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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT REPORT
PURSUANT TO
SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported): July 17, 2024
First
Community Corporation
(Exact name
of registrant as specified in its charter)
South
Carolina
(State or other
jurisdiction of incorporation)
| 000-28344 |
57-1010751 |
| (Commission File Number) |
(IRS Employer Identification No.) |
| |
|
| 5455 Sunset Blvd, Lexington, South Carolina |
29072 |
| (Address of principal executive offices) |
(Zip Code) |
(803)
951-2265
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former name
or former address, if changed since last report.)
Check the appropriate box below if
the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
(see General Instruction A.2. below):
| ☐ |
Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425) |
| |
|
| ☐ |
Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12) |
| |
|
| ☐ |
Pre-commencement communications pursuant
to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| |
|
| ☐ |
Pre-commencement communications pursuant
to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| |
|
Securities registered pursuant to
Section 12(b) of the Act:
| Title
of each class |
Trading
Symbol(s) |
Name
of exchange on which registered |
| Common
stock, par value $1.00 per share |
FCCO |
The
Nasdaq Stock Market |
Indicate by check mark whether the
registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ☐
If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations
and Financial Condition.
On July 17, 2024, First Community
Corporation (the “Company”), holding company for First Community Bank, issued a press release announcing its financial
results for the period ended June 30, 2024. The Company announced that the Board of Directors has approved a cash dividend for
the second quarter of 2024. The Company will pay a $0.15 per share dividend to holders of the Company’s common stock. This
dividend is payable on August 13, 2024 to shareholders of record as of July 30, 2024.
A copy of the press release is attached
hereto as Exhibit 99.1.
FORWARD-LOOKING STATEMENTS
Certain statements in this report may
contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as
statements relating to future plans, goals, projections and expectations, and are thus prospective. Forward looking statements can
be identified by words such as “anticipate”, “expects”, “intends”, “believes”,
“may”, “likely”, “will”, “plans”, “positions”, “future”,
“forward” or other statements that indicate future periods. Such forward-looking statements are subject to risks,
uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by
such forward-looking statements. Such risks, uncertainties and other factors, include, among others, the following: (1) competitive
pressures among depository and other financial institutions may increase significantly and have an effect on pricing, spending,
third-party relationships and revenues; (2) the strength of the United States economy in general and the strength of the local
economies in which we conduct operations may be different than expected; (3) the rate of delinquencies and amounts of charge-offs,
the level of allowance for credit loss, the rates of loan growth, or adverse changes in asset quality in our loan portfolio, which
may result in increased credit risk-related losses and expenses; (4) changes in legislation, regulation, policies or administrative
practices, whether by judicial, governmental, or legislative action; (5) adverse conditions in the stock market, the public debt
markets and other capital markets (including changes in interest rate conditions) could continue to have a negative impact on the
company; (6) changes in interest rates, which have and may continue to affect our deposit and funding costs, net income, prepayment
penalty income, mortgage banking income, and other future cash flows, or the market value of our assets, including our investment
securities; (7) technology and cybersecurity risks, including potential business disruptions, reputational risks, and financial
losses, associated with potential attacks on or failures by our computer systems and computer systems of our vendors and other third
parties; (8) elevated inflation which causes adverse risk to the overall economy, and could indirectly pose challenges to our
customers and to our business; (9) any increases in FDIC assessment which has increased, and may continue to increase, our cost of
doing business; (10) the adverse effects of events beyond our control that may have a destabilizing effect on financial markets and
the economy, such as epidemics and pandemics, war or terrorist activities, essential utility outages, deterioration in the global
economy, instability in the credit markets, disruptions in our customers’ supply chains or disruption in transportation and
disruptions caused from widespread cybersecurity incidents; and (11) risks, uncertainties and other factors disclosed in our most recent
Annual Report on Form 10-K filed with the SEC, or in any of our Quarterly Reports on Form 10-Q or Current Reports on Form 8-K filed
with the SEC since the end of the fiscal year covered by our most recently filed Annual Report on Form 10-K, which are available at
the SEC’s Internet site (http://www.sec.gov).
Although we believe that the assumptions
underlying the forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate. We can give no
assurance that the results contemplated in the forward-looking statements will be realized. The inclusion of this forward-looking
information should not be construed as a representation by our company or any person that the future events, plans, or expectations
contemplated by our company will be achieved. We undertake no obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events, or otherwise, except as required by law.
Item 9.01. Financial Statements
and Exhibits.
(d) Exhibits
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
| |
FIRST COMMUNITY CORPORATION |
| |
|
|
| |
By: |
/s/ D. Shawn Jordan |
| |
Name: |
D. Shawn Jordan |
| |
Title: |
Chief Financial Officer |
| |
|
|
| Dated: July 17, 2024 |
|
|
Exhibit 99.1
 |
|
| |
News
Release
For Release July 17,
2024
9:00 A.M. |
| |
|
| |
Contact: (803) 951- 2265
D. Shawn Jordan, EVP &
Chief Financial Officer or
Robin D. Brown, EVP &
Chief Marketing Officer |
| |
|
First Community Corporation
Announces Second Quarter Results and Increased Cash Dividend
Highlights for Second
Quarter of 2024
| · | Net
income of $3.265 million during the second quarter of 2024, an increase of 25.7% on a
linked quarter basis, and $5.862 million through June 30, 2024. |
| · | Diluted
EPS of $0.42 per common share for the second quarter of 2024 and $0.76 through June 30,
2024, an increase of 23.5% on a linked quarter basis. |
| · | Net
interest margin on a tax equivalent basis of 2.93% with margin expansion of 14 basis
points during the second quarter of 2024 compared to the first quarter of 2024. |
| · | Total
loans increased by $31.9 million during the second quarter of 2024, an annualized growth
rate of 11.1%. |
| · | Total
deposits were $1.605 billion and customer deposits (excludes brokered CDs) were $1.562
billion at June 30, 2024. Customer deposit growth was $44.1 million during the second
quarter, an 11.7% annualized growth rate. |
| · | Investment
advisory revenue of $1.508 million. Assets under management (AUM) were a record $865.6
million at June 30, 2024, which is a 14.6% increase year-to-date through June 30, 2024. |
| · | Mortgage
line of business total production of $49.0 million which is the highest quarter since
2020. |
| · | Key
credit quality metrics continue to be excellent with net charge-offs, including overdrafts,
during the second quarter of 2024 of $5 thousand; net loan recoveries, excluding overdrafts,
during the quarter of $1,000; non-performing assets of 0.04%; and past due loans of 0.07%
at June 30, 2024. |
| · | Increased
cash dividend to $0.15 per common share, which is the 90th consecutive quarter
of cash dividends paid to common shareholders. |
Lexington, SC – July
17, 2024 Today, First Community Corporation (Nasdaq: FCCO), the holding company for First Community Bank, reported net income
for the second quarter of 2024 of $3.265 million as compared to $2.597 million in the first quarter of 2024 and $3.327 million
in the second quarter of 2023. Diluted earnings per common share were $0.42 for the second quarter of 2024 as compared to $0.34
in the first quarter of 2024 and $0.43 for the second quarter of 2023.
