Hawthorn Bancshares Reports Third Quarter 2024 Results
Rhea-AI Summary
Hawthorn Bancshares (NASDAQ: HWBK) reported Q3 2024 net income of $4.6 million, or $0.66 per diluted share, representing a 77% increase from Q3 2023. The company's net interest margin improved to 3.36%, while maintaining strong credit quality with non-performing loans at 0.28% of total loans. Total assets reached $1.81 billion, with loans decreasing by 2.1% and deposits declining by 3.0% compared to the previous quarter. Book value per share increased 24% year-over-year to $20.91, and the company remained well-capitalized with a total risk-based capital ratio of 14.91%.
Positive
- Net income increased 77% year-over-year to $4.6 million
- Net interest margin improved to 3.36% from 3.33% in Q2 2024
- Book value per share increased 24% year-over-year to $20.91
- Strong credit quality maintained with non-performing loans at 0.28%
- Efficiency ratio improved to 66.23% from 79.79% year-over-year
Negative
- Loans decreased by $31.8 million (2.1%) quarter-over-quarter
- Deposits declined by $46.7 million (3.0%) quarter-over-quarter
- Non-interest income decreased 5.3% from previous quarter
- Non-performing assets increased to 0.58% from 0.54% in previous quarter
News Market Reaction
On the day this news was published, HWBK gained 3.12%, reflecting a moderate positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
JEFFERSON CITY, Mo., Oct. 30, 2024 (GLOBE NEWSWIRE) -- Hawthorn Bancshares, Inc. (NASDAQ: HWBK), (the “Company”), the bank holding company for Hawthorn Bank, reported third quarter 2024 net income of
Third Quarter 2024 Results
- Net income improved
$2.0 million , or77% , from the third quarter 2023 (the "prior year quarter") - EPS of
$0.66 , an improvement of$0.30 per share, or83% , from the prior year quarter - Net interest margin, fully taxable equivalent ("FTE") improved in the third quarter 2024 to
3.36% compared to3.33% for second quarter 2024 (the "prior quarter”) - Return on average assets and equity of
1.00% and12.87% , respectively - Loans decreased
$31.8 million , or2.1% , and deposits decreased$46.7 million , or3.0% , compared to the prior quarter - Investments increased
$17.9 million , or9.3% , compared to the prior quarter - Credit quality remained strong with non-performing loans to total loans of
0.28% - Remained well capitalized with total risk-based capital of
14.91% - Book Value per share increased
$4.09 to$20.91 , or24% , compared to the prior year quarter
Brent Giles, Chief Executive Officer of Hawthorn Bancshares, Inc. commented, “We are pleased with the progress we've made on our strategic objectives, and the corresponding financial results. Our focus on core lines of business has resulted in reduced overhead expenses and expansion of our fee income."
Financial Summary
(unaudited)
| September 30, | June 30, | September 30, | |||||||||
| 2024 | 2024 | 2023 | |||||||||
| Balance sheet information: | |||||||||||
| Total assets | $ | 1,809,769 | $ | 1,847,810 | $ | 1,879,005 | |||||
| Loans held for investment | 1,466,751 | 1,498,504 | 1,556,969 | ||||||||
| Investment securities | 209,019 | 191,159 | 240,521 | ||||||||
| Deposits | 1,503,504 | 1,550,250 | 1,580,365 | ||||||||
| Total stockholders’ equity | $ | 146,474 | $ | 138,241 | $ | 118,404 | |||||
| Key ratios and per share data: | |||||||||||
| Book value per share | $ | 20.91 | $ | 19.71 | $ | 16.82 | |||||
| Market price per share | $ | 25.03 | $ | 19.80 | $ | 16.25 | |||||
| Diluted earnings per share (QTR) | $ | 0.66 | $ | 0.66 | $ | 0.36 | |||||
| Net interest margin (FTE) (QTR) | |||||||||||
| Efficiency ratio (QTR) | |||||||||||
Financial Results for the Quarter and Nine Months Ended September 30, 2024
Earnings
Net income for the third quarter 2024 was
Net income for the nine months ended September 30, 2024 was
Net Interest Income and Net Interest Margin
Net interest income for the third quarter 2024 was
Interest income decreased
The yield earned on average loans held for investment was consistent at
The average cost of deposits was
Non-interest Income
Total non-interest income for the third quarter 2024 was
The decrease in the current quarter compared to the prior quarter was primarily due to the Company completing the sale of its mortgage servicing rights and recognizing a gain on sale on foreclosed property in the prior quarter.
The increase in the current quarter compared to the prior year quarter was primarily due to an increase in earnings on bank owned life insurance and a decrease in other real estate owned valuation write-downs, partially offset by a decrease in the gains on sale of mortgage loans in the current quarter.
