• Southern States Bancshares, Inc. Announces Third Quarter 2023 Financial Results

    Source: Nasdaq GlobeNewswire / 23 Oct 2023 07:30:28   America/New_York

    Third Quarter 2023 Performance and Operational Highlights

    • Core net income(1) of $9.6 million, or $1.06 per diluted share(1)
    • Net income of $6.6 million, or $0.73 per diluted share
    • Net interest income of $20.7 million, an increase of $1.3 million from the prior quarter
    • Net interest margin (“NIM”) of 3.78%, up 5 basis points from the prior quarter
    • NIM of 3.79% on a fully-taxable equivalent basis (“NIM - FTE”)(1)
    • Return on average assets (“ROAA”) of 1.15%; return on average stockholders’ equity (“ROAE”) of 12.96%; and return on average tangible common equity (“ROATCE”)(1) of 14.21%
    • Core ROAA(1) of 1.66%; and core ROATCE(1) of 20.50%
    • Efficiency ratio of 48.01%; and core efficiency ratio of 42.79%
    • Linked-quarter loan growth was 13.3% annualized
    • Linked-quarter total deposits declined 1.5% annualized, primarily due to a reduction in brokered deposits
    • Linked-quarter total deposits, excluding brokered deposits, increased 4.2% annualized from the prior quarter

    (1) See “Reconciliation of Non-GAAP Financial Measures” below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

          

    ANNISTON, Ala., Oct. 23, 2023 (GLOBE NEWSWIRE) -- Southern States Bancshares, Inc. (NASDAQ: SSBK) (“Southern States” or the “Company”), the holding company for Southern States Bank, an Alabama state-chartered commercial bank (the “Bank”), today reported net income of $6.6 million, or $0.73 diluted earnings per share, for the third quarter of 2023. This compares to net income of $8.8 million, or $0.98 diluted earnings per share, for the second quarter of 2023, and net income of $6.7 million, or $0.75 diluted earnings per share, for the third quarter of 2022. The Company reported core net income of $9.6 million, or $1.06 diluted core earnings per share, for the third quarter of 2023. This compares to core net income of $7.1 million, or $0.79 diluted core earnings per share, for the second quarter of 2023, and core net income of $6.8 million, or $0.77 diluted core earnings per share, for the third quarter of 2022 (see “Reconciliation of Non-GAAP Financial Measures”).

    CEO Commentary
         
    Mark Chambers, Chief Executive Officer and President of Southern States, said, “Our business development teams continued to identify compelling opportunities in the third quarter, driving annualized sequential loan growth of 13.3% and maintaining the strong momentum we’ve generated over the past two years as we meet steady loan demand across our economically dynamic footprint.”
    “Our growth positioned the bank to capitalize on higher rates, with increased yields on earning assets driving a nearly 7% gain in net interest income from the second quarter and from a year earlier, bolstering our core earnings. As we pursue new business, we remain committed to diligent underwriting and robust credit quality. Our non-performing loans as a percentage of the overall loan portfolio totaled just 0.06%, consistent with the prior quarter.”
    “Importantly, we continue to fund our loan growth with a healthy deposit franchise. Our funding costs did increase during the third quarter to remain competitive in terms of price amid higher rates to keep our total deposit levels relatively stable. However, this was more than offset by our loan growth and gains in yields, and our net interest margin expanded by 5 basis points in the quarter as a result.”
     

    During the second quarter of 2023, the Company received a $5.1 million employee retention credit (“ERC”). The second quarter of 2023 included the $5.1 million ERC in noninterest income, and also included $1.2 million in noninterest expense for professional fees paid by the Company in obtaining the ERC. After reviewing the revised IRS guidelines pertaining to ERC issued during the third quarter, the Company determined to return the full $5.1 million ERC to the IRS and has recorded a payable. The Company will also receive a refund of all professional fees totaling $1.2 million related to ERC. Accordingly, the third quarter of 2023 reflects a $5.1 million reduction in noninterest income and a $1.2 million reduction in noninterest expense related to the return of the ERC. This was deemed a change in circumstance between the second and third quarters of 2023. The following table for the three months ended June 30, 2023 and the three months ended September 30, 2023 eliminates the effect of the ERC. There is no impact on the nine months ended September 30, 2023.

    Results excluding ERC 
     Three Months Ended Nine Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2023
          
    Results of Operations     
    Interest income$35,204  $32,185  $96,088 
    Interest expense 14,473   12,753   36,379 
    Net interest income 20,731   19,432   59,709 
    Provision for credit losses 773   1,557   3,511 
    Net interest income after provision 19,958   17,875   56,198 
    Noninterest income 2,206   1,762   5,755 
    Noninterest expense 9,812   12,189   32,159 
    Income tax expense 2,843   1,572   6,738 
    Net income$9,509  $5,876  $23,056 
          
    Per Share Data     
    Earnings per share:     
    Basic$1.07  $0.67  $2.62 
    Diluted$1.05  $0.66  $2.56 
          
    Performance and Financial Ratios     
    ROAA 1.65%  1.07%  1.41%
    ROAE 18.59%  12.18%  15.85%
    Efficiency ratio 42.76%  57.39%  49.47%
          


    Net Interest Income and Net Interest Margin
     Three Months Ended % Change September 30, 2023
    vs.
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 June 30,
    2023    		 September 30,
    2022
     (Dollars in thousands)    
              
    Average interest-earning assets$2,175,103  $2,091,998  $1,859,104  4.0% 17.0%
    Net interest income$20,731  $19,432  $19,435  6.7% 6.7%
    Net interest margin 3.78%  3.73%  4.15% 5bps (37) bps
              
              

    Net interest income for the third quarter of 2023 was $20.7 million, an increase of 6.7% from $19.4 million for the second quarter of 2023. The increase was primarily driven by the impact of a higher yield on interest-earning assets due to both growth and higher interest rates, which more than offset a higher cost of interest-bearing deposits primarily due to rising interest rates.

    Relative to the third quarter of 2022, net interest income increased $1.3 million, or 6.7%. The increase was primarily the result of a sharp improvement in the yield on interest-earning assets due to both year over year growth and higher interest rates, which outpaced the accelerated rise in costs on interest-bearing liabilities due to a rapid rise in interest rates, coupled with growth in interest-bearing liabilities. A portion of the growth in interest-bearing deposits is due to migration from noninterest-bearing into interest-bearing deposits.

