In the header of the bulleted list it should say First Quarter
Highlights (instead of Fourth Quarter Highlights).
The updated release reads:
CITIZENS HOLDING COMPANY REPORTS
EARNINGS
Citizens Holding Company (the “Company”) (OTCQX:CIZN) announced
today results of operations for the three months ended March 31,
2024.
(in thousands, except share and per share data)
Net income for the three months ended March 31, 2024 was $2,868,
or $0.51 per share-basic and diluted, a linked-quarter increase of
$3,662, or 461.21%, from a net loss of ($794), or ($0.14), per
share-basic and diluted, for the three months ended December 31,
2023. Net income also increased $1,728, or 151.58%, from net income
of $1,140, or $0.20, per share-basic and diluted for the same
quarter in 2023.
First Quarter Highlights
- Total revenues, or interest and non-interest income, for the
three months ended March 31, 2024 totaled $21,213, an increase of
$6,020, or 39.62%, from the prior quarter. The increase in total
revenue is primarily attributed to an increase of $4,920, or
535.36%, in non-interest income attributed to a one-time gain on a
sale-leaseback transaction of $4,535.
- Yields on earning assets increased 19 basis point (“bps”) to
461 bps for the three months ended March 31, 2024 compared to 442
bps for the three months ended December 31, 2023 and increased 101
bps compared to 360 bps for the three months ended March 31,
2023.
- Loans held for investment (“LHFI”) increased $25,388, or 3.95%,
to $667,416 at March 31, 2023, compared to $642,028 at December 31,
2023. With the Company’s strong on-balance sheet liquidity, the
Company is in an opportune position, relative to the banking
industry, to continue to fund loan demand.
- Credit quality continues to remain solid with total
non-performing assets (“NPA”) to loans at 54 bps at March 31, 2024
compared to 60 bps at December 31, 2023. Total non-performing
assets decreased ($264), or (6.91%), to $3,562 at March 31, 2024,
compared to $3,826 at December 31, 2023, and decreased ($615), or
(14.73%), compared to $4,177 at March 31, 2023.
- Allowance for credit losses (“ACL”) to loans was 1.00% at March
31, 2023 compared to 1.02% in the prior quarter and 1.06% the same
period a year ago.
Chief Executive Officer (“CEO”)
Commentary
Stacy Brantley, President and Chief Executive Officer of the
Company, stated, “The Citizens Bank of Philadelphia (the `Bank'),
the wholly owned subsidiary of the Company, continued to execute
its strategic balance sheet realignment completing two key
transactions during the quarter. The bank sold three branches in a
sale leaseback transaction generating a pre-tax gain of $4,535.
Additionally, the bank realized a pre-tax loss of $1,574 on the
sale of bonds reinvesting the proceeds in higher yielding assets.
These transactions are targeted at improving net interest income on
a go-forward basis and at buffering the bank’s balance sheet in
this volatile rate environment.”
“The Company’s realized solid loan growth of $25,271 in the
quarter representing a 3.98% increase in LHFI over the prior
quarter end and a 17.73% increase over the prior year quarter ended
March 31, 2023. Credit metrics remain strong with past dues and
non-performers at historically low levels. Total deposits increased
3.46% over the prior quarter-end and 8.49% over the quarter ended
March 31, 2023. While deposit growth was solid, the shift from
non-interest bearing to interest bearing deposits as clients more
actively manage their funds creates headwinds to margin
expansion.”
“The Company’s net interest margin expanded slightly during the
quarter, up 5 bps over the prior quarter ended December 31, 2023.
“We are encouraged by margin expansion, although slight, in the
first quarter. We anticipate continued margin expansion in the
subsequent quarter as our strategic transactions become fully baked
in and loan growth realized late in the first quarter more fully
impacts quarterly earnings.”
“We will continue to evaluate our balance sheet and look for
strategic opportunities to improve performance. Our strong
on-balance sheet liquidity has us well positioned for growth as we
seek to increase long-term value for our shareholders.”
