FNCB Bancorp, Inc. Announces First Quarter 2024 Earnings
DUNMORE, Pa., April 30, 2024 (GLOBE NEWSWIRE) -- FNCB Bancorp, Inc. (NASDAQ: FNCB; www.fncb.com), the parent company of Dunmore-based FNCB Bank (the “Bank” and collectively, “FNCB”) today reported net income of $3.5 million, or $0.18 per diluted shares, for the first quarter of 2024, an increase of $869 thousand, or 32.6%, compared to $2.7 million or $0.14 per diluted share, for the same period of 2023. The earnings improvement was primarily due to a $1.6 million increase in net interest income, partially offset by increases in the provision for credit losses of $511 thousand and non-interest expense of $266 thousand. For the three months ended March 31, 2024, the annualized return on average assets and the return on average shareholders' equity were 0.78% and 10.58%, respectively, compared to 0.62% and 8.84%, respectively, for the same period of 2023. FNCB declared and paid dividends to shareholders of common stock of $0.09 per share for each of the first quarters of 2024 and 2023. *Agreement and Plan of Merger*
On September 27, 2023, FNCB and Peoples Financial Services Corp. (“PFIS”) (NASDAQ:PFIS) announced that both companies had entered into a strategic combination and executed an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which FNCB will merge with and into PFIS, with PFIS as the surviving entity. Immediately after this merger, the Bank will merge with and into Peoples Security Bank and Trust Company (“Peoples Bank”) with Peoples Bank as the surviving bank and a wholly-owned subsidiary of PFIS. The completion of the merger requires, among other things, the approval from regulatory authorities. FNCB held a special meeting of shareholders on March 22, 2024, at which time FNCB's shareholders approved the Merger Agreement. Pending regulatory approval, FNCB expects the merger to be consummated in the second half of 2024, however, there can be no assurance that the transaction will be consummated during this time period, or at all.
*First quarter 2024 performance: *
● First quarter 2024 net income increased $869 thousand, or 32.6%, to $3.5 million, or $0.18 per diluted share, compared to $2.7 million, or $0.14 per diluted share for the first quarter of 2023; ● Yield on earning assets (FTE) increased 79 basis points to 5.24% for the first quarter of 2024 from 4.45% for the same quarter of 2023, and improved 20 basis points on a linked-quarter basis from 5.04% for the fourth quarter of 2023; ● Cost of funds increased 61 basis points to 2.76% from 2.15% comparing the first quarters of 2024 and 2023, and remained unchanged on a linked-quarter basis from 2.76% for the fourth quarter of 2023; ● Net interest margin (FTE) increased 28 basis points to 3.06% for the first quarter of 2024, compared to 2.78% for the same period of 2023, and improved 19 basis points on a linked-quarter basis from 2.87% for the fourth quarter of 2023; and ● Efficiency ratio improved to 62.17% for the first quarter of 2024 compared to 67.69% for the same period of 2023.
*Summary financial position at March 31, 2024 as compared to December 31, 2023:*
● Total assets decreased $15.0 million, or 0.8%, to $1.866 billion at March 31, 2024 from $1.881 billion at December 31, 2023; ● Net loans and leases increased $29.5 million, or 2.4%, to $1.238 billion at March 31, 2024 from $1.208 billion at December 31, 2023; ● Total deposits decreased $47.7 million, or 3.1%, to $1.481 billion at March 31, 2024 from $1.529 billion at December 31, 2023; ● Non-performing loans as a percentage of total loans were 0.48% at March 31, 2024 and 0.44% at December 31, 2023; and ● The Bank was well capitalized with total risk-based capital and leverage ratios of 13.45% and 9.47%, respectively, at March 31 2024, and 12.66% and 8.76%, respectively, at December 31, 2023.
"We are very pleased with our first quarter 2024 results," stated FNCB President and CEO, Gerard A. Champi. "Our disciplined approach to balance sheet management has translated into margin improvement for the third consecutive quarter. We experienced some weakening in asset quality during the first quarter of 2024, particularly related to our commercial equipment financing line. We are committed to maintaining a strong asset quality position and actively monitor our asset quality metrics. In the first quarter of 2024, we adjusted our underwriting standards with respect to this line to maintain asset quality. As we anticipate the strategic merger with PFIS later in 2024, we continue to work together towards the integration of our businesses to ensure a smooth transition for our combined customers," concluded Mr. Champi.
