Muncy Columbia Financial Corporation Reports First Quarter 2024 Earnings

Muncy Columbia Financial Corporation (“Corporation”) (OTCQX: CCFN), parent company of Journey Bank (“Bank”), has released its unaudited financial statements for the first quarter of 2024.

Unaudited Financial Information

Net income, as reported under accounting principles generally accepted in the United States of America (“GAAP”), for the quarter-ended March 31, 2024, was $4,036,000 compared to net income of $1,940,000 for the same period in 2023. Earnings per share, basic and diluted, for the quarters-ended March 31, 2024 and 2023 were $1.13 and $0.93, respectively. Return on average assets and return on average equity were 1.02% and 10.52% for the quarter-ended March 31, 2024 as compared to 0.82% and 8.94% for the same period of 2023.

The fully-tax equivalent net interest margin on interest earning assets and liabilities was 3.32% and 2.41% at March 31, 2024 and 2023, respectively.

Total consolidated assets amounted to $1,573,271,000 at March 31, 2024, as compared to $1,639,779,000 at December 31, 2023. For the quarter-ended March 31, 2024, loans receivable, not held for sale, increased by $12,318,000 while available-for-sale debt securities decreased $73,708,000. Total deposits increased $62,831,000 while short term borrowings decreased $126,619,000 since the end of 2023.

On January 17, 2024, the Corporation sold available-for-sale debt securities with a total market value of $50,311,000, the proceeds of which were utilized to paydown short-term Federal Home Loan Bank of Pittsburgh (“FHLB”) borrowings. Securities sold included $34,222,000 of US government agency securities, $15,526,000 of mortgaged-backed securities and $563,000 of collateralized mortgage obligations. The sale resulted in a net realized loss of $8,000 which was recorded in January 2024.

The increase in total deposits during the quarter-ended March 31, 2024 was as a result of a strategic initiative to reposition customer repurchase agreements, which are classified as short-term borrowings, into core deposit accounts. The Bank anticipates a continued migration of customer repurchase accounts from short-term borrowings to deposits throughout 2024. The execution of this initiative will assist in optimizing the Bank’s long-term liquidity needs and balance sheet management strategies.

Total non-performing assets amounted to $7,328,000 at March 31, 2024, as compared to $4,475,000 at December 31, 2023. For the quarter-ended March 31, 2024, the increase in non-performing assets was primarily attributable to one real estate loan relationship with an aggregate balance of $2,221,000 which was placed on nonaccrual status during the quarter. This relationship is well secured, and the Bank is working closely with the borrower to bring the relationship to a current status. The Bank does not expect to incur a credit loss related to this relationship at this time.

The Corporation invests in various forms of agency debt including mortgage-backed securities and callable agency debt. The fair value of these securities is influenced by market interest rates, prepayment speeds on mortgage securities, bid to offer spreads in the market place and credit premiums for various types of agency debt. These factors change continuously and therefore the fair market value of these securities may be higher or lower than the Corporation’s carrying value at any measurement date. The temporary impact on investment securities will also affect stockholders’ equity as these fluctuations are recorded through accumulated other comprehensive income (loss). For the quarter-ended March 31, 2024, the temporary impact of these unrealized losses on the stockholders’ equity amounted to a reduction of $16,526,000. The Corporation does not consider its debt securities to be credit impaired since it has both the intent and ability to hold the securities until a recovery of its amortized cost basis, which may be maturity, and the decline in fair value is deemed to be as a result of changes in interest rates and not credit factors.

Total stockholders’ equity equated to a book value per share of $43.35 at March 31, 2024 as compared with $43.08 at December 31, 2023. For the quarter-ended March 31, 2024 cash dividends of $0.44 per share were paid to stockholders as compared to $0.42 for the same period of 2023. The Corporation remains well capitalized, with an equity to assets ratio of 9.84% as of March 31, 2024 and 9.38% at December 31, 2023.

About Muncy Columbia Financial Corporation

Muncy Columbia Financial Corporation ("MCFC") is a registered financial holding company headquartered in Bloomsburg, Pennsylvania. MCFC has one subsidiary bank, Journey Bank, serving individuals, families, nonprofits and business clients throughout Clinton, Columbia, Lycoming, Montour, Northumberland and Sullivan Counties through 22 banking offices.

