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Heartland BancCorp Earns $3.9 Million, or $1.94 Per Diluted Share, in the Second Quarter of 2022; Declares Quarterly Cash Dividend of $0.69 per Share

WHITEHALL, Ohio, July 19, 2022 (GLOBE NEWSWIRE) -- Heartland BancCorp (“Heartland” and “the Company”) (OTCQX: HLAN), parent company of Heartland Bank (“Bank”), today reported net income of $3.9 million, or $1.94 per diluted share in the second quarter of 2022, compared to $4.2 million, or $2.06 per diluted share in the second quarter of 2021, and $4.0 million, or $1.99 per diluted share, in the preceding quarter. Results for the second quarter of 2022 reflect lower interest and fees on Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans compared to the prior quarter and the year ago quarter, due to slowing PPP loan forgiveness as the program nears its conclusion. In the first six months of 2022, net income was $8.0 million, or $3.93 per diluted share, compared to $8.8 million, or $4.35 per diluted share, in the first six months of 2021.

The company announced that its board of directors declared a quarterly cash dividend of $0.69 per share. The dividend will be payable October 11, 2022, to shareholders of record as of September 24, 2022. Heartland has paid regular quarterly cash dividends since 1993.

“The highlights of the second quarter included substantial growth in the loan portfolio and the resulting net interest margin expansion,” stated G. Scott McComb, Chairman, President and Chief Executive Officer. “We continue to benefit from our strong core deposit base to fund loan activity; as a result, the cost of funds has remained flat despite rising interest rates. Additionally, we made progress in building out our presence in the Cincinnati market during the quarter. We entered that market organically towards the end of the year, and our efforts are already paying off, contributing to second quarter loan growth and revenues. With our skilled banking teams in place, combined with strong economic factors in our greater Columbus, northern Kentucky and Cincinnati markets, we are well positioned for continued growth going forward.”

Second Quarter Financial Highlights (at or for the three months ended June 30, 2022)

  • Net income was $3.9 million, or $1.94 per diluted share, compared to $4.2 million, or $2.06 per diluted share, in the second quarter of 2021.
  • Provision for loan losses was $480,000, which was unchanged compared to the second quarter a year ago.
  • Net interest margin expanded nine basis points to 3.92%, compared to 3.83% in the preceding quarter and improved 54 basis points compared to 3.38% in the second quarter a year ago.
  • Second quarter revenues (net interest income plus noninterest income) increased 5.0% to $16.2 million, compared to $15.4 million in the second quarter a year ago.
  • Annualized return on average assets was 1.10%, compared to 1.09% in the second quarter of 2021.
  • Annualized return on average tangible common equity was 11.97%, compared to 12.84% in the second quarter a year ago.
  • Excluding Paycheck Protection Program (PPP) loans, gross loans increased 15.5% to $1.21 billion at June 30, 2022, compared to $1.05 billion a year ago.
  • Credit quality remains pristine, with nonperforming loans to gross loans of 0.12% and nonperforming assets to total assets of 0.10% at June 30, 2022.
  • Tangible book value was $64.06 per share, compared to $66.53 per share a year ago.
  • Declared a quarterly cash dividend of $0.69 per share.

Balance Sheet Review

Assets

Total assets decreased nominally to $1.50 billion at June 30, 2022, compared to $1.51 billion a year earlier, and increased 2.8% compared to $1.45 billion three months earlier. The slight decrease compared to the prior year was the due to both PPP loan forgiveness and a reduction in excess liquidity, which offset core loan growth. Heartland’s loan-to-deposit ratio was 91.8% at June 30, 2022, compared to 90.6% at March 31, 2022, and 87.3% at June 30, 2021.

Liquidity levels continued to decline, with interest bearing deposits in other banks at $35.6 million, representing 2.5% of interest-earning assets as of June 30, 2022, compared to 8.0% at June 30, 2021.

Average earning assets were $1.35 billion in the second quarter of 2022 and in the first quarter of 2021, and $1.45 billion in the second quarter a year ago. The average yield on interest-earning assets was 4.17% in the second quarter of 2022, up 10 basis points from 4.07% in the preceding quarter and up 43 basis points from 3.74% in the second quarter a year ago.