*Summary Results *
Net interest income on a tax-equivalent basis increased $1.7 million, or 14.4%, to $13.6 million for the three months ended March 31, 2024 from $11.9 million for the comparable period of 2023, as a tax-equivalent interest income increased by a greater magnitude than interest expense. FNCB’s tax-equivalent net interest margin increased 28 basis points to 3.06% for the first quarter of 2024 from 2.78% for the same quarter of 2023. Additionally, on a linked quarter basis, FNCB's tax-equivalent net interest margin increased 19 basis points from 2.87% for the fourth quarter of 2023, which marked margin improvement for the the third consecutive quarter. Tax-equivalent interest income increased $4.3 million, or 22.5%, to $23.2 million for the first quarter of 2024 from $18.9 million for the same quarter of 2023. The increase in tax-equivalent interest income largely reflected an increase in the tax-equivalent yield on average earning assets, coupled with growth in average earning assets comparing the three months ended March 31, 2024 and 2023. The tax-equivalent yield on average earning assets increased 79 basis points to 5.24% for the first quarter of 2024 from 4.45% for the same quarter of 2023. Specifically, the tax-equivalent yield on the loan portfolio increased 77 basis points to 5.93% at March 31, 2024, from 5.16% at March 31, 2023. Additionally, the tax-equivalent yield on the investment portfolio increased 57 basis points to 3.55% for the first quarter of 2024 from 2.98% for the same quarter of 2023. Total average earning assets increased $68.8 million, or 4.0%, to $1.772 billion for the three months ended March 31, 2024, from $1.703 billion for the same three months of 2023. Specifically, average total loans and leases increased $111.4 million, or 9.8%, to $1.248 billion for the first quarter of 2024 from $1.137 billion for the same quarter of 2023, as FNCB experienced moderate demand within the commercial and industrial, commercial equipment financing and state and political subdivision loan categories. Meanwhile, total securities averaged $509.9 million for the first quarter of 2024, a decrease of $39.3 million, or 7.2%, from $549.2 million for the same quarter of 2023.
Partially offsetting the increase in tax-equivalent interest income was a $2.6 million, or 36.1%, increase in interest expense to $9.7 million for the three months ended March 31, 2024 from $7.1 million for the same three months of 2023, caused primarily by an increase in funding costs, coupled with an increase in average interest-bearing liabilities. FNCB increased deposit rates and offered several certificate of deposit specials in response to rising market rates and increased competition within its market area. As a result, FNCB's cost of funds increased 61 basis points to 2.76% for the three months ended March 31, 2024 from 2.15% for the same three months of 2023. The average rate paid for interest-bearing deposits increased 86 basis points to 2.46% for the first quarter of 2024 from 1.60% for the same period of 2023, as costs for all major deposit categories increased. Specifically, the average rate paid on interest bearing demand deposits increased 56 basis points to 2.27% for the first quarter of 2024 from 1.71% for the same quarter of 2023. Comparing the first quarters of 2024 and 2023, the average rates paid for time deposits and savings deposits increased 152 basis points and 12 basis points, respectively. The increase in market interest rates also impacted the cost of borrowed funds which increased 9 basis points to 4.95% from 4.86% for the three months ended March 31, 2024 and 2023, respectively. On a linked quarter basis, funding costs have appeared to stabilize as FNCB's cost of funds was unchanged from 2.76% for the fourth quarter of 2023. Comparing the first quarters of 2024 and 2023, average interest-bearing liabilities increased $77.1 million, or 5.8%, to $1.398 billion from $1.320 billion, respectively, which reflected higher average deposit volumes, partially offset by a reduction in average borrowed funds. Average interest-bearing deposits increased $130.2 million, or 11.9%, to $1.227 billion from $1.097 billion comparing the first quarters of 2024 and 2023, respectively. Accounting for the majority of the increase in interest-bearing deposit volumes was an increase in average time deposits of $127.1 million, or 53.0%, to $366.8 million for the three months ended March 31, 2024, from $239.7 million for the same three months of 2023. In response to industry-wide liquidity pressures, FNCB increased utilization of brokered deposits, to manage interest rate risk and for liquidity purposes. Brokered deposits averaged $165.9 million for the three months ended March 31, 2024, an increase of $94.5 million from $71.4 million for the same three months of 2023. Average interest-bearing demand deposits increased $16.2 million, or 2.3%, to $730.2 million for the first quarter of 2024 compared to $714.0 million for the same quarter of 2023, while average savings deposits decreased $13.1 million, or 9.1%, to $130.0 million from $143.1 million comparing the first quarters of 2024 and 2023, respectively. Average borrowed fund balances decreased $53.0 million, or 23.7%, to $170.7 million for the three months ended March 31, 2024, from $223.7 million for the same three-month period in 2023.