Financial Condition and Results of Operations
Loans and Deposits
Total loans outstanding, net of unearned income, as of March 31,
2024 totaled $667,416 compared to $642,028 at December 31, 2023 and
$567,240 as of March 31, 2023.
Total deposits as of March 31, 2024 were $1,210,600 compared to
$1,170,077 at December 31, 2023 and $1,115,826 as of March 31,
2023. With the pressure throughout the banking system in regards to
deposits, the Company has not experienced material outflows in
deposits, but continues to see a shift from noninterest bearing
deposits to interest bearing deposits.
Net Interest Income
Net interest income for the three months ended March 31, 2024
was $7,790, an increase of 436, or 5.93%, compared to $7,354 for
the three months ended December 31, 2023, and an increase of $112,
or 1.46%, compared to $7,678 for the three months ended March 31,
2023. The net interest margin (“NIM”) was 2.40% for the three
months ended March 31, 2024 compared to 2.35% for the three months
ended December 31, 2023 and 2.56% for the same period in 2023.
Management expects continued pressure on NIM given the current
interest rate environment, however, the Company saw an uptick in
NIM for the three months ended March 31, 2024.
The linked-quarter increase in net interest income is primarily
a result of the increase in interest income of $1,100, or 7.71%,
partially offset by an increase in interest expense of $664, or
9.60%, compared to the three months ended December 31, 2023. The
increase from the same period ended March 31, 2023 is due to an
increase in interest income of $4,342, or 39.36%. This increase in
interest income is partially offset by an increase in total
interest expense of $4,230, or 126.11%, when compared to the same
period in 2023. This increase is the direct result of increased
loan production partially offset by increased deposit competition
primarily caused by higher short-term rates.
Credit Quality
The Company’s NPAs decreased by ($264), or (6.91%), to $3,562 at
March 31, 2024 compared to $3,826 at December 31, 2023, and
decreased ($615), or (14.73%), compared to $4,177 at March 31,
2023. The primary cause of the decrease year-over-year was due the
decrease in non-accrual loans of ($665), or (22.22%).
Net recoveries were $2 for the three months ended March 31,
2024. Year-to-date net recoveries to average loans were 0.00% at
March 31, 2024 compared to (0.01%) at March 31, 2023.
The provision for credit losses (“PCL”) for the three months
ended March 31, 2024 was $192 compared to $107 for the linked
quarter and $6 for the same period a year ago. The PCL was
primarily driven by loan growth partially offset by favorable
qualitative factor adjustments due to better than expected GDP
growth and strong unemployment. Additionally, the Company has not
observed material deterioration in local CRE valuations that some
of the larger central business districts have experienced. The ACL
to LHFI was 1.00% and 1.06% at March 31, 2024 and 2023,
respectively, and 1.02% at December 31, 2023, representing a level
management considers commensurate with the risk in the loan
portfolio.
Liquidity and Capital
Given the events within the banking industry during 2023,
investment securities portfolios, interest rate risk, liquidity and
capital have become much more of a focus for the Company’s
management team and Board, regulators and investors. As a result of
this, the Company is providing additional information on our
liquidity and capital position as of March 31, 2024 to disclose the
more traditional and stable nature of the Company’s banking
model.
The Company currently has limited reliance on the wholesale
funding market. The Company had $-0- in overnight Federal Funds
borrowings at March 31, 2024, December 31, 2023, and $1,725 at
March 31, 2023. The Company currently has capacity to borrow
$197,000 from the Federal Home Loan Bank of Dallas (“FHLB”),
approximately $150,000 in brokered deposit availability and $50,000
in availability with our correspondent Fed Funds lines.
Additionally, the Company could provide additional collateral to
the FHLB to increase the capacity there, should that avenue be
needed.