Year-to-date through June
30, 2024, net income was $5.862 million compared to $6.790 million during the first six months of 2023. Diluted earnings per share
for the first half of 2024 were $0.76, compared to $0.89 during the same time period in 2023.
Cash Dividend and
Capital
The
Board of Directors approved an increased cash dividend for the second quarter of 2024. The company will pay a $0.15 per share
dividend to holders of the company’s common stock. This dividend is payable August 13, 2024 to shareholders of record as
of July 30, 2024. First Community Corporation President and CEO Mike Crapps commented, “Our entire board is pleased that
our performance enables the company to continue its cash dividend for the 90th consecutive quarter.”
As
previously announced on May 14, 2024, the Company’s Board of Directors has approved a plan to utilize up to $7.1 million
of capital to repurchase shares of its common stock, which represents approximately 5.3% of total shareholders’ equity as
of March 31, 2024. This new share repurchase plan expires on May 13, 2025. Under the repurchase plan, the Company may repurchase
shares from time to time. No shares have been repurchased under this plan. Crapps noted, “This approved share repurchase
provides us with some flexibility in managing capital going forward.”
Each of the regulatory
capital ratios for the bank exceed the well capitalized minimum levels currently required by regulatory statute. At June 30, 2024,
the bank’s regulatory capital ratios (Leverage, Tier I Risk Based and Total Risk Based) were 8.44%, 12.55%, and 13.62%,
respectively. This compares to the same ratios as of June 30, 2023 of 8.63%, 13.29%, and 14.35%, respectively. As of June 30,
2024, the bank’s Common Equity Tier I ratio was 12.55% compared to 13.29% at June 30, 2023. The Company’s Tangible
Common Equity to Tangible Assets ratio (TCE ratio) was 6.47% at June 30, 2024, compared to 6.32% at March 31, 2024 and 6.31% at
June 30, 2023.
Tangible Book Value (TBV)
per share increased during the quarter to $15.85 per share at June 30, 2024, from $15.51 per share as of March 31, 2024 and $14.33
as of June 30, 2023.
Loan
Portfolio Quality/Allowance for Loan Losses
The company’s asset
quality metrics as of June 30, 2024 were excellent. The non-performing assets ratio as of June 30, 2024 was 0.04% and the total
past dues ratio was 0.07%. Non-accrual loans were $173 thousand, which is 0.01% of total loans, at June 30, 2024. During the second
quarter of 2024, the bank had net charge-offs, including overdrafts, of $5 thousand and net loan recoveries, excluding overdrafts,
of $1 thousand. Year-to-date through June 30, 2024, net charge-offs, including overdrafts, were $27 thousand and net loan recoveries,
excluding overdrafts, were $2 thousand. The ratio of classified loans plus OREO now stands at 1.21% of total bank regulatory risk-based
capital as of June 30, 2024. Provision expense in the second quarter of 2024 was $454 thousand with $328 thousand related to growth
in the loan portfolio and the remainder due to a slight extension in the average life of the portfolio due to lower loan prepayments.
As a community bank focused
on local businesses, professionals, organizations, and individuals, the bank has no individual or industry concentrations. In
order to provide additional clarity to our commercial real estate exposure, the information below includes only non-owner occupied
loans. As of June 30, 2024:
| Collateral | |
Outstanding | | |
% of Loan
Portfolio | | |
Average
Loan Size | | |
Weighted
Avg LTV of
Top 10 Loans | |
| Retail | |
$ | 91,549,392 | | |
| 7.7 | % | |
$ | 995,102 | | |
| 55 | % |
| Warehouse & Industrial | |
$ | 78,006,255 | | |
| 6.6 | % | |
$ | 804,188 | | |
| 61 | % |
| Office | |
$ | 66,359,134 | | |
| 5.6 | % | |
$ | 713,539 | | |
| 57 | % |
| Hotel | |
$ | 65,178,549 | | |
| 5.5 | % | |
$ | 3,621,030 | | |
| 63 | % |
In the office exposure
noted above, there are only four loans where the collateral is an office building in excess of 50,000 square feet of rentable
space. These four loans represent $10.6 million in loan outstandings and have a weighted average loan-to-value of 34%.
Balance
Sheet
Total loans increased during
the second quarter of 2024 by $31.9 million, which is an annualized growth rate of 11.1%. This increase is a result of growth
in the commercial loan portfolio of $14.2 million, growth in the residential mortgage portfolio of $12.9 million, and growth in
the consumer loan portfolio of $4.8 million. Commercial loan production was $42.6 million during the second quarter compared to
$27.8 million in the first quarter of 2024. Additionally, growth was aided by advances from unfunded commercial construction loans
available for draws of $23.7 million during the second quarter of 2024. Also early loan payoffs and paydowns declined during the
quarter.
Total deposits were
$1.605 billion at June 30, 2024 compared to $1.578 billion at March 31, 2024, an increase of $26.5 million, a 6.7% annualized
growth rate. The bank began issuing brokered certificates of deposit during the third quarter of
2023 to supplement its funding mix. During the second quarter of 2024 brokered CDs declined from $60.5 million at March 31, 2024
to $42.9 million at June 30, 2024, as the bank called a $17.7 million brokered certificate of deposit with an all-in cost of 5.70%
on April 25, 2024. Total deposits, excluding brokered deposits, were $1.562 billion at June 30, 2024 compared to $1.518
billion at March 31, 2024, with an annual growth rate, excluding brokered deposits, of 11.7%. Pure deposits, which are defined
as total deposits less certificates of deposits, increased $20.3 million during the second quarter of 2024, to $1.319 billion
at June 30, 2024, a 6.3% annualized growth rate. Non-interest bearing accounts increased $17.1 million to $460.4 million during
the quarter and at June 30, 2024 represented 28.7% of total deposits. This compares to 28.1% as of March 31, 2024. Securities
sold under agreements to repurchase, which are related to customer cash management accounts or business sweep accounts, were $59.3
million at June 30, 2024.
Costs of deposits increased
on a linked quarter basis to 1.98% in the second quarter of 2024 from 1.90% in the first quarter of 2024. Cost of funds increased
just 0.01% on a linked quarter basis to 2.17% in the second quarter of 2024 from 2.16% in the first quarter of 2024. As additional
information, the cost of deposits were 1.95% in the month of March 2024 and 1.97% in the month of June 2024. Cost of funds were
2.18% in the month of March 2024 and 2.15% in the month of June 2024. This decline in cost of funds was due to an improved mix
including a reduction in wholesale funding and growth in pure deposits which includes non-interest bearing deposits. The cumulative
cycle betas through April 2024, which represent trough to peak, for cost of deposits is 36.76% and for cost of funds is 40.00%.
As of June 30, 2024, cumulative cycle betas for cost of deposits is 36.00% and for cost of funds is 38.67%. Ted Nissen, President
and CEO of First Community Bank, commented, “A strength of our bank has been and continues to be the value of our deposit
franchise. In the second quarter of 2024, we saw growth in total deposits, pure deposits and non-interest bearing deposits. While
we did see an increase in cost of deposits during the quarter, cost of funds was almost flat on a linked quarter.”
As of June 30, 2024, the
bank had uninsured deposits of $460.0 million, or 28.7%, of total bank deposits. Of those uninsured deposits, $93.5 million, or
5.8%, of total bank deposits were deposits of states or political subdivisions in the U.S. which are secured or collateralized.