Loan Portfolio

Over the course of the SBA PPP, Heartland originated 1,845 PPP loans, or $199.0 million in loans, and generated total PPP loan fees receivable of approximately $8.6 million. As of June 30, 2022, Heartland had received forgiveness from the SBA for $195.8 million. Approximately $132,000 of the income recognized during the second quarter of 2022 was related to recognizing origination fees for PPP loan payoffs or forgiveness, compared to $347,000 of income recognized during the first quarter of 2022, and $368,000 of income recognized during the second quarter of 2021. The balance of net unamortized PPP fees remaining to be recognized in fee income over the life of the associated loans, was $62,000 as of June 30, 2022.

“Core loan growth was robust during the second quarter, increasing 5.4% over the prior quarter end, or 21.6% annualized. We had great activity in the 1-4 family loan segment as well as in owner occupied CRE. Additionally, our loan pipeline remains strong, and we are replacing PPP loans with higher yielding loans, which is helping our net interest margin expand,” said Ben Babcanec, EVP and Chief Operating Officer.

The total loan portfolio increased substantially during the quarter, even with $5.7 million in PPP loan forgiveness during the quarter. Excluding PPP loans, gross loans increased 5.4% to $1.21 billion at June 30, 2022, compared to $1.15 billion at March 31, 2022, and increased 15.5% compared to $1.05 billion a year earlier. Including PPP loans, net loans were $1.20 billion at June 30, 2022, which was a 4.9% increase compared to $1.14 billion at March 31, 2022, and a 5.3% increase compared to $1.13 billion at June 30, 2021.

Commercial loans decreased 38.9% from year ago levels to $134.0 million, and comprise 11.1% of the total loan portfolio at June 30, 2022. The decrease was primarily due to the $99.7 million reduction in PPP loan balances compared to a year ago. Owner occupied commercial real estate loans (CRE) increased 11.2% to $306.5 million at June 30, 2022, compared to a year ago, and comprise 25.3% of the total loan portfolio. Non-owner occupied CRE loans increased 18.4% to $346.9 million, compared to a year ago, and comprise 28.6% of the total loan portfolio at June 30, 2022. 1-4 family residential real estate loans increased 17.7% from year ago levels to $370.4 million and represent 30.6% of total loans. Home equity loans increased 6.2% from year ago levels to $37.7 million and represent 3.1% of total loans, and consumer loans increased 53.5% from year ago levels to $15.3 million and represent 1.3% of the total loan portfolio at June 30, 2022.

Deposits

Total deposits were $1.30 billion at June 30, 2022, a 3.6% increase compared to $1.26 billion at March 31, 2022. Total deposits were unchanged compared to a year earlier, largely due to the reduction in CD’s as the Bank continues to focus on shifting its deposit mix to gathering and retaining low-cost deposits. “We were able to capitalize on our excess liquidity and improve our deposit mix, remaining focused on using low-cost deposits to fund new loan growth,” said Babcanec. At June 30, 2022, noninterest bearing demand deposit accounts increased 10.7% compared to a year ago and represented 37.6% of total deposits; savings, NOW and money market accounts increased 4.1% compared to a year ago and represented 46.6% of total deposits, and CDs decreased 24.7% compared to a year ago and comprised 15.9% of total deposits. The average cost of deposits was 0.16% in the second quarter of 2022, compared to 0.15% in the first quarter of 2022, and 0.27% in the second quarter of 2021.

Shareholders’ Equity

Shareholders’ equity was $141.9 million at June 30, 2022, compared to $147.7 million three months earlier and $146.5 million a year earlier. The decrease in shareholders’ equity during the current quarter was primarily due to a $8.5 million decrease in accumulated other comprehensive income related to an increase in the unrealized loss on available for sale securities reflecting the increase in market interest rates during the current quarter. At June 30, 2022, Heartland’s tangible book value was $64.06 per share, compared to $66.92 at March 31, 2022, and $66.53 at June 30, 2021.

Heartland continues to maintain capital levels in excess of the requirements to be categorized as “well-capitalized” with tangible equity to tangible assets of 8.68% at June 30, 2022, compared to 9.32% at March 31, 2022, and 8.89% at June 30, 2021.