Non-interest income slightly decreased by $43 thousand, or 2.6%, for the three months ended March 31, 2024, to $1.6 million from $1.7 million for the three months ended March 31, 2023. The revenue decrease was largely due to a reduction in net gains on the sale of available-for-sale securities and other income, partially offset by a decrease in the net loss on equity securities, coupled with increases in wealth management services revenue and income from bank-owned life insurance. There were no net gains on the sale of available-for-sale debt securities for the three months ended March 31, 2024, compared to the net gain recorded on the sale of available-for-sale securities of $162 thousand for the three months ended March 31, 2023. Other non-interest income decreased $77 thousand, or 14.9%, to $441 thousand from $518 thousand comparing the first quarters of 2024 and 2023, respectively. Factoring into the decrease in other income were reductions in loan referral fees, loan-related fees and merchant services revenue. Due to a reduction in transaction volume, loan referral fees, which include commissions received from loan swap transactions and brokered mortgages, decreased $56 thousand to $15 thousand for the three months ended March 31, 2024 from $71 thousand for the same three months of 2023. Loan-related fees and merchant services revenue decreased $50 thousand and $31 thousand, respectively, comparing the first quarters of 2024 and 2023. Partially offsetting these negative variances was a $95 thousand, or 18.6%, decrease on the net loss recognized on equity securities, of $413 thousand for the three months ended March 31, 2024, compared to the $508 thousand recognized for the three months ended March 31, 2023. FNCB's holdings of equity securities are comprised primarily of the common stock of publicly traded bank holding companies. Volatility within the financial services industry continued to negatively impact equity prices within this sector during the first quarter of 2024 but to a lesser extent in comparison to the same period of 2023. In addition, wealth management services revenue generated from 1st Investment Services increased $66 thousand, or 27.6%, to $304 thousand for the three months ended March 31, 2024, compared to $238 thousand for the comparable period of 2023, which reflected expansion of this line of business. Income from bank-owned life insurance totaled $226 thousand for the first quarter of 2024, an increase of $29 thousand, or 14.6%, from $197 thousand for the first quarter of 2023.
Non-interest expense increased $266 thousand, or 3.0%, to $9.2 million for the three months ended March 31, 2024, from $8.9 million for the same three-month period of 2023, which was primarily due to the recognition of merger and acquisition expenses that totaled $284 thousand for the three months ended March 31, 2024. No such expenses were recorded during the three months ended March 31, 2023. Also factoring to the increase in non-interest expense was an increase in contributions made to non-for-profit organizations as part of neighborhood assistance tax credit programs. Contributions, which are presented in non-interest expense net of tax credits, were $253 thousand in 2024, an increase $234 thousand from $19 thousand for the same quarter of 2023. These negative variances were partially offset by $202 thousand, or 3.7%, decreases in salaries and employee benefits to $5.2 million for the three months ended March 31, 2024, compared to $5.4 million for the same three-month period of 2023.
*Asset Quality *
Total non-performing loans increased $630 thousand, or 11.7%, to $6.0 million, representing 0.48% of total loans and leases, at March 31, 2024, from $5.4 million, or 0.44% of total loans and leases, at December 31, 2023. FNCB’s loan delinquency rate (total delinquent loans as a percentage of total loans) increased to 0.79% at March 31, 2024, compared to 0.75% at December 31, 2023. The increase in loan delinquencies was concentrated in commercial and industrial and consumer loans due primarily to increases in loans within these categories that were 30-59 days past due, while the increase in non-performing loans largely reflected the migration of commercial equipment financing loans from accruing to non-accrual status. FNCB's annualized net charge-off ratio increased to 0.33% for the three months ended March 31, 2024 compared to 0.09% for the same three months of 2023. The year-over-year increase in net loans charged off was concentrated in commercial equipment financing loans, specifically loans secured by tractor-trailers due to a contraction in the trucking industry. FNCB recorded a provision for credit losses of $1.5 million for the first quarter of 2024 compared to a provision of $975 thousand for the same quarter of 2023. The allowance for credit losses was $12.5 million, or 1.00%, of total loans and leases, at March 31, 2024, compared to an allowance for credit losses of $12.0 million, or 0.98% of total loans and leases at December 31, 2023.
*Financial Condition*
Total assets decreased $15.0 million, or 0.8%, to $1.866 billion at March 31, 2024 from $1.881 billion at December 31, 2023. The change in total assets primarily reflected decreases in cash and cash equivalents and available-for-sale debt securities, partially offset by an increase in loans and leases. Cash and cash equivalents decreased $37.3 million, or 34.6%, to $70.6 million at March 31, 2024, from $107.9 million at December 31, 2023. Available-for-sale debt securities decreased $8.7 million, or 1.9%, to $442.1 million at March 31, 2024 from $450.8 million at December 31, 2023. Loans and leases, net of the ACL, increased $29.5 million, or 2.4%, to $1.238 billion at March 31, 2024 from $1.208 billion at December 31, 2023. The increase in loans and leases reflected moderate demand within the commercial and industrial, commercial equipment financing and state and political subdivision loan categories. Meanwhile, total deposits decreased $47.7 million, or 3.1%, to $1.481 billion at March 31, 2024 from $1.529 billion at December 31, 2023, which was due primarily to cyclical deposit trends of public deposits, coupled with the runoff of retail time deposit specials that were not renewed upon maturity. Partially offsetting these deposit decreases was a $33.1 million increase in brokered deposits to $181.8 million at March 31, 2024 from $148.7 million at December 31, 2023. Total borrowed funds outstanding at March 31, 2024, were $229.9 million, an increase of $29.6 million, or 14.8%, from $200.3 million at December 31, 2023.