Total uninsured deposits, excluding these deposits that are secured or collateralized, were $366.4 million, or 22.8%, of total
deposits at June 30, 2024. The average balance of all customer deposit accounts as of June 30, 2024 was $28,532. The average balance
for consumer accounts was $15,008 and for non-consumer accounts was $63,038. All of the above point to the granularity and the
quality of the bank’s deposit franchise.
The bank has other short-term
investments, primarily interest bearing cash at the Federal Reserve Bank, of $86.2 million at June 30, 2024 compared to $122.8
million at March 31, 2024. Further, the bank has additional sources of liquidity in the form of federal funds purchased lines
of credit in the total amount of $77.5 million with three financial institutions and $10.0 million through the Federal Reserve
Discount Window. There were no borrowings against the above lines of credit as of June 30, 2024.
The bank also has substantial
borrowing capacity at the Federal Home Loan Bank (FHLB) of Atlanta with an approved line of credit of up to 25% of assets. As
of June 30, 2024, the bank had FHLB advances of $50.0 million, which was a reduction of $10 million during the second quarter
of 2024. Therefore, the bank has remaining credit availability under this facility of $421.5 million, subject to collateral requirements.
Combined, at June 30, 2024,
the company has total remaining credit availability in excess of $509.0 million as compared to non-secured or non-collateralized
uninsured deposits of $366.4 million as noted above.
The investment portfolio
was $488.7 million at June 30, 2024 compared to $495.1 million at March 31, 2024 with a yield of 3.66% in the second quarter of
2024. The effective duration of the total investment portfolio is relatively low at 3.8. Accumulated Other Comprehensive Loss
(AOCL) improved to $27.3 million at June 30, 2024 from $27.4 million at March 31, 2024.
Mr. Nissen commented, “We
are extremely excited about the success in the growth of loans and deposits during the second quarter. This is reflective of the
hard work of our team and the high quality of our customers and markets.”
Revenue
Net Interest Income/Net
Interest Margin
Net interest income was
$12.7 million for the second quarter of 2024 compared to first quarter of 2024 net interest income of $12.1 million and $12.1
million for the second quarter of 2023. Second quarter of 2024 net interest margin, on a tax equivalent basis, was 2.93% compared
to 2.79% in the first quarter of the year, up 14 basis points on a linked quarter. Crapps commented, “We believe we had
an inflection point in margin on a non-taxable equivalent basis in February of 2024 with four consecutive months of margin expansion
from 2.77% in February of 2024 to 2.96% in June of 2024. This increase in margin is due to a continued increase in the yields
on loans and an improved earning asset mix with a higher percentage of loans along with a flattening and reduction of the cost
of funds and cost of deposits as noted above.”
As previously disclosed,
effective May 5, 2023, the company entered into a pay-fixed/receive-floating interest rate swap (the “Pay-Fixed Swap Agreement”)
for a notional amount of $150.0 million that was designated as a fair value hedge to hedge the risk of changes in the fair value
of the fixed rate loans included in the closed loan portfolio. This fair value hedge converts the hedged loans from a fixed rate
to a synthetic floating SOFR rate. The Pay-Fixed Swap Agreement will mature on May 5, 2026 and the company will pay a fixed coupon
rate of 3.58% while receiving the overnight SOFR rate. This interest rate swap positively impacted interest on loans by $668 thousand
during the second quarter of 2024 and $1.3 million year-to-date through June 30, 2024. Loan yields and net interest margin both
benefitted with an increase of 24 basis points and 16 basis points, respectively during the second quarter and year-to-date through
June 30, 2024.
Non-Interest Income
Non-interest income in
the second quarter of 2024 was $3.642 million, compared to $3.184 million in the first quarter of 2024 and $3.051 million in the
second quarter of 2023, an increase of 14.4% and 19.4%, respectively.
Total production in the
mortgage line of business in the second quarter of 2024 was $49.0 million which was the highest quarter since 2020 and was comprised
of $22.7 million in secondary market loans, $14.6 million in adjustable rate mortgages (ARMs) and $11.7 million in construction
loans. Fee revenue from the mortgage line of business was $659 thousand for the second quarter of 2024 which includes $655 thousand
associated with the secondary market loans with a gain-on-sale margin of 2.89%. This compares to production year-over-year of
$32.3 million which was comprised of $12.9 million in secondary market loans, $5.7 million in ARMs, and $13.7 million in construction
loans. Fee revenue associated with the secondary market loans in the second quarter of 2023 was $371 thousand with a gain-on-sale
margin of 2.87%. Mr. Crapps noted, “During the quarter, we saw an increase in demand for secondary market loans as we also
continue to have success with our adjustable rate mortgage and construction loan products. As the adjustable rate and construction
loans are held on our balance sheet, the immediate result is less gain-on-sale revenue, but additional loan growth and interest
income. Additionally, this is building a pipeline for future gain-on-sale revenue when the interest rate environment changes.”
Total assets under management
(AUM) in the investment advisory line of business were $865.6 million at June 30, 2024 from $832.9 million at March 31, 2024 and
$755.4 million at December 31, 2023. This record in AUM is driven by a combination of net new asset growth and market appreciation.
Revenue in this line of business was $1.508 million in the second quarter of 2024, up from $1.358 million at March 31, 2024 and
$1.081 million in the second quarter of 2023, an increase of 11.0% and 39.5%, respectively.
Other non-recurring non-interest
income during the second quarter of 2024 was $95 thousand that includes a $101 thousand gain on insurance proceeds which was partially
offset by a $5 thousand loss on disposition of assets on the closing of the downtown Augusta banking office.
Non-Interest
Expense
Non-interest expense was
$11.843 million in the second quarter of 2024 an increase of $38 thousand over the first quarter of the year. Salaries and benefits
expense increased $202 thousand on a linked quarter due to higher variable compensation expenses in the mortgage and financial
planning lines of business and the full quarter impact of annual increases for exempt employees which were effective on March
1, 2024. The Other expense category increased $107 thousand on a linked quarter basis due to an increase in shareholder and transfer
agent expense of $45 thousand and higher professional fees of $43 thousand primarily related to increased audit and accounting
fees. Other real estate expenses were up $78 thousand in the second quarter of 2024 due to a write down of an OREO property. The
FDIC assessment increased $24 thousand on a linked quarter. All of the above were offset by a decrease in marketing expense in
the amount of $308 thousand.
On a related note, the
effective income tax rate for the second quarter of 2024 was 19.16% compared to 21.66% in the second quarter of 2023 and 21.94%
in the first quarter of 2024. The reduction in the effective tax rate this quarter was due to a non-recurring tax adjustment of
$149 thousand.
Other
In December
of 2023, First Community announced certain promotions and additions to its Executive Leadership Team designed to preserve the
bank’s culture and prepare for its long term success and sustainability. Notably, this included that effective July 1, 2024,
J. Ted Nissen assumed the role of CEO of First Community Bank while still retaining the role of president and has also joined
the First Community board of directors. Michael C. “Mike” Crapps continues in his role as president and CEO of First
Community Corporation. In his new position as CEO, Mr. Nissen will be responsible for the leadership of day-to-day bank operations,
including its mortgage and financial planning lines of business. Mr. Crapps will continue to focus on board governance, investor
relations, strategy development and growth decisions including new markets and mergers/acquisitions, client retention and prospecting,
and leadership development.