Operating Results

In the second quarter of 2022, Heartland generated a ROAA of 1.10% and a ROAE of 10.87%, compared to 1.14% and 10.66%, respectively, in the first quarter of 2022 and 1.09% and 11.63%, respectively, in the second quarter a year ago.

Net Interest Income/Net Interest Margin

Net interest income, before the provision for loan losses, increased 7.6% to $13.2 million in the second quarter of 2022, compared to $12.2 million in the second quarter a year ago, and increased 2.9% compared to $12.8 million in the preceding quarter. Interest income benefitted from the amortization of PPP loan fees and the full recognition of the deferred PPP loan fees upon forgiveness by the SBA. During the second quarter of 2022, Heartland received $5.7 million in loan forgiveness through the SBA, compared to $18.7 million in loan forgiveness during the prior quarter, resulting in total net PPP fee income of $132,000 and $347,000, respectively. As of June 30, 2022, there was $62,000 of net deferred PPP fee income remaining. In the first six months of 2022, net interest income increased 6.8% to $26.0 million, compared to $24.3 million in the first six months of 2021.

Total revenues (net interest income, before the provision for loan losses, plus noninterest income) was $16.2 million in the second quarter, a 5.0% increase compared to $15.4 million in the second quarter a year ago, and a nominal increase compared to $16.1 million in the preceding quarter. Year-to-date, total revenues increased 3.4% to $32.2 million, compared to $31.2 million in the same period a year earlier.

Heartland’s net interest margin expanded nine basis points to 3.92% in the second quarter of 2022, compared to 3.83% in the preceding quarter and improved by 54 basis points compared to 3.38% in the second quarter of 2021. “Our net interest margin for the quarter benefitted from strong net interest income generation, robust loan growth and rising interest rates. New core loans that carry a higher interest rate are replacing lower rate PPP loans, which is helping our net interest margin expand compared to a year ago,” said Carrie Almendinger, EVP, and Chief Financial Officer. “We believe we are well positioned for additional interest rate increases, with a low-cost core deposit base and strong balance sheet liquidity to support continued loan demand.”

“Our strategy of patience in deploying excess liquidity in the investment portfolio is starting to benefit us as we continue to ladder into significantly higher yielding securities over the next few quarters,” said McComb.

Heartland’s net interest margin continues to remain above the peer average posted by the Dow Jones U.S. MicroCap Bank Index with total market capitalization under $250 million as of March 31, 2022.*

Provision for Loan Losses

“We have a very solid risk management culture in place, and continue to make additions to the allowance for loan losses to reflect the steady level of new loan growth,” said McComb.

Heartland recorded a $480,000 provision for loan losses in the second quarter of 2022, which was the same amount recorded in both the preceding quarter and the year ago quarter.

Noninterest Income

Noninterest income decreased 4.9% to $3.0 million in the second quarter of 2022, compared to $3.2 million in the second quarter a year ago, and decreased 7.8% compared to $3.3 million in the preceding quarter. Gains on sale of loans, and originated mortgage servicing rights, decreased 46.5% to $431,000 in the second quarter of 2022, compared to $805,000 in the second quarter a year ago, and decreased 36.9% compared to $683,000 in the preceding quarter. In the first six months of 2022, noninterest income decreased 8.6% to $6.3 million, compared to $6.9 million in the first six months of 2021.

“The mortgage market continues to be strong for mortgage originations through the second quarter of 2022, although we’ve seen volumes make their way on to the balance sheet leading to lower gains on sale,” said Almendinger.

Noninterest Expense

Heartland’s second quarter noninterest expenses totaled $10.8 million, compared to $10.6 million in the preceding quarter and $9.8 million in the second quarter a year ago. Salary and employee benefit expenses, the largest component of noninterest expense, were $6.8 million in the second quarter of 2022, compared to $6.9 million in the first quarter of 2022 and $5.6 million in the second quarter of 2021. “The increase in noninterest expenses compared to the year ago quarter is primarily a result of our expansion into the Cincinnati market during the fourth quarter of 2021 and a $1.5 million reduction of deferred PPP loan costs from the second quarter of 2021,” said Almendinger. “By expanding into the Cincinnati market organically, with a seasoned leader who has been established in that market for years, we have begun to broaden our client base and our operations without a significant increase to operating expenses.” Year-to-date, noninterest expense totaled $21.4 million, compared to $19.4 million in the first six months of 2021.