The Company and the Bank, remain in a strong capital position
and well-capitalized. A comparison of the various regulatory ratios
for the Company and the Bank are noted below:
March 31, 2024
December 31, 2023
March 31, 2023
Citizens Holding Company
Tier 1 leverage ratio
7.31
%
7.43
%
8.01
%
Common Equity tier 1 capital ratio
7.31
%
7.43
%
8.01
%
Tier 1 risk-based capital ratio
11.87
%
11.95
%
13.70
%
Total risk-based capital ratio
12.65
%
12.70
%
14.46
%
The Citizens Bank
Tier 1 leverage ratio
8.37
%
8.64
%
9.29
%
Common Equity tier 1 capital ratio
8.37
%
8.64
%
9.29
%
Tier 1 risk-based capital ratio
13.48
%
13.78
%
15.75
%
Total risk-based capital ratio
14.25
%
14.52
%
16.50
%
Noninterest Income
Noninterest income increased for the three months ended March
31, 2024, by $4,920, or 535.36%, compared to the three months ended
December 31, 2023, and increased by $3,476, or 147.10%, compared to
the same period in 2023.
The increase quarter-over-quarter is primarily due to other
noninterest income increasing $4,600, or 676.47%, primarily driven
by a one-time gain on the sale-leaseback transaction of three
locations of $4,535 in the current quarter.
Noninterest Expense
Noninterest expense increased for the three months ended March
31, 2024 by $327, or 3.49%, compared to the three months ended
December 31, 2023 and increased by $943, or 10.79%, compared to the
same period in 2023.
The increase year-over-year is primarily due to an increase in
occupancy expense of $480, or 26.02%.
Dividends
The Company paid aggregate cash dividends in the amount of $901,
or $0.16 per share, during the three-month period ended March 31,
2024 compared to $1,346, or $0.24 per share, for the same period in
2023.
At $0.16 per share, the Company’s current quarterly dividend
yield is approximately 8% which reflects the Company’s continued
commitment to returning shareholder value.
Citizens Holding Company
Financial Highlights
(amounts in thousands, except
share and per share data)
For the Three Months Ended March 31, December 31, March 31,
2024
2023
2023
INTEREST INCOME Loans, including fees
$
10,264
$
9,422
$
7,323
Investment securities
3,045
3,163
3,370
Other interest
2,065
1,689
339
15,374
14,274
11,032
INTEREST EXPENSE Deposits
5,261
4,503
1,820
Other borrowed funds
2,323
2,417
1,534
7,584
6,920
3,354
NET INTEREST INCOME
7,790
7,354
7,678
PCL
192
107
6
NET INTEREST INCOME AFTER PCL
7,598
7,247
7,672
NONINTEREST INCOME Service charges on deposit accounts
957
990
914
Other service charges and fees
1,176
1,234
1,037
Net (losses) gains on sales of securities
(1,574
)
(1,986
)
-
Other noninterest income
5,280
680
412
5,839
919
2,363
NONINTEREST EXPENSE Salaries and employee benefits
4,885
4,522
4,695
Occupancy expense
2,325
2,199
1,845
Other noninterest expense
2,474
2,635
2,201
9,684
9,357
8,741
NET INCOME BEFORE TAXES
3,753
(1,190
)
1,294
INCOME TAX EXPENSE (BENEFIT)
885
(397
)
154
NET INCOME (LOSS)
$
2,868
$
(794
)
$
1,140
Earnings (Loss) per share - basic
$
0.51
$
(0.14
)
$
0.20
Earnings (Loss) per share - diluted
$
0.51
$
(0.14
)
$
0.20
Dividends paid
$
0.16
$
0.16
$
0.24
Average shares outstanding - basic
5,603,570
5,603,570
5,595,320
Average shares outstanding - diluted
5,603,570
5,603,570
5,595,320
March 31, March 31, December 31,
2024
2023
2023
Assets (Unaudited) (Unaudited) Change % Change (Audited)
Change % Change Cash and due from banks
$
16,868
$
15,600
$
1,268
8.13
%
$
14,553
$
2,315
15.91
%
Interest bearing deposits with other banks
