
Non-interest expenses:
Salaries and employee benefits			3,766				5,802				9,568
Occupancy and equipment			959				(35	)			924
Other non-interest expenses(2)			3,268				2,430				5,698
Total non-interest expenses			7,993				8,197				16,190
Income before income taxes and elimination of inter-segment profit		$	3,161			$	(2,233	)			928
Elimination of inter-segment profit											(2,163	)
Income before income taxes											(1,235	)
Income tax expense											(1,248	)
Net income										$	13

(1) Before elimination of inter-segment profit.(2) Other non-interest expenses include $945,000 of merger expenses. The full amount of merger expenses was allocated to Envision Bank.

The information above was derived from the internal management reporting system used to measure performance of the segments.

Randolph Bancorp, Inc.Segment Information(Dollars in thousands)(Unaudited)

		For the Six Months Ended June 30, 2021
		Envision Bank				Envision Mortgage				Consolidated Total
Net interest income		$	8,736			$	1,554			$	10,290
Provision (credit) for loan losses			(240	)			-				(240	)
Net interest income after provision for loan losses			8,976				1,554				10,530
Non-interest income:
Customer service fees			733				53				786
Gain on loan origination and sale activities, net (1)			-				18,232				18,232
Mortgage servicing fees, net			(189	)			1,349				1,160
Other			309				251				560
Total non-interest income			853				19,885				20,738
Non-interest expenses:
Salaries and employee benefits (2)			3,548				12,199				15,747
Occupancy and equipment			851				514				1,365
Other non-interest expenses			2,349				3,117				5,466
Total non-interest expenses			6,748				15,830				22,578
Income (loss) before income taxes and elimination of inter-segment profit		$	3,081			$	5,609				8,690
Elimination of inter-segment profit											(1,499	)
Income before income taxes											7,191
Income tax expense											1,502
Net income										$	5,689

(1) Before elimination of inter-segment profit.The information above was derived from the internal management reporting system used to measure performance of the segments.

Randolph Bancorp, Inc.Reconciliation of GAAP to Non-GAAP Net Income (in thousands, except per share amounts)Unaudited

				Quarter Ended
				June 30, 2022
Adjustments		Income Statement Section		Income Before Taxes				Provision (Credit) for Income Taxes				Net Income				Earnings per Share (diluted)
GAAP basis				$	83			$	(165	)		$	248			$	0.05
Merger expenses(1)		Non-interest expense			357				-				357				0.07
Non-GAAP basis				$	440			$	(165	)		$	605			$	0.12
				Quarter Ended
				March 31, 2022
Adjustments		Income Statement Section		Income (Loss) Before Taxes				Provision (Credit) for Income Taxes				Net Income (Loss)				Earnings (Loss) per Share (diluted)
GAAP basis				$	(1,318	)		$	(1,083	)		$	(235	)		$	(0.05	)
Merger expenses(1)		Non-interest expense			588				-				588				0.12
Reversal of cease use liability		Non-interest expense			(290	)			(89	)			(201	)			(0.04	)
Severance expenses		Non-interest expense			240				74				166				0.03
Non-GAAP basis				$	(780	)		$	(1,098	)		$	318			$	0.06
				Quarter Ended
				December 31, 2021
Adjustments		Income Statement Section		Income Before Taxes				Provision for Income Taxes				Net Income				Earnings per Share (diluted)
GAAP basis				$	1,116			$	330			$	786			$	0.16
Loss on disposal of fixed assets		Non-interest income			55				16				39				0.01
Accrued severance expenses		Non-interest expense			26				7				19				-
Non-GAAP basis				$	1,197			$	353			$	844			$	0.17
				Quarter Ended
				September 30, 2021
Adjustments		Income Statement Section		Income Before Taxes				Provision for Income Taxes				Net Income				Earnings per Share (diluted)
GAAP basis				$	4,356			$	1,230			$	3,126			$	0.62
Accrued severance expenses		Non-interest expense			139				40				99				0.02
Other outsourcing expenses		Non-interest expense			190				54				136				0.03
Non-GAAP basis				$	4,685			$	1,324			$	3,361			$	0.67
				Quarter Ended
				June 30, 2021
Adjustments		Income Statement Section		Income Before Taxes				Provision (Credit) for Income Taxes				Net Income				Earnings per Share (diluted)
GAAP basis				$	1,415			$	(162	)		$	1,577			$	0.31
Loss on disposal of fixed assets		Non-interest expense			29				8				21				-
Accrued severance expenses		Non-interest expense			145				41				104				0.02
Other outsourcing expenses		Non-interest expense			71				20				51				0.01
Non-GAAP basis				$	1,660			$	(93	)		$	1,753			$	0.34

