Bogota Financial Corp. (NASDAQ: BSBK) (the “Company”), the
holding company for Bogota Savings Bank (the “Bank”), reported net
loss for the three months ended December 31, 2023 of $1.2 million
or ($0.09) per basic and diluted share, compared to net income of
$1.9 million or $0.14 per basic and diluted share for the
comparable prior year period. The Company reported net income for
the twelve months ended December 31, 2023 of $643,000 or $0.05 per
basic and diluted share compared to net income of $6.9 million, or
$0.51 per basic and diluted share, for the prior year.
On May 24, 2023, the Company announced it had received
regulatory approval for the repurchase of up to 249,920 shares of
its common stock, which was approximately 5% of its then
outstanding common stock (excluding shares held by Bogota
Financial, MHC). As of December 31, 2023, 216,837 shares have been
repurchased under this program at a cost of $1.6 million.
Other Financial Highlights:
- Total assets decreased $11.8 million, or 1.2%, to $939.3
million at December 31, 2023 from $951.1 million at December 31,
2022, due to a decrease in loans and securities, offset by an
increase in cash and cash equivalents.
- Cash and cash equivalents increased $8.1 million, or 48.0%, to
$24.9 million at December 31, 2023 from $16.8 million at December
31, 2022.
- Securities decreased $21.0 million, or 12.9%, to $141.5 million
at December 31, 2023 from $162.5 million at December 31, 2022.
- Net loans decreased $4.3 million, or 0.6%, to $714.7 million at
December 31, 2023 from $719.0 million at December 31, 2022.
- Total deposits at December 31, 2023 were $625.3 million,
decreasing $76.1 million, or 10.8%, as compared to $701.4 million
at December 31, 2022, primarily due to a $76.7 million decrease in
non-interest-bearing deposits, checking, savings and money market
accounts, offset by a $682,000 increase in certificates of deposit.
The average rate on deposits increased 200 basis points to 2.85%
for 2023 from 0.85% for 2022 due to higher interest rates and a
larger percentage of deposits consisting of higher-costing
certificates of deposit.
- Federal Home Loan Bank advances increased $65.4 million, or
63.9% to $167.7 million at December 31, 2023 from $102.3 million as
of December 31, 2022.
- Return on average assets was 0.07% for the twelve-month period
ended December 31, 2023 compared to 0.77% for twelve-month period
ended December 31, 2022.
- Return on average equity was 0.46% for the twelve-month period
ended December 31, 2023 compared to 4.76% for the twelve-month
period ended December 31, 2022.
- Upon adoption of the CECL method of calculating the allowance
for credit losses on January 1, 2023, the Bank recorded a one-time
decrease, net of tax, in retained earnings of $220,000, an increase
to the allowance for credit losses of $157,000 and an increase in
the reserve for unfunded liabilities of $152,000.
Kevin Pace, President and Chief Executive Officer, said
“Elevated interest rates have continued to negatively impact
funding costs and our net interest margin. Our credit quality
remains strong and our net interest margin compression is
stabilizing. While the financial results for 2023 were
disappointing, we are diligently implementing our strategic plan
and taking the necessary steps to improve performance. We realized
some significant one-time expenses in the 4th quarter of 2023 that
will not impact the Bank going forward. Despite the challenges
presented by the economic landscape, we continue to remain positive
and resilient with our ability to navigate uncertainties. Growth
remains a key focus as we remain committed to delivering value to
our shareholders and customers.”
“The Bank recently embarked on an exciting journey becoming the
official sponsor of the Fairleigh Dickinson University Men’s
basketball program that achieved great success in last years’ NCAA
tournament. The team now plays in the newly named Bogota Savings
Bank Center. We are enthusiastic that this partnership will help
grow the Bank brand and have a positive impact on our community.
Our new branch in Upper Saddle River, New Jersey, is nearing
completion with an anticipated opening in March 2024.”
Mr. Pace further stated, "I would like to express my gratitude
to our talented team, whose unwavering dedication and hard work
have been instrumental in our success. We look forward to building
on this momentum, embracing new opportunities, and delivering
sustained value to all our stakeholders in the years ahead."
Income Statement Analysis
Comparison of Operating Results for the Three Months Ended
December 31, 2023 and December 31, 2022
Net income decreased by $3.1 million, or 161.9%, to a net loss
of $1.2 million for the three months ended December 31, 2023 from
net income of $1.9 million for the three months ended December 31,
2022. This decrease was primarily due to a decrease of $3.1 million
in net interest income and a $1.4 million increase in non-interest
expense, partially offset by a decrease of $150,000 in the
provision for credit losses and a decrease of $1.3 million in
income tax expense.
