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FNCB Bancorp, Inc. Announces First Quarter 2022 Net Income

DUNMORE, Pa., April 29, 2022 (GLOBE NEWSWIRE) -- FNCB Bancorp, Inc. (NASDAQ: FNCB; www.fncb.com), the parent company of Dunmore-based FNCB Bank (the “Bank”), (collectively, "FNCB") today reported net income of $4.4 million, or $0.22 per basic and diluted share, for the three months ended March 31, 2022, a decrease of $1.4 million, or 25.4%, compared to $5.8 million, or $0.29 per share for the same period of 2021. The reduction in earnings was largely due to increases in non-interest expense and the provision for loan and lease losses, coupled with a decrease in non-interest income. These reductions to earnings were partially mitigated by an increase in net interest income. For the three months ended March 31, 2022, the annualized return on average assets and return on average equity was 1.08% and 11.31%, respectively, compared to 1.61% and 15.27%, respectively, for the same period of 2021.  FNCB declared and paid dividends to shareholders of common stock of $0.075 per share for the first quarter of 2022, a 25% increase, compared to $0.060 per share for the same period of 2021. 

First quarter 2022 performance: 

  • First quarter 2022 net income was $4.4 million, or $0.22 per share, compared to $5.8 million, or $0.29 per share for the first quarter of 2021, a decrease of $1.4 million, or 25.4%;
  • Yield on earning assets (FTE) decreased 40 basis points to 3.45% for the first quarter of 2022 from 3.85% for the first quarter of 2021, but improved 4 basis points on a linked-quarter basis from 3.41% for the fourth quarter of 2021; 
  • Cost of funds decreased 20 basis points to 0.14% from 0.34% comparing the first quarters of 2022 and 2021, and decreased 2 basis points on a linked-quarter basis from 0.16% for the fourth quarter of 2021; 
  • Net interest margin (FTE) contracted 24 basis points to 3.35% for the first quarter of 2022, compared to 3.59% for the same period of 2021, but widened 6 basis points on a linked-quarter basis from 3.29% for the fourth quarter of 2021;
  • Efficiency ratio increased to 58.12% in the first quarter of 2022 compared to 51.87% for the first quarter of 2021, but improved from 61.75% on a linked-quarter basis from the fourth quarter of 2021.

Summary financial position at March 31, 2022 as compared to December 31, 2021:

  • Total assets declined $14.8 million, or 0.9%, to $1.650 billion at March 31, 2022 from $1.664 billion at December 31, 2021;
  • Loans and leases, net of deferred loan fees and unearned income, increased $56.2 million, or 5.8%, to $1.023 billion at March 31, 2022 from $967.0 million at December 31, 2021;
  • Total deposits decreased $43.4 million, or 3.0% to $1.412 billion at March 31, 2022 from $1.455 billion at December 31, 2021;
  • Non-performing loans as a percentage of total loans improved to 0.37% at March 31, 2022 from 0.39% at December 31, 2021;
  • The Bank was well capitalized with total risk-based capital and leverage ratios of 14.10% and 9.30%, respectively, at March 31, 2022, and 14.64% and 8.92%, respectively, at December 31, 2021.

"We are very pleased with our first quarter 2022 operating results," stated Gerard A. Champi, President and CEO. "We continued to effectively manage funding costs and improve earning asset yields and the net interest margin over the prior quarter. Additionally, we successfully completed several strategic initiatives during the first quarter of 2022 including completing the launch of 1st Equipment Finance, our new commercial equipment financing and leasing product offering, and the purchase of several third-party originated loan pools. Both initiatives allowed us to diversify FNCB's loan portfolio, reduce risk and enhance net interest income run rates going forward," concluded Champi. 