    Net interest margin for the third quarter of 2023 was 3.78%, compared to 3.73% for the second quarter of 2023. The increase was primarily due to an increase in the average balance and yield on interest-earning assets, which outpaced the combined effect of higher average balances and cost of interest-bearing deposits.

    Relative to the third quarter of 2022, net interest margin decreased from 4.15%. The decrease was primarily due to a rapid increase in interest rates, which accelerated the cost on interest-bearing liabilities at a faster pace than the yield received on interest-earning assets. A shift from noninterest-bearing deposits into interest-bearing deposits also had a negative impact on net interest margin.

    Noninterest Income
     Three Months Ended % Change September 30, 2023
    vs.
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 June 30,
    2023    		 September 30,
    2022
     (Dollars in thousands)    
              
    Service charges on deposit accounts$442  $456  $508  (3.1)% (13.0)%
    Swap fees 453   173   11  161.8% 4018.2%
    SBA/USDA fees 74   66   95  12.1% (22.1)%
    Mortgage origination fees 158   188   218  (16.0)% (27.5)%
    Net loss on securities (12)  (45)  (143) (73.3)% (91.6)%
    Employee retention credit and related revenue (5,100)  5,100   —  N/A N/A
    Other operating income 1,091   924   650  18.1% 67.8%
    Total noninterest income$(2,894) $6,862  $1,339  (142.2)% (316.1)%
              
              

    Noninterest income for the third quarter of 2023 was reported as a $2.9 million net expense, compared to noninterest income of $6.9 million for the second quarter of 2023. The change in ERC eligibility between the second and third quarters of 2023 is substantially the reason for the significant variation. This decrease was partially offset by a $280,000 increase in swap fees during the third quarter of 2023.

    Relative to the third quarter of 2022, noninterest income decreased 316.1% from $1.3 million. The decrease was substantially due to the aforementioned return of ERC. This decrease was partially offset by a $280,000 increase in swap fees during the third quarter of 2023 and $132,000 in dividend income realized on equity securities.

    Noninterest Expense
     Three Months Ended % Change September 30, 2023
    vs.
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 June 30,
    2023    		 September 30,
    2022
     (Dollars in thousands)    
              
    Salaries and employee benefits$5,752  $7,863 $6,152 (26.8)% (6.5)%
    Equipment and occupancy expenses 718   694  764 3.5% (6.0)%
    Data processing fees 650   646  599 0.6% 8.5%
    Regulatory assessments 322   180  235 78.9% 37.0%
    Professional fees related to ERC (1,243)  1,243  — N/A N/A
    Other operating expenses 2,370   2,806  2,487 (15.5)% (4.7)%
    Total noninterest expenses$8,569  $13,432 $10,237 (36.2)% (16.3)%
              
              

    Noninterest expense for the third quarter of 2023 was $8.6 million, a decrease of 36.2% from $13.4 million for the second quarter of 2023. The decrease was substantially attributable to a decrease in salaries and benefits as a result of significantly less retirement expenses during the third quarter of 2023, in addition to several open positions. Additionally, the change in ERC eligibility resulted in a $1.2 million refund of professional fees related to the ERC. Provision for unfunded loan commitments decreased $181,000 during the third quarter of 2023.

    Relative to the third quarter of 2022, noninterest expense decreased 16.3% from $10.2 million. The decrease was substantially due to the aforementioned refund of professional fees related to the ERC, a decrease in salaries and benefits as a result of a reduction in employees and a net reduction in forgery/fraud losses during the third quarter of 2023.

    Loans and Credit Quality 
     Three Months Ended % Change September 30, 2023
    vs.
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 June 30,
    2023    		 September 30,
    2022
    (Dollars in thousands)    
              
    Gross loans 1,779,846   1,722,278   1,530,129  3.3% 16.3%
    Unearned income (5,698)  (5,766)  (5,139) (1.2)% 10.9%
    Loans, net of unearned income (“Loans”)$1,774,148  $1,716,512  $1,524,990  3.4% 16.3%
    Average loans, net of unearned (“Average loans”)$1,740,582  $1,676,816  $1,480,735  3.8% 17.5%
              
    Nonperforming loans (“NPL”)$1,082  $1,010  $3,950  7.1% (72.6)%
    Provision for credit losses$773  $1,557  $1,663  (50.4)% (53.5)%
    Allowance for credit losses (“ACL”)$22,181  $21,385  $18,423  3.7% 20.4%
    Net charge-offs (recoveries)$(23) $27  $47  (185.2)% (148.9)%
    NPL to gross loans 0.06%  0.06%  0.26%    
    Net charge-offs (recoveries) to average loans(1)(0.01)%  0.01%  0.01%    
    ACL to loans 1.25%  1.25%  1.21%    
              
    (1)   Ratio is annualized.         
              
              

    Loans, net of unearned income, were $1.8 billion at September 30, 2023, up $57.6 million from June 30, 2023 and up $249.2 million from September 30, 2022. The linked-quarter and year-over-year increases in loans were primarily attributable to new business growth across our footprint.

    Nonperforming loans totaled $1.1 million, or 0.06% of gross loans, at September 30, 2023, compared with $1.0 million, or 0.06% of gross loans, at June 30, 2023, and $4.0 million, or 0.26% of gross loans, at September 30, 2022. The $72,000 net increase in nonperforming loans in the third quarter of 2023 was primarily attributable to a commercial real estate loan that was added to nonaccrual status and partially offset by a commercial real estate loan that moved back to accruing status. The $2.9 million net decrease in nonperforming loans from September 30, 2022, was primarily attributable to a significant commercial real estate loan being moved back to accruing status, two loans that were paid-off and one loan that was charged-off.

    The Company recorded a provision for credit losses of $773,000 for the third quarter of 2023, compared to $1.6 million for the second quarter of 2023. Provision in the second quarter of 2023 was based on increases for qualitative economic factors as well as loan growth, whereas provision in the third quarter of 2023 was based solely on loan growth. The Company expects future provisions to be based on loan growth, unless credit issues arise.