As announced
during the first quarter of 2024, the company closed its banking office located at 771 Broad Street in downtown Augusta, Georgia
on June 27, 2024. The company has three other banking offices in the Central Savannah River Area (CSRA) including locations in
Augusta and Evans, Georgia and Aiken South Carolina. Cost savings are estimated to be $327 thousand annually going forward.
About First Community
Corporation
First Community Corporation
stock trades on The NASDAQ Capital Market under the symbol “FCCO” and is the holding company for First Community Bank,
a local community bank based in the Midlands of South Carolina. First Community Bank is a full-service commercial bank offering
deposit and loan products and services, residential mortgage lending and financial planning/investment advisory services for businesses
and consumers. First Community serves customers in the Midlands, Aiken, Upstate and Piedmont Regions of South Carolina as well
as Augusta, Georgia. For more information, visit www.firstcommunitysc.com.
FORWARD-LOOKING
STATEMENTS
This news release and certain
statements by our management may contain “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995, such as statements relating to future plans, goals, projections and expectations, and are thus
prospective. Forward looking statements can be identified by words such as “anticipate”, “expects”, “intends”,
“believes”, “may”, “likely”, “will”, “plans”, “positions”,
“future”, “forward”, or other statements that indicate future periods. Such forward-looking statements
are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from future results
expressed or implied by such forward-looking statements. Such risks, uncertainties and other factors, include, among others, the
following: (1) competitive pressures among depository and other financial institutions may increase significantly and have an
effect on pricing, spending, third-party relationships and revenues; (2) the strength of the United States economy in general
and the strength of the local economies in which we conduct operations may be different than expected; (3) the rate of delinquencies
and amounts of charge-offs, the level of allowance for credit loss, the rates of loan growth, or adverse changes in asset quality
in our loan portfolio, which may result in increased credit risk-related losses and expenses; (4) changes in legislation, regulation,
policies or administrative practices, whether by judicial, governmental, or legislative action; (5) adverse conditions in the
stock market, the public debt markets and other capital markets (including changes in interest rate conditions) could continue
to have a negative impact on the company; (6) changes in interest rates, which have and may continue to affect our deposit and
funding costs, net income, prepayment penalty income, mortgage banking income, and other future cash flows, or the market value
of our assets, including our investment securities; (7) technology and cybersecurity risks, including potential business disruptions,
reputational risks, and financial losses, associated with potential attacks on or failures by our computer systems and computer
systems of our vendors and other third parties; (8) elevated inflation which causes adverse risk to the overall economy, and could
indirectly pose challenges to our customers and to our business; (9) any increases in FDIC assessment which has increased, and
may continue to increase, our cost of doing business; (10) the adverse effects of events beyond our control that may have a destabilizing
effect on financial markets and the economy, such as epidemics and pandemics, war or terrorist activities, essential utility outages,
deterioration in the global economy, instability in the credit markets, disruptions in our customers’ supply chains or disruption
in transportation; and (11) risks, uncertainties and other factors disclosed in our most recent Annual Report on Form 10-K filed
with the SEC, or in any of our Quarterly Reports on Form 10-Q or Current Reports on Form 8-K filed with the SEC since the end
of the fiscal year covered by our most recently filed Annual Report on Form 10-K, which are available at the SEC’s Internet
site (http://www.sec.gov).
Although we believe that
the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate.
We can give no assurance that the results contemplated in the forward-looking statements will be realized. The inclusion of this
forward-looking information should not be construed as a representation by our company or any person that the future events, plans,
or expectations contemplated by our company will be achieved. We undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events, or otherwise, except as required by law.
###
FIRST
COMMUNITY CORPORATION
BALANCE
SHEET DATA
(Dollars
in thousands, except per share data)
| | |
As of | |
| | |
June 30, | | |
March 31, | | |
December 31, | | |
September 30, | | |
June 30, | |
| | |
2024 | | |
2024 | | |
2023 | | |
2023 | | |
2023 | |
| Total Assets | |
$ | 1,884,844 | | |
$ | 1,886,991 | | |
$ | 1,827,688 | | |
$ | 1,793,722 | | |
$ | 1,740,982 | |
| Other Short-term Investments and CD’s1 | |
| 86,172 | | |
| 122,778 | | |
| 66,787 | | |
| 69,703 | | |
| 28,710 | |
| Investment Securities | |
| | | |
| | | |
| | | |
| | | |
| | |
| Investments Held-to-Maturity | |
| 213,706 | | |
| 215,260 | | |
| 217,200 | | |
| 219,903 | | |
| 221,429 | |
| Investments Available-for-Sale | |
| 269,918 | | |
| 274,349 | | |
| 282,226 | | |
| 280,549 | | |
| 328,239 | |
| Other Investments at Cost | |
| 5,029 | | |
| 5,504 | | |
| 6,800 | | |
| 6,305 | | |
| 6,208 | |
| Total Investment Securities | |
| 488,653 | | |
| 495,113 | | |
| 506,226 | | |
| 506,757 | | |
| 555,876 | |