Summary Results 

Net interest income on a tax-equivalent basis increased $1.4 million, or 12.1%, to $13.0 million for the three months ended March 31, 2022 from $11.6 million for the comparable period of 2021. The improvement in tax-equivalent net interest income primarily reflected an increase in tax-equivalent interest income of $1.0 million or 7.8%, to $13.5 million for the first quarter of 2022 from $12.5 million for the same quarter of 2021, coupled with a decrease in interest expense of $0.4 million, or 52.0%, to $0.4 million from $0.8 million comparing the first quarter of 2022 and 2021, respectively. The $1.0 million, or 7.8%, increase in tax-equivalent interest income largely reflected higher volumes of earning assets, as total average earning assets increased $263.0 million, or 20.3%, to $1.559 billion for the three months ended March 31, 2022 from $1.296 billion for the same three months of 2021. Specifically, total securities averaged $541.0 million for the first quarter of 2022, an increase of $179.0 million, or 49.5%, from $362.0 million for the first quarter of 2021, reflecting the redeployment of excess liquidity into the investment portfolio throughout 2021. In addition, average total loans and leases increased $79.9 million, or 8.7%, to $1.000 billion for the first quarter of 2022 from $920.4 million for the same quarter of 2021, which was largely due to strong organic loan demand, FNCB's new commercial equipment financing and leasing product offering and purchases of third-party originated loan pools. Partially offsetting the positive impact of earning asset growth, was a decrease in the tax-equivalent yield on average earning assets of 40 basis points to 3.45% for the three months ended March 31, 2022, compared to 3.85% for the same three months of 2021. The decline in yield included a reduction in net loan origination fees recognized on forgiven PPP loans of $0.6 million, or 49.8%, comparing the three months ended March 31, 2022 and 2021, as the majority of PPP loans were forgiven in 2021. FNCB continued to successfully manage funding costs as evidenced by a 20-basis point reduction in the cost of funds to 0.14% for the three months ended March 31, 2022 from 0.34% for the same three months of 2021, which was the main factor leading to the $0.4 million, or 52.0%, reduction in interest expense. Specifically, the average rate paid for interest-bearing deposits decreased 20 basis points to 0.12% for the first quarter of 2022 from 0.32% for the same period of 2021, which reflected the reduction in market interest rates and repricing of higher-costing time deposits upon maturity. Additionally, average borrowing costs decreased 117 basis points to 0.69% from 1.86% comparing the three months ended March 31, 2022 and 2021. Interest-bearing liabilities averaged $1.159 billion for the first quarter of 2022, an increase of $149.6 million, or 14.8%, from $1.009 billion for the same quarter of 2021. The increase in interest-bearing liabilities reflected deposit migration from time deposits into non-maturity deposits as well as an increase in utilization of wholesale funding. Specifically, interest-bearing deposits increased $112.6 million, or 11.3%, to $1.112 billion from $999.1 million, while average borrowed funds increased $37.0 million, or 359.2%, to $47.3 million from $10.3 million, comparing the first quarters of 2022 and 2021, respectively. Average interest-bearing demand deposits increased $130.7 million, or 18.8%, to $826.5 million for the first quarter of 2022 compared to $695.8 million for the same quarter of 2021, while average savings deposits increased $26.1 million, or 22.9%, to $140.5 million from $114.3 million comparing the first quarters of 2022 and 2021, respectively. Conversely, average time deposits decreased $44.3 million, or 23.4%, to $144.7 million for the three months ended March 31, 2022 from $189.0 million for the same three months of 2021. Despite the increase in net interest income, FNCB began to experience some margin compression, as the tax-equivalent net interest margin decreased 24 basis points to 3.35% for the first quarter of 2022 from 3.59% for the same quarter of 2021. Additionally, the net interest spread declined 20 basis points to 3.31% for the three months ended March 31, 2022 from 3.51% for the same three months of 2021. The reduction in margin and spread largely reflected decreases in yields earned on loans and investments, coupled with the decline in PPP loan origination fees recognized, comparing the first quarters of 2022 and 2021. On a linked-quarter basis, the tax-equivalent net interest margin and interest rate spread each widened 6 basis points from 3.29% and 3.25%, respectively, for the fourth quarter of 2021.

For the three months ended March 31, 2022, non-interest income decreased $1.0 million, or 35.5%, to $1.8 million from $2.8 million for the three months ended March 31, 2021. The decrease was largely due to shifting market conditions which resulted in reductions in net gains on equity securities, net gains on the sale of available-for-sale debt securities and net gains on the sale of mortgage loans held for sale. In addition, in 2021, FNCB recorded non-recurring income of $0.4 million received on a BOLI insurance claim. These reductions were partially offset by an increase in deposit service charges. For the three months ended March 31, 2022, FNCB recorded a net loss on equity securities of $0.1 million, a decrease of $0.5 million, or 134.3%, compared to a net gain on equity securities of $0.4 million for the same three months of 2021. Additionally, there were no net gains realized on the sale of available-for-sale debt securities during the three months ended March 31, 2022. Comparatively, net gains realized on the sale of available-for-sale debt securities were $0.2 million for the same three-month period of 2021. There were no net gains on the sale of mortgage loans held for sale for the first quarter of 2022, compared to $0.2 million for the same quarter of 2021. These reductions were partially offset by a $0.2 million, or 20.1%, increase in deposit service charges to $1.1 million for the three months ended March 31, 2022, compared to $0.9 million for the three months ended March 31, 2021. 