Cautionary Note Regarding Forward Looking Statements

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of current or historical fact and involve substantial risks and uncertainties. Words such as "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "projects," "may," "will," "should," and other similar expressions can be used to identify forward-looking statements. Such statements are subject to factors that could cause actual results to differ materially from anticipated results. Among the risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements include, but are not limited to the following: costs or difficulties related to integration following the merger; the risk that the anticipated benefits, cost savings and other savings from the merger may not be fully realized or may take longer than expected to realize; potential impairment to the goodwill recorded in connection with the merger; changes in general economic trends, including inflation and changes in interest rates; our ability to manage credit risk; our ability to maintain an adequate level of allowance for credit loss on loans; increased competition; changes in consumer demand for financial services; our ability to control costs and expenses; fluctuations in the values of securities held in our securities portfolio, including as a result of changes in interest rates; our ability to successfully manage liquidity risk; adverse developments in borrower industries and, in particular, declines in real estate values; the concentration of large deposits from certain customers who have balances above current FDIC insurance limits; changes in and compliance with federal and state laws that regulate our business and capital levels; our ability to raise capital as needed; and any other risks described in the “Risk Factors” sections of reports filed by the Corporation with the Securities and Exchange Commission. We do not undertake, and specifically disclaim, any obligation to publicly revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements, except as required by law. Accordingly, you should not place undue reliance on forward-looking statements.

Muncy Columbia Financial Corporation
Consolidated Balance Sheets
 
(In Thousands, Except Share and Per Share Data) (Unaudited) March 31, 2024 December 31, 2023
ASSETS
Cash and due from banks

$

11,994

 

$

14,614

 

Interest-bearing deposits in other banks

 

4,237

 

 

3,763

 

Total cash and cash equivalents

 

16,231

 

 

18,377

 

 
Interest-bearing time deposits

 

736

 

 

979

 

Available-for-sale debt securities, at fair value

 

339,594

 

 

413,302

 

Marketable equity securities, at fair value

 

1,178

 

 

1,295

 

Restricted investment in bank stocks, at cost

 

8,013

 

 

10,394

 

Loans held for sale

 

614

 

 

366

 

 
Loans receivable

 

1,080,747

 

 

1,068,429

 

Allowance for credit losses

 

(9,351

)

 

(9,302

)

Loans, net

 

1,071,396

 

 

1,059,127

 

 
Premises and equipment, net

 

27,322

 

 

27,569

 

Foreclosed assets held for sale

 

335

 

 

170

 

Accrued interest receivable

 

4,849

 

 

5,362

 

Bank-owned life insurance

 

40,456

 

 

40,209

 

Investment in limited partnerships

 

5,641

 

 

5,828

 

Deferred tax asset, net

 

11,745

 

 

12,634

 

Goodwill

 

25,609

 

 

25,609

 

Core deposit intangible, net

 

11,346

 

 

11,895

 

Other assets

 

8,206

 

 

6,663

 

TOTAL ASSETS

$

1,573,271

 

$

1,639,779

 

 
LIABILITIES
Interest-bearing deposits

$

949,546

 

$

884,654

 

Noninterest-bearing deposits

 

263,954

 

 

266,015

 

Total deposits

 

1,213,500

 

 

1,150,669

 

 
Short-term borrowings

 

125,913

 

 

252,532

 

Long-term borrowings

 

65,524

 

 

70,448

 

Accrued interest payable

 

2,281

 

 

2,358

 

Other liabilities

 

11,190

 

 

9,947

 

TOTAL LIABILITIES

 

1,418,408

 

 

1,485,954

 

 
STOCKHOLDERS' EQUITY
Common stock, par value $1.25 per share; 15,000,000 shares authorized; issued 3,836,988 and outstanding 3,572,288 at March 31, 2024; issued 3,834,976 and outstanding 3,570,276 at December 31, 2023;

4,796

4,794

Additional paid-in capital

 

83,403

 

 

83,343

 

Retained earnings

 

92,980

 

 