Interest income increased $585,000, or 6.5%, from $9.0 million
for the three months ended December 31, 2022 to $9.6 million for
the three months ended December 31, 2023 due to higher yields on
interest-earning assets.
Interest income on cash and cash equivalents increased $115,000,
or 383.3%, to $145,000 for the three months ended December 31, 2023
from $30,000 for the three months ended December 31, 2022 due a 210
basis point increase in the average yield from 3.98% for the three
months ended December 31, 2022 to 6.08% for the three months ended
December 31, 2023 due to the higher interest rate environment. The
increase was also due to a $6.5 million increase in the average
balance to $9.4 million for the three months ended December 31,
2023 from $3.0 million for the three months ended December 31,
2022, reflecting the increase of liquidity due to lower loan
originations.
Interest income on loans increased $363,000, or 4.6%, to $8.2
million for the three months ended December 31, 2023 compared to
$7.9 million for the three months ended December 31, 2022 due
primarily to 22 basis point increase in the average yield from
4.35% for the three months ended December 31, 2022 to 4.57% for the
three months ended December 31, 2023, offset by a $2.7 million
decrease in the average balance to $714.4 million for the three
months ended December 31, 2023 from $717.1 million for the three
months ended December 31, 2022 and a $348,000 reserve for
nonaccrual interest on a delinquent construction loan.
Interest income on securities increased $61,000, or 6.2%, to
$1.0 million for the three months ended December 31, 2023 from
$980,000 for the three months ended December 31, 2022 primarily due
to a 78 basis point increase in the average yield from 2.34% for
the three months ended December 31, 2022 to 3.12% for the three
months ended December 31, 2023, offset by a $34.5 million decrease
in the average balance to $133.2 million for the three months ended
December 31, 2023 from $167.7 million for the three months ended
December 31, 2022.
Interest expense increased $3.7 million, or 125.4%, from $2.9
million for the three months ended December 31, 2022 to $6.6
million for the three months ended December 31, 2023 due to higher
costs on interest-bearing liabilities, offset by a decrease in the
average balance of interest-bearing liabilities.
Interest expense on interest-bearing deposits increased $3.1
million, or 140.5%, to $5.2 million for the three months ended
December 31, 2023 from $2.2 million for the three months ended
December 31, 2022. The increase was due to a 207 basis point
increase in the average cost of deposits to 3.41% for the three
months ended December 31, 2023 from 1.34% for the three months
ended December 31, 2022. The increase in the average cost of
deposits was due to the higher interest rate environment and a
change in the composition of the deposit portfolio. The average
balances of certificates of deposit increased $29.0 million to
$497.1 million for the three months ended December 31, 2023 from
$468.1 million for the three months ended December 31, 2022 while
NOW and money market accounts and savings accounts decreased $54.6
million and $12.2 million for the three months ended December 31,
2023, respectively, compared to the three months ended December 31,
2022.
Interest expense on Federal Home Loan Bank borrowings increased
$623,000, or 82.1%, from $759,000 for the three months ended
December 30, 2022 to $1.4 million for the three months ended
December 31, 2023. The increase was due to an increase in the
average cost of 152 basis points to 3.99% for the three months
ended December 31, 2023 from 2.47% for the three months ended
December 31, 2022 due to the new borrowings at higher rates. The
increase was also due to an increase in the average balance of
borrowings of $15.5 million to $137.4 million for the three months
ended December 31, 2023 from $122.0 million for the three months
ended December 31, 2022.
Net interest income decreased $3.1 million, or 51.4%, to $2.9
million for the three months ended December 31, 2023 from $6.0
million for the three months ended December 31, 2022. The decrease
reflected a 159 basis point decrease in our net interest rate
spread to 0.88% for the three months ended December 31, 2023 from
2.47% for the three months ended December 31, 2022. Our net
interest margin decreased 133 basis points to 1.35% for the three
months ended December 31, 2023 from 2.68% for the three months
ended December 31, 2022.
We recorded no provision for credit losses for the three months
ended December 31, 2023 compared to a $150,000 provision for loan
losses for the three-month period ended December 31, 2022. The
absence of a provision in the fourth quarter of 2023 reflects the
decrease in the loan portfolio.
Non-interest income increased by $27,000, or 10.4%, to $283,000
for the three months ended December 31, 2023 from $256,000 for the
three months ended December 31, 2022. Bank-owned life insurance
income increased $23,000, or 12.5%, due higher balances during
2023.