Non-interest expense increased $1.3 million, or 19.2% to $8.5 million for the three months ended March 31, 2022 from $7.2 million for the three months ended March 31, 2021, which primarily reflected increases in salaries and employee benefits, data processing expenses and other operating expenses. Salaries and employee benefits increased $0.9 million, or 24.7%, to $4.6 million for the first quarter of 2022 from $3.7 million for the same quarter of 2021. The increase in salaries and benefits was primarily due to the onboarding of additional staff related to the new commercial equipment financing and leasing product offering, increases in payroll taxes and higher retirement costs. Data processing expenses increased $0.3 million, or 29.8%, to $1.1 million for the three months ended March 31, 2022, compared to $0.8 million for the same three months of 2021. Other operating expenses increased $0.1 million, or 19.5% to $0.9 million for the first quarter of 2022, compared to $0.8 million for the same quarter of 2021. 

Asset Quality

FNCB's asset quality was favorable during the first quarter of 2022, as total non-performing loans remained relatively constant at $3.9 million, representing 0.37% and 0.39% of total loans and leases, gross at March 31, 2022 and at December 31, 2021, respectively. Year-over-year, non-performing loans decreased $0.9 million, or 20.2%, from $4.8 million, or 0.52% of total loans, gross, at March 31, 2021. FNCB’s loan delinquency rate (total delinquent loans as a percentage of total loans, gross) remained constant at 0.55% at March 31, 2022 and at December 31, 2021, but improved 0.15% compared to 0.70% at March 31, 2021. FNCB recorded a provision for loan and lease losses of $0.8 million for the first quarter of 2022 compared to a $0.2 million provision for the same quarter of 2021. The increase was primarily attributable to increases in loan and lease volumes.  The allowance for loan and lease losses was $13.1 million, or 1.27% of total loans and leases, gross, at March 31, 2022, compared to $12.4 million, or 1.27% of total loans and leases, gross, at December 31, 2021 and $12.1 million, or 1.30% of total loans and leases, gross, at March 31, 2021.

Financial Condition

Total assets decreased $14.8 million, or 0.9%, to $1.650 billion at March 31, 2022 from $1.664 billion at December 31, 2021. The change in total assets primarily reflected decreases in cash and cash equivalents and available-for-sale debt securities, which were partially offset by an increase in loans and leases, net of the ALLL. Cash and cash equivalents decreased $74.9 million, or 75.7%, to $24.1 million at March 31, 2022 from $99.0 million at December 31, 2021. Available-for-sale debt securities decreased $8.5 million, or 1.6%, to $514.1 million at March 31, 2022 from $522.6 million at December 31, 2021. Loans and leases increased $56.2 million, or 5.8%, to $1.023 billion at March 31, 2022 from $967.0 million at December 31, 2021. Increases were experienced across all loan categories, which reflected the roll-out of the new commercial equipment financing product offering, strong organic loan demand and the purchase of several pools of third-party originated loans. Total deposits decreased $43.4 million, or 3.0%, to $1.412 billion at March 31, 2022 from $1.455 billion at December 31, 2021. Meanwhile, total borrowed funds increased $57.0 million to $87.3 million at March 31, 2022 from $30.3 million at December 31, 2021. The increase was entirely due to an increase in advances through the FHLB of Pittsburgh. 