    Net recoveries for the third quarter of 2023 were $23,000, or (0.01)% of average loans on an annualized basis, compared to net charge-offs of $27,000, or 0.01% of average loans on an annualized basis, for the second quarter of 2023, and net charge-offs of $47,000, or 0.01% of average loans on an annualized basis, for the third quarter of 2022.

    The Company’s allowance for credit losses was 1.25% of total loans and 2050.00% of nonperforming loans at September 30, 2023, compared with 1.25% of total loans and 2117.33% of nonperforming loans at June 30, 2023. Allowance for credit losses on unfunded commitments was $1.5 million at September 30, 2023.

    Deposits
     Three Months Ended % Change September 30, 2023
    vs.
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 June 30,
    2023    		 September 30,
    2022
     (Dollars in thousands)    
              
    Noninterest-bearing deposits$418,125  $449,433  $499,613  (7.0)% (16.3)%
    Interest-bearing deposits 1,498,276   1,474,478   1,267,479  1.6% 18.2%
    Total deposits$1,916,401  $1,923,911  $1,767,092  (0.4)% 8.4%
              
    Uninsured deposits$568,323  $553,084  $707,371  2.8% (19.7)%
    Uninsured deposits to total deposits 29.66%  28.75%  40.03%    
    Noninterest deposits to total deposits 21.82%  23.36%  28.27%    
              
              

    Total deposits were $1.9 billion at September 30, 2023, down slightly from June 30, 2023 and up from $1.8 billion at September 30, 2022. The $7.5 million decrease in total deposits in the third quarter was primarily related to a reduction in brokered deposits of $25.9 million, partially offset by an $18.4 million increase in customer deposits. Total brokered deposits were $168.3 million at September 30, 2023.

    Capital
     September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022
    Company Bank Company Bank Company Bank
               
    Tier 1 capital ratio to average assets8.70% 11.71% 8.70% 11.82% 8.44% 11.49%
    Risk-based capital ratios:           
    Common equity tier 1 (“CET1”) capital ratio9.32% 12.55% 9.11% 12.37% 8.73% 11.89%
    Tier 1 capital ratio9.32% 12.55% 9.11% 12.37% 8.73% 11.89%
    Total capital ratio14.60% 13.67% 14.42% 13.47% 12.26% 12.87%
                
                

    As of September 30, 2023, total stockholders’ equity was $201.9 million, up from $197.3 million at June 30, 2023. The increase of $4.7 million was substantially due to earnings growth, partially offset by an increase in accumulated other comprehensive loss resulting from changes in the value of the available for sale securities portfolio.

    About Southern States Bancshares, Inc.
    Headquartered in Anniston, Alabama, Southern States Bancshares, Inc. is a bank holding company that operates primarily through its wholly-owned subsidiary, Southern States Bank. The Bank is a full service community banking institution, which offers an array of deposit, loan and other banking-related products and services to businesses and individuals in its communities. The Bank operates 13 branches in Alabama and Georgia and two loan production offices in Atlanta.

    Forward-Looking Statements
    This press release contains forward-looking statements within the meaning of the federal securities laws, which reflect our current expectations and beliefs with respect to, among other things, future events and our financial performance. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. This may be especially true given recent events and trends in the banking industry and the inflationary environment. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the dates made, we cannot give any assurance that such expectations will prove correct and actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 under the section entitled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors”. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict.

    These statements are often, but not always, made through the use of words or phrases such as “may,” “can,” “should,” “could,” “to be,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “likely,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “target,” “project,” “would” and “outlook,” or the negative version of those words or other similar words or phrases of a future or forward-looking nature. Forward-looking statements appear in a number of places in this press release and may include statements about business strategy and prospects for growth, operations, ability to pay dividends, competition, regulation and general economic conditions.

    Contact Information 
      
    Lynn JoyceKevin Dobbs
    (205) 820-8065(310) 622-8245
    ljoyce@ssbank.bankssbankir@finprofiles.com
      


    SELECT FINANCIAL DATA
    (Dollars in thousands, except share and per share amounts)
              
     Three Months Ended Nine Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 September 30,
    2023    		 September 30,
    2022
             
    Results of Operations         
    Interest income$35,204  $32,185  $22,520  $96,088  $56,144 
    Interest expense 14,473   12,753   3,085   36,379   5,690 
    Net interest income 20,731   19,432   19,435   59,709   50,454 
    Provision for credit losses 773   1,557   1,663   3,511   3,667 
    Net interest income after provision 19,958   17,875   17,772   56,198   46,787 
    Noninterest income (2,894)  6,862   1,339   5,755   4,074 
    Noninterest expense 8,569   13,432   10,237   32,159   29,178 
    Income tax expense 1,866   2,549   2,174   6,738   5,204 
    Net income$6,629  $8,756  $6,700  $23,056  $16,479 
    Core net income(1)$9,563  $7,058  $6,806  $23,901  $16,883 
              
    Share and Per Share Data         
    Shares issued and outstanding 8,834,168   8,738,814   8,705,920   8,834,168   8,705,920 
    Weighted average shares outstanding:         
    Basic 8,846,018   8,763,635   8,693,745   8,791,007   8,797,720 
    Diluted 9,040,687   8,950,847   8,871,116   9,016,603   8,952,600 
    Earnings per share:         
    Basic$0.75  $1.00  $0.77  $2.62  $1.87 
    Diluted$0.73  $0.98  $0.75  $2.56  $1.84 
    Core - diluted(1)$1.06  $0.79  $0.77  $2.65  $1.89 
    Book value per share$22.86  $22.57  $19.56  $22.86  $19.56 
    Tangible book value per share(1)$20.84  $20.52  $17.48  $20.84  $17.48 
    Cash dividends per common share$0.09  $0.09  $0.09  $0.27  $0.27 
              