For the three months ended December 31, 2023, non-interest
expense increased $1.4 million, or 40.9%, over the comparable 2022
period. Salaries and employee benefits increased $895,000, or
40.9%, due to an accrual of a severance contract for the retirement
of the previous President. Professional Fees increased $162,000, or
186.5% due to higher legal costs. FDIC insurance premiums increased
$40,000, or 69.3%, due to a higher assessment rate in 2023. Data
processing expense increased $39,000, or 18.3%, due to higher
processing costs. Director fees decreased $51,000, or 26.6%, due to
lower pension expense. The decrease in advertising expense of
$29,000, or 23.1%, was due to reduced promotions for branch
locations and less promotions on deposit and loan products. Other
expense increased $376,000, or 128.9%, due to a pending fraud claim
that is under review with the insurance company.
Income tax expense decreased $1.3 million, or 174.8%, to a
benefit of $548,000 for the three months ended December 31, 2023
from a $732,000 expense for the three months ended December 31,
2022. The decrease was due to $4.4 million of lower taxable
income.
Comparison of Operating Results for the Twelve Months Ended
December 31, 2023 and December 31, 2022
Net income decreased by $6.2 million, or 90.7%, to $643,000 for
the twelve months ended December 31, 2023 from $6.9 million for the
twelve months ended December 31, 2022. This decrease was primarily
due to a decrease of $8.1 million in net interest income, and an
increase of $1.5 million in non-interest expense, offset by a
decrease of $550,000 in the provision for credit losses and a
decrease of $2.8 million in income tax expense.
Interest income increased $6.9 million, or 22.8%, from $30.3
million for the twelve months ended December 31, 2022 to $37.3
million for the twelve months ended December 31, 2023 due to
increases in the average balances of and higher yields on
interest-earning assets.
Interest income on cash and cash equivalents increased $451,000,
or 385.5%, to $568,000 for the twelve months ended December 31,
2023 from $117,000 for the twelve months ended December 31, 2022
due a 476 basis point increase in the average yield from 0.47% for
the twelve months ended December 31, 2022 to 5.23% for the twelve
months ended December 31, 2023 due to the higher interest rate
environment. This was offset by a $14.2 million decrease in the
average balance to $10.9 million for the twelve months ended
December 31, 2023 from $25.0 million for the twelve months ended
December 31, 2022, reflecting the use of excess liquidity to fund
loan originations.
Interest income on loans increased $5.8 million, or 22.0%, to
$32.0 million for the twelve months ended December 31, 2023
compared to $26.3 million for the twelve months ended December 31,
2022 due primarily to a $75.1 million increase in the average
balance to $713.8 million for the twelve months ended December 31,
2023 from $638.7 million for the twelve months ended December 31,
2022 and a 38 basis point increase in the average yield from 4.11%
for the twelve months ended December 31, 2022 to 4.49% for the
twelve months ended December 31, 2023. The increase was offset by a
$1.2 million reserve for nonaccrual interest on a delinquent
construction loan.
Interest income on securities increased $484,000, or 13.2%, to
$4.2 million for the twelve months ended December 31, 2023 from
$3.7 million for the twelve months ended December 31, 2022 due
primarily to a 68 basis point increase in the average yield from
2.19% for the twelve months ended December 31, 2022 to 2.87% for
the twelve months ended December 31, 2023. The increase was offset
by a $23.1 million decrease in the average balance of securities to
$144.9 million for the twelve months ended December 31, 2023 from
$168.0 million for the twelve months ended December 31, 2022.
Interest expense increased $15.0 million, or 206.9%, from $7.3
million for the twelve months ended December 31, 2022 to $22.3
million for the twelve months ended December 31, 2023 due to
increases in the average balance of and higher costs on
interest-bearing liabilities.
Interest expense on interest-bearing deposits increased $12.9
million, or 252.9%, to $18.0 million for the twelve months ended
December 31, 2023 from $5.1 million for the twelve months ended
December 31, 2022. The increase was due to a 200 basis point
increase in the average cost of interest-bearing deposits to 2.85%
for the twelve months ended December 31, 2023 from 0.85% for the
twelve months ended December 31, 2022. The increase in the average
cost of deposits was due to the higher interest rate environment
and a change in the composition of the deposit portfolio. The
average balances of certificates of deposit increased $103.5
million to $498.1 million for the twelve months ended December 31,
2023 from $394.6 million for the twelve months ended December 31,
2022 while NOW and money market accounts and savings accounts
decreased $54.8 million and $14.3 million for the twelve months
ended December 31, 2023, respectively, compared to the twelve
months ended December 31, 2022.