Total shareholders’ equity decreased $24.1 million, or 14.8%, to $138.4 million at March 31, 2022 from $162.5 million at December 31, 2021.  The decrease in capital was primarily due to an accumulated other comprehensive loss of $17.7 million at March 31, 2022, compared to accumulated other comprehensive income of $6.3 million at December 31, 2021. This $24.0 million reduction was related primarily to the depreciation in the fair value of FNCB's available-for-sale debt securities, net of deferred taxes. Also contributing to the reduction in capital was $3.0 million for the repurchase of common shares under a board authorized stock repurchase program and $1.5 million in dividends declared and paid for the three months ended March 31, 2022. These reductions were slightly offset by net income for the three months ended March 31, 2022 of $4.4 million. Tangible book value decreased from $8.13 per share at December 31, 2021 to $7.03 per share at March 31, 2022. FNCB Bank was considered well capitalized with total risk-based capital and Tier 1 leverage ratios of 14.10% and 9.30%, respectively, at March 31, 2022, and 14.64% and 8.92%, respectively, at December 31, 2021.

Availability of Filings

Copies of FNCB’s most recent Annual Report on Form 10-K and Quarterly Reports on form 10-Q will be provided upon request from: Shareholder Relations, FNCB Bancorp, Inc., 102 East Drinker Street, Dunmore, PA 18512 or by calling (570) 348-6419. FNCB’s SEC filings including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q are also available free of charge on the Investor Relations page of FNCB’s website, www.fncb.com, and on the SEC website at: http://www.sec.gov/edgar/searchedgar/companysearch.html

About FNCB Bancorp, Inc.:

FNCB Bancorp, Inc. is the bank holding company of FNCB Bank. Locally-based for over 112 years, FNCB Bank continues as a premier community bank in Northeastern Pennsylvania – offering a full suite of personal, small business and commercial banking solutions with industry-leading mobile, online and in-branch products and services. FNCB currently operates through 16 community offices located in Lackawanna, Luzerne and Wayne Counties and remains dedicated to making its customers’ banking experience simply better. For more information about FNCB, visit www.fncb.com.

INVESTOR CONTACT:

James M. Bone, Jr., CPA
Executive Vice President and Chief Financial Officer               
FNCB Bank
(570) 348-6419
[email protected]

FNCB may from time to time make written or oral “forward-looking statements,” including statements contained in our filings with the Securities and Exchange Commission (“SEC”), in our reports to shareholders, and in our other communications, which are made in good faith by us pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include statements with respect to FNCB’s beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, that are subject to significant risks and uncertainties, and are subject to change based on various factors (some of which are beyond our control). The words “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “project,” “future” and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause FNCB’s financial performance to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements: the effect of the novel Coronavirus Disease 2019 ("COVID-19") pandemic on FNCB and its customers, the Commonwealth of Pennsylvania and the United States, related to the economy, overall financial stability and the global supply chain; the COVID-19 pandemic and actions taken to control its spread; government intervention in the U.S. financial system including the effects of recent legislative, tax, accounting and regulatory actions and reforms, including, but not limited to, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and the Tax Cuts and Jobs Act; political instability; the ability of FNCB to manage credit risk; weakness in the economic environment, in general, and within FNCB’s market area; the deterioration of one or a few of the commercial real estate loans with relatively large balances contained in FNCB’s loan portfolio; greater risk of loan defaults and losses from concentration of loans held by FNCB, including those to insiders and related parties; if FNCB’s portfolio of loans to small and mid-sized community-based businesses increases its credit risk; if FNCB’s ALLL is not sufficient to absorb actual losses or if increases to the ALLL were required; FNCB is subject to interest-rate risk and any changes in interest rates could negatively impact net interest income or the fair value of FNCB's financial assets; if management concludes that the decline in value of any of FNCB’s investment securities is other-than-temporary could result in FNCB recording an impairment loss; if FNCB’s risk management framework is ineffective in mitigating risks or losses to FNCB; if FNCB is unable to successfully compete with others for business; a loss of depositor confidence resulting from changes in either FNCB’s financial condition or in the general banking industry; if FNCB is unable to retain or grow its core deposit base; inability or insufficient dividends from its subsidiary, FNCB Bank; if FNCB loses access to wholesale funding sources; interruptions or security breaches of FNCB’s information systems; any systems failures or interruptions in information technology and telecommunications systems of third parties on which FNCB depends; security breaches; if FNCB’s information technology is unable to keep pace with growth or industry developments or if technological developments result in higher costs or less advantageous pricing; the loss of management and other key personnel; dependence on the use of data and modeling in both its management’s decision-making generally and in meeting regulatory expectations in particular; additional risk arising from new lines of business, products, product enhancements or services offered by FNCB; inaccuracy of appraisals and other valuation techniques FNCB uses in evaluating and monitoring loans secured by real property and other real estate owned; unsoundness of other financial institutions; damage to FNCB’s reputation; defending litigation and other actions; dependence on the accuracy and completeness of information about customers and counterparties; risks arising from future expansion or acquisition activity; environmental risks and associated costs on its foreclosed real estate assets; any remediation ordered, or adverse actions taken, by federal and state regulators, including requiring FNCB  to act as a source of financial and managerial strength for the FNCB Bank in times of stress;  costs arising from extensive government regulation, supervision and possible regulatory enforcement actions; new or changed legislation or regulation and regulatory initiatives; noncompliance and enforcement action with the Bank Secrecy Act and other anti-money laundering statutes and regulations; failure to comply with numerous "fair and responsible banking" laws; any violation of laws regarding privacy, information security and protection of personal information or another incident involving personal, confidential or proprietary information of individuals; any rulemaking changes implemented by the Consumer Financial Protection Bureau; inability to attract and retain its highest performing employees due to potential limitations on incentive compensation contained in proposed federal agency rulemaking; any future increases in FNCB Bank’s FDIC deposit insurance premiums and assessments; and the success of FNCB at managing the risks involved in the foregoing and other risks and uncertainties, including those detailed in FNCB’s filings with the SEC.

