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Solera National Bancorp Announces Third Quarter 2023 Financial Results

Total deposits are now over $1 Billion, up 21% from 12/31/2022.

Year-to-date net income of 13.1 million is on pace to equal 2022.

LAKEWOOD, CO / ACCESSWIRE / October 19, 2023 / Solera National Bancorp, Inc. (OTC PINK:SLRK) ("Company"), the holding company for Solera National Bank ("Bank"), a business-focused bank located in the Denver metropolitan area, today reported financial results for the three months and nine months ended September 30, 2023. For the third quarter of 2023, net income was $4.9 million ($1.11 per share) and $13.1 million year to date.

3Q23 Financial Highlights

(Comparison to 3Q22 unless otherwise noted)

  • The Company had a pre-tax, pre-provision income of $5.9 million in the third quarter of 2023 compared to $5.2 million from Q2 2023.
  • Net interest income of $8.5 million for the third quarter of 2023 represents a 15% increase over the $7.4 million.
  • Our cost of funds has increased 188 BPS from Q3 2022.
  • Return on equity was 29.40%.
  • Total criticized loans have decreased by 40 bps. Non-performing loans 0.87%.
  • Efficiency ratio stayed low at 39.25%.
  • Total non-interest expense decreased by $849 thousand or 18%.

Michael Quagliano, Executive Chairman of the Board, commented: "Wow, in this high-rate environment, we made 1.11 EPS and over 10% return in one quarter for the shareholders. I/we continue to work relentlessly for the shareholders. If you have a new metric to judge us on, let me know what it is, and we will achieve that, too!"

Steve Snailum, COO, commented: "Solera continues to demonstrate strength and resilience in the face of challenges. The foresight and strategic thinking of bank leadership has enabled the bank to thrive in both rates up and rates down economic cycles, and furthermore, the ability of the team to execute the strategy remains a pillar of success for Solera. As Thomas Edison said, "Genius is one percent inspiration, ninety-nine percent perspiration." Solera is never afraid of hard work, and we are committed to providing exceptional service and results to our clients and shareholders ."

Kreighton Reed, EVP, commented: "Non-interest bearing deposits have been and will remain a main priority for Solera. We will be expanding our product set to expand our non-interest bearing growth. Our non-interest bearing deposits have shown strong resilience to this high rate environment."

Tim Pester, the Controller, commented: " We are excited to report another outstanding quarter, as our bank's strong earnings performance in this elevated rate environment reflects our unwavering commitment to financial excellence and our ability to navigate dynamic economic landscapes with precision and resilience."

Jay Hansen, CFO, commented: "We slowed down our growth mainly because of a core system conversion and to let our capital numbers catch up, and we have significantly reduced our FHLB borrowings & moved to more core deposits. Higher for longer appears to be the Fed position, but we are ready for markets to go up or down. I am very proud of our team and the extra hours they have put in during our exhausting conversion. Our key ratios are some of the best for less than $2 Billion banks, especially in Colorado."

About Solera National Bancorp, Inc.

Solera National Bancorp, Inc. was incorporated in 2006 to organize and serve as the holding company for Solera National Bank, which opened for business in September 2007. Solera National Bank is a community bank serving the needs of emerging businesses and real estate investors. At the core of Solera National Bank is welcoming, attentive, and respectful customer service, a focus on supporting a growing and diverse economy, and a passion to serve our community through service, education, and volunteerism. For more information, please visit http://www.SoleraBank.com.

This press release contains statements that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The statements contained in this release, which are not historical facts and that relate to future plans or projected results of Solera National Bancorp, Inc. and its wholly-owned subsidiary, Solera National Bank, are forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated, or implied. We undertake no obligation to update or revise any forward-looking statement. Readers of this release are cautioned not to put undue reliance on forward-looking statements.

Contacts: Jay Hansen, CFO (303) 209-8600

FINANCIAL TABLES FOLLOW

SOLERA NATIONAL BANCORP, INC.
CONSOLIDATED BALANCE SHEET
(unaudited)

($000s)
9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022
ASSETS
Cash and due from banks
$ 2,156 $ 1,657 $ 1,957 $ 3,490 $ 2,683
Federal funds sold
- - 5,300 - -
Interest-bearing deposits with banks
1,651 1,528 2,214 1,499 2,379
Investment securities, available-for-sale
169,673 173,552 170,033 164,176 154,044
Investment securities, held-to-maturity
199,875 204,900 205,425 207,048 205,475
FHLB and Federal Reserve Bank stocks, at cost
7,516 9,043 7,103 3,954 3,843
Paycheck Protection Program (PPP) loans, gross
86 111 111 578 589
Net deferred (fees)/expenses, PPP loans
- - - (6 ) (7 )
Net PPP loans
86 111 111 572 582
Traditional loans, gross
746,198 745,666 717,943 578,584 539,568
Allowance for loan and lease losses
(9,405 ) (9,404 ) (8,847 ) (8,005 ) (8,004 )
Net traditional loans
736,793 736,262 709,096 570,188 531,147
Premises and equipment, net
28,918 27,625 26,816 25,266 25,040
Accrued interest receivable
7,232 6,557 7,044 5,825 5,833
Bank-owned life insurance
4,972 4,944 4,917 4,891 4,864
Other assets
12,611 8,952 10,291 8,408 11,003
TOTAL ASSETS
$ 1,171,483 $ 1,175,131 $ 1,150,307 $ 995,317 $ 946,893
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing demand deposits
$ 509,382 $ 539,522 $ 536,880 $ 551,990 $ 543,260
Interest-bearing demand deposits
46,153 42,825 56,715 40,853 33,236
Savings and money market deposits
272,948 219,834 210,476 202,542 170,148
Time deposits
232,728 130,716 147,174 84,398 108,520
Total deposits
1,061,211 932,897 951,245 879,783 855,164