(1) Merger expenses are not tax deductible and therefore no provision for income taxes is calculated in the table.

Randolph Bancorp, Inc.Reconciliation of GAAP to Non-GAAP Net Income (in thousands, except per share amounts)(Unaudited)

				Year to Date
				June 30, 2022
Adjustments		Income Statement Section		Income (Loss) Before Taxes				Provision (Credit) for Income Taxes				Net Income (Loss)				Earnings (Loss) per Share (diluted)
GAAP basis				$	(1,235	)		$	(1,248	)		$	13			$	-
Merger expenses(1)		Non-interest expense			945				-				945				0.19
Reversal of cease use liability		Non-interest expense			(290	)			(89	)			(201	)			(0.04	)
Severance expenses		Non-interest expense			240				74				166				0.03
Non-GAAP basis				$	(340	)		$	(1,263	)		$	923			$	0.18
				Year to Date
				June 30, 2021
Adjustments		Income Statement Section		Income Before Taxes				Provision for Income Taxes				Net Income				Earnings per Share (diluted)
GAAP basis				$	7,191			$	1,502			$	5,689			$	1.10
Loss on disposal of fixed assets		Non-interest expense			29				8				21				-
Accrued severance expenses		Non-interest expense			254				72				182				0.04
Other outsourcing expenses		Non-interest expense			71				20				51				0.01
Non-GAAP basis				$	7,545			$	1,602			$	5,943			$	1.15

(1) Merger expenses are not tax deductible and therefore no provision for income taxes is calculated in the table.

Randolph Bancorp, Inc. Selected Financial Highlights(Unaudited)

		At or for the Three Months Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2022				2022				2021				2021				2021
Return on average assets: (1, 5)
GAAP			0.13	%			(0.12	%)			0.41	%			1.66	%			0.86	%
Non-GAAP (2)			0.32	%			0.16	%			0.44	%			1.79	%			0.96	%
Return on average equity: (1, 6)
GAAP			1.11	%			(0.98	%)			3.07	%			12.09	%			6.11	%
Non-GAAP (2)			2.70	%			1.33	%			3.29	%			13.00	%			6.79	%
Net interest margin (10)			3.39	%			2.86	%			3.14	%			3.36	%			3.01	%
Non-interest income to total income:
GAAP			23.29	%			29.39	%			44.33	%			57.69	%			56.73	%
Non-GAAP (2)			23.29	%			29.39	%			44.63	%			57.69	%			56.83	%
Profit percentage (9)
GAAP			4.49	%			(16.72	%)			9.85	%			30.20	%			11.55	%
Non-GAAP (2)			9.05	%			(9.51	%)			10.59	%			32.53	%			13.56	%
Efficiency ratio: (7)
GAAP			95.51	%			116.72	%			90.15	%			69.80	%			88.45	%
Non-GAAP (2)			90.95	%			109.51	%			89.41	%			67.47	%			86.44	%
Tier 1 capital to average assets (3)			12.24	%			11.47	%			13.23	%			13.38	%			13.72	%
Non-performing assets as a percentage of total assets (4)			0.36	%			0.37	%			0.33	%			0.20	%			0.86	%
Allowance for loan losses as a percentage of total loans (4)			1.00	%			1.09	%			1.14	%			1.13	%			1.19	%
Allowance for loan losses as a percentage of total loans, excluding SBA PPP Loans (4)			1.00	%			1.09	%			1.15	%			1.14	%			1.22	%
Allowance for loan losses as a percentage of non-performing assets			237.40	%			237.17	%			239.67	%			427.66	%			101.89	%
Allowance for loan losses as a percentage of non-performing loans			237.40	%			237.17	%			239.67	%			427.66	%			101.89	%
Tangible book value per share (8)		$	17.18			$	17.07			$	19.73			$	19.71			$	19.16
Outstanding shares			5,197,680				5,180,670				5,113,825				5,103,619				5,254,522