90,514

 

Accumulated other comprehensive loss

 

(16,526

)

 

(15,036

)

Treasury stock, at cost; 264,700 shares at March 31, 2024 and December 31, 2023

 

(9,790

)

 

(9,790

)

TOTAL STOCKHOLDERS' EQUITY

 

154,863

 

 

153,825

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

1,573,271

 

$

1,639,779

 

Muncy Columbia Financial Corporation
Consolidated Statements of Income
 

For the Three Months Ended

March 31,

(In Thousands, Except Share and Per Share Data) (Unaudited)

2024

 

2023

INTEREST AND DIVIDEND INCOME
Interest and fees on loans:
Taxable

$

17,256

 

$

5,934

 

Tax-exempt

 

353

 

 

216

 

Interest and dividends on investment securities:
Taxable

 

1,161

 

 

1,208

 

Tax-exempt

 

830

 

 

129

 

Dividend and other interest income

 

223

 

 

67

 

Federal funds sold

 

-

 

 

-

 

Deposits in other banks

 

66

 

 

60

 

TOTAL INTEREST AND DIVIDEND INCOME

 

19,889

 

 

7,614

 

 
INTEREST EXPENSE
Deposits

 

4,610

 

 

627

 

Short-term borrowings

 

2,497

 

 

1,786

 

Long-term borrowings

 

847

 

 

-

 

TOTAL INTEREST EXPENSE

 

7,954

 

 

2,413

 

 
NET INTEREST INCOME

 

11,935

 

 

5,201

 

 
Provision (credit) for credit losses - loans

 

101

 

 

(418

)

(Credit) provision for credit losses - off balance sheet credit exposures

 

(11

)

 

9

 

TOTAL PROVISION (CREDIT) FOR CREDIT LOSSES

 

90

 

 

(409

)

 
NET INTEREST INCOME AFTER PROVISION (CREDIT) FOR CREDIT LOSSES

 

11,845

 

 

5,610

 

 
NON-INTEREST INCOME
Service charges and fees

 

615

 

 

525

 

Gain on sale of loans

 

76

 

 

29

 

Earnings on bank-owned life insurance

 

227

 

 

109

 

Brokerage

 

224

 

 

128

 

Trust

 

206

 

 

191

 

Losses on marketable equity securities

 

(117

)

 

(81

)

Realized losses on available-for-sale debt securities, net

 

(8

)

 

-

 

Interchange fees

 

619

 

 

424

 

Other non-interest income

 

690

 

 

301

 

TOTAL NON-INTEREST INCOME

 

2,532

 

 

1,626

 

 
NON-INTEREST EXPENSE
Salaries and employee benefits

 

4,802

 

 

2,592

 

Occupancy

 

618

 

 

323

 

Furniture and equipment

 

896

 

 

519

 

Pennsylvania shares tax

 

210

 

 

161

 

Professional fees

 

799

 

 

311

 

Director's fees

 

134

 

 

82

 

Federal deposit insurance

 

220

 

 

108

 

Telecommunications

 

88

 

 

84

 

Automated teller machine and interchange

 

262

 

 

119

 

Merger-related expenses

 

96

 

 

-

 

Amortization of core deposit intangible

 

549

 

 

-

 

Other non-interest expense

 

972

 

 

518

 

TOTAL NON-INTEREST EXPENSE

 

9,646

 

 

4,817

 

 
INCOME BEFORE INCOME TAX PROVISION

 

4,731

 

 

2,419

 

INCOME TAX PROVISION

 

695

 

 

479

 

NET INCOME

$

4,036

 

$

1,940

 

 
EARNINGS PER SHARE - BASIC AND DILUTED

$

1.13

 

$

0.93

 

WEIGHTED AVERAGE SHARES OUTSTANDING

 

3,570,342

 

 

2,079,135

 

At or 3 Months Ended (Unaudited)
 
(Dollars in Thousands, Except Per Share Data) 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
 
Operating Highlights
 
Net income (loss)

$

4,036

 

$

(1,186

)

$

1,171

 

$

1,462

 

$

1,940

 

Net interest income

 

11,935

 

 

8,257

 

 

4,891

 