Interest expense on Federal Home Loan Bank borrowings increased
$2.1 million, or 98.1%, from $2.2 million for the twelve months
ended December 31, 2022 to $4.3 million for the twelve months ended
December 31, 2023. The increase was due to an increase in the
average cost of 156 basis points to 3.67% for the twelve months
ended December 31, 2023 from 2.11% for the twelve months ended
December 31, 2022 due to the new borrowings at higher rates. The
increase was also due to an increase in the average balance of
borrowings of $14.4 million to $116.8 million for the twelve months
ended December 31, 2023 from $102.5 million for the twelve months
ended December 31, 2022. Cash flow hedges used to manage interest
rate risk totaled $20.0 million at December 31, 2023. During the
twelve months ended December 31, 2023, the use of the cash flow
hedges reduced the interest expense on the Federal Home Loan Bank
advances by $364,000.
Net interest income decreased $8.1 million, or 35.1%, to $15.0
million for the twelve months ended December 31, 2023 from $23.1
million for the twelve months ended December 31, 2022. The increase
reflected a 130 basis point decrease in our net interest rate
spread to 1.28% for the twelve months ended December 31, 2023 from
2.58% for the twelve months ended December 31, 2022. Our net
interest margin decreased 105 basis points to 1.71% for the twelve
months ended December 31, 2023 from 2.76% for the twelve months
ended December 31, 2022.
We recorded a $125,000 recovery of credit losses for the twelve
months ended December 31, 2023 compared to a $425,000 provision for
loan losses for the twelve-month period ended December 31, 2022.
The Bank had a decrease in the loan portfolio as well as no
charge-offs offset by increased delinquent and non-performing
loans. As of January 1, 2023 the Bank adopted CECL and recorded a
one-time adjustment of $157,000 to the allowance for credit
losses.
Non-interest income increased by $15,000, or 1.4%. Gain on sale
of loans decreased $58,000, or 66.2%, as loan originations were
lower in 2023 due to the higher interest rate environment and the
decision to slow loan production to preserve capital and liquidity.
Other income decreased $41,000 or 25.1%. These decreases were more
than offset by an increase in income from bank-owned life insurance
of $87,000, or 12.5%, due to higher balances during 2023.
For the twelve months ended December 31, 2023, non-interest
expense increased $1.5 million, or 10.3%, over 2022. Salaries and
employee benefits increased $1.1 million, or 12.7%, due to an
accrual of a severance contract for the retirement of the previous
President and a higher employee count. Director fees decreased
$181,000, or 22.6%, due to lower pension expense. Professional fees
increased $115,000 or 21.1%, due to higher legal expense. FDIC
insurance premiums increased $198,000, or 89.9%, due to a higher
assessment rate in 2023. Data processing decreased $163,000, or
14.4%, due to the timing of invoices. Other expense increased
$341,000, or 34.6%, due to a pending fraud claim that is under
review with the insurance company.
Income taxes decreased $2.8 million, or 106.2%, to a benefit of
$162,000 for the twelve months ended December 31, 2023 from $2.6
million expense for the twelve months ended December 31, 2022. The
decrease was due to $9.0 million, or 94.9%, of lower taxable
income. The effective tax rate for the twelve months ended December
31, 2023 and 2022 was (33.76%) and 27.55%, respectively.
Balance Sheet Analysis
Total assets were $939.3 million at December 31, 2023,
representing a decrease of $11.8 million, or 1.2%, from December
31, 2022. Cash and cash equivalents increased $8.1 million during
the period primarily due to loan payments received and proceeds
from the call and maturity of securities. Net loans decreased $4.3
million, or 0.6%, due to $69.0 million in repayments, partially
offset by new production of $64.7 million. Due to the interest rate
environment, we have seen a decrease in demand for residential and
construction loans, which have been primary drivers of our loan
growth in recent periods. Securities held to maturity decreased
$4.8 million, or 6.2%, and securities available for sale decreased
$16.2 million or 19.1%, due to the repayments of mortgage-backed
securities and maturities of corporate bonds.
Delinquent loans increased $11.1 million to $12.6 million, or
1.76% of total loans, at December 31, 2023. The increase was mostly
due to one commercial construction loan (currently non-performing)
located in Totowa New Jersey with a balance of $11.1 million with a
loan to value ratio of 46%. During the same timeframe,
non-performing assets increased to $12.8 million and were 1.36% of
total assets at December 31, 2023. The Company’s allowance for
credit losses was 0.39% of total loans and 21.81% of non-performing
loans at December 31, 2023 compared to 0.36% of total loans and
136.3% of non-performing loans at December 31, 2022. The Bank does
not have any exposure to commercial real estate loans secured by
office space.