| Loans Held-for-Sale | |
| 6,701 | | |
| 1,719 | | |
| 4,433 | | |
| 5,509 | | |
| 4,195 | |
| Loans | |
| 1,189,189 | | |
| 1,157,305 | | |
| 1,134,019 | | |
| 1,091,645 | | |
| 1,032,165 | |
| Allowance for Credit Losses - Investments | |
| 27 | | |
| 29 | | |
| 30 | | |
| 32 | | |
| 37 | |
| Allowance for Credit Losses - Loans | |
| 12,932 | | |
| 12,459 | | |
| 12,267 | | |
| 11,818 | | |
| 11,554 | |
| Allowance for Credit Losses - Unfunded Commitments | |
| 490 | | |
| 512 | | |
| 597 | | |
| 643 | | |
| 429 | |
| Goodwill | |
| 14,637 | | |
| 14,637 | | |
| 14,637 | | |
| 14,637 | | |
| 14,637 | |
| Other Intangibles | |
| 525 | | |
| 564 | | |
| 604 | | |
| 643 | | |
| 682 | |
| Total Deposits | |
| 1,604,528 | | |
| 1,578,067 | | |
| 1,511,001 | | |
| 1,492,026 | | |
| 1,420,753 | |
| Securities Sold Under Agreements to Repurchase | |
| 59,286 | | |
| 81,833 | | |
| 62,863 | | |
| 67,173 | | |
| 72,103 | |
| Federal Funds Purchased | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
| Federal Home Loan Bank Advances | |
| 50,000 | | |
| 60,000 | | |
| 90,000 | | |
| 80,000 | | |
| 95,000 | |
| Junior Subordinated Debt | |
| 14,964 | | |
| 14,964 | | |
| 14,964 | | |
| 14,964 | | |
| 14,964 | |
| Accumulated Other Comprehensive Loss (AOCL) | |
| (27,288 | ) | |
| (27,442 | ) | |
| (28,191 | ) | |
| (33,057 | ) | |
| (31,488 | ) |
| Shareholders’ Equity | |
| 136,179 | | |
| 133,493 | | |
| 131,059 | | |
| 123,601 | | |
| 124,148 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Book Value Per Common Share | |
$ | 17.84 | | |
$ | 17.50 | | |
$ | 17.23 | | |
$ | 16.26 | | |
$ | 16.35 | |
| Tangible Book Value Per Common Share | |
$ | 15.85 | | |
$ | 15.51 | | |
$ | 15.23 | | |
$ | 14.25 | | |
$ | 14.33 | |
| Equity to Assets | |
| 7.22 | % | |
| 7.07 | % | |
| 7.17 | % | |
| 6.89 | % | |
| 7.13 | % |
| Tangible Common Equity to Tangible Assets (TCE Ratio) | |
| 6.47 | % | |
| 6.32 | % | |
| 6.39 | % | |
| 6.09 | % | |
| 6.31 | % |
Loan to Deposit Ratio (Includes Loans
Held-for-Sale) | |
| 74.53 | % | |
| 73.45 | % | |
| 75.34 | % | |
| 73.53 | % | |
| 72.94 | % |
Loan to Deposit Ratio (Excludes Loans
Held-for-Sale) | |
| 74.11 | % | |
| 73.34 | % | |
| 75.05 | % | |
| 73.17 | % | |
| 72.65 | % |
| Allowance for Credit Losses - Loans/Loans | |
| 1.09 | % | |
| 1.08 | % | |
| 1.08 | % | |
| 1.08 | % | |
| 1.12 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Regulatory Capital Ratios (Bank): | |
| | | |
| | | |
| | | |
| | | |
| | |
| Leverage Ratio | |
| 8.44 | % | |
| 8.35 | % | |
| 8.45 | % | |
| 8.63 | % | |
| 8.63 | % |
| Tier 1 Capital Ratio | |
| 12.55 | % | |
| 12.65 | % | |
| 12.53 | % | |
| 12.47 | % | |
| 13.29 | % |
| Total Capital Ratio | |
| 13.62 | % | |
| 13.71 | % | |
| 13.58 | % | |
| 13.50 | % | |
| 14.35 | % |
| Common Equity Tier 1 Capital Ratio | |
| 12.55 | % | |
| 12.65 | % | |
| 12.53 | % | |
| 12.47 | % | |
| 13.29 | % |
| Tier 1 Regulatory Capital | |
$ | 158,080 | | |
$ | 155,590 | | |
$ | 153,859 | | |
$ | 151,360 | | |
$ | 150,414 | |
| Total Regulatory Capital | |
$ | 171,529 | | |
$ | 168,590 | | |
$ | 166,752 | | |
$ | 163,853 | | |
$ | 162,434 | |
| Common Equity Tier 1 Capital | |
$ | 158,080 | | |
$ | 155,590 | | |
$ | 153,859 | | |
$ | 151,360 | | |
$ | 150,414 | |
1 Includes federal funds
sold and interest-bearing deposits
| Average Balances: | |
Three months ended | | |
Six months ended | |
| | |
June 30, | | |
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| | |
| | |
| | |
| | |
| |
| Average Total Assets | |
$ | 1,862,009 | | |
$ | 1,737,044 | | |
$ | 1,859,862 | | |
$ | 1,716,463 | |
| Average Loans (Includes Loans Held-for-Sale) | |
| 1,178,342 | | |
| 1,017,215 | | |
| 1,163,803 | | |
| 1,001,942 | |
| Average Investment Securities | |
| 491,187 | | |
| 562,629 | | |
| 495,277 | | |
| 563,866 | |
| Average Short-term Investments and CDs1 | |
| 79,996 | | |
| 42,576 | | |
| 88,674 | | |
| 36,391 | |
| Average Earning Assets | |
| 1,749,525 | | |
| 1,622,420 | | |
| 1,747,754 | | |
| 1,602,199 | |
| Average Deposits | |
| 1,569,939 | | |
| 1,409,131 | | |
| 1,545,669 | | |
| 1,395,495 | |
| Average Other Borrowings | |
| 139,165 | | |
| 189,409 | | |
| 162,461 | | |
| 184,496 | |
| Average Shareholders’ Equity | |
| 133,729 | | |
| 124,179 | | |
| 132,855 | | |
| 122,129 | |
| Asset Quality: | |
As of | |
| | |
June 30, | | |
March 31, | | |
December 31, | | |
September 30, | | |
June 30, | |
| | |
2024 | | |
2024 | | |
2023 | | |
2023 | | |
2023 | |
| Loan Risk Rating by Category (End of Period) | |
| | | |
| | | |
| | | |
| | | |
| | |
| Special Mention | |
$ | 673 | | |
$ | 833 | | |
$ | 331 | | |
$ | 550 | | |
$ | 565 | |
| Substandard | |
| 1,528 | | |
| 1,418 | | |
| 1,449 | | |
| 1,241 | | |
| 1,312 | |
| Doubtful | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
| Pass | |
| 1,186,988 | | |
| 1,155,054 | | |
| 1,132,239 | | |
| 1,089,854 | | |
| 1,030,288 | |
| Total Loans | |
$ | 1,189,189 | | |
$ | 1,157,305 | | |
$ | 1,134,019 | | |
$ | 1,091,645 | | |
$ | 1,032,165 | |
| Nonperforming Assets | |
| | | |
| | | |
| | | |
| | | |
| | |
| Non-accrual Loans | |
$ | 173 | | |
$ | 56 | | |
$ | 27 | | |
$ | 61 | | |
$ | 83 | |
| Other Real Estate Owned and Repossessed Assets | |
| 544 | | |
| 622 | | |
| 622 | | |
| 666 | | |
| 927 | |
| Accruing Loans Past Due 90 Days or More | |
| — | | |
| 157 | | |
| 215 | | |
| 3 | | |
| 1 | |
| Total Nonperforming Assets | |
$ | 717 | | |
$ | 835 | | |
$ | 864 | | |
$ | 730 | | |
$ | 1,011 | |
| | |
Three months ended | | |
Six months ended | |
| | |
June 30, | | |
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| Loans Charged-off | |
$ | 6 | | |
$ | 1 | | |
$ | 31 | | |
$ | 3 | |
| Overdrafts Charged-off | |
| 10 | | |
| 26 | | |
| 35 | | |