FNCB cautions that the foregoing list of important factors is not all inclusive. Readers are also cautioned not to place undue reliance on any forward-looking statements, which reflect management’s analysis only as of the date of this report, even if subsequently made available by FNCB on its website or otherwise. FNCB does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of FNCB to reflect events or circumstances occurring after the date of this press release. Readers should carefully review the risk factors described in the Annual Report and other documents that FNCB periodically files with the SEC, including its Form 10-K for the year ended December 31, 2021. 

 
FNCB Bancorp, Inc.
Selected Financial Data
 
 Mar 31,  Dec 31,  Sept 30,  June 30,  Mar 31, 
 2022  2021  2021  2021  2021 
Per share data:                   
Net income (fully diluted)$0.22  $0.20  $0.31  $0.26  $0.29 
Cash dividends declared$0.075  $0.075  $0.075  $0.060  $0.060 
Book value$7.03  $8.13  $8.10  $7.99  $7.65 
Tangible book value$7.03  $8.13  $8.10  $7.99  $7.65 
Market value:                   
High$10.15  $9.40  $8.35  $7.98  $8.94 
Low$8.67  $8.21  $7.17  $6.90  $5.80 
Close$9.49  $9.24  $8.23  $7.27  $7.54 
Common shares outstanding 19,683,671   19,989,875   19,985,837   20,102,602   20,240,668 
                    
Selected ratios:                   
Annualized return on average assets 1.08%  0.94%  1.58%  1.38%  1.61%
Annualized return on average shareholders' equity 11.31%  9.82%  15.61%  13.37%  15.27%
Efficiency ratio 58.12%  61.75%  51.32%  51.86%  51.87%
Tier I leverage ratio (FNCB Bank) 9.30%  8.92%  9.80%  9.90%  9.88%
Total risk-based capital to risk-adjusted assets (FNCB Bank) 14.10%  14.64%  15.91%  15.79%  16.26%
Average shareholders' equity to average total assets 9.54%  9.61%  10.14%  10.35%  10.53%
Yield on earning assets (FTE) 3.45%  3.41%  3.63%  3.80%  3.85%
Cost of funds 0.14%  0.16%  0.23%  0.30%  0.34%
Net interest spread (FTE) 3.31%  3.25%  3.40%  3.50%  3.51%
Net interest margin (FTE) 3.35%  3.29%  3.46%  3.58%  3.59%
Total delinquent loans/total loans 0.55%  0.55%  0.61%  0.56%  0.70%
Allowance for loan and lease losses/total loans 1.27%  1.27%  1.25%  1.26%  1.30%
Non-performing loans/total loans 0.37%  0.39%  0.47%  0.46%  0.52%
Annualized net (recoveries) charge-offs /average loans 0.00%  (0.03%)  (0.03%)  (0.02%)  0.03%