    Performance and Financial Ratios         
    ROAA 1.15%  1.60%  1.35%  1.41%  1.19%
    ROAE 12.96%  18.15%  15.42%  15.85%  12.72%
    Core ROAA(1) 1.66%  1.29%  1.37%  1.47%  1.21%
    ROATCE(1) 14.21%  20.01%  17.24%  17.47%  14.22%
    Core ROATCE(1) 20.50%  16.13%  17.51%  18.11%  14.57%
    NIM 3.78%  3.73%  4.15%  3.85%  3.85%
    NIM - FTE(2) 3.79%  3.74%  4.17%  3.87%  3.87%
    Net interest spread 2.84%  2.86%  3.86%  3.00%  3.64%
    Yield on loans 6.86%  6.61%  5.37%  6.62%  4.97%
    Yield on interest-earning assets 6.42%  6.17%  4.81%  6.20%  4.29%
    Cost of interest-bearing liabilities 3.58%  3.31%  0.95%  3.20%  0.65%
    Cost of funds(2) 2.80%  2.58%  0.69%  2.48%  0.46%
    Cost of interest-bearing deposits 3.43%  3.12%  0.82%  3.02%  0.52%
    Cost of total deposits 2.63%  2.38%  0.58%  2.29%  0.36%
    Noninterest deposits to total deposits 21.82%  23.36%  28.27%  21.82%  28.27%
    Core deposits to total deposits 86.58%  86.18%  92.17%  86.58%  92.17%
    Uninsured deposits to total deposits 29.66%  28.75%  40.03%  29.66%  40.03%
    Total loans to total deposits 92.58%  89.22%  86.30%  92.58%  86.30%
    Efficiency ratio 48.01%  51.00%  48.94%  49.47%  52.98%
    Core efficiency ratio(1) 42.79%  49.96%  48.94%  47.06%  52.98%
              
              

    (1) See “Reconciliation of Non-GAAP Financial Measures” below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.
    (2) Includes total interest-bearing liabilities and noninterest deposits.

     
    SELECT FINANCIAL DATA
    (Dollars in thousands)
              
     Three Months Ended Nine Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 September 30,
    2023    		 September 30,
    2022
             
    Financial Condition (ending)         
    Total loans$1,774,148  $1,716,512  $1,524,990  $1,774,148  $1,524,990 
    Total securities 189,496   182,717   170,375   189,496   170,375 
    Total assets 2,296,527   2,277,803   2,052,725   2,296,527   2,052,725 
    Total noninterest bearing deposits 418,125   449,433   499,613   418,125   499,613 
    Total core deposits(1) 1,659,291   1,657,961   1,628,660   1,659,291   1,628,660 
    Total deposits 1,916,401   1,923,911   1,767,092   1,916,401   1,767,092 
    Total borrowings 146,573   131,472   93,020   146,573   93,020 
    Total liabilities 2,094,603   2,080,553   1,882,400   2,094,603   1,882,400 
    Total shareholders’ equity 201,924   197,250   170,325   201,924   170,325 
              
    Financial Condition (average)         
    Total loans$1,740,582  $1,676,816  $1,480,735  $1,676,134  $1,373,564 
    Total securities 201,830   196,731   185,670   197,005   175,381 
    Total other interest-earning assets 232,691   218,451   192,699   199,379   202,837 
    Total interest-bearing assets 2,175,103   2,091,998   1,859,104   2,072,518   1,751,782 
    Total assets 2,282,217   2,200,843   1,966,556   2,180,851   1,858,993 
    Total noninterest-bearing deposits 448,616   438,987   491,917   442,149   502,951 
    Total interest-bearing deposits 1,472,024   1,412,047   1,207,797   1,395,529   1,097,693 
    Total deposits 1,920,640   1,851,034   1,699,714   1,837,678   1,600,644 
    Total borrowings 129,882   131,411   75,039   122,156   68,719 
    Total interest-bearing liabilities 1,601,906   1,543,458   1,282,836   1,517,685   1,166,412 
    Total shareholders’ equity 202,955   193,516   172,402   194,430   173,210 
              
    Asset Quality         
    Nonperforming loans$1,082  $1,010  $3,950  $1,082  $3,950 
    Other real estate owned (“OREO”)$2,903  $2,870  $2,930  $2,903  $2,930 
    Nonperforming assets (“NPA”)$3,985  $3,880  $6,880  $3,985  $6,880 
    Net charge-offs (recovery) to average loans(2)(0.01)         %  0.01%  0.01%  0.02%  0.01%
    Provision for credit losses to average loans(2) 0.18%  0.37%  0.45%  0.28%  0.36%
    ACL to loans 1.25%  1.25%  1.21%  1.25%  1.21%
    ACL to gross loans 1.25%  1.24%  1.20%  1.25%  1.20%
    ACL to NPL 2050.00%  2117.33%  466.41%  2050.00%  466.41%
    NPL to loans 0.06%  0.06%  0.26%  0.06%  0.26%
    NPL to gross loans 0.06%  0.06%  0.26%  0.06%  0.26%
    NPA to gross loans and OREO 0.22%  0.22%  0.45%  0.22%  0.45%
    NPA to total assets 0.17%  0.17%  0.34%  0.17%  0.34%
              
    Regulatory and Other Capital Ratios         
    Total shareholders’ equity to total assets 8.79%  8.66%  8.30%  8.79%  8.30%
    Tangible common equity to tangible assets(3) 8.08%  7.94%  7.48%  8.08%  7.48%
    Tier 1 capital ratio to average assets 8.70%  8.70%  8.44%  8.70%  8.44%
    Risk-based capital ratios:         
    CET1 capital ratio 9.32%  9.11%  8.73%  9.32%  8.73%
    Tier 1 capital ratio 9.32%  9.11%  8.73%  9.32%  8.73%
    Total capital ratio 14.60%  14.42%  12.26%  14.60%  12.26%
              
              

    (1) We define core deposits as total deposits excluding brokered deposits and time deposits greater than $250,000.
    (2) Ratio is annualized.
    (3) See “Reconciliation of Non-GAAP Financial Measures” below for reconciliation of non-GAAP financial measures to their most closely comparable GAAP financial measures.

