Pinnacle Bancshares Announces Results for Year Ended and Fourth Quarter December 31, 2022
02/23/2023 - 08:00 AM
JASPER, Ala. --(BUSINESS WIRE)--
Robert B. Nolen , Jr., President and Chief Executive Officer of Pinnacle Bancshares, Inc. (OTCBB: PCLB), today announced Pinnacle’s results of operations for the fourth quarter and year ended December 31, 2022 :
For the year ended December 31, 2022 , net income was $4,504,000 $4.79 December 31, 2021 was $4,692 ,00$4.83 December 31, 2022 and 2021, was approximately $4,327,000 $3,879,000 $4.61 $3.99
For the three months ended December 31, 2022 , net income was $1,016,000 $1.12 December 31, 2021 was $972,000 $1.00 December 31, 2022 and 2021, was approximately $1,016,000 $791,000 $1.12 $.82 .
Provision for loan losses was $125,000 December 31, 2022 and $200,000
Company’s net interest margin was 3.48% and 3.35% , respectively for the three months and year ended December 31, 2022 , respectively, compared to 3.48% and 3.49% for both the three months and year ended December 31, 2021 , respectively.
At December 31, 2022 , Pinnacle’s allowance for loan losses as a percent of total loans was 2.16% , compared to 2.02% at December 31, 2021 . Net charge-offs were $102,000 $45,000 December 31, 2022 , compared to $130,000 December 31, 2021 . The ratio of nonperforming assets to total loans was .00% at December 31, 2022 , compared to .01% at December 31, 2021 .
Pinnacle was classified as “well capitalized” at the end of 2022. All capital ratios are significantly higher than the requirements for a well-capitalized institution.
Dividends of $.25 and $1.00 December 31, 2022 , as compared to $.22 and $.88 per share during the three months and year ended December 31, 2021 .
Effects of Inflation
Inflation has caused a substantial rise in interest rates during 2022 which has had a negative effect in the securities market. As a result of rising interest rates, the Company has recorded an accumulated other comprehensive loss on securities available for sale of approximately $30 million $1.5 million December 31, 2021 . Thus, this has caused the decrease in total equity during 2022 even though net earnings has been strong. Although these unrealized losses recorded as of December 31, 2022 were significant, management does not anticipate these losses to be other than temporary as these unrealized losses do not currently appear related to any credit deterioration within the portfolio but from higher interest rates.
Forward-Looking Statements
Information contained in this press release, other than historical information, may be considered forward-looking in nature and is subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. Pinnacle undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in Pinnacle’s expectations. Certain tabular presentations may not reconcile because of rounding.
Pinnacle Bancshares , Inc.’s wholly owned subsidiary Pinnacle Bank has seven offices located in central and northwest Alabama .
PINNACLE BANCSHARES, INC.
Unaudited Financial Highlights
(In Thousands, except share and per share data)
Three Months Ended December 31 ,
2022
2021
Net income
$
1,016,000
$
972,000
Basic and diluted earnings per share
$
1.12
$
1.00
Performance ratios (annualized):
Return on average assets
1.29
%
1.17
%
Return on average equity
11.45
%
11.44
%
Interest rate spread
3.35
%
3.39
%
Net interest margin
3.48
%
3.48
%
Operating cost to assets
2.57
%
2.13
%
Weighted average basic and diluted shares outstanding
909,534
970,791
Dividends per share
$
0.25
$
0.22
Provision for loan losses
$
125,000
$
200,000
Years Ended December 31 ,
2022
2021
Net income
$
4,504,000
$
4,692,000
Basic and diluted earnings per share
$
4.79
$
4.83
Performance ratios (annualized):
Return on average assets
1.35
%
1.48
%
Return on average equity
12.88
%
14.49
%
Interest rate spread
3.25
%
3.40
%
Net interest margin
3.35
%
3.49
%
Operating cost to assets
2.22
%
2.26
%