Total liabilities decreased $9.3 million, or 1.1%, to $802.2
million mainly due to a $76.1 million decrease in deposits, offset
by a $65.4 million increase in borrowings. Total deposits decreased
$76.1 million, or 10.8%, to $625.3 million at December 31, 2023
from $701.4 million at December 31, 2022. The decrease in deposits
reflected decreases in NOW, money market and savings accounts,
which decreased by $68.7 million from $170.2 million at December
31, 2022 to $101.5 million at December 31, 2023, offset by an
increase in certificate of deposit accounts, which increased by
$682,000 to $493.3 million from $492.6 million at December 31,
2022. At December 31, 2023, brokered deposits were $53.3 million or
8.5% of deposits and municipal deposits were $48.0 million or 7.7%
of deposits. At December 31, 2023, uninsured deposits represented
8.4% of the Bank’s total deposits. Federal Home Loan Bank advances
increased $65.4 million, or 63.9%, to fund loan growth and deposit
outflows. Total borrowing capacity at the Federal Home Loan Bank is
$308.2 million of which $167.7 million is advanced.
Total stockholders’ equity decreased $2.5 million to $137.2
million, due to increased accumulated other comprehensive loss for
securities available for sale of $254,000 and the repurchase of
413,097 shares of stock during the period at a cost of $3.7
million, offset by net income of $643,000 for the twelve months
ended December 31, 2023. At December 31, 2023, the Company’s ratio
of average stockholders’ equity-to-total assets was 15.32%,
compared to 15.61% at December 31, 2022.
About Bogota Financial Corp.
Bogota Financial Corp. is a Maryland corporation organized as
the mid-tier holding company of Bogota Savings Bank and is the
majority-owned subsidiary of Bogota Financial, MHC. Bogota Savings
Bank is a New Jersey chartered stock savings bank that has served
the banking needs of its customers in northern and central New
Jersey since 1893. It operates from six offices located in Bogota,
Hasbrouck Heights, Newark, Oak Ridge, Parsippany and Teaneck, New
Jersey and operates a loan production office in Spring Lake, New
Jersey.
Forward-Looking Statements
This press release contains certain forward-looking statements
about the Company and the Bank. Forward-looking statements include
statements regarding anticipated future events and can be
identified by the fact that they do not relate strictly to
historical or current facts. They often include words such as
“believe,” “expect,” “anticipate,” “estimate,” and “intend” or
future or conditional verbs such as “will,” “would,” “should,”
“could,” or “may.” Forward-looking statements, by their nature, are
subject to risks and uncertainties. Certain factors that could
cause actual results to differ materially from expected results
include increased competitive pressures, changes in the interest
rate environment, inflation, general economic conditions or
conditions within the securities markets, potential recessionary
conditions, real estate market values in the Bank’s lending
area, changes in liquidity, including
the size and composition of our deposit portfolio, including the
percentage of uninsured deposits in the portfolio; changes in the quality of our loan and security
portfolios, increases in non-performing and classified loans,
monetary and fiscal policies of the U.S. Government including
policies of the U.S. Treasury and the Board of Governors of the
Federal Reserve System, a failure in or breach of the Company’s
operational or security systems or infrastructure, including
cyberattacks, the failure to maintain current technologies, failure
to retain or attract employees and legislative, accounting and
regulatory changes that could adversely affect the business in
which the Company and the Bank are engaged.
The Company undertakes no obligation to revise these
forward-looking statements or to reflect events or circumstances
after the date of this press release.