The efficiency ratio for the second quarter of 2022 was 66.9%, compared to 65.9% for the preceding quarter and 63.6% for the second quarter of 2021.

Income Tax Provision

In the second quarter of 2022, Heartland recorded $933,000 in state and federal income tax expense for an effective tax rate of 19.2%, compared to $952,000, or 19.1% in the first quarter of 2022 and $942,000 or 18.4% in the second quarter a year ago.

__________________
*As of March 31, 2022, the Dow Jones U.S. MicroCap Bank Index tracked 155 banks with total common market capitalization under $250 million for the following ratios: NIM* of 3.17%.

Credit Quality

“We are beginning to step up our risk mitigation process due to inflation concerns and rising interest rates, and are implementing all the necessary procedures to ensure we are well positioned for all economic cycles,” said McComb.

At June 30, 2022, the allowance for loan losses (ALLL) was $15.9 million, or 1.32% of total loans, compared to $15.5 million, or 1.34% of total loans at March 31, 2022, and $13.9 million, or 1.21% of total loans a year ago. As of June 30, 2022, the ALLL represented 1,316.1% of nonaccrual loans, compared to 1,636.7% three months earlier and 488.1% one year earlier.

Nonaccrual loans were $1.2 million at June 30, 2022, compared to $944,000 at March 31, 2022, and decreased 57.4% when compared to $2.8 million at June 30, 2021. Heartland had net loan charge-offs of $5,000 at June 30, 2022. This compared to $5,000 in net loan recoveries at March 31, 2022, and $1.3 million in net loan charge-offs at June 30, 2021. There was $245,000 in loans past due 90 days and still accruing at June 30, 2022, compared to $383,000 at March 31, 2022, and $359,000 at June 30, 2021.

Heartland’s performing restructured loans, that were not included in nonaccrual loans, totaled $4.5 million at June 30, 2022, compared to $5.1 million at March 31, 2022. Borrowers who are in financial difficulty, and who have been granted concessions, including interest rate reductions, term extensions, or payment alterations, are categorized as restructured loans.

There was $5,000 in other real estate owned and other non-performing assets on the books at June 30, 2022, unchanged from three months earlier and one year earlier. Non-performing assets (NPAs), consisting of non-performing loans and loans past due 90 days or more, was $1.5 million, or 0.10% of total assets inclusive of PPP loans, at June 30, 2022, compared to $1.3 million, or 0.09% of total assets, at March 31, 2022, and decreased 54.4% when compared to $3.2 million, or 0.21% of total assets a year ago.

About Heartland BancCorp

Heartland BancCorp is a registered Ohio bank holding company and the parent of Heartland Bank, which operates 18 full-service banking offices and TransCounty Title Agency, LLC. Heartland Bank, founded in 1911, provides full-service commercial, small business, and consumer banking services; professional financial planning services; and other financial products and services. Heartland Bank is a member of the Federal Reserve, a member of the FDIC, and an Equal Housing Lender. Heartland BancCorp is currently quoted on the OTC Markets (OTCQX) under the symbol HLAN. Learn more about Heartland Bank at Heartland.Bank.

In May of 2022, Heartland was ranked #112 on the American Banker Magazine’s list of Top 200 Publicly Traded Community Banks and Thrifts based on three-year average return on equity as of December 31, 2021.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about (i) the benefits of a merger between Heartland Bank and Victory Community Bank, including future financial and operating results, cost savings enhancements to revenue and accretion to reported earnings that may be realized from the merger; (ii) Heartland’s plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts; and (iii) other statements identified by words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “targets,” “projects,” or words of similar meaning generally intended to identify forward-looking statements. These forward-looking statements are based upon the current beliefs and expectations of Heartland’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of Heartland. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the anticipated results discussed in these forward-looking statements because of the following factors, among others: (1) the assumptions and estimates used by Heartland’s management include both assumptions as to certain business decisions that are subject to change and, in many respects, subjective judgment, and thus is susceptible to multiple interpretations and periodic revisions based on actual experience and business developments, and thus, may not be realized; (2) legislative or regulatory changes, including changes in accounting standards, may adversely affect the businesses in which Heartland is engaged; (3) changes in the interest rate environment may adversely affect net interest income; (4) results may be adversely affected by continued diversification of assets and adverse changes to credit quality; (5) competition from other financial services companies in Heartland’s markets could adversely affect operations; (6) the impact of the coronavirus (COVID-19) pandemic on the employees and customers of Heartland, as well as the resulting effect on the business, financial condition and results of operations on Heartland; and (7) the current economic slowdown could adversely affect credit quality and loan originations.