| 33 | |
| Loan Recoveries | |
| (7 | ) | |
| (15 | ) | |
| (33 | ) | |
| (32 | ) |
| Overdraft Recoveries | |
| (4 | ) | |
| (2 | ) | |
| (6 | ) | |
| (5 | ) |
| Net Charge-offs (Recoveries) | |
$ | 5 | | |
$ | 10 | | |
$ | 27 | | |
$ | (1 | ) |
| Net Charge-offs / (Recoveries) to Average Loans2 | |
| 0.00 | % | |
| 0.00 | % | |
| 0.00 | % | |
| (0.00 | %) |
2 Annualized
FIRST
COMMUNITY CORPORATION
INCOME
STATEMENT DATA
(Dollars
in thousands, except per share data)
| | |
Three months ended | | |
Three months ended | | |
Six months ended | |
| | |
June 30, | | |
March 31, | | |
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
| Interest income | |
$ | 21,931 | | |
$ | 17,497 | | |
$ | 21,256 | | |
$ | 15,890 | | |
$ | 43,187 | | |
$ | 33,387 | |
| Interest expense | |
| 9,237 | | |
| 5,360 | | |
| 9,179 | | |
| 3,533 | | |
| 18,416 | | |
| 8,893 | |
| Net interest income | |
| 12,694 | | |
| 12,137 | | |
| 12,077 | | |
| 12,357 | | |
| 24,771 | | |
| 24,494 | |
| Provision for (release of) credit losses | |
| 454 | | |
| 186 | | |
| 129 | | |
| 70 | | |
| 583 | | |
| 256 | |
| Net interest income after provision for (release of) credit losses | |
| 12,240 | | |
| 11,951 | | |
| 11,948 | | |
| 12,287 | | |
| 24,188 | | |
| 24,238 | |
| Non-interest income | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Deposit service charges | |
| 235 | | |
| 220 | | |
| 259 | | |
| 232 | | |
| 494 | | |
| 452 | |
| Mortgage banking income | |
| 659 | | |
| 371 | | |
| 425 | | |
| 155 | | |
| 1,084 | | |
| 526 | |
| Investment advisory fees and non-deposit commissions | |
| 1,508 | | |
| 1,081 | | |
| 1,358 | | |
| 1,067 | | |
| 2,866 | | |
| 2,148 | |
| Gain (loss) on sale of other assets | |
| — | | |
| 105 | | |
| — | | |
| — | | |
| — | | |
| 105 | |
| Other non-recurring income | |
| 95 | | |
| 121 | | |
| — | | |
| — | | |
| 95 | | |
| 121 | |
| Other | |
| 1,145 | | |
| 1,153 | | |
| 1,142 | | |
| 1,121 | | |
| 2,287 | | |
| 2,274 | |
| Total non-interest income | |
| 3,642 | | |
| 3,051 | | |
| 3,184 | | |
| 2,575 | | |
| 6,826 | | |
| 5,626 | |
| Non-interest expense | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Salaries and employee benefits | |
| 7,303 | | |
| 6,508 | | |
| 7,101 | | |
| 6,331 | | |
| 14,404 | | |
| 12,839 | |
| Occupancy | |
| 738 | | |
| 813 | | |
| 790 | | |
| 830 | | |
| 1,528 | | |
| 1,643 | |
| Equipment | |
| 317 | | |
| 377 | | |
| 330 | | |
| 336 | | |
| 647 | | |
| 713 | |
| Marketing and public relations | |
| 258 | | |
| 370 | | |
| 566 | | |
| 346 | | |
| 824 | | |
| 716 | |
| FDIC assessment | |
| 302 | | |
| 221 | | |
| 278 | | |
| 182 | | |
| 580 | | |
| 403 | |
| Other real estate expenses | |
| 90 | | |
| (30 | ) | |
| 12 | | |
| (133 | ) | |
| 102 | | |
| (163 | ) |
| Amortization of intangibles | |
| 39 | | |
| 40 | | |
| 39 | | |
| 39 | | |
| 78 | | |
| 79 | |
| Other | |
| 2,796 | | |
| 2,456 | | |
| 2,689 | | |
| 2,505 | | |
| 5,485 | | |
| 4,961 | |
| Total non-interest expense | |
| 11,843 | | |
| 10,755 | | |
| 11,805 | | |
| 10,436 | | |
| 23,648 | | |
| 21,191 | |
| Income before taxes | |
| 4,039 | | |
| 4,247 | | |
| 3,327 | | |
| 4,426 | | |
| 7,366 | | |
| 8,673 | |
| Income tax expense | |
| 774 | | |
| 920 | | |
| 730 | | |
| 963 | | |
| 1,504 | | |
| 1,883 | |
| Net income | |
$ | 3,265 | | |
$ | 3,327 | | |
$ | 2,597 | | |
$ | 3,463 | | |
$ | 5,862 | | |
$ | 6,790 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Per share data | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net income, basic | |
$ | 0.43 | | |
$ | 0.44 | | |
$ | 0.34 | | |
$ | 0.46 | | |
$ | 0.77 | | |
$ | 0.90 | |
| Net income, diluted | |
$ | 0.42 | | |
$ | 0.43 | | |
$ | 0.34 | | |
$ | 0.45 | | |
$ | 0.76 | | |
$ | 0.89 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Average number of shares outstanding - basic | |
| 7,617,266 | | |
| 7,564,928 | | |
| 7,600,450 | | |
| 7,555,080 | | |
| 7,608,232 | | |
| 7,559,691 | |
| Average number of shares outstanding - diluted | |
| 7,695,476 | | |
| 7,654,817 | | |
| 7,679,771 | | |
| 7,644,440 | | |
| 7,684,913 | | |
| 7,648,595 | |
| Shares outstanding period end | |
| 7,635,145 | | |
| 7,593,759 | | |
| 7,629,005 | | |
| 7,587,763 | | |
| 7,635,145 | | |
| 7,593,759 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Return on average assets | |
| 0.71 | % | |
| 0.77 | % | |
| 0.56 | % | |
| 0.83 | % | |
| 0.63 | % | |
| 0.80 | % |
| Return on average common equity | |
| 9.82 | % | |
| 10.75 | % | |
| 7.91 | % | |
| 11.70 | % | |
| 8.87 | % | |
| 11.21 | % |
| Return on average tangible common equity | |
| 11.08 | % | |
| 12.26 | % | |
| 8.95 | % | |
| 13.42 | % | |
| 10.02 | % | |
| 12.82 | % |
| Net interest margin (non taxable equivalent) | |
| 2.92 | % | |
| 3.00 | % | |
| 2.78 | % | |
| 3.17 | % | |
| 2.85 | % | |
| 3.08 | % |
| Net interest margin (taxable equivalent) | |
| 2.93 | % | |
| 3.02 | % | |
| 2.79 | % | |
| 3.19 | % | |
| 2.86 | % | |
| 3.10 | % |
| Efficiency ratio1 | |
| 72.75 | % | |
| 71.52 | % | |
| 77.15 | % | |
| 69.43 | % | |
| 74.88 | % | |
| 70.47 | % |
| 1 | Calculated by dividing
non-interest expense by net interest income on tax equivalent basis and non interest income, excluding loss on sale of securities,
gain (loss) on sale of other assets and other non-recurring noninterest income. |
FIRST COMMUNITY CORPORATION
Yields
on Average Earning Assets and
Rates on Average Interest-Bearing Liabilities
| | |
Three months ended June 30, 2024 | | |
Three months ended June 30, 2023 | |
| | |
Average | | |
Interest | | |
Yield/ | | |
Average | | |
Interest | | |
Yield/ | |
| | |
Balance | | |
Earned/Paid | | |
Rate | | |
Balance | | |
Earned/Paid | | |
Rate | |
| Assets | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Earning assets | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Loans | |