Total shareholders’ equity increased $3.1 million, or 2.3%, to $137.7 million at March 31, 2024 from $134.6 million at December 31, 2023. The increase in shareholders' equity was primarily due to a $1.2 million, or 3.1%, reduction in the accumulated other comprehensive loss to $38.9 million at March 31, 2024, from $40.1 million at December 31, 2023, coupled with net income for the three months ended March 31, 2024, of $3.5 million. Partially offsetting these increases to capital were dividends declared and paid of $1.8 million for the three months ended March 31, 2024. The Bank was considered well capitalized with total risk-based capital and Tier 1 leverage ratios of 13.45% and 9.47% at March 31, 2024, respectively, and 12.66% and 8.76%, respectively at December 31, 2023.
*Availability of Filings*
Copies of FNCB’s most recent Annual Report on Form 10-K and Quarterly Reports on form 10-Q will be provided upon request from: Shareholder Relations, FNCB Bancorp, Inc., 102 East Drinker Street, Dunmore, PA 18512 or by calling (570) 348-6419. FNCB’s SEC filings including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q are also available free of charge on the Investor Relations page of FNCB’s website, www.fncb.com, and on the SEC website at: http://www.sec.gov/edgar/searchedgar/companysearch.html
*About FNCB Bancorp, Inc.:*
FNCB Bancorp, Inc. is the bank holding company of FNCB Bank. Locally-based for over 115 years, FNCB Bank continues as a premier community bank in Northeastern Pennsylvania – offering a full suite of personal, small business and commercial banking solutions with industry-leading mobile, online and in-branch products and services. FNCB currently operates through 16 community offices located in Lackawanna, Luzerne and Wayne Counties and remains dedicated to making its customers’ banking experience simply better. For more information about FNCB, visit www.fncb.com.
*INVESTOR CONTACT:*
James M. Bone, Jr., CPA
Executive Vice President and Chief Financial Officer
FNCB Bank
(570) 348-6419
james.bone@fncb.com
FNCB may from time to time make written or oral “forward-looking statements,” including statements contained in our filings with the Securities and Exchange Commission (“SEC”), in our reports to shareholders, and in our other communications, which are made in good faith by us pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include statements with respect to FNCB’s beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, including statements with respect to future changes in monetary policy or interest rates, or new product offerings and the anticipated merger between FNCB and Peoples Financial Services Corp. (“PFIS”) under the Agreement and Plan of Merger, dated September 27, 2023 (the “Merger Agreement”) pursuant to which FNCB will merge with and into PFIS, with PFIS as the surviving entity, along with the transaction occurring immediately after such merger, whereby FNCB’s wholly owned subsidiary, FNCB Bank (the “Bank”) will merge with and into Peoples Security Bank and Trust Company (“Peoples Bank”), with Peoples Bank as the surviving bank and a wholly-owned subsidiary of PFIS, that are subject to significant risks and uncertainties, and are subject to change based on various factors (some of which are beyond our control). The words “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “project,” “future” and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause FNCB’s financial performance to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements: government intervention in the U.S. financial system including the effects of recent legislative, tax, accounting and regulatory actions and reforms; political instability; acts of world terrorism; global unrest; the ability of FNCB to manage credit risk; weakness in the economic environment, in general, and within FNCB’s market area; the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the Merger Agreement between FNCB and PFIS; the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes or at all and to successfully integrate operations of FNCB and FNCB Bank and those of PFIS and Peoples Bank, its wholly-owned subsidiary, which may be more difficult, time consuming or costly than expected; diversion of management's attention from ongoing business operations and opportunities; effects of the announcement, pendency or completion of the proposed transaction on the ability of FNCB and PFIS to retain customers and retain and hire key personnel and maintain relationships with their vendors, and on their operating results and businesses generally; the deterioration of one or a few of the large balance commercial and/or commercial real estate loans contained in FNCB’s loan portfolio; greater risk of loan defaults and losses from concentration of loans held by FNCB, including those to insiders and related parties; if FNCB’s portfolio of loans to small and mid-sized community-based businesses increases its credit risk; if FNCB’s allowance for credit losses ("ACL") is not sufficient to absorb actual losses or if increases to the ACL were required; FNCB is subject to interest-rate risk and any changes in interest rates could negatively impact net interest income or the fair value of FNCB's financial assets; if management concludes that the decline in value