BOGOTA FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF
FINANCIAL CONDITION
(unaudited)
2023
2022
ASSETS
Cash and due from banks
$
13,567,115
$
8,160,028
Interest-bearing deposits in other
banks
11,362,356
8,680,889
Cash and cash equivalents
24,929,471
16,840,917
Securities available for sale
68,888,179
85,100,578
Securities held to maturity (fair value of
$65,374,753 and $70,699,651 respectively)
72,656,179
77,427,309
Loans, net of allowance $2,785,949 and
$2,578,174, respectively
714,688,635
719,025,762
Premises and equipment, net
7,687,387
7,884,335
Federal Home Loan Bank (“FHLB”) stock
8,616,100
5,490,900
Accrued interest receivable
3,932,785
3,966,651
Core deposit intangibles
206,116
267,272
Bank owned life insurance
30,987,851
30,206,325
Other assets
6,731,500
4,888,954
Total assets
$
939,324,203
$
951,099,003
LIABILITIES AND STOCKHOLDERS'
EQUITY
Liabilities
Deposits
Non-interest bearing
$
30,554,842
$
38,653,349
Interest bearing
594,792,300
662,758,100
625,347,142
701,411,449
FHLB advances-short term
37,500,000
59,000,000
FHLB advances-long term
130,189,663
43,319,254
Advance payments by borrowers for taxes
and insurance
2,733,709
3,174,661
Other liabilities
6,380,486
4,534,516
Total liabilities
802,151,000
811,439,880
Stockholders' Equity
Preferred stock $0.01 par value 1,000,000
shares authorized, none issued and outstanding at December 31, 2023
and 2022
—
—
Common stock $0.01 par value, 30,000,000
shares authorized, 13,279,230 issued and outstanding at December
31, 2023 and 13,699,016 at December 31, 2022
132,792
136,989
Additional Paid-In capital
56,149,915
59,099,476
Retained earnings
92,177,068
91,756,673
Unearned ESOP shares (409,750 shares at
December 31, 2023 and 436,945 shares at December 31, 2022)
(4,821,798
)
(5,123,002
)
Accumulated other comprehensive loss
(6,464,774
)
(6,211,013
)
Total stockholders' equity
137,173,203
139,659,123
Total liabilities and stockholders'
equity
$
939,324,203
$
951,099,003
BOGOTA FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(unaudited)
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
Interest income
Loans
$
8,224,488
$
7,860,684
$
32,046,033
$
26,264,486
Securities
Taxable
1,027,755
933,963
4,070,144
3,516,832
Tax-exempt
13,135
45,882
91,428
161,187
Other interest-earning assets
300,656
140,335
1,072,240
403,969
Total interest income
9,566,034
8,980,864
37,279,845
30,346,474
Interest expense
Deposits
5,245,865
2,180,832
18,023,772
5,106,517
FHLB advances
1,382,244
759,476
4,282,603
2,162,217
Total interest expense
6,628,109
2,940,308
22,306,375
7,268,734
Net interest income
2,937,925
6,040,556
14,973,470
23,077,740
Provision (credit) for loan losses
—
150,000
(125,000
)
425,000
Net interest income after provision
(credit) for credit losses
2,937,925
5,890,556
15,098,470
22,652,740
Non-interest income
Fees and service charges
47,382
42,848
206,763
179,734
Gain on sale of loans
—
—
29,375
86,913
Bank-owned life insurance
207,453
184,373
781,526
694,900
Other
27,711
28,801
121,371
162,126
Total non-interest income
282,546
256,022
1,139,035
1,123,673
Non-interest expense
Salaries and employee benefits
3,082,176
2,187,586
9,820,128
8,713,734
Occupancy and equipment
359,937
356,872
1,474,107
1,390,718
FDIC insurance assessment
98,525
58,210
418,215
220,210
Data processing
251,485
212,497
969,398
1,132,790
Advertising
95,681
124,424
465,064
492,859
Director fees
141,639
192,862
619,650
800,611
Professional fees
248,526
86,751
661,045
546,004
Other
668,220
291,903
1,329,520
988,081
Total non-interest expense
4,946,189
3,511,105
15,757,127
14,285,007
(Loss) income before income taxes
(1,725,718
)
2,635,473
480,378
9,491,406
Income tax (benefit) expense
(547,958
)
732,122
(162,157
)
2,614,545
Net (loss) income
$
(1,177,760
)
$
1,903,351
$
642,535
$
6,876,861
Earnings (loss) per Share - basic
$
(0.09
)
$
0.14
$
0.05
$
0.51
Earnings (loss) per Share - diluted
$
(0.09
)
$
0.14
$
0.05
$
0.51
Weighted average shares outstanding -
basic
12,766,872
13,299,055
12,891,847
13,570,407
Weighted average shares outstanding -
diluted
12,766,872
13,330,553
12,891,847
13,576,934
BOGOTA FINANCIAL CORP.