Heartland cautions that the foregoing list of factors is not exclusive. All subsequent written and oral forward-looking statements are expressly qualified in their entirety by the cautionary statements above. Heartland does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law.

 
Heartland BancCorp
Quarterly Financial Summary
               
 Three Months Ended
Earnings and dividends:Jun. 30, 2022Mar. 31, 2022Dec. 31, 2021Sep. 30, 2021Jun. 30, 2021
Interest income$13,993  $13,611  $14,337  $13,912  $13,541 
Interest expense 832   819   925   1,126   1,309 
Net interest income 13,161   12,792   13,412   12,786   12,232 
Provision for loan losses 480   480   480   480   480 
Noninterest income 3,012   3,268   3,797   3,635   3,168 
Noninterest expense 10,824   10,589   10,407   9,917   9,789 
Provision for income taxes 933   952   1,299   1,265   942 
Net income 3,936   4,039   5,023   4,759   4,189 
               
Share data:              
Basic earnings per share$1.96  $2.02  $2.51  $2.38  $2.10 
Diluted earnings per share 1.94   1.99   2.48   2.34   2.06 
Dividends declared per share 0.69   0.69   0.63   0.63   0.63 
Book value per share 70.66   73.56   76.42   74.91   73.29 
Tangible book value per share 64.06   66.92   69.74   68.20   66.53 
               
Common shares outstanding, 20,000,000 authorized 2,098,962   2,098,562   2,094,787   2,094,037   2,089,987 
Treasury shares (90,612)  (90,612)  (90,612)  (90,612)  (90,612)
Common shares, net 2,008,350   2,007,950   2,004,175   2,003,425   1,999,375 
Average common shares outstanding, net 2,008,154   2,004,901   2,003,784   2,000,839   1,995,900 
               
Balance sheet - average balances:              
Loans receivable, net$1,164,191  $1,153,203  $1,160,267  $1,148,103  $1,148,225 
PPP loans 6,094   17,889   44,321   81,932   111,667 
Earning assets 1,345,041   1,354,627   1,378,244   1,396,127   1,452,502 
Goodwill & intangible assets 13,295   13,355   13,409   13,470   13,537 
Total assets 1,437,003   1,442,050   1,461,752   1,481,787   1,540,047 
Deposits 1,237,620   1,238,275   1,248,971   1,270,425   1,328,153 
Borrowings 42,459   39,000   47,192   50,042   55,080 
Shareholders' equity 145,218   153,591   151,620   148,306   144,381 
               
Ratios:              
Return on average assets 1.10%  1.14%  1.36%  1.27%  1.09%
Return on average equity 10.87%  10.66%  13.14%  12.73%  11.63%
Return on average tangible common equity 11.97%  11.68%  14.42%  14.00%  12.84%
Yield on earning assets 4.17%  4.07%  4.13%  3.95%  3.74%
Cost of deposits 0.16%  0.15%  0.17%  0.22%  0.27%
Cost of funds 0.26%  0.26%  0.28%  0.34%  0.38%
Net interest margin 3.92%  3.83%  3.86%  3.63%  3.38%
Efficiency ratio 66.94%  65.94%  60.48%  60.39%  63.57%
               
Asset quality:              
Net loan charge-offs to average loans 0.00%  0.00%  -0.05%  0.00%  0.44%
Nonperforming loans to gross loans 0.12%  0.11%  0.14%  0.24%  0.28%
Nonperforming assets to total assets 0.10%  0.09%  0.11%  0.22%  0.21%
Allowance for loan losses to gross loans 1.32%  1.34%  1.28%  1.25%  1.21%
               