     
        CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
         (Dollars in thousands)
            
     September 30,
    2023    		 June 30,
    2023    		 December 31,
    2022    		 September 30,
    2022
    (Unaudited) (Unaudited) (Audited) (Unaudited)
           
    Assets       
    Cash and due from banks$31,047  $21,299  $15,260  $17,394 
    Interest-bearing deposits in banks 103,646   159,818   90,198   165,637 
    Federal funds sold 81,487   84,812   63,041   63,031 
    Total cash and cash equivalents 216,180   265,929   168,499   246,062 
            
    Securities available for sale, at fair value 169,859   163,075   155,544   150,718 
    Securities held to maturity, at amortized cost 19,637   19,642   19,652   19,657 
    Other equity securities, at fair value 3,654   3,762   4,444   5,694 
    Restricted equity securities, at cost 4,971   3,862   3,134   2,791 
    Loans held for sale 1,799   1,589   1,047   1,643 
            
    Loans, net of unearned income 1,774,148   1,716,512   1,587,164   1,524,990 
    Less allowance for credit losses 22,181   21,385   20,156   18,423 
    Loans, net 1,751,967   1,695,127   1,567,008   1,506,567 
            
    Premises and equipment, net 26,694   26,957   27,345   28,585 
    Accrued interest receivable 8,321   7,372   6,963   5,699 
    Bank owned life insurance 29,697   29,521   29,186   29,677 
    Annuities 15,266   15,359   15,478   15,564 
    Foreclosed assets 2,903   2,870   2,930   2,930 
    Goodwill 16,862   16,862   16,862   16,862 
    Core deposit intangible 981   1,062   1,226   1,302 
    Other assets 27,736   24,814   25,886   18,974 
            
    Total assets$2,296,527  $2,277,803  $2,045,204  $2,052,725 
            
    Liabilities and Stockholders’ Equity       
    Liabilities:       
    Deposits:       
    Noninterest-bearing$418,125  $449,433  $460,977  $499,613 
    Interest-bearing 1,498,276   1,474,478   1,259,766   1,267,479 
    Total deposits 1,916,401   1,923,911   1,720,743   1,767,092 
            
    Other borrowings 4,991   (13)  (19)  19,978 
    FHLB advances 55,000   45,000   31,000   26,000 
    Subordinated notes 86,582   86,485   86,314   47,042 
    Accrued interest payable 1,280   1,063   584   359 
    Other liabilities 30,349   24,107   24,863   21,929 
            
    Total liabilities 2,094,603   2,080,553   1,863,485   1,882,400 
    Stockholders’ equity:       
    Common stock 44,307   43,831   43,714   43,529 
    Capital surplus 77,671   77,101   76,785   75,835 
    Retained earnings 94,429   88,603   73,764   63,956 
    Accumulated other comprehensive loss (13,126)  (10,799)  (11,048)  (12,403)
    Unvested restricted stock (580)  (709)  (477)  (592)
    Vested restricted stock units (777)  (777)  (1,019)  — 
            
    Total stockholders’ equity 201,924   197,250   181,719   170,325 
            
    Total liabilities and stockholders’ equity$2,296,527  $2,277,803  $2,045,204  $2,052,725 
                    


        CONSOLIDATED STATEMENTS OF INCOME
       (Dollars in thousands, except per share amounts)
              
     Three Months Ended Nine Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 September 30,
    2023    		 September 30,
    2022
    (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
    Interest income:         
    Loans, including fees$30,084  $27,630  $20,052  $83,049 $51,083 
    Taxable securities 1,796   1,641   1,010   4,819  2,417 
    Nontaxable securities 227   228   323   747  931 
    Other interest and dividends 3,097   2,686   1,135   7,473  1,713 
    Total interest income 35,204   32,185   22,520   96,088  56,144 
              
    Interest expense:         
    Deposits 12,732   10,998   2,489   31,498  4,251 
    Other borrowings 1,741   1,755   596   4,881  1,439 
    Total interest expense 14,473   12,753   3,085   36,379  5,690 
              
    Net interest income 20,731   19,432   19,435   59,709  50,454 
    Provision for credit losses 773   1,557   1,663   3,511  3,667 
    Net interest income after provision for credit losses 19,958   17,875   17,772   56,198  46,787 
              
    Noninterest income:         
    Service charges on deposit accounts 442   456   508   1,348  1,433 
    Swap fees 453   173   11   622  48 
    SBA/USDA fees 74   66   95   274  575 
    Mortgage origination fees 158   188   218   446  717 
    Net (loss) gain on securities (12)  (45)  (143)  457  (546)
    Employee retention credit and related revenue (5,100)  5,100   —   —  — 
    Other operating income 1,091   924   650   2,608  1,847 
    Total noninterest income (2,894)  6,862   1,339   5,755  4,074 
              
    Noninterest expenses:         
    Salaries and employee benefits 5,752   7,863   6,152   19,926  17,859 
    Equipment and occupancy expenses 718   694   764   2,095  2,188 
    Data processing fees 650   646   599   1,889  1,733 
    Regulatory assessments 322   180   235   844  760 
    Professional fees related to ERC (1,243)  1,243   —   —  — 
    Other operating expenses 2,370   2,806   2,487   7,405  6,638 
    Total noninterest expenses 8,569   13,432   10,237   32,159  29,178 
              
    Income before income taxes 8,495   11,305   8,874   29,794  21,683 
              
    Income tax expense 1,866   2,549   2,174   6,738  5,204 
              
    Net income$6,629  $8,756  $6,700  $23,056 $16,479 
              
    Basic earnings per share$0.75  $1.00  $0.77  $2.62 $1.87 
              
    Diluted earnings per share$0.73  $0.98  $0.75  $2.56 $1.84 
                       


    AVERAGE BALANCE SHEET AND NET INTEREST MARGIN
    (Dollars in thousands)
                      
     Three Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022
    Average
    Balance    		 Interest Yield/Rate Average
    Balance    		 Interest Yield/Rate Average
    Balance    		 Interest Yield/Rate
    Assets:                 
    Interest-earning assets:                 
    Loans, net of unearned income(1)$1,740,582  $30,084 6.86% $1,676,816  $27,630 6.61% $1,480,735  $20,052 5.37%
    Taxable securities 156,364   1,796 4.56%  151,107   1,641 4.36%  128,932   1,010 3.11%
    Nontaxable securities 45,466   227 1.98%  45,624   228 2.00%  56,738   323 2.26%
    Other interest-earnings assets 232,691   3,097 5.28%  218,451   2,686 4.93%  192,699   1,135 2.34%
    Total interest-earning assets$2,175,103  $35,204 6.42% $2,091,998  $32,185 6.17% $1,859,104  $22,520 4.81%
    Allowance for credit losses (21,606)      (20,154)      (17,250)    
    Noninterest-earning assets 128,720       128,999       124,702     
    Total Assets$2,282,217      $2,200,843      $1,966,556     
                      