SELECTED RATIOS
(unaudited)
At or For the Three Months
Ended December 31,
At or For the Twelve Months
Ended December 31,
2023
2022
2023
2022
Performance Ratios (1):
(Loss) return on average assets (2)
(0.51
)%
0.80
%
0.07
%
0.77
%
(Loss) return on average equity (3)
(3.43
)%
5.42
%
0.46
%
4.76
%
Interest rate spread (4)
0.88
%
2.47
%
1.28
%
2.58
%
Net interest margin (5)
1.35
%
2.68
%
1.71
%
2.76
%
Efficiency ratio (6)
153.59
%
55.76
%
97.04
%
59.03
%
Average interest-earning assets to average
interest-bearing liabilities
115.71
%
116.23
%
116.95
%
119.60
%
Net loans to deposits
114.29
%
102.51
%
114.29
%
102.51
%
Equity to assets (7)
14.94
%
14.80
%
14.89
%
16.06
%
Capital Ratios:
Tier 1 capital to average assets
15.24
%
15.61
%
Asset Quality Ratios:
Allowance for loan losses as a percent of
total loans
0.39
%
0.36
%
Allowance for loan losses as a percent of
non-performing loans
21.81
%
136.32
%
Net charge-offs to average outstanding
loans during the period
0.00
%
0.00
%
Non-performing loans as a percent of total
loans
1.79
%
0.26
%
Non-performing assets as a percent of
total assets
1.36
%
0.20
%
(1)
Certain performance ratios for the
three-months are annualized.
(2)
Represents net income divided by average
total assets.
(3)
Represents net income divided by average
stockholders’ equity.
(4)
Represents the difference between the
weighted average yield on average interest-earning assets and the
weighted average cost of average interest-bearing liabilities. Tax
exempt income is reported on a tax equivalent basis using a
combined federal and state marginal tax rate of 27.5%.
(5)
Represents net interest income as a
percent of average interest-earning assets. Tax exempt income is
reported on a tax equivalent basis using a combined federal and
state marginal tax rate of 27.5% for 2023 and 2022.
(6)
Represents non-interest expenses divided
by the sum of net interest income and non-interest income.
(7)
Represents average stockholders’ equity
divided by average total assets.
LOANS
Loans are summarized as follows at December 31, 2023 and
December 31, 2022:
2023
2022
Real estate:
Residential First Mortgage
$
456,647,592
$
466,100,627
Commercial and Multi-Family Real
Estate
175,443,080
162,338,669
Construction
49,302,040
61,825,478
Commercial & Industrial
6,658,370
1,684,189
Consumer:
Home equity and other
29,423,503
29,654,973
Total loans
717,474,585
721,603,936
Allowance for loan losses
(2,785,950
)
(2,578,174
)
$
714,688,635
$
719,025,762
The following tables set forth the distribution of total deposit
accounts, by account type, at the dates indicated (unaudited).
At December 31,
2023
2022
Amount
Percent
Average Rate
Amount
Percent
Average Rate
(Dollars in thousands)
Noninterest bearing demand accounts
$
30,608
4.89
%
—
%
$
38,653
5.52
%
—
%
NOW accounts
41,321
6.61
1.90
82,720
11.79
0.88
Money market accounts
14,622
2.34
0.30
30,037
4.28
0.32
Savings accounts
45,521
7.28
1.76
57,408
8.18
0.49
Certificates of deposit
493,275
78.88
4.00
492,593
70.23
2.37
Total
$
625,347
100.00
%
3.42
%
$
701,411
100.00
%
1.82
%
Average Balance Sheets and Related Yields and Rates
The following tables present information regarding average
balances of assets and liabilities, the total dollar amounts of
interest income and dividends from average interest-earning assets,
the total dollar amounts of interest expense on average
interest-bearing liabilities, and the resulting annualized average
yields and costs. The yields and costs for the periods indicated
are derived by dividing income or expense by the average balances
of assets or liabilities, respectively, for the periods presented.
Average balances have been calculated using daily balances.
Nonaccrual loans are included in average balances only. Loan fees
are included in interest income on loans and are not material.