Heartland BancCorp
Consolidated Balance Sheets
       
               
AssetsJun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Jun. 30, 2021
Cash and due from$18,139  $16,698  $10,469  $14,985  $12,925 
Interest bearing deposits 35,583   56,284   54,415   50,370   114,042 
Interest bearing time deposits -   -   -   283   281 
Available-for-sale securities 154,505   150,674   156,505   166,187   159,683 
Held-to-maturity securities 49   49   49   202   202 
               
Loans held for sale 655   2,573   4,648   3,013   1,221 
               
Commercial 134,033   142,925   154,182   179,776   219,421 
CRE (Owner occupied) 306,507   285,287   288,261   274,368   275,727 
CRE (Non Owner occupied) 346,905   346,326   358,713   326,919   292,955 
1-4 Family 370,444   331,255   322,558   319,662   314,630 
Home Equity 37,740   35,948   36,250   36,106   35,527 
Consumer 15,343   13,218   12,620   11,118   9,995 
Allowance for loan losses (15,925)  (15,450)  (14,965)  (14,352)  (13,867)
Net Loans 1,195,047   1,139,508   1,157,619   1,133,597   1,134,390 
               
Premises and equipment 30,516   29,583   29,410   29,495   29,937 
Nonmarketable equity securities 6,032   6,028   6,024   6,024   6,024 
Mortgage serving rights, net 3,268   3,261   3,096   2,882   2,665 
Foreclosed assets held for sale 5   5   5   5   5 
Goodwill 12,388   12,388   12,388   12,388   12,388 
Intangible Assets 874   929   990   1,052   1,113 
Deferred income taxes 1,404   1,404   1,404   929   929 
Life insurance assets 18,314   18,218   18,120   18,019   17,919 
Accrued interest receivable and other assets 19,083   17,023   13,967   14,964   15,456 
Total assets$1,495,862  $1,454,626  $1,469,109  $1,454,396  $1,509,179 
               
Liabilities and Shareholders' Equity              
Liabilities              
Deposits              
Demand$489,172  $500,733  $478,893  $440,531  $441,836 
Saving, NOW and money market 606,534   578,633   588,959   577,831   582,782 
Time 206,632   178,000   188,193   223,534   274,336 
Total deposits 1,302,338   1,257,366   1,256,045   1,241,896   1,298,954 
Repurchase agreements 14,525   8,275   9,032   10,060   9,754 
FHLB Advances 0   0   12,000   14,000   17,000 
Subordinated debt 24,672   24,661   24,651   24,641   24,630 
Interest payable and other liabilities 12,413   16,628   14,223   13,717   12,312 
Total liabilities 1,353,948   1,306,930   1,315,951   1,304,314   1,362,650 
               
Shareholders' Equity              
Common stock, without par value 61,641   61,488   61,231   61,039   60,917 
Retained earnings 99,841   97,294   94,638   90,874   87,370 
Accumulated other comprehensive income (expense) (14,574)  (6,091)  2,283   3,164   3,237 
Treasury stock at Cost, Common (4,994)  (4,994)  (4,994)  (4,994)  (4,994)
Total shareholders' equity 141,914   147,696   153,158   150,082   146,529 
Total liabilities and shareholders' equity$1,495,862  $1,454,626  $1,469,109  $1,454,396  $1,509,179 
               