of any of FNCB’s investment securities is caused by a credit-related event could result in FNCB recording an impairment loss; if FNCB’s risk management framework is ineffective in mitigating risks or losses to FNCB; if FNCB is unable to successfully compete with others for business; a loss of depositor confidence resulting from changes in either FNCB’s financial condition or in the general banking industry; if FNCB is unable to retain or grow its core deposit base; inability or insufficient dividends from its subsidiary, FNCB Bank; if FNCB loses access to wholesale funding sources; interruptions or security breaches of FNCB’s information systems; any systems failures or interruptions in information technology and telecommunications systems of third parties on which FNCB depends; security breaches; if FNCB’s information technology is unable to keep pace with growth or industry developments or if technological developments result in higher costs or less advantageous pricing; the loss of management and other key personnel; dependence on the use of data and modeling in both its management’s decision-making generally and in meeting regulatory expectations in particular; additional risk arising from new lines of business, products, product enhancements or services offered by FNCB; inaccuracy of appraisals and other valuation techniques FNCB uses in evaluating and monitoring loans secured by real property and other real estate owned; unsoundness of other financial institutions; damage to FNCB’s reputation; defending litigation and other actions; dependence on the accuracy and completeness of information about customers and counterparties; risks arising from future expansion or acquisition activity; environmental risks and associated costs on its foreclosed real estate assets; any remediation ordered, or adverse actions taken, by federal and state regulators, including requiring FNCB to act as a source of financial and managerial strength for the FNCB Bank in times of stress; costs arising from extensive government regulation, supervision and possible regulatory enforcement actions; new or changed legislation or regulation and regulatory initiatives; noncompliance and enforcement action with the Bank Secrecy Act and other anti-money laundering statutes and regulations; failure to comply with numerous "fair and responsible banking" laws; any violation of laws regarding privacy, information security and protection of personal information or another incident involving personal, confidential or proprietary information of individuals; any rulemaking changes implemented by the Consumer Financial Protection Bureau; inability to attract and retain its highest performing employees due to potential limitations on incentive compensation contained in proposed federal agency rulemaking; any future increases in FNCB Bank’s FDIC deposit insurance premiums and assessments; and the success of FNCB at managing the risks involved in the foregoing and other risks and uncertainties, including those detailed in FNCB’s filings with the SEC.
FNCB cautions that the foregoing list of important factors is not all inclusive. Readers are also cautioned not to place undue reliance on any forward-looking statements, which reflect management’s analysis only as of the date of this report, even if subsequently made available by FNCB on its website or otherwise. FNCB does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of FNCB to reflect events or circumstances occurring after the date of this report.
Readers should carefully review the risk factors described in the documents that FNCB periodically files with the SEC, including the 2023 Annual Report.
FNCB Bancorp, Inc.
Selected Financial Data
Mar 31, Dec 31, Sept 30, Jun 30, Mar 31, 2024 2023 2023 2023 2023
*Per share data:* * * * * * * * * * *
Net income (fully diluted) $ 0.18 $ 0.17 $ 0.21 $ 0.14 $ 0.14
Cash dividends declared $ 0.09 $ 0.09 $ 0.09 $ 0.09 $ 0.09
Book value $ 6.96 $ 6.80 $ 5.96 $ 6.28 $ 6.43
Tangible book value $ 6.96 $ 6.80 $ 5.96 $ 6.28 $ 6.43
Market value:
High $ 7.00 $ 7.15 $ 6.88 $ 6.82 $ 9.00
Low $ 5.41 $ 5.54 $ 5.47 $ 5.45 $ 6.09
Close $ 6.07 $ 6.79 $ 5.95 $ 5.97 $ 6.20
Common shares outstanding 19,795,151 19,787,031 19,780,317 19,750,092 19,683,873
*Selected ratios:* * * * * * * * * * *
Annualized return on average assets 0.78 % 0.73 % 0.91 % 0.63 % 0.62 %
Annualized return on average shareholders' equity 10.58 % 11.21 % 13.39 % 8.89 % 8.84 %
Efficiency ratio 62.17 % 69.48 % 66.75 % 68.11 % 67.69 %
Tier I leverage ratio (FNCB Bank) 9.47 % 8.76 % 9.11 % 8.98 % 8.96 %
Total risk-based capital to risk-adjusted assets (FNCB Bank) 13.45 % 12.66 % 13.21 % 12.97 % 12.97 %
Average shareholders' equity to average total assets 7.33 % 6.51 % 6.83 % 7.07 % 6.96 %
Yield on earning assets (FTE) 5.24 % 5.04 % 4.93 % 4.67 % 4.45 %
Cost of funds 2.76 % 2.76 % 2.66 % 2.45 % 2.15 %
Net interest spread (FTE) 2.48 % 2.28 % 2.27 % 2.22 % 2.30 %
Net interest margin (FTE) 3.06 % 2.87 % 2.85 % 2.75 % 2.78 %
Total delinquent loans/total loans 0.79 % 0.75 % 0.72 % 0.50 % 0.40 %
Allowance for credit losses/total loans 1.00 % 0.98 % 1.01 % 1.07 % 1.06 %
Non-performing loans/total loans 0.48 % 0.44 % 0.43 % 0.31 % 0.23 %
Annualized net charge-offs/average loans 0.33 % 0.18 % 0.15 % 0.07 % 0.09 %
FNCB Bancorp, Inc.