145,924
606
145,318
23979.83
%
79,923
66,001
82.58
%
Cash and cash equivalents
162,792
16,206
146,586
904.52
%
94,476
68,316
72.31
%
Investment securities held-to-maturity, at amortized cost
384,015
402,237
(18,222
)
-4.53
%
387,799
(3,783
)
-0.98
%
Investment securities available-for-sale, at fair value
152,553
201,740
(49,187
)
-24.38
%
177,795
(25,242
)
-14.20
%
Loans held for investment (LHFI) (1)
667,416
567,240
100,176
17.66
%
642,028
25,388
3.95
%
Less allowance for credit losses (ACL), LHFI (1)
6,668
6,017
651
10.82
%
6,551
117
1.79
%
Net LHFI
660,748
561,223
99,525
17.73
%
635,477
25,271
3.98
%
Premises and equipment, net
20,530
27,561
(7,031
)
-25.51
%
27,073
(6,543
)
-24.17
%
Other real estate owned, net
1,234
1,179
55
4.63
%
1,234
-
0.00
%
Accrued interest receivable
4,784
4,562
222
4.86
%
5,231
(447
)
-8.54
%
Cash surrender value of life insurance
26,438
25,909
529
2.04
%
26,284
154
0.59
%
Deferred tax assets, net
27,533
29,091
(1,558
)
-5.36
%
28,008
(475
)
-1.70
%
Identifiable intangible assets, net
13,304
13,413
(109
)
-0.81
%
13,331
(27
)
-0.21
%
Other assets
19,592
6,349
13,243
208.59
%
8,972
10,620
118.36
%
Total Assets
$
1,473,523
$
1,289,470
$
184,053
14.27
%
$
1,405,680
$
67,843
4.83
%
Liabilities and Shareholders' Equity
Liabilities Deposits: Non-interest bearing deposits
$
263,006
$
288,466
$
(25,460
)
-8.83
%
$
264,528
$
(1,522
)
-0.58
%
Interest bearing deposits
947,594
827,360
120,234
14.53
%
905,549
42,045
4.64
%
Total deposits
1,210,600
1,115,826
94,774
8.49
%
1,170,077
40,523
3.46
%
Securities sold under agreement to repurchase
173,254
98,532
74,722
75.84
%
158,086
15,168
9.59
%
Short-term borrowings
-
1,725
(1,725
)
-100.00
%
-
-
0.00
%
Borrowings on secured line of credit
18,000
18,000
-
0.00
%
18,000
-
0.00
%
Deferred compensation payable
9,841
9,985
(144
)
-1.45
%
9,929
(88
)
-0.89
%
Other liabilities
16,135
4,279
11,856
277.08
%
6,815
9,320
136.75
%
Total liabilities
1,427,830
1,248,347
179,483
14.38
%
1,362,907
64,924
4.76
%
Shareholders' Equity Common stock, $0.20 par value,
22,500,000 shares authorized, Issued and outstanding: 5,628,811
shares - March 31, 2024; 5,616,438 shares - December 31, 2023
1,123
1,122
-
0.00
%
1,123
-
0.00
%
Additional paid-in capital
18,618
18,448
170
0.92
%
18,585
32
0.17
%
Accumulated other comprehensive loss, net of tax benefit of $25,064
at March 31, 2024 and $25,362 at December 31, 2023
(75,369
)
(79,822
)
4,453
-5.58
%
(76,289
)
920
-1.21
%
Retained earnings
101,321
101,335
(14
)
-0.01
%
99,354
1,967
1.98
%
Total shareholders' equity
45,693
41,123
4,570
11.11
%
42,773
2,920
6.83
%
-
Total liabilities and shareholders' equity
$
1,473,523
$
1,289,470
$
184,053
14.27
%
$
1,405,680
$
67,843
4.83
%
SELECTED FINANCIAL INFORMATION
March 31, December 31, March 31,
2024
2023
2023
Dollars in thousands, except per share data (Unaudited) (Audited)
(Unaudited)
Per Share Data Basic Earnings per Common
Share
$
0.51
$
(0.14
)
$
0.20
Diluted Earnings per Common Share
0.51
(0.14
)
0.20
Dividends per Common Share
0.16
0.16
0.24
Book Value per Common Share
8.15
7.62
7.35
Tangible Book Value per Common Share
5.78
5.24
4.70
Average Diluted Shares Outstanding
5,603,570
5,603,570
5,595,320
End of Period Common Shares Outstanding
5,628,811
5,616,438
5,595,320
Annualized Performance Ratios Return on Average
Assets
0.78
%
0.14
%
0.34
%
Return on Average Equity
18.79
%
4.89
%
11.49
%
Equity/Assets
3.10
%
3.04
%
3.19
%
Yield on Earning Assets
4.61
%
4.42
%
3.60
%
Cost of Funds