$ | 1,178,342 | | |
$ | 16,400 | | |
| 5.60 | % | |
$ | 1,017,215 | | |
$ | 12,314 | | |
| 4.86 | % |
| Non-taxable securities | |
| 48,982 | | |
| 359 | | |
| 2.95 | % | |
| 50,729 | | |
| 368 | | |
| 2.91 | % |
| Taxable securities | |
| 442,205 | | |
| 4,114 | | |
| 3.74 | % | |
| 511,900 | | |
| 4,223 | | |
| 3.31 | % |
| Int bearing deposits in other banks | |
| 79,956 | | |
| 1,057 | | |
| 5.32 | % | |
| 42,576 | | |
| 592 | | |
| 5.58 | % |
| Fed funds sold | |
| 40 | | |
| 1 | | |
| 10.05 | % | |
| — | | |
| — | | |
| NA | |
| Total earning assets | |
| 1,749,525 | | |
| 21,931 | | |
| 5.04 | % | |
| 1,622,420 | | |
| 17,497 | | |
| 4.33 | % |
| Cash and due from banks | |
| 23,636 | | |
| | | |
| | | |
| 25,490 | | |
| | | |
| | |
| Premises and equipment | |
| 30,469 | | |
| | | |
| | | |
| 31,320 | | |
| | | |
| | |
| Goodwill and other intangibles | |
| 15,181 | | |
| | | |
| | | |
| 15,339 | | |
| | | |
| | |
| Other assets | |
| 55,810 | | |
| | | |
| | | |
| 54,074 | | |
| | | |
| | |
| Allowance for credit losses - investments | |
| (29 | ) | |
| | | |
| | | |
| (42 | ) | |
| | | |
| | |
| Allowance for credit losses - loans | |
| (12,583 | ) | |
| | | |
| | | |
| (11,557 | ) | |
| | | |
| | |
| Total assets | |
$ | 1,862,009 | | |
| | | |
| | | |
$ | 1,737,044 | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Liabilities | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing liabilities | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing transaction accounts | |
$ | 303,825 | | |
$ | 809 | | |
| 1.07 | % | |
$ | 313,627 | | |
$ | 374 | | |
| 0.48 | % |
| Money market accounts | |
| 400,656 | | |
| 3,344 | | |
| 3.36 | % | |
| 359,274 | | |
| 2,230 | | |
| 2.49 | % |
| Savings deposits | |
| 113,620 | | |
| 113 | | |
| 0.40 | % | |
| 133,823 | | |
| 60 | | |
| 0.18 | % |
| Time deposits | |
| 308,164 | | |
| 3,454 | | |
| 4.51 | % | |
| 149,899 | | |
| 728 | | |
| 1.95 | % |
| Fed funds purchased | |
| 6 | | |
| — | | |
| 0.00 | % | |
| 181 | | |
| 2 | | |
| 4.43 | % |
| Securities sold under agreements to repurchase | |
| 68,591 | | |
| 497 | | |
| 2.91 | % | |
| 70,582 | | |
| 363 | | |
| 2.06 | % |
| FHLB Advances | |
| 55,604 | | |
| 712 | | |
| 5.15 | % | |
| 103,682 | | |
| 1,310 | | |
| 5.07 | % |
| Other long-term debt | |
| 14,964 | | |
| 308 | | |
| 8.28 | % | |
| 14,964 | | |
| 293 | | |
| 7.85 | % |
| Total interest-bearing liabilities | |
| 1,265,430 | | |
| 9,237 | | |
| 2.94 | % | |
| 1,146,032 | | |
| 5,360 | | |
| 1.88 | % |
| Demand deposits | |
| 443,674 | | |
| | | |
| | | |
| 452,508 | | |
| | | |
| | |
| Allowance for credit losses - unfunded commitments | |
| 512 | | |
| | | |
| | | |
| 382 | | |
| | | |
| | |
| Other liabilities | |
| 18,664 | | |
| | | |
| | | |
| 13,943 | | |
| | | |
| | |
| Shareholders’ equity | |
| 133,729 | | |
| | | |
| | | |
| 124,179 | | |
| | | |
| | |
| Total liabilities and shareholders’ equity | |
$ | 1,862,009 | | |
| | | |
| | | |
$ | 1,737,044 | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Cost of deposits, including demand deposits | |
| | | |
| | | |
| 1.98 | % | |
| | | |
| | | |
| 0.97 | % |
| Cost of funds, including demand deposits | |
| | | |
| | | |
| 2.17 | % | |
| | | |
| | | |
| 1.34 | % |
| Net interest spread | |
| | | |
| | | |
| 2.10 | % | |
| | | |
| | | |
| 2.45 | % |
| Net interest income/margin | |
| | | |
$ | 12,694 | | |
| 2.92 | % | |
| | | |
$ | 12,137 | | |
| 3.00 | % |
| Net interest income/margin (tax equivalent) | |
| | | |
$ | 12,733 | | |
| 2.93 | % | |
| | | |
$ | 12,213 | | |
| 3.02 | % |
FIRST COMMUNITY CORPORATION
Yields on Average Earning Assets and
Rates on Average Interest-Bearing Liabilities
| | |
Six months ended June 30, 2024 | | |
Six months ended June 30, 2023 | |
| | |
Average | | |
Interest | | |
Yield/ | | |
Average | | |
Interest | | |
Yield/ | |
| | |
Balance | | |
Earned/Paid | | |
Rate | | |
Balance | | |
Earned/Paid | | |
Rate | |
| Assets | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Earning assets | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Loans | |
$ | 1,163,803 | | |
$ | 31,951 | | |
| 5.52 | % | |
$ | 1,001,942 | | |
$ | 23,473 | | |
| 4.72 | % |
| Non-taxable securities | |
| 49,119 | | |
| 716 | | |
| 2.93 | % | |
| 51,143 | | |
| 743 | | |
| 2.93 | % |
| Taxable securities | |
| 446,158 | | |
| 8,303 | | |
| 3.74 | % | |
| 512,723 | | |
| 8,284 | | |
| 3.26 | % |
| Int bearing deposits in other banks | |
| 88,623 | | |
| 2,216 | | |
| 5.03 | % | |
| 36,328 | | |
| 886 | | |
| 4.92 | % |
| Fed funds sold | |
| 51 | | |
| 1 | | |
| 3.94 | % | |
| 63 | | |
| 1 | | |
| 3.20 | % |
| Total earning assets | |
| 1,747,754 | | |
| 43,187 | | |
| 4.97 | % | |
| 1,602,199 | | |
| 33,387 | | |
| 4.20 | % |
| Cash and due from banks | |
| 24,010 | | |
| | | |
| | | |
| 25,749 | | |
| | | |
| | |
| Premises and equipment | |
| 30,471 | | |
| | | |
| | | |
| 31,347 | | |
| | | |
| | |
| Goodwill and other intangibles | |
| 15,201 | | |
| | | |
| | | |
| 15,358 | | |
| | | |
| | |
| Other assets | |
| 54,925 | | |
| | | |
| | | |
| 53,317 | | |
| | | |
| | |
| Allowance for credit losses - investments | |
| (29 | ) | |
| | | |
| | | |
| (43 | ) | |
| | | |
| | |
| Allowance for credit losses - loans | |
| (12,470 | ) | |
| | | |
| | | |
| (11,464 | ) | |
| | | |
| | |
| Total assets | |
$ | 1,859,862 | | |
| | | |
| | | |
$ | 1,716,463 | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Liabilities | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing liabilities | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing transaction accounts | |
$ | 297,295 | | |
$ | 1,487 | | |
| 1.01 | % | |
$ | 317,039 | | |
$ | 596 | | |
| 0.38 | % |
| Money market accounts | |