Year-to-Date Consolidated Statements of Income
Three Months Ended March 31,
(in thousands, except share data) 2024 2023
*Interest income* * * * *
Interest and fees on loans and leases $ 18,320 $ 14,565
Interest and dividends on securities:
Taxable 3,627 3,077
Tax-exempt 534 587
Dividends 226 273
Total interest and dividends on securities 4,387 3,937
Interest on interest-bearing deposits in other banks 178 177
*Total interest income* 22,885 18,679
*Interest expense* * * * *
Interest on deposits 7,543 4,377
Interest on borrowed funds 2,113 2,717
*Total interest expense* 9,656 7,094
*Net interest income before provision for credit losses* 13,229 11,585
Provision for credit losses 1,486 975
*Net interest income after provision for credit losses* 11,743 10,610
*Non-interest income* * * * *
Deposit service charges 1,070 1,064
Net gain on the sale of available-for-sale debt securities - 162
Net loss on equity securities (413 ) (508 )
Income from bank-owned life insurance 226 197
Wealth management services revenue 304 238
Other 441 518
*Total non-interest income* 1,628 1,671
*Non-interest expense* * * * *
Salaries and employee benefits 5,193 5,395
Occupancy expense 575 521
Equipment expense 238 272
Advertising expense 144 209
Data processing expense 969 998
Regulatory assessments 302 213
Bank shares tax 275 205
Professional fees 317 302
Credit to provision for unfunded commitments (255 ) (269 )
Contributions 253 19
Merger and acquisition expenses 284 -
Other operating expenses 892 1,056
*Total non-interest expense* 9,187 8,921
*Income before income taxes* 4,184 3,360
Income tax expense 652 697
*Net income* $ 3,532 $ 2,663
*Income per share* * * * *
Basic $ 0.18 $ 0.14
Diluted $ 0.18 $ 0.14
*Cash dividends declared per common share* $ 0.09 $ 0.09
*Weighted average number of shares outstanding:* * * * *
Basic 19,793,235 19,682,357
Diluted 19,795,213 19,690,859
FNCB Bancorp, Inc.
Quarter-to-Date Consolidated Statements of Income Three Months Ended Mar 31, Dec 31, Sept 30, Jun 30, Mar 31,
(in thousands, except share data) 2024 2023 2023 2023 2023
*Interest income* * * * * * * * * * *
Interest and fees on loans and leases $ 18,320 $ 17,722 $ 17,224 $ 15,853 $ 14,565
Interest and dividends on securities
Taxable 3,627 3,247 3,063 3,064 3,077
Tax-exempt 534 537 539 544 587
Dividends 226 247 248 223 273
Total interest and dividends on securities 4,387 4,031 3,850 3,831 3,937
Interest on interest-bearing deposits in other banks 178 339 243 252 177
*Total interest income* 22,885 22,092 21,317 19,936 18,679
*Interest expense* * * * * * * * * * *
Interest on deposits 7,543 7,493 6,446 6,145 4,377
Interest on borrowed funds 2,113 2,123 2,664 2,162 2,717
*Total interest expense* 9,656 9,616 9,110 8,307 7,094
*Net interest income before provision (credit to provision) for credit losses* 13,229 12,476 12,207 11,629 11,585
Provision (credit to provision) for credit losses 1,486 376 (270 ) 799 975
*Net interest income after provision (credit to provision) for credit losses* 11,743 12,100 12,477 10,830 10,610
*Non-interest income* * * * * * * * * * *
Deposit service charges 1,070 1,218 1,132 1,123 1,064
Net gain on the sale of available-for-sale debt securities - - - 90 162
Net (loss) gain on equity securities (413 ) 172 (233 ) (1,032 ) (508 )
Income from bank-owned life insurance 226 140 210 205 197
Wealth management services revenue 304 224 237 245 238
Other 441 578 348 317 518
*Total non-interest income* 1,628 2,332 1,694 948 1,671
*Non-interest expense* * * * * * * * * * *
Salaries and employee benefits 5,193 5,375 4,935 4,529 5,395
Occupancy expense 575 569 516 550 521
Equipment expense 238 230 229 232 272
Advertising expense 144 241 198 188 209
Data processing expense 969 1,024 1,034 952 998
Regulatory assessments 302 307 283 312 213
Bank shares tax 275 284 264 263 205
Professional fees 317 312 265 214 302
Credit to provision for unfunded commitments (255 ) (74 ) (235 ) (225 ) (269 )
Contributions 253 49 - - 19
Merger and acquisition expenses 284 943 537 - -
Other operating expenses 892 1,339 1,274 1,087 1,056
*Total non-interest expense* 9,187 10,599 9,300 8,102 8,921
*Income before income taxes* 4,184 3,833 4,871 3,676 3,360
Income tax expense 652 480 709 871 697
*Net income* $ 3,532 $ 3,353 $ 4,162 $ 2,805 $ 2,663
*Income per share* * * * * * * * * * *
Basic $ 0.18 $ 0.17 $ 0.21 $ 0.14 $ 0.14
Diluted $ 0.18 $ 0.17 $ 0.21 $ 0.14 $ 0.14
*Cash dividends declared per common share* $ 0.090 $ 0.090 $ 0.090 $ 0.090 $ 0.090
*Weighted average number of shares outstanding:* * * * * * * * * * *
Basic 19,793,235 19,782,236 19,776,342 19,715,136 19,682,357
Diluted 19,795,213 19,782,452 19,776,360 19,715,136 19,690,859
FNCB Bancorp, Inc.