Non-interest Expense
Total non-interest expense for the third quarter 2024 was
The third quarter 2024 efficiency ratio was
Loans
Loans held for investment decreased
Investments
Investments increased
Asset Quality
Non-performing assets to total loans was
In the third quarter 2024, the Company had net loan charge-offs of
The Company's provision for credit losses and unfunded commitments was consistent at
The allowance for credit losses at September 30, 2024 was
Deposits
Total deposits at September 30, 2024 were
Capital
The Company maintains its “well capitalized” regulatory capital position. At September 30, 2024, capital ratios were as follows: total risk-based capital to risk-weighted assets
Pursuant to the Company's 2019 Repurchase Plan, management is given discretion to determine the number and pricing of the shares to be purchased under the plan, as well as the timing of any such purchases. The Company repurchased 56,692 common shares under the repurchase plan during the first nine months of 2024 at an average cost of
During the fourth quarter of 2024, the Company's Board of Directors approved a quarterly cash dividend of
[Tables follow]
FINANCIAL SUMMARY
(unaudited)
| Three Months Ended | |||||||||
| September 30, | June 30, | September 30, | |||||||
| Statement of income information: | 2024 | 2024 | 2023 | ||||||
| Total interest income | $ | 23,819 | $ | 23,556 | $ | 23,888 | |||
| Total interest expense | 9,492 | 9,384 | 8,741 | ||||||
| Net interest income | 14,327 | 14,172 | 15,147 | ||||||
| Provision for credit losses on loans and unfunded commitments | 500 | 457 | 110 | ||||||
| Non-interest income | 3,783 | 3,995 | 606 | ||||||
| Investment securities gains (losses), net | 8 | (15) | 3 | ||||||
| Non-interest expense | 11,994 | 12,034 | 12,569 | ||||||
| Pre-tax income | 5,624 | 5,661 | 3,077 | ||||||
| Income taxes | 1,050 | 1,033 | 498 | ||||||
| Net income | $ | 4,574 | $ | 4,628 | $ | 2,579 | |||
| Earnings per share: | |||||||||
| Basic: | $ | 0.66 | $ | 0.66 | $ | 0.36 | |||
| Diluted: | $ | 0.66 | $ | 0.66 | $ | 0.36 | |||
| Nine Months Ended | |||||||||
| September 30, | |||||||||
| Statement of income information: | 2024 | 2023 | |||||||
| Total interest income | $ | 71,427 | $ | 66,748 | |||||
| Total interest expense | 28,181 | 23,451 | |||||||
| Net interest income | 43,246 | 43,297 | |||||||
| Provision for credit losses on loans and unfunded commitments | 726 | 790 | |||||||
| Non-interest income | 10,798 | 5,384 | |||||||
| Investment securities (losses) gains, net | (7) | 18 | |||||||
| Non-interest expense | 36,603 | 37,772 | |||||||
| Pre-tax income | 16,708 | 10,137 | |||||||
| Income taxes | 3,049 | 1,738 | |||||||
| Net income | $ | 13,659 | $ | 8,399 | |||||
| Earnings per share: | |||||||||
| Basic: | $ | 1.95 | $ | 1.19 | |||||
| Diluted: | $ | 1.95 | $ | 1.19 | |||||
FINANCIAL SUMMARY (continued)
(unaudited)
| September 30, | June 30, | September 30, | |||||||||
| 2024 | 2024 | 2023 | |||||||||
| Key financial ratios: | |||||||||||
| Return on average assets (QTR) | |||||||||||
| Return on average common equity (QTR) | |||||||||||
| Net interest margin (FTE) (QTR) | |||||||||||
| Efficiency ratio (QTR) | |||||||||||
| Asset Quality Ratios: | |||||||||||
| Allowance for credit losses to total loans | |||||||||||
| Non-performing loans to total loans (a) | |||||||||||
| Non-performing assets to loans | |||||||||||
| Non-performing assets to assets | |||||||||||
| Performing TDRs to loans | $ | 636 | $ | 1,977 | $ | 74 | |||||
| Net Charge-offs to Average Loans (QTR) | |||||||||||
| Allowance for credit losses on loans to | |||||||||||
| non-performing loans (a) | |||||||||||
| Capital Ratios: | |||||||||||
| Average stockholders' equity to average total assets (QTR) | |||||||||||
| Period-end stockholders' equity to period-end assets | |||||||||||
| Total risk-based capital ratio | |||||||||||
| Tier 1 risk-based capital ratio | |||||||||||
| Common equity Tier 1 capital | |||||||||||
| Tier 1 leverage ratio | |||||||||||
(a) Non-performing loans include loans 90-days past due and accruing and non-accrual loans.
About Hawthorn Bancshares
Hawthorn Bancshares, Inc., a financial-bank holding company headquartered in Jefferson City, Missouri, is the parent company of Hawthorn Bank, which has served families and businesses for more than 150 years. Hawthorn Bank has multiple locations, including in the greater Kansas City metropolitan area, Jefferson City, Columbia, Springfield, and Clinton.
Contact:
Hawthorn Bancshares, Inc.
Brent M. Giles
Chief Executive Officer
TEL: 573.761.6100
www.HawthornBancshares.com
The financial results in this press release reflect preliminary, unaudited results, which are not final until the Company's Quarterly Report on Form 10-Q is filed. Statements made in this press release that suggest the Company's or management's intentions, hopes, beliefs, expectations, or predictions of the future include "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. It is important to note that actual results could differ materially from those projected in such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those projected in such forward-looking statements is contained from time to time in the Company's quarterly and annual reports filed with the Securities and Exchange Commission. These forward-looking statements are made as of the date of this communication, and the Company disclaims any obligation to update any forward-looking statement or to publicly announce the results of any revisions to any of the forward-looking statements included herein, except as required by law.
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