 
FNCB Bancorp, Inc.
Year-to-Date Consolidated Statements of Income
 
  Three Months Ended
  March 31,
(in thousands, except share data) 2022  2021
Interest income       
Interest and fees on loans and leases $10,102  $9,786
Interest and dividends on securities:       
Taxable  2,390   1,906
Tax-exempt  612   486
Dividends  78   62
Total interest and dividends on securities  3,080   2,454
Interest on interest-bearing deposits in other banks  7   3
Total interest income  13,189   12,243
Interest expense       
Interest on deposits  324   798
Interest on borrowed funds       
Federal Home Loan Bank of Pittsburgh advances  31   -
Junior subordinated debentures  51   48
Total interest on borrowed funds  82   48
Total interest expense  406   846
Net interest income before provision for loan and lease losses  12,783   11,397
Provision for loan and lease losses  759   186
Net interest income after provision for loan and lease losses  12,024   11,211
Non-interest income       
Deposit service charges  1,050   874
Net gain on the sale of available-for-sale debt securities  -   213
Net (loss) gain on equity securities  (125)  364
Net gain on the sale of mortgage loans held for sale  -   224
Loan-related fees  57   133
Income from bank-owned life insurance  145   121
Bank-owned life insurance settlement  -   422
Merchant services revenue  199   138
Other  464   285
Total non-interest income  1,790   2,774
Non-interest expense       
Salaries and employee benefits  4,658   3,736
Occupancy expense  548   609
Equipment expense  324   353
Advertising expense  132   117
Data processing expense  1,063   819
Regulatory assessments  225   188
Bank shares tax  341   315
Professional fees  327   259
Other operating expenses  926   775
Total non-interest expense  8,544   7,171
Income before income taxes  5,270   6,814
Income tax expense  917   981
Net income $4,353  $5,833
        
Income per share       
Basic $0.22  $0.29
Diluted $0.22  $0.29
        
Cash dividends declared per common share $0.075  $0.060
Weighted average number of shares outstanding:       
Basic  19,935,288   20,242,262
Diluted  19,972,113   20,253,606

 
FNCB Bancorp, Inc.
Quarter-to-Date Consolidated Statements of Income
 
  Three Months Ended
  Mar 31,  Dec 31,  Sept 30,  June 30, Mar 31,
(in thousands, except share data) 2022  2021  2021  2021 2021
Interest income                  
Interest and fees on loans and leases $10,102  $10,325  $10,696  $10,242 $9,786
Interest and dividends on securities                  
Taxable  2,390   2,281   2,070   1,980  1,906
Tax-exempt  612   567   517   516  486
Dividends  78   63   55   59  62
Total interest and dividends on securities  3,080   2,911   2,642   2,555  2,454
Interest on interest-bearing deposits in other banks  7   53   31   1  3
Total interest income  13,189   13,289   13,369   12,798  12,243
Interest expense                  
Interest on deposits  324   410   582   718  798
Interest on borrowed funds                  
Federal Home Loan Bank of Pittsburgh advances  31   6   -   -  -
Junior subordinated debentures  51   48   47   48  48
Total interest on borrowed funds  82   54   47   48  48
Total interest expense  406   464   629   766  846
Net interest income before provision (credit) for loan and lease losses  12,783   12,825   12,740   12,032  11,397
Provision (credit) for loan and lease losses  759   338   (513)  155  186
Net interest income after provision (credit) for loan and lease losses  12,024   12,487   13,253   11,877  11,211
Non-interest income                  
Deposit service charges  1,050   1,038   1,009   956  874
Net gain on the sale of available-for-sale debt securities  -   -   -   -  213
Net (loss) gain on equity securities  (125)  145   156   36  364
Net gain on the sale of mortgage loans held for sale  -   40   41   47  224
Loan-related fees  57   76   77   104  133
Income from bank-owned life insurance  145   139   139   142  121
Bank-owned life insurance settlement  -   -   -   4  422
Merchant services revenue  199   140   159   156  138
Other  464   365   261   264  285
Total non-interest income  1,790   1,943   1,842   1,709  2,774
Non-interest expense                  
Salaries and employee benefits  4,658   4,901   4,022   4,038  3,736
Occupancy expense  548   549   450   431  609
Equipment expense  324   333   319   333  353
Advertising expense  132   221   160   214  117
Data processing expense  1,063   1,024   961   885  819
Regulatory assessments  225   149   160   112  188
Bank shares tax  341   (34)  352   342  315
Professional fees  327   150   153   112  259
Other operating expenses  926   1,879   923   759  775
Total non-interest expense  8,544   9,172   7,500   7,226  7,171
Income before income taxes  5,270   5,258   7,595   6,360  6,814
Income tax expense  917   1,300   1,244   1,131  981
Net income $4,353  $3,958  $6,351  $5,229 $5,833
                   