2.66
%
2.41
%
1.35
%
Net Interest Margin
2.40
%
2.35
%
2.56
%
Credit Metrics Allowance for Loan Losses to Total
Loans
1.00
%
1.02
%
1.06
%
Non-performing assets to loans
0.54
%
0.60
%
0.74
%
Citizens Holding Company is a one-bank holding company and the
parent company of the Bank, both headquartered in Philadelphia,
Mississippi. The Bank currently has locations in fourteen counties
throughout the state of Mississippi. In addition to full service
commercial banking, the Company offers mortgage loans, title
insurance services through third party partnerships and a full
range of Internet banking services including online banking, bill
pay and cash management services for businesses. Internet services
are available at the Bank web site, www.thecitizensbankphila.com.
Citizens Holding Company stock is listed on the OTCQX Best Market
and is traded under the symbol CIZN. The Company's transfer agent
is American Stock Transfer & Trust Company. Investor relations
information may be obtained at the corporate website,
https://www.thecitizensbankphila.com/investor-relations.
Cautionary Note Regarding Forward-Looking Statements
This press release includes “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. All statements
other than statements of historical facts included in this release
regarding the Company’s financial position, results of operations,
business strategies, plans, objectives and expectations for future
operations, are forward looking statements. The Company can give no
assurances that the assumptions upon which such forward-looking
statements are based will prove to have been correct.
Forward-looking statements speak only as of the date they are made.
The Company does not undertake a duty to update forward-looking
statements to reflect circumstances or events that occur after the
date the forward-looking statements are made. Such forward-looking
statements are subject to certain risks, uncertainties and
assumptions. The risks and uncertainties that may affect the
operation, performance, development and results of the Company’s
and the Bank’s business include, but are not limited to, the
following: (a) the risk of adverse changes in business conditions
in the banking industry generally and in the specific markets in
which the Company operates; (b) our ability to mitigate our risk
exposures; (c) changes in the legislative and regulatory
environment that negatively impact the Company and Bank through
increased operating expenses; (d) increased competition from other
financial institutions; (e) the impact of technological advances;
(f) expectations about the movement of interest rates, including
actions that may be taken by the Federal Reserve Board in response
to changing economic conditions; (g) changes in asset quality and
loan demand; (h) expectations about overall economic strength and
the performance of the economics in the Company’s market area; and
(i) other risks detailed from time to time in the Company’s filings
with the Securities and Exchange Commission. Should one or more of
these risks materialize or should any such underlying assumptions
prove to be significantly different, actual results may vary
significantly from those anticipated, estimated, projected or
expected.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240418402995/en/
Citizens Holding Company, Philadelphia Phillip R. Branch,
601/519-4016 Phillip.branch@thecitizensbank.bank
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