    Liabilities and Stockholders’ Equity:                 
    Interest-bearing liabilities:                 
    Interest-bearing transaction accounts 88,668   20 0.09%  92,245   20 0.09%  114,517   26 0.09%
    Savings and money market accounts 867,066   7,767 3.55%  845,742   6,872 3.26%  811,349   1,644 0.80%
    Time deposits 516,290   4,945 3.80%  474,060   4,106 3.47%  281,931   819 1.15%
    FHLB advances 43,261   514 4.72%  45,000   529 4.72%  27,380   102 1.47%
    Other borrowings 86,621   1,227 5.62%  86,411   1,226 5.69%  47,659   494 4.12%
    Total interest-bearing liabilities$1,601,906  $14,473 3.58% $1,543,458  $12,753 3.31% $1,282,836  $3,085 0.95%
                      
    Noninterest-bearing liabilities:                 
    Noninterest-bearing deposits$448,616      $438,987      $491,917     
    Other liabilities 28,740       24,882       19,401     
    Total noninterest-bearing liabilities 477,356       463,869       511,318     
    Stockholders’ Equity 202,955       193,516       172,402     
    Total Liabilities and Stockholders’ Equity$2,282,217      $2,200,843      $1,966,556     
                      
    Net interest income  $20,731     $19,432     $19,435  
    Net interest spread(2)    2.84%     2.86%     3.86%
    Net interest margin(3)    3.78%     3.73%     4.15%
    Net interest margin - FTE(4)(5)    3.79%     3.74%     4.17%
    Cost of funds(6)    2.80%     2.58%     0.69%
    Cost of interest-bearing deposits    3.43%     3.12%     0.82%
    Cost of total deposits    2.63%     2.38%     0.58%
                         

    (1)   Includes nonaccrual loans.
    (2)   Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.
    (3)   Net interest margin is a ratio of net interest income to average interest earning assets for the same period.
    (4)   Net interest margin - FTE is a ratio of fully-taxable equivalent net interest income to average interest earning assets for the same period. It assumes a 24.0% tax rate.
    (5)   Refer to “Reconciliation of Non-GAAP Financial Measures”.
    (6)   Includes total interest-bearing liabilities and noninterest deposits.

     
    AVERAGE BALANCE SHEET AND NET INTEREST MARGIN
    (Dollars in thousands)
                
     Nine Months Ended
    September 30,
    2023    		 September 30,
    2022
    Average
    Balance    		 Interest Yield/Rate Average
    Balance    		 Interest Yield/Rate
    Assets:           
    Interest-earning assets:           
    Loans, net of unearned income(1)$1,676,134  $83,049 6.62% $1,373,564  $51,083 4.97%
    Taxable securities 149,058   4,819 4.32%  119,224   2,417 2.71%
    Nontaxable securities 47,947   747 2.08%  56,157   931 2.22%
    Other interest-earnings assets 199,379   7,473 5.01%  202,837   1,713 1.13%
    Total interest-earning assets$2,072,518  $96,088 6.20% $1,751,782  $56,144 4.29%
    Allowance for credit losses (20,750)      (16,044)    
    Noninterest-earning assets 129,083       123,255     
    Total Assets$2,180,851      $1,858,993     
                
    Liabilities and Stockholders’ Equity:           
    Interest-bearing liabilities:           
    Interest-bearing transaction accounts 91,602   59 0.09%  113,427   78 0.09%
    Savings and money market accounts 839,827   19,679 3.13%  741,397   2,862 0.52%
    Time deposits 464,100   11,760 3.39%  242,869   1,311 0.72%
    FHLB advances 35,703   1,202 4.50%  26,115   144 0.74%
    Other borrowings 86,453   3,679 5.69%  42,604   1,295 4.06%
    Total interest-bearing liabilities$1,517,685  $36,379 3.20% $1,166,412  $5,690 0.65%
                
    Noninterest-bearing liabilities:           
    Noninterest-bearing deposits$442,149      $502,951     
    Other liabilities 26,587       16,420     
    Total noninterest-bearing liabilities$468,736      $519,371     
    Stockholders’ Equity 194,430       173,210     
    Total Liabilities and Stockholders’ Equity$2,180,851      $1,858,993     
                
    Net interest income  $59,709     $50,454  
    Net interest spread(2)    3.00%     3.64%
    Net interest margin(3)    3.85%     3.85%
    Net interest margin - FTE(4)(5)    3.87%     3.87%
    Cost of funds(6)    2.48%     0.46%
    Cost of interest-bearing deposits    3.02%     0.52%
    Cost of total deposits    2.29%     0.36%
                  

    (1)   Includes nonaccrual loans.
    (2)   Net interest spread is the difference between interest rates earned on interest earning assets and interest rates paid on interest-bearing liabilities.
    (3)   Net interest margin is a ratio of net interest income to average interest earning assets for the same period.
    (4)   Net interest margin - FTE is a ratio of fully-taxable equivalent net interest income to average interest earning assets for the same period. It assumes a 24.0% tax rate.
    (5)   Refer to “Reconciliation of Non-GAAP Financial Measures”.
    (6)   Includes total interest-bearing liabilities and noninterest deposits.