| 403,917 | | |
| 6,729 | | |
| 3.35 | % | |
| 335,460 | | |
| 3,559 | | |
| 2.14 | % |
| Savings deposits | |
| 114,999 | | |
| 227 | | |
| 0.40 | % | |
| 143,353 | | |
| 120 | | |
| 0.17 | % |
| Time deposits | |
| 296,049 | | |
| 6,480 | | |
| 4.40 | % | |
| 144,096 | | |
| 1,110 | | |
| 1.55 | % |
| Fed funds purchased | |
| 4 | | |
| — | | |
| 0.00 | % | |
| 1,411 | | |
| 33 | | |
| 4.72 | % |
| Securities sold under agreements to repurchase | |
| 77,823 | | |
| 1,106 | | |
| 2.86 | % | |
| 78,485 | | |
| 719 | | |
| 1.85 | % |
| FHLB Advances | |
| 69,670 | | |
| 1,770 | | |
| 5.11 | % | |
| 89,636 | | |
| 2,192 | | |
| 4.93 | % |
| Other long-term debt | |
| 14,964 | | |
| 617 | | |
| 8.29 | % | |
| 14,964 | | |
| 564 | | |
| 7.60 | % |
| Total interest-bearing liabilities | |
| 1,274,721 | | |
| 18,416 | | |
| 2.91 | % | |
| 1,124,444 | | |
| 8,893 | | |
| 1.59 | % |
| Demand deposits | |
| 433,409 | | |
| | | |
| | | |
| 455,547 | | |
| | | |
| | |
| Allowance for credit losses - unfunded commitments | |
| 554 | | |
| | | |
| | | |
| 390 | | |
| | | |
| | |
| Other liabilities | |
| 18,323 | | |
| | | |
| | | |
| 13,953 | | |
| | | |
| | |
| Shareholders’ equity | |
| 132,855 | | |
| | | |
| | | |
| 122,129 | | |
| | | |
| | |
| Total liabilities and shareholders’ equity | |
$ | 1,859,862 | | |
| | | |
| | | |
$ | 1,716,463 | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Cost of deposits, including demand deposits | |
| | | |
| | | |
| 1.94 | % | |
| | | |
| | | |
| 0.78 | % |
| Cost of funds, including demand deposits | |
| | | |
| | | |
| 2.17 | % | |
| | | |
| | | |
| 1.14 | % |
| Net interest spread | |
| | | |
| | | |
| 2.06 | % | |
| | | |
| | | |
| 2.61 | % |
| Net interest income/margin | |
| | | |
$ | 24,771 | | |
| 2.85 | % | |
| | | |
$ | 24,494 | | |
| 3.08 | % |
| Net interest income/margin (tax equivalent) | |
| | | |
$ | 24,850 | | |
| 2.86 | % | |
| | | |
$ | 24,669 | | |
| 3.10 | % |
The tables below provide a reconciliation
of non-GAAP measures to GAAP for the periods indicated:
| Tangible book value per common share | |
June 30,
2024 | | |
March 31,
2024 | | |
December 31,
2023 | | |
September 30,
2023 | | |
June 30,
2023 | |
| Tangible common equity per common share (non-GAAP) | |
$ | 15.85 | | |
$ | 15.51 | | |
$ | 15.23 | | |
$ | 14.25 | | |
$ | 14.33 | |
| Effect to adjust for intangible assets | |
| 1.99 | | |
| 1.99 | | |
| 2.00 | | |
| 2.01 | | |
| 2.02 | |
| Book value per common share (GAAP) | |
$ | 17.84 | | |
$ | 17.50 | | |
$ | 17.23 | | |
$ | 16.26 | | |
$ | 16.35 | |
| Tangible common shareholders’ equity to tangible assets | |
| | | |
| | | |
| | | |
| | | |
| | |
| Tangible common equity to tangible assets (non-GAAP) | |
| 6.47 | % | |
| 6.32 | % | |
| 6.39 | % | |
| 6.09 | % | |
| 6.31 | % |
| Effect to adjust for intangible assets | |
| 0.75 | % | |
| 0.75 | % | |
| 0.78 | % | |
| 0.80 | % | |
| 0.82 | % |
| Common equity to assets (GAAP) | |
| 7.22 | % | |
| 7.07 | % | |
| 7.17 | % | |
| 6.89 | % | |
| 7.13 | % |
| Return on average tangible common equity | |
Three months ended
June 30, | | |
Three months ended
March 31, | | |
Six months ended
June 30, | |
| | |
2024 | | |
2023 | | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| Return on average tangible common equity (non-GAAP) | |
| 11.08 | % | |
| 12.26 | % | |
| 8.95 | % | |
| 13.42 | % | |
| 10.02 | % | |
| 12.82 | % |
| Effect to adjust for intangible assets | |
| (1.26 | )% | |
| (1.51 | )% | |
| (1.04 | )% | |
| (1.72 | )% | |
| (1.15 | )% | |
| (1.61 | )% |
| Return on average common equity (GAAP) | |
| 9.82 | % | |
| 10.75 | % | |
| 7.91 | % | |
| 11.70 | % | |
| 8.87 | % | |
| 11.21 | % |
| | |
Three months ended | | |
Six months ended | |
| | |
June 30, | | |
March 31, | | |
June 30, | | |
June 30, | |
| Pre-tax, pre-provision earnings | |
2024 | | |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| Pre-tax, pre-provision earnings (non-GAAP) | |
$ | 4,493 | | |
$ | 3,456 | | |
$ | 4,433 | | |
$ | 7,949 | | |
$ | 8,929 | |
| Effect to adjust for pre-tax, pre-provision earnings | |
| (1,228 | ) | |
| (859 | ) | |
| (1,106 | ) | |
| (2,087 | ) | |
| (2,139 | ) |
| Net Income (GAAP) | |
$ | 3,265 | | |
$ | 2,597 | | |
$ | 3,327 | | |
$ | 5,862 | | |
$ | 6,790 | |
Certain financial information presented
above is determined by methods other than in accordance with generally accepted accounting principles (“GAAP”). These
non-GAAP financial measures include “Tangible book value per common share,” “Tangible common shareholders’
equity to tangible assets,” “Return on average tangible common equity,” and “Pre-tax, pre-provision earnings.”
| · | “Tangible
book value per common share” is defined as total equity reduced by recorded intangible
assets divided by total common shares outstanding. |
| · | “Tangible
common shareholders’ equity to tangible assets” is defined as total common
equity reduced by recorded intangible assets divided by total assets reduced by recorded
intangible assets. |
| · | “Return
on average tangible common equity” is defined as net income on an annualized basis
divided by average total equity reduced by average recorded intangible assets. |
| · | “Pre-tax,
pre-provision earnings” is defined as net interest income plus non-interest income,
reduced by non-interest expense. |
Our management believes
that these non-GAAP measures are useful because they enhance the ability of investors and management to evaluate and compare our
operating results from period-to-period in a meaningful manner. Non-GAAP measures have limitations as analytical tools, and investors
should not consider them in isolation or as a substitute for analysis of the company’s results as reported under GAAP.
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