Weighted average basic and diluted shares outstanding
939,575
972,248
Dividends per share
$
1.00
$
0.88
Provision for loan losses
$
125,000
$
200,000
(Audited)
December 31, 2022
December 31, 2021
Total assets
$
332,905,000
$
339,710,000
Loans receivable, net
$
115,956,000
$
122,659,000
Deposits
$
322,260,000
$
298,693,000
Brokered CD’s included in deposits
$
11,756,000
$
24,937,000
Total stockholders’ equity
$
5,738,000
$
35,659,000
Book value per share (excluding OCI)
$
39.17
$
35.15
Average Stockholders’ equity to assets ratio (excluding OCI)
10.47
%
10.19
%
Asset quality ratios:
Nonperforming loans as a percent of total loans
.00
%
.01
%
Nonperforming assets as a percent of total loans
.00
%
.01
%
Allowance for loan losses as a percent of total loans
2.16
%
2.02
%
FINANCIAL INFORMATION
PINNACLE BANCSHARES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
(Audited)
December 31 ,
December 31 ,
2022
2021
Assets
Cash and cash equivalents
$
2,054,034
1,730,327
Interest bearing deposits in banks
11,874,886
11,146,497
Securities available for sale
170,580,649
183,516,514
Restricted equity securities
773,600
741,600
Loans
118,516,666
125,196,462
Less Allowance for loan losses
2,561,078
2,537,948
Loans, net
115,955,588
122,658,514
Premises and equipment, net
6,926,632
7,015,537
Right-of-use lease assets – operating
398,364
493,627
Goodwill
306,488
306,488
Bank owned life insurance
10,206,334
9,822,441
Accrued interest receivable
2,070,896
1,917,598
Other assets
11,757,553
361,228
Total assets
$
332,905,024
339,710,371
Liabilities and Stockholders’ Equity
Deposits
Noninterest-bearing
$
94,783,406
88,430,320
Interest-bearing
227,476,411
210,262,213
Total deposits
322,259,817
298,692,533
Subordinated debentures
3,093,000
3,093,000
Accrued interest payable
111,652
77,843
Operating lease liabilities
398,364
493,627
Other liabilities
1,304,275
1,694,225
Total liabilities
327,167,108
304,051,228
Stockholders’ equity
Common stock, par value $.01 per share; 2,400,000 authorized; 1,872,313 issued; 909,534 and 970,791 shares outstanding, respectively
18,723
18,723
Additional paid‑in capital
8,923,223
8,923,223
Treasury stock (962,779 and 901,522 shares, respectively)
(15,588,799
)
(13,533,621
)
Retained earnings
42,274,372
38,710,339
Accumulated other comprehensive income (loss), net of tax
(29,889,603
)
1,540,479
Total stockholders’ equity
5,737,916
35,659,143
Total liabilities and stockholders’ equity
$
332,905,024
$
339,710,371
PINNACLE BANCSHARES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended
Years Ended
December 31 ,
December 31 ,
2022
2021
2022
2021
Interest income
Loans, including fees
$
1,666,711
$
1,669,927
$
6,512,150
$
6,453,336
Securities available for sale
1,431,684
1,187,083
5,419,511
4,332,287
Other interest
72,494
4,196
170,912
31,000
Total interest income
3,170,889
2,861,206
12,102,573
10,816,623
Interest expense
Deposits
184,218
103,069
570,926
386,593
Borrowings
935
1,934
1,745
2,729
Subordinated debentures
38,600
37,550
152,510
151,150
Total interest expense
223,753
142,553
725,181
540,472
Net interest income
2,947,136
2,718,653
11,377,392
10,276,151
Provision for loan losses
125,000
200,000
125,000
200,000
Net interest income after provision
for loan losses
2,822,136
2,518,653
11,252,392
10,076,151
Other income
Fees and service charges on deposit accounts
384,999
397,276
1,504,850
1,490,449
Service fee income, net
758
911
3,292
3,962
Bank owned life insurance
95,975
90,625
383,894
1,106,105
Mortgage fee income
2,700
8,263
30,457
37,901
Net gain on securities available for sale
-
-
-
227,237
Total other income
484,432
497,075
1,922,493
2,865,654
Other expense:
Salaries and employee benefits
1,095,981
973,561
4,165,501
3,970,530
Occupancy expense
230,977
236,014
891,240
900,124
Marketing and professional expense
88,407
64,551
289,975
262,672
Other operating expenses
609,725
504,497
2,057,305
2,034,747
Total other expenses
2,025,090
1,778,623