(1) Annualized for quarterly periods presented.(2) See page 26 – Reconciliation of GAAP to Non-GAAP Net Income.(3) Average assets calculated on a quarterly basis for all periods presented.(4) Total loans exclude loans held for sale but includes net deferred loan costs and fees.(5) This non-GAAP measure represents net income divided by average total assets.(6) This non-GAAP measure represents net income divided by average stockholders’ equity.(7) This non-GAAP measure represents total non-interest expenses divided by net interest income and non-interest income.(8) This non-GAAP measure represents total stockholders’ equity, minus intangible assets of $0, $22,000, $24,000, $26,000, and $28,000 at June 30, 2022, March 31, 2022, December 31, 2021, September 30, 2021, and June 30, 2021, respectively, divided by outstanding shares at period end. The Company recorded a full impairment of intangible assets during the second quarter of 2022.(9) This non-GAAP measure represents net interest income plus noninterest income less non-interest expense divided by net interest income plus non-interest income.(10) During the fourth quarter of 2021, the Company changed the yield calculation method from the “30/360” to the “Actual/Actual” method. Management believes that the “Actual/Actual” method provides a more consistent and relevant metric for yield performance comparisons.

Randolph Bancorp, Inc. Selected Financial Highlights(Unaudited)

		At or for the Six Months Ended
		June 30,				June 30,
		2022				2021
Return on average assets: (1, 5)
GAAP			0.00	%			1.56	%
Non-GAAP (2)			0.24	%			1.63	%
Return on average equity: (1, 6)
GAAP			0.03	%			11.01	%
Non-GAAP (2)			1.99	%			11.50	%
Net interest margin (10)			3.12	%			2.98	%
Non-interest income to total income:
GAAP			26.26	%			65.15	%
Non-GAAP (2)			26.26	%			65.19	%
Profit percentage (9)
GAAP			(5.85	%)			23.54	%
Non-GAAP (2)			0.00	%			24.71	%
Efficiency ratio: (7)
GAAP			105.85	%			76.46	%
Non-GAAP (2)			100.00	%			75.29	%
Tier 1 capital to average assets (3)			12.24	%			13.72	%
Non-performing assets as a percentage of total assets (4)			0.36	%			0.86	%
Allowance for loan losses as a percentage of total loans (4)			1.00	%			1.19	%
Allowance for loan losses as a percentage of total loans, excluding SBA PPP Loans (4)			1.00	%			1.22	%
Allowance for loan losses as a percentage of non-performing assets			237.40	%			101.89	%
Allowance for loan losses as a percentage of non-performing loans			237.40	%			101.89	%
Tangible book value per share (8)		$	17.18			$	19.16
Outstanding shares			5,197,680				5,254,522

(1) Annualized for quarterly periods presented.(2) See page 27 – Reconciliation of GAAP to Non-GAAP Net Income.(3) Average assets calculated on an annual basis for all periods presented.(4) Total loans exclude loans held for sale but includes net deferred loan costs and fees.(5) This non-GAAP measure represents net income divided by average total assets.(6) This non-GAAP measure represents net income divided by average stockholders’ equity.(7) This non-GAAP measure represents total non-interest expenses divided by net interest income and non-interest income.(8) This non-GAAP measure represents total stockholders’ equity, minus intangible assets of $0 and $28,000 at June 30, 2022 and June 30, 2021, respectively, divided by outstanding shares at period end.(9) This non-GAAP measure represents net interest income plus noninterest income less non-interest expense divided by net interest income plus non-interest income.(10) During the fourth quarter of 2021, the Company changed the yield calculation method from the “30/360” to the “Actual/Actual” method. Management believes that the “Actual/Actual” method provides a more consistent and relevant metric for yield performance comparisons.

For More Information, Contact:William M. Parent, President and Chief Executive Officer (617-925-1955) 

Source: Randolph Bancorp, Inc.