 

4,913

 

 

5,201

 

Provision (credit) for credit losses

 

90

 

 

3,114

 

 

(168

)

 

(16

)

 

(409

)

Non-interest income

 

2,532

 

 

2,267

 

 

1,522

 

 

1,706

 

 

1,626

 

Non-interest expense

 

9,646

 

 

9,163

 

 

5,273

 

 

4,857

 

 

4,817

 

 
Balance Sheet Highlights
 
Total assets

$

1,573,271

 

$

1,639,779

 

$

957,580

 

$

960,080

 

$

955,030

 

Loans, net and loans held for sale

 

1,072,010

 

 

1,059,493

 

 

556,862

 

 

544,593

 

 

535,843

 

Goodwill and core deposit intangible, net

 

36,955

 

 

37,504

 

 

7,937

 

 

7,937

 

 

7,937

 

Total deposits
Noninterest-bearing

$

263,954

 

$

266,015

 

$

165,888

 

$

175,521

 

$

178,438

 

Savings

 

203,002

 

 

204,968

 

 

155,750

 

 

157,833

 

 

166,231

 

NOW

 

298,122

 

 

251,953

 

 

146,944

 

 

152,358

 

 

151,191

 

Money Market

 

112,190

 

 

103,602

 

 

41,521

 

 

44,341

 

 

51,846

 

Time Deposits

 

336,232

 

 

324,131

 

 

130,472

 

 

128,430

 

 

127,670

 

Total interest-bearing deposits

 

949,546

 

 

884,654

 

 

474,687

 

 

482,962

 

 

496,938

 

Core deposits*

 

877,268

 

 

826,538

 

 

510,103

 

 

530,053

 

 

547,706

 

 
Selected Ratios
 
Fully tax-equivalent net interest margin (YTD)

 

3.32

%

 

2.34

%

 

2.29

%

 

2.32

%

 

2.41

%

Annualized return on average assets

 

1.02

%

 

-0.35

%

 

0.63

%

 

0.71

%

 

0.82

%

Annualized return on average equity

 

10.52

%

 

-3.95

%

 

6.78

%

 

7.63

%

 

8.94

%

 
Capital Ratios - Journey Bank**
 
Common equity tier I capital ratio

 

13.95

%

 

13.52

%

 

18.80

%

 

18.96

%

 

18.94

%

Tier 1 capital ratio

 

13.95

%

 

13.52

%

 

18.80

%

 

18.96

%

 

18.94

%

Total risk-based capital ratio

 

14.94

%

 

14.49

%

 

19.91

%

 

20.11

%

 

20.10

%

Leverage ratio

 

8.40

%

 

8.03

%

 

10.58

%

 

10.65

%

 

10.62

%

 
Asset Quality Ratios
 
Non-performing assets

$

7,328

 

$

4,475

 

$

2,659

 

$

2,562

 

$

2,808

 

Allowance for credit losses - loans

 

9,351

 

 

9,302

 

 

6,094

 

 

6,278

 

 

6,288

 

Allowance for credit losses to total loans

 

0.87

%

 

0.87

%

 

1.09

%

 

1.14

%

 

1.16

%

Allowance for credit losses to non-performing assets

127.61

%

207.87

%

244.81

%

245.04

%

223.91

%
 
Per Share Data
 
Earnings (loss) per share

$

1.13

 

$

(0.41

)

$

0.56

 

$

0.71

 

$

0.93

 

Dividend declared per share

 

0.44

 

 

0.43

 

 

0.43

 

 

0.43

 

 

0.42

 

Book value

 

43.35

 

 

43.08

 

 

42.50

 

 

43.44

 

 

44.52

 

Common stock price:
Bid

$

30.50

 

$

34.50

 

$

34.59

 

$

37.57

 

$

40.05

 

Ask

 

32.00

 

 

37.17

 

 

35.00

 

 

43.00

 

 

42.50

 

Weighted average common shares

 

3,570,342

 

 

2,873,775

 

 

2,080,109

 

 

2,079,649

 

 

2,079,135

 

 
* Core deposits are defined as total deposits less time deposits
** Capital ratios for the most recent period are estimated

 

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