Consolidated Balance Sheets
Mar 31, Dec 31, Sept 30, Jun 30, Mar 31,
(in thousands) 2024 2023 2023 2023 2023
*Assets* * * * * * * * * * *
Cash and cash equivalents:
Cash and due from banks $ 18,323 $ 27,819 $ 42,081 $ 32,893 $ 20,418
Interest-bearing deposits in other banks 52,266 80,049 34,990 72,107 49,153
Total cash and cash equivalents 70,589 107,868 77,071 105,000 69,571
Available-for-sale debt securities, at fair value 442,120 450,814 437,142 452,877 473,119
Equity securities, at fair value 4,373 4,786 6,104 6,337 7,369
Restricted stock, at cost 9,364 8,814 8,842 9,325 8,482
Loans and leases, net of deferred loan fees and costs and unearned income 1,250,225 1,220,265 1,205,752 1,200,595 1,163,789
Allowance for credit losses (12,455 ) (11,986 ) (12,149 ) (12,873 ) (12,279 )
Net loans and leases 1,237,770 1,208,279 1,193,603 1,187,722 1,151,510
Bank premises and equipment, net 14,256 14,546 14,790 15,028 15,316
Accrued interest receivable 7,590 7,085 6,599 6,329 6,143
Bank-owned life insurance 36,667 37,251 37,111 36,901 36,696
Other assets 43,253 41,543 45,511 42,353 41,275
*Total assets* $ 1,865,982 $ 1,880,986 $ 1,826,773 $ 1,861,872 $ 1,809,481
*Liabilities* * * * * * * * * * *
Deposits:
Demand (non-interest-bearing) $ 286,286 $ 285,548 $ 297,740 $ 285,674 $ 281,114
Interest-bearing 1,195,008 1,243,434 1,204,635 1,190,390 1,182,192
Total deposits 1,481,294 1,528,982 1,502,375 1,476,064 1,463,306
Borrowed funds 229,856 200,272 186,733 242,022 196,648
Accrued interest payable 1,284 1,355 1,001 1,089 848
Other liabilities 15,803 15,778 18,862 18,638 22,185
*Total liabilities* 1,728,237 1,746,387 1,708,971 1,737,813 1,682,987
*Shareholders' equity* * * * * * * * * * *
Preferred stock - - - - -
Common stock 24,743 24,733 24,725 24,687 24,604
Additional paid-in capital 78,412 78,253 78,050 77,757 77,636
Retained earnings 73,522 71,782 70,221 67,851 66,834
Accumulated other comprehensive income (38,932 ) (40,169 ) (55,194 ) (46,236 ) (42,580 )
*Total shareholders' equity* 137,745 134,599 117,802 124,059 126,494
*Total liabilities and shareholders’ equity* $ 1,865,982 $ 1,880,986 $ 1,826,773 $ 1,861,872 $ 1,809,481
FNCB Bancorp, Inc.