     
    LOAN COMPOSITION
    (Dollars in thousands)
                    
     September 30,
    2023    		 June 30,
    2023    		 December 31,
    2022    		 September 30,
    2022
    Amount % of gross Amount % of gross Amount % of gross Amount % of gross
                   
    Real estate mortgages:               
    Construction and development$229,188  12.9% $228,236  13.3% $255,736  16.1% $222,159  14.5%
    Residential 224,499  12.6%  214,897  12.5%  167,891  10.5%  164,296  10.7%
    Commercial 1,049,545  59.0%  1,011,815  58.7%  904,872  56.8%  889,942  58.2%
    Commercial and industrial 268,283  15.0%  259,195  15.0%  256,553  16.1%  243,577  15.9%
    Consumer and other 8,331  0.5%  8,135  0.5%  7,655  0.5%  10,155  0.7%
    Gross loans 1,779,846  100.0%  1,722,278  100.0%  1,592,707  100.0%  1,530,129  100.0%
    Unearned income (5,698)    (5,766)    (5,543)    (5,139)  
    Loans, net of unearned income 1,774,148     1,716,512     1,587,164     1,524,990   
    Allowance for credit losses (22,181)    (21,385)    (20,156)    (18,423)  
    Loans, net$1,751,967    $1,695,127    $1,567,008    $1,506,567   
                            


    DEPOSIT COMPOSITION
    (Dollars in thousands)
                    
     September 30,
    2023    		 June 30,
    2023    		 December 31,
    2022    		 September 30,
    2022
    Amount % of total Amount % of total Amount % of total Amount % of total
                   
                    
    Noninterest-bearing transaction$418,125 21.8% $449,433 23.3% $460,977 26.8% $499,613 28.3%
    Interest-bearing transaction 934,383 48.8%  922,835 48.0%  837,127 48.6%  855,350 48.4%
    Savings 38,518 2.0%  41,574 2.2%  49,235 2.9%  78,687 4.5%
    Time deposits, $250,000 and under 436,613 22.8%  438,228 22.8%  307,145 17.8%  266,491 15.0%
    Time deposits, over $250,000 88,762 4.6%  71,841 3.7%  66,259 3.9%  66,951 3.8%
    Total deposits$1,916,401 100.0% $1,923,911 100.0% $1,720,743 100.0% $1,767,092 100.0%
                            


    Nonperforming Assets
    (Dollars in thousands)
            
     September 30,
    2023    		 June 30,
    2023    		 December 31,
    2022    		 September 30,
    2022
           
           
    Nonaccrual loans$1,082  $1,010  $2,245  $3,950 
    Past due loans 90 days or more and still accruing interest —   —   —   — 
    Total nonperforming loans 1,082   1,010   2,245   3,950 
    OREO 2,903   2,870   2,930   2,930 
    Total nonperforming assets$3,985  $3,880  $5,175  $6,880 
            
    Troubled debt restructured loans – nonaccrual(1) 970   724   832   1,011 
    Troubled debt restructured loans – accruing 1,052   1,328   1,292   1,307 
    Total troubled debt restructured loans$2,022  $2,052  $2,124  $2,318 
            
    Allowance for credit losses$22,181  $21,385  $20,156  $18,423 
    Loans, net of unearned income at the end of the period$1,774,148  $1,716,512  $1,587,164  $1,524,990 
    Gross loans outstanding at the end of period$1,779,846  $1,722,278  $1,592,707  $1,530,129 
    Total assets$2,296,527  $2,277,803  $2,045,204  $2,052,725 
    Allowance for credit losses to nonperforming loans 2050.00%  2117.33%  897.82%  466.41%
    Nonperforming loans to loans, net of unearned income 0.06%  0.06%  0.14%  0.26%
    Nonperforming loans to gross loans 0.06%  0.06%  0.14%  0.26%
    Nonperforming assets to gross loans and OREO 0.22%  0.22%  0.32%  0.45%
    Nonperforming assets to total assets 0.17%  0.17%  0.25%  0.34%
            
    Nonaccrual loans by category:       
    Real estate mortgages:       
    Construction & Development$—  $33  $67  $70 
    Residential Mortgages 289   297   565   550 
    Commercial Real Estate Mortgages 785   671   1,278   2,888 
    Commercial & Industrial 8   9   312   434 
    Consumer and other —   —   23   8 
    Total$1,082  $1,010  $2,245  $3,950 
                    

    (1) Troubled debt restructured loans are excluded from nonperforming loans unless they otherwise meet the definition of nonaccrual loans or are more than 90 days past due.

     
    Allowance for Credit Losses
    (Dollars in thousands)
              
     Three Months Ended Nine Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 September 30,
    2023    		 September 30,
    2022
             
    Average loans, net of unearned income$1,740,582  $1,676,816  $1,480,735  $1,676,134  $1,373,564 
    Loans, net of unearned income$1,774,148  $1,716,512  $1,524,990  $1,774,148  $1,524,990 
    Gross loans$1,779,846  $1,722,278  $1,530,129  $1,779,846  $1,530,129 
    Allowance for credit losses at beginning of the period$21,385  $19,855  $16,807  $20,156  $14,844 
    Impact of adoption of ASC 326$—  $—  $—  $(1,285) $— 
    Charge-offs:         
    Construction and development 3   —   —   3   66 
    Residential —   —   —   —   7 
    Commercial —   —   —   —   — 
    Commercial and industrial —   44   269   262   269 
    Consumer and other —   —   1   6   8 
    Total charge-offs 3   44   270   271   350 
    Recoveries:         
    Construction and development —   —   —   —   — 
    Residential 10   17   11   38   46 
    Commercial —   —   —   —   — 
    Commercial and industrial —   —   204   14   204 
    Consumer and other 16   —   8   18   12 
    Total recoveries 26   17   223   70   262 
    Net charge-offs (recoveries)$(23) $27  $47  $201  $88 
              
    Provision for credit losses$773  $1,557  $1,663  $3,511  $3,667 
    Balance at end of the period$22,181  $21,385  $18,423  $22,181  $18,423 
              
    Allowance for credit losses on unfunded commitments at beginning of the period$1,495  $1,285  $—  $—  $— 
    Impact of adoption of ASC 326 —   —   —   1,285   — 
    Provision for credit losses on unfunded commitments 29   210   —   239   — 
    Balance at the end of the period$1,524  $1,495  $—  $1,524  $— 
              
    Allowance to loans, net of unearned income 1.25%  1.25%  1.21%  1.25%  1.21%
    Allowance to gross loans 1.25%  1.24%  1.20%  1.25%  1.20%
    Net charge-offs (recoveries) to average loans, net of unearned income(1)(0.01)%  0.01%  0.01%  0.02%  0.01%
    Provision for credit losses to average loans, net of unearned income(1) 0.18%  0.37%  0.45%  0.28%  0.36%
                        

    (1) Ratio is annualized.