Income per share                  
Basic $0.22  $0.20  $0.31  $0.26 $0.29
Diluted $0.22  $0.20  $0.31  $0.26 $0.29
                   
Cash dividends declared per common share $0.075  $0.075  $0.075  $0.060 $0.060
Weighted average number of shares outstanding:                  
Basic  19,935,288   19,988,272   19,997,021   20,222,216  20,242,262
Diluted  19,972,113   20,015,776   20,009,387   20,232,694  20,253,606

 
FNCB Bancorp, Inc.
Consolidated Balance Sheets
 
  Mar 31,  Dec 31,  Sept 30,  June 30,  Mar 31, 
(in thousands) 2022  2021  2021  2021  2021 
Assets                    
Cash and cash equivalents:                    
Cash and due from banks $19,383  $16,651  $24,612  $24,782  $22,382 
Interest-bearing deposits in other banks  4,719   82,369   149,581   31,160   76,172 
Total cash and cash equivalents  24,102   99,020   174,193   55,942   98,554 
Available-for-sale debt securities  514,133   522,566   470,323   432,807   407,396 
Equity securities, at fair value  5,018   4,922   4,777   4,303   4,267 
Restricted stock, at cost  4,020   1,911   1,826   1,099   1,149 
Loans held for sale  -   -   491   642   267 
Loans and leases, net of deferred loan fees and costs and unearned income  1,036,400   979,439   958,408   976,538   931,943 
Allowance for loan and lease losses  (13,129)  (12,416)  (12,018)  (12,285)  (12,076)
Net loans and leases  1,023,271   967,023   946,390   964,253   919,867 
Bank premises and equipment, net  15,895   16,082   17,269   17,360   17,407 
Accrued interest receivable  4,870   4,643   4,593   4,485   4,567 
Bank-owned life insurance  36,639   33,494   33,355   33,216   33,074 
Other assets  21,602   14,662   12,674   10,656   13,488 
Total assets $1,649,550  $1,664,323  $1,665,891  $1,524,763  $1,500,036 
                     
Liabilities                    
Deposits:                    
Demand (non-interest-bearing) $317,541  $320,089  $321,952  $312,408  $319,532 
Interest-bearing  1,094,052   1,134,939   1,160,114   1,025,770   1,003,296 
Total deposits  1,411,593   1,455,028   1,482,066   1,338,178   1,322,828 
Borrowed funds  87,260   30,310   10,310   10,310   10,310 
Accrued interest payable  57   49   56   87   99 
Other liabilities  12,251   16,479   11,509   15,574   11,869 
Total liabilities  1,511,161   1,501,866   1,503,941   1,364,149   1,345,106 
                     
Shareholders' equity                    
Preferred stock  -   -   -   -   - 
Common stock  24,604   24,987   24,982   25,128   25,300 
Additional paid-in capital  77,642   80,128   80,000   80,591   81,640 
Retained earnings  53,834   50,990   48,541   43,698   39,691 
Accumulated other comprehensive income  (17,691)  6,352   8,427   11,197   8,299 
Total shareholders' equity  138,389   162,457   161,950   160,614   154,930 
Total liabilities and shareholders’ equity $1,649,550  $1,664,323  $1,665,891  $1,524,763  $1,500,036 

 
FNCB Bancorp, Inc.
Summary Tax-equivalent Net Interest Income
 
  Three Months Ended 
  Mar 31,  Dec 31,  Sept 30,  June 30,  Mar 31, 
(dollars in thousands) 2022  2021  2021  2021  2021 
Interest income                    
Loans:                    
Loans - taxable $9,755  $9,983  $10,364  $9,897  $9,401 
Loans - tax-free  439   433   420   437   487 
Total loans  10,194   10,416   10,784   10,334   9,888 
Securities:                    
Securities, taxable  2,468   2,344   2,125   2,039   1,968 
Securities, tax-free  775   719   654   653   615 
Total interest and dividends on securities  3,243   3,063   2,779   2,692   2,583 
Interest-bearing deposits in other banks  7   53   31   1   3 
Total interest income  13,444   13,532   13,594   13,027   12,474 
Interest expense                    
Deposits  324   410   582   718   798 
Borrowed funds  82   54   47   48   48 
Total interest expense  406   464   629   766   846 
Net interest income $13,038  $13,068  $12,965  $12,261  $11,628 
                     