Summary Tax-equivalent Net Interest Income
Three Months Ended Mar 31, Dec 31, Sept 30, Jun 30, Mar 31,
(dollars in thousands) 2024 2023 2023 2023 2023
*Interest income* * * * * * * * * * *
Loans and leases:
Loans and leases - taxable $ 17,600 $ 17,229 $ 16,768 $ 15,411 $ 14,145
Loans and leases - tax-free 911 625 577 559 532
Total loans 18,511 17,854 17,345 15,970 14,677
Securities:
Securities, taxable 3,853 3,494 3,311 3,287 3,350
Securities, tax-free 676 680 682 689 743
Total interest and dividends on securities 4,529 4,174 3,993 3,976 4,093
Interest-bearing deposits in other banks 178 339 243 252 177
*Total interest income* 23,218 22,367 21,581 20,198 18,947
*Interest expense* * * * * * * * * * *
Deposits 7,543 7,493 6,446 6,145 4,377
Borrowed funds 2,113 2,123 2,664 2,162 2,717
*Total interest expense* 9,656 9,616 9,110 8,307 7,094
*Net interest income* $ 13,562 $ 12,751 $ 12,471 $ 11,891 $ 11,853
*Average balances* * * * * * * * * * *
Earning assets:
Loans and leases:
Loans and leases - taxable $ 1,173,876 $ 1,168,557 $ 1,152,611 $ 1,122,385 $ 1,082,830
Loans and leases - tax-free 74,371 56,889 55,100 55,142 54,045
Total loans 1,248,247 1,225,446 1,207,711 1,177,527 1,136,875
Securities:
Securities, taxable 416,290 428,901 430,977 438,157 449,351
Securities, tax-free 93,602 93,977 94,276 94,964 99,836
Total securities 509,892 522,878 525,253 533,121 549,187
Interest-bearing deposits in other banks 13,748 26,036 18,874 20,620 17,068
*Total interest-earning assets* 1,771,887 1,774,360 1,751,838 1,731,268 1,703,130
Non-earning assets 59,607 48,063 53,906 57,463 51,930
*Total assets* $ 1,831,494 $ 1,822,423 $ 1,805,744 $ 1,788,731 $ 1,755,060
Interest-bearing liabilities:
Deposits $ 1,226,918 $ 1,217,659 $ 1,156,345 $ 1,179,288 $ 1,096,758
Borrowed funds 170,668 174,261 215,801 176,838 223,694
*Total interest-bearing liabilities* 1,397,586 1,391,920 1,372,146 1,356,126 1,320,452
Demand deposits 279,760 289,982 287,846 284,053 287,975
Other liabilities 19,843 21,853 22,444 22,030 24,487
Shareholders' equity 134,305 118,668 123,308 126,522 122,146
*Total liabilities and shareholders' equity* $ 1,831,494 $ 1,822,423 $ 1,805,744 $ 1,788,731 $ 1,755,060
*Yield/Cost* * * * * * * * * * *
Earning assets:
Loans and leases:
Interest and fees on loans and leases - taxable 6.00 % 5.90 % 5.82 % 5.49 % 5.23 %
Interest and fees on loans and leases - tax-free 4.90 % 4.40 % 4.19 % 4.05 % 3.94 %
Total loans 5.93 % 5.83 % 5.74 % 5.42 % 5.16 %
Securities:
Securities, taxable 3.70 % 3.26 % 3.07 % 3.00 % 2.98 %
Securities, tax-free 2.89 % 2.89 % 2.89 % 2.90 % 2.98 %
Total securities 3.55 % 3.19 % 3.04 % 2.98 % 2.98 %
Interest-bearing deposits in other banks 5.18 % 5.21 % 5.15 % 4.89 % 4.15 %
*Total earning assets* 5.24 % 5.04 % 4.93 % 4.67 % 4.45 %
Interest-bearing liabilities:
Interest on deposits 2.46 % 2.46 % 2.23 % 2.08 % 1.60 %
Interest on borrowed funds 4.95 % 4.87 % 4.94 % 4.89 % 4.86 %
*Total interest-bearing liabilities* 2.76 % 2.76 % 2.66 % 2.45 % 2.15 %
*Net interest spread* 2.48 % 2.28 % 2.27 % 2.22 % 2.30 %
*Net interest margin* 3.06 % 2.87 % 2.85 % 2.75 % 2.78 %
FNCB Bancorp, Inc.
Asset Quality Data Mar 31, Dec 31, Sept 30, Jun 30, Mar 31,
(in thousands) 2024 2023 2023 2023 2023
*At period end* * * * * * * * * * *
Non-accrual loans and leases $ 5,980 $ 5,338 $ 5,084 $ 3,711 $ 2,601
Loans past due 90 days or more and still accruing 26 38 59 49 52
Total non-performing loans and leases 6,006 5,376 5,143 3,760 2,653
Other real estate owned (OREO) - - - - -
Other non-performing assets 2,019 2,067 1,647 1,647 1,773
Total non-performing assets $ 8,025 $ 7,443 $ 6,790 $ 5,407 $ 4,426
*For the three months ended* * * * * * * * * * *
Allowance for credit losses
Beginning balance, prior to adoption of ASU 2016-13 $ 11,986 $ 12,149 $ 12,873 $ 12,279 $ 14,193
Impact of ASU 2016-13 - - - - (2,636 )
Loans and leases charged-off 1,355 1,194 818 553 776
Recoveries of charged-off loans and leases 338 655 364 348 523
Net charge-offs 1,017 539 454 205 253
Provision (credit to provision) for credit losses 1,486 376 (270 ) 799 975
Ending balance $ 12,455 $ 11,986 $ 12,149 $ 12,873 $ 12,279