Accrued interest payable
1,042 150 70 438 238
Short-term borrowings
7,100 137,193 98,432 52,175 37,223
Long-term FHLB borrowings
34,000 34,000 34,000 4,000 4,000
Accounts payable and other liabilities
2,860 2,786 2,489 1,192 628
TOTAL LIABILITIES
1,106,213 1,107,026 1,086,236 937,588 897,253
Common stock
43 43 43 43 43
Additional paid-in capital
38,748 38,748 38,748 38,748 38,748
Retained earnings
50,877 46,240 42,562 37,978 32,994
Accumulated other comprehensive (loss) gain
(24,398 ) (16,926 ) (17,282 ) (19,040 ) (22,145 )
TOTAL STOCKHOLDERS' EQUITY
65,270 68,105 64,071 57,729 49,640
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$ 1,171,483 $ 1,175,131 $ 1,150,307 $ 995,317 $ 946,893

SOLERA NATIONAL BANCORP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

Three Months Ended
($000s, except per share data)
9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022
Interest and dividend income
Interest and fees on traditional loans
$ 11,638 $ 10,684 $ 9,691 $ 7,678 $ 6,140
Interest and fees on PPP loans
- - 11 2 277
Investment securities
3,826 3,679 3,549 3,500 3,130
Dividends on bank stocks
163 163 120 64 68
Other
59 23 17 18 18
Total interest income
$ 15,686 $ 14,549 $ 13,388 $ 11,262 9,633
Interest expense
Deposits
5,680 4,307 3,947 2,322 1,062
FHLB & Fed borrowings
1,497 1,819 1,281 480 327
Total interest expense
7,177 6,126 5,228 2,802 1,389
Net interest income
8,509 8,423 8,160 8,460 8,244
Provision for loan and lease losses
9 559 759 5 859
Net interest income after
provision for loan and lease losses
8,500 7,864 7,401 8,455 7,385
Noninterest income
Customer service and other fees
372 417 405 303 257
Other income
822 972 747 726 551
Gain on sale of loan
- - - - -
Gain on sale of securities
- - 242 96 478
Total noninterest income
1,194 1,389 1,394 1,125 1,286
Noninterest expense
Employee compensation and benefits
1,957 2,101 2,015 1,949 1,690
Occupancy
341 336 292 310 198
Professional fees
148 96 112 110 65
Other general and administrative
1,362 2,124 1,104 1,406 974
Total noninterest expense
3,808 4,657 3,523 3,775 2,927
Net Income Before Taxes
$ 5,886 $ 4,596 $ 5,273 $ 5,805 $ 5,744
Income Tax Expense
985 968 689 821 843
Net Income
$ 4,901 $ 3,628 $ 4,584 $ 4,984 $ 4,901
Income Per Share
$ 1.11 $ 0.84 $ 1.03 $ 1.16 $ 1.14
Tangible Book Value Per Share
$ 14.72 $ 15.84 $ 14.45 $ 13.43 $ 11.54
WA Shares outstanding
4,433,286 4,299,953 4,433,286 4,299,953 4,299,953
Pre-Tax Pre-Provision Income
$ 5,895 $ 5,155 $ 6,032 $ 5,810 $ 6,603
Net Interest Margin
3.29 % 3.37 % 3.36 % 3.97 % 4.18 %
Cost of Funds
2.54 % 2.24 % 1.98 % 1.21 % 0.66 %
Efficiency Ratio
39.25 % 47.46 % 37.83 % 39.78 % 32.34 %
Return on Average Assets
1.67 % 1.25 % 1.71 % 2.05 % 2.22 %
Return on Average Equity
29.40 % 21.96 % 30.11 % 37.14 % 38.43 %
Leverage Ratio
7.6 % 7.3 % 7.2 % 7.9 % 8.1 %
Asset Quality:
Non-performing loans to gross loans
0.87 % 1.07 % 0.74 % 0.93 % 1.01 %
Non-performing assets to total assets
0.55 % 0.68 % 0.46 % 0.54 % 0.57 %
Allowance for loan losses to gross traditional loans
1.24 % 1.24 % 1.23 % 1.38 % 1.48 %
* Not meaningful due to the insignificant amount of non-performing loans.
Criticized loans/assets:
Special mention
$ 26,006 $ 29,164 $ 23,951 $ 23,566 $ 19,385
Substandard: Accruing
1,695 1,720 2,195 1,739 1,911
Substandard: Nonaccrual
6,508 8,005 5,300 5,364 5,431
Doubtful
- - - - -
Total criticized loans
$ 34,209 $ 38,889 $ 31,446 $ 30,669 $ 26,727
Other real estate owned
- - - - -
Investment securities
- - - - -
Total criticized assets
$ 34,209 $ 38,889 $ 31,446 $ 30,669 $ 26,727
Criticized assets to total assets
2.91 % 3.31 % 2.73 % 3.08 % 2.82 %

SOURCE: Solera National Bank



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https://www.accesswire.com/794821/solera-national-bancorp-announces-third-quarter-2023-financial-results

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