Heartland BancCorp
Consolidated Statements of Income
               
 Three Months Ended
Interest IncomeJun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Jun. 30, 2021
Loans$12,778 $12,544 $13,251 $12,826 $12,484
Securities              
Taxable 586  471  467  448  437
Tax-exempt 578  574  586  589  580
Other 51  22  33  49  40
Total interest income 13,993  13,611  14,337  13,912  13,541
Interest Expense              
Deposits 484  454  523  715  886
Borrowings 348  365  402  411  423
Total interest expense 832  819  925  1,126  1,309
Net Interest Income 13,161  12,792  13,412  12,786  12,232
Provision for Loan Losses 480  480  480  480  480
Net Interest Income After Provision for Loan Losses 12,681  12,312  12,932  12,306  11,752
Noninterest income              
Service charges 916  861  834  812  692
Gains on sale of loans and originated MSR 431  683  1,339  1,048  805
Loan servicing fees, net 311  509  462  463  223
Title insurance income 346  290  313  421  382
Net realized gains on sales of available-for-sale securities -  -  -  -  -
Increase in cash value of life insurance 96  98  101  101  99
Other 912  827  748  790  967
Total noninterest income 3,012  3,268  3,797  3,635  3,168
Noninterest Expense              
Salaries and employee benefits 6,819  6,905  6,520  6,318  5,550
Net occupancy and equipment expense 960  994  948  981  966
Software and data processing fees 907  833  801  778  1,027
Professional fees 247  233  262  230  263
Marketing expense 247  259  218  275  279
State financial institution tax 257  277  313  167  309
FDIC insurance premiums 94  69  128  60  85
Other 1,293  1,019  1,217  1,108  1,310
Total noninterest expense 10,824  10,589  10,407  9,917  9,789
Income before Income Tax 4,869  4,991  6,322  6,024  5,131
Provision for Income Taxes 933  952  1,299  1,265  942
Net Income$3,936 $4,039 $5,023 $4,759 $4,189
Basic Earnings Per Share$1.96 $2.02 $2.51 $2.38 $2.10
Diluted Earnings Per Share$1.94 $1.99 $2.48 $2.34 $2.06
               

Heartland BancCorp
Consolidated Statements of Income
      
 Six Months Ended
Interest IncomeJun. 30, 2022 Jun. 30, 2021
Loans$25,322 $25,230
Securities     
Taxable 1,057  761
Tax-exempt 1,152  1,181
Other 73  88
Total interest income 27,604  27,260
Interest Expense     
Deposits 938  2,016
Borrowings 713  935
Total interest expense 1,651  2,951
Net Interest Income 25,953  24,309
Provision for Loan Losses 960  960
Net Interest Income After Provision for Loan Losses 24,993  23,349
Noninterest income     
Service charges 1,777  1,265
Gains on sale of loans and originated MSR 1,114  2,355
Loan servicing fees, net 820  428
Title insurance income 636  700
Net realized gains on sales of available-for-sale securities -  223
Increase in cash value of life insurance 194  198
Other 1,739  1,699
Total noninterest income 6,280  6,868
Noninterest Expense     
Salaries and employee benefits 13,724  10,754
Net occupancy and equipment expense 1,954  1,986
Software and data processing fees 1,740  1,785
Professional fees 480  641
Marketing expense 506  555
State financial institution tax 534  624
FDIC insurance premiums 163  213
Other 2,312  2,845
Total noninterest expense 21,413  19,403
Income before Income Tax 9,860  10,814
Provision for Income Taxes 1,885  2,001
Net Income$7,975 $8,813
Basic Earnings Per Share$3.97 $4.42
Diluted Earnings Per Share$3.93 $4.35
      

Heartland BancCorp
ADDITIONAL FINANCIAL INFORMATION          
(Dollars in thousands except per share amounts)(Unaudited)          
           
Asset Quality Ratios and Data:  
  Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Jun. 30, 2021
Nonaccrual loans (excluding restructured loans) $949  $659  $1,333  $1,657  $1,748 
Nonaccrual restructured loans  261   285   285   1,093   1,093 
Loans past due 90 days and still accruing  245   383   16   -   359 
Total non-performing loans  1,455   1,327   1,634   2,750   3,200 
           
OREO and other non-performing assets  5   5   5   5   5 
Total non-performing assets $1,460  $1,332  $1,639  $2,755  $3,205 
           
Nonperforming loans to gross loans  0.12%  0.11%  0.14%  0.24%  0.28%
Nonperforming assets to total assets  0.10%  0.09%  0.11%  0.22%  0.21%
Allowance for loan losses to gross loans  1.32%  1.34%  1.28%  1.25%  1.21%
           
Performing restructured loans (RC-C) $4,519  $5,106  $5,119  $610  $621 
           
Net charge-offs quarter ending $5  $(5) $(133) $(6) $1,263 

 

Contact: G. Scott McComb, Chairman, President & CEO
  Heartland BancCorp 614-337-4600 

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