    Reconciliation of Non-GAAP Financial Measures

    In addition to reporting GAAP results, the Company reports non-GAAP financial measures in this earnings release and other disclosures. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our performance. While we believe that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.

    The following table provides a reconciliation of the non-GAAP financial measures to their most directly comparable financial measure presented in accordance with GAAP.

    Reconciliation of Non-GAAP Financial Measures
    (Dollars in thousands, except share and per share amounts)
              
     Three Months Ended Nine Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 September 30,
    2023    		 September 30,
    2022
             
    Net income$6,629  $8,756  $6,700  $23,056  $16,479 
    Add:  One-time retirement related expenses —   1,571   —   1,571   — 
    Add:  Professional fees related to ERC (1,243)  1,243   —   —   — 
    Add:  Net OREO (losses) gains (9)  7   —   (2)  — 
    Less: Employee retention related revenue (5,100)  5,100   —   —   — 
    Less: (Loss) gain on securities (12)  (45)  (143)  457   (546)
    Less: Tax effect 926   (536)  37   267   142 
    Core net income$          9,563  $          7,058  $6,806  $23,901  $16,883 
    Average assets$2,282,217  $2,200,843  $1,966,556  $2,180,851  $1,858,993 
    Core return on average assets         1.66 %          1.29 %          1.37 %          1.47 %          1.21 %
              
    Net income$6,629  $8,756  $6,700  $23,056  $16,479 
    Add:  One-time retirement related expenses —   1,571   —   1,571   — 
    Add:  Professional fees related to ERC (1,243)  1,243   —   —   — 
    Add:  Net OREO (losses) gains (9)  7   —   (2)  — 
    Add:  Provision 773   1,557   1,663   3,511   3,667 
    Less: Employee retention related revenue (5,100)  5,100   —   —   — 
    Less: (Loss) gain on securities (12)  (45)  (143)  457   (546)
    Add:  Income taxes 1,866   2,549   2,174   6,738   5,204 
    Pretax pre-provision core net income$13,128  $10,628  $10,680  $34,417  $25,896 
    Average assets$2,282,217  $2,200,843  $1,966,556  $2,180,851  $1,858,993 
    Pretax pre-provision core return on average assets         2.28 %          1.94 %          2.15 %          2.11 %          1.86 %
              
    Net interest income$20,731  $19,432  $19,435  $59,709  $50,454 
    Add:  Fully-taxable equivalent adjustments(1) 70   65   86   213   251 
    Net interest income - FTE$20,801  $19,497  $19,521  $59,922  $50,705 
              
    Net interest margin 3.78%  3.73%  4.15%  3.85%  3.85%
    Effect of fully-taxable equivalent adjustments(1) 0.01%  0.01%  0.02%  0.02%  0.02%
    Net interest margin - FTE         3.79 %          3.74 %          4.17 %          3.87 %          3.87 %
              
    Total stockholders’ equity$201,924  $197,250  $170,325  $201,924  $170,325 
    Less:  Intangible assets 17,843   17,924   18,164   17,843   18,164 
    Tangible common equity$184,081  $179,326  $152,161  $184,081  $152,161 
                        

    (1) Assumes a 24.0% tax rate.

     
    Reconciliation of Non-GAAP Financial Measures
    (Dollars in thousands, except share and per share amounts)
              
     Three Months Ended Nine Months Ended
    September 30,
    2023    		 June 30,
    2023    		 September 30,
    2022    		 September 30,
    2023    		 September 30,
    2022
             
    Core net income$9,563  $7,058  $6,806  $23,901  $16,883 
    Diluted weighted average shares outstanding 9,040,687   8,950,847   8,871,116   9,016,603   8,952,600 
    Diluted core earnings per share$1.06  $0.79  $0.77  $2.65  $1.89 
              
    Common shares outstanding at year or period end 8,834,168   8,738,814   8,705,920   8,834,168   8,705,920 
    Tangible book value per share$20.84  $20.52  $17.48  $20.84  $17.48 
              
    Total assets at end of period$2,296,527  $2,277,803  $2,052,725  $2,296,527  $2,052,725 
    Less:  Intangible assets 17,843   17,924   18,164   17,843   18,164 
    Adjusted assets at end of period$2,278,684  $2,259,879  $2,034,561  $2,278,684  $2,034,561 
    Tangible common equity to tangible assets         8.08 %          7.94 %          7.48 %          8.08 %          7.48 %
              
    Total average shareholders equity$202,955  $193,516  $172,402  $194,430  $173,210 
    Less:  Average intangible assets 17,893   17,974   18,203   17,973   18,270 
    Average tangible common equity$185,062  $175,542  $154,199  $176,457  $154,940 
    Net income to common shareholders$6,629  $8,756  $6,700  $23,056  $16,479 
    Return on average tangible common equity 14.21%  20.01%  17.24%  17.47%  14.22%
    Average tangible common equity$185,062  $175,542  $154,199  $176,457  $154,940 
    Core net income$9,563  $7,058  $6,806  $23,901  $16,883 
    Core return on average tangible common equity 20.50%  16.13%  17.51%  18.11%  14.57%
              
    Net interest income$20,731  $19,432  $19,435  $59,709  $50,454 
    Add:  Noninterest income (2,894)  6,862   1,339   5,755   4,074 
    Less: Employee retention related revenue (5,100)  5,100   —   —   — 
    Less: (Loss) gain on securities (12)  (45)  (143)  457   (546)
    Operating revenue$22,949  $21,239  $20,917  $65,007  $55,074 
              
    Expenses:         
    Total noninterest expense$8,569  $13,432  $10,237  $32,159  $29,178 
    Less: One-time retirement related expenses —   1,571   —   1,571   — 
    Less: Professional fees related to ERC (1,243)  1,243   —   —   — 
    Less: Net OREO (losses) gains (9)  7   —   (2)  — 
    Adjusted noninterest expenses$9,821  $10,611  $10,237  $30,590  $29,178 
    Core efficiency ratio 42.79%  49.96%  48.94%  47.06%  52.98%

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