7,404,021
7,168,073
Income before income taxes
1,281,478
1,237,105
5,770,864
5,773,732
Income tax expense
265,692
265,425
1,266,668
1,081,975
Net income
$
1,015,786
$
971,680
$
4,504,196
$
4,691,757
Cash dividend per share
$
0.25
$
0.22
$
1.00
$
0.88
Basic and diluted earnings per share
$
1.12
$
1.00
$
4.79
$
4.83
Weighted –average basic and diluted
shares outstanding
909,534
970,791
939,575
972,248
PINNACLE BANCSHARES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
Years Ended December 31, 2022 and 2021
Accumulated
Additional
Other
Total
Common Stock
Paid-in
Treasury
Retained
Comprehensive
Stockholders’
Shares
Amount
Capital
Stock
Earnings
Income
Equity
Balance December 31, 2020
1,872,313
$
18,723
$
8,923,223
$
(13,441,345
)
$
34,874,072
$
3,957,193
$
34,331,866
Net income
-
-
-
4,691,757
-
4,691,757
Cash dividends declared
($.88 per share)
-
-
-
-
(855,490
)
-
(855,490
)
Purchase of treasury stock
-
-
-
(92,276
)
-
-
(92,276
)
Other comprehensive loss
-
-
-
-
-
(2,416,714
)
(2,416,714
)
Balance December 31, 2021
1,872,313
$
18,723
$
8,923,223
$
(13,533,621
)
$
38,710,339
$
1,540,479
$
35,659,143
Accumulated
Additional
Other
Total
Common Stock
Paid-in
Treasury
Retained
Comprehensive
Stockholders’
Shares
Amount
Capital
Stock
Earnings
Income (Loss)
Equity
Balance December 31, 2021
1,872,313
$
18,723
$
8,923,223
$
(13,533,621
)
$
38,710,339
$
1,540,479
$
35,659,143
Net income
-
-
-
4,504,196
-
4,504,196
Cash dividends declared
($1.00
-
-
-
-
(940,163
)
-
(940,163
)
Purchase of treasury stock
-
-
-
(2,055,178
)
-
-
(2,055,178
)
Other comprehensive loss
-
-
-
-
-
(31,430,082
)
(31,430,082
)
Balance December 31, 2022
1,872,313
$
18,723
$
8,923,223
$
(15,588,799
)
$
42,274,372
$
(29,889,603
)
$
5,737,916
PINNACLE BANCSHARES, INC ,
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended
December 31 ,
2022
2021
OPERATING ACTIVITIES:
Net income
$
4,504,196
$
4,691,757
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation
424,648
446,694
Provision for loan losses
125,000
200,000
Net investment amortization expense
208,429
318,421
Net increase in bank owned life insurance
(383,893
)
(1,106,105
)
Gain on sale of securities available for sale
-
(227,237
)
Decrease in accrued interest receivable
(153,298
)
(426,572
)
Increase (decrease) in accrued interest payable
33,809
(67,983
)
Net other operating activities
(96,419
)
332,950
Net cash provided by operating activities
4,662,472
4,161,925
INVESTING ACTIVITIES:
Net (increase) decrease in loans
6,577,926
(13,429,427
)
Net increase in interest bearing deposits in other banks
(728,389
)
(7,039,836
)
Purchase of securities available for sale
(41,170,098
)
(68,497,441
)
Proceeds from sale of securities available for sale
-
7,752,740
Proceeds from maturing, calls, and payments received on securities available for sale
10,777,596
13,348,008
Net (purchase) redemption of restricted equity securities
(32,000
)
43,900
Proceeds from bank owned life insurance
-
1,580,540
Purchase of premises and equipment
(335,743
)
(906,785
)
Net cash used in investing activities
(24,910,708
)
(67,148,301
)
FINANCING ACTIVITIES:
Net increase in deposits
23,567,284
63,583,802
Purchase of treasury stock
(2,055,178
)
(92,276
)
Payments of cash dividends
(940,163
)
(855,490
)
Net cash provided by financing activities
20,571,943
62,636,078
Net increase (decrease) in cash and cash equivalents
323,707
(350,340
)
Cash and cash equivalents at beginning of period
1,730,327
2,080,667
Cash and cash equivalents at end of period
$
2,054,034
$
1,730,327
SUPPLEMENTAL DISCLOSURES:
Cash paid during the period for:
Interest
$
691,372
$
608,455
Taxes
$
1,330,568
$
1,025,679
OTHER NONCASH TRANSACTIONS
Real estate acquired through foreclosure
$
-
$
-
Internally financed sales of other real estate owned
$
-
$
-
View source version on businesswire.com : https://www.businesswire.com/news/home/20230223005189/en/
Joe B. Adams , III
Source: Pinnacle Bancshares, Inc.