Average balances                    
Earning assets:                    
Loans:                    
Loans - taxable $946,201  $915,693  $921,648  $909,833  $873,544 
Loans - tax-free  54,096   45,920   43,091   44,583   46,897 
Total loans  1,000,297   961,613   964,739   954,416   920,441 
Securities:                    
Securities, taxable  437,955   409,210   357,684   326,848   286,128 
Securities, tax-free  103,086   92,685   82,706   82,304   75,876 
Total securities  541,041   501,895   440,390   409,152   362,004 
Interest-bearing deposits in other banks  17,464   125,609   94,434   7,042   13,490 
Total interest-earning assets  1,558,802   1,589,117   1,499,563   1,370,610   1,295,935 
Non-earning assets  78,394   91,968   105,912   145,861   175,301 
Total assets $1,637,196  $1,681,085  $1,593,014  $1,516,471  $1,471,236 
Interest-bearing liabilities:                    
Deposits $1,111,671  $1,163,920  $1,080,312  $1,019,612  $999,085 
Borrowed funds  47,346   17,810   10,419   10,310   10,310 
Total interest-bearing liabilities  1,159,017   1,181,100   1,090,731   1,029,922   1,009,395 
Demand deposits  308,830   322,536   325,571   317,670   294,525 
Other liabilities  13,234   15,846   15,258   11,998   12,413 
Shareholders' equity  156,115   161,603   161,454   156,881   154,903 
Total liabilities and shareholders' equity $1,637,196  $1,681,085  $1,593,014  $1,561,471  $1,471,236 
                     
Yield/Cost                    
Earning assets:                    
Loans:                    
Interest and fees on loans - taxable  4.12%  4.36%  4.50%  4.35%  4.30%
Interest and fees on loans - tax-free  3.25%  3.77%  3.90%  3.92%  4.15%
Total loans  4.08%  4.33%  4.47%  4.33%  4.30%
Securities:                    
Securities, taxable  2.25%  2.29%  2.38%  2.50%  2.75%
Securities, tax-free  3.01%  3.10%  3.16%  3.17%  3.24%
Total securities  2.40%  2.44%  2.52%  2.63%  2.85%
Interest-bearing deposits in other banks  0.16%  0.17%  0.13%  0.06%  0.09%
Total earning assets  3.45%  3.41%  3.63%  3.80%  3.85%
Interest-bearing liabilities:                    
Interest on deposits  0.12%  0.14%  0.22%  0.28%  0.32%
Interest on borrowed funds  0.69%  1.21%  1.80%  1.86%  1.86%
Total interest-bearing liabilities  0.14%  0.16%  0.23%  0.30%  0.34%
Net interest spread  3.31%  3.25%  3.40%  3.50%  3.51%
Net interest margin  3.35%  3.29%  3.46%  3.58%  3.59%

 
FNCB Bancorp, Inc.
Asset Quality Data
 
  Mar 31,  Dec 31,  Sept 30,  June 30,  Mar 31,
(in thousands) 2022  2021  2021  2021  2021
At period end                   
Non-accrual loans, including non-accruing troubled debt restructured loans (TDRs) $3,864  $3,863  $4,475  $4,555  $4,842
Loans past due 90 days or more and still accruing  -   -   -   -   -
Total non-performing loans  3,864   3,863   4,475   4,555   4,842
Other real estate owned (OREO)  228   920   54   236   58
Other non-performing assets  1,773   1,773   1,773   1,773   1,900
Total non-performing assets $5,865  $6,556  $6,302  $6,564  $6,800
                    
Accruing TDRs $6,455  $6,666  $6,666  $6,823  $6,962
                    
                    
For the three months ended                   
Allowance for loan and lease losses                   
Beginning balance $12,416  $12,018  $12,285  $12,076  $11,950
Loans charged-off  95   34   255   136   361
Recoveries of charged-off loans  49   94   501   190   301
Net charge-offs (recoveries)  46   (60)  (246)  (54)  60
Provision (credit) for loan and lease losses  759   338   (513)  155   186
Ending balance $13,129  $12,416  $12,018  $12,285  $12,076

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