Three Months Ended December
31,
2023
2022
Average
Interest and
Yield/
Average
Interest and
Yield/
Balance
Dividends
Cost (3)
Balance
Dividends
Cost (3)
(Dollars in thousands)
(unaudited)
Assets:
Cash and cash equivalents
$
9,433
$
145
6.08
%
$
2,962
$
30
3.98
%
Loans
714,380
8,224
4.57
%
717,096
7,861
4.35
%
Securities
133,241
1,041
3.12
%
167,708
980
2.34
%
Other interest-earning assets
7,216
156
8.70
%
6,327
110
6.99
%
Total interest-earning assets
864,270
9,566
4.40
%
894,093
8,981
3.99
%
Non-interest-earning assets
56,543
53,969
Total assets
$
920,813
$
948,062
Liabilities and equity:
NOW and money market accounts
$
67,510
$
310
1.82
%
$
122,136
$
177
0.57
%
Savings accounts
44,855
205
1.81
%
57,038
57
0.40
%
Certificates of deposit
497,147
4,731
3.78
%
468,138
1,947
1.65
%
Total interest-bearing deposits
609,512
5,246
3.41
%
647,312
2,181
1.34
%
Federal Home Loan Bank advances (1)
137,445
1,382
3.99
%
121,961
759
2.47
%
Total interest-bearing liabilities
746,957
6,628
3.52
%
769,273
2,940
1.52
%
Non-interest-bearing deposits
34,835
36,105
Other non-interest-bearing liabilities
1,454
2,296
Total liabilities
783,246
807,674
Total equity
137,567
140,388
Total liabilities and equity
$
920,813
$
948,062
Net interest income
$
2,938
$
6,041
Interest rate spread (2)
0.88
%
2.47
%
Net interest margin (3)
1.35
%
2.68
%
Average interest-earning assets to average
interest-bearing liabilities
115.71
%
116.23
%
1.
Cash flow hedges are used to manage
interest rate risk. During the three months ended December 31,
2023, the net effect on interest expense on the Federal Home Loan
Bank advances was a reduced expense of $110,000.
2.
Interest rate spread represents the
difference between the weighted average yield on interest-earning
assets and the weighted average cost of interest-bearing
liabilities.
3.
Net interest margin represents net
interest income divided by average total interest-earning
assets.
Twelve Months Ended December
31,
2023
2022
Average
Interest and
Yield/
Average
Interest and
Yield/
Balance
Dividends
Cost (3)
Balance
Dividends
Cost (3)
(Dollars in thousands)
(unaudited)
Assets:
Cash and cash equivalents
$
10,868
$
568
5.23
%
$
25,044
$
117
0.47
%
Loans
713,799
32,046
4.49
%
638,679
26,264
4.11
%
Securities
144,880
4,162
2.87
%
167,987
3,678
2.19
%
Other interest-earning assets
6,389
505
7.90
%
5,677
288
5.05
%
Total interest-earning assets
875,936
37,281
4.26
%
837,387
30,347
3.62
%
Non-interest-earning assets
54,925
52,525
Total assets
$
930,861
$
889,912
Liabilities and equity:
NOW and money market accounts
$
85,663
$
1,399
1.63
%
$
140,473
$
787
0.56
%
Savings accounts
48,351
580
1.20
%
62,626
184
0.29
%
Certificates of deposit
498,129
16,046
3.22
%
394,593
4,136
1.05
%
Total interest-bearing deposits
632,143
18,025
2.85
%
597,692
5,107
0.85
%
Federal Home Loan Bank advances (1)
116,816
4,283
3.67
%
102,458
2,162
2.11
%
Total interest-bearing liabilities
748,959
22,308
2.98
%
700,150
7,269
1.04
%
Non-interest-bearing deposits
38,636
41,501
Other non-interest-bearing liabilities
4,627
3,914
Total liabilities
792,222
745,565
Total equity
138,639
144,347
Total liabilities and equity
$
930,861
$
889,912
Net interest income
$
14,973
$
23,078
Interest rate spread (2)
1.28
%
2.58
%
Net interest margin (3)
1.71
%
2.76
%
Average interest-earning assets to average
interest-bearing liabilities
116.95
%
119.60
%
1.
Cash flow hedges are used to manage
interest rate risk. During the twelve months ended December 31,
2023, the net effect on interest expense on the Federal Home Loan
Bank advances was a reduced expense of $364,000.
2.
Interest rate spread represents the
difference between the weighted average yield on interest-earning
assets and the weighted average cost of interest-bearing
liabilities.
3.
Net interest margin represents net
interest income divided by average total interest-earning
assets.
Rate/Volume Analysis
The following table sets forth the effects of changing rates and
volumes on net interest income. The rate column shows the effects
attributable to changes in rate (changes in rate multiplied by
prior volume). The volume column shows the effects attributable to
changes in volume (changes in volume multiplied by prior rate). The
net column represents the sum of the prior columns. Changes
attributable to changes in both rate and volume that cannot be
segregated have been allocated proportionally based on the changes
due to rate and the changes due to volume.
Three Months Ended December
31,
Twelve Months Ended December
31,
2023 Compared to Three
2023 Compared to Twelve
Months
Months Ended December 31,
2022
Ended December 31,
2022
Increase (Decrease) Due
to
Increase (Decrease) Due
to
Volume
Rate
Net
Volume
Rate
Net
(In thousands)
(unaudited)
Interest income:
Cash and cash equivalents
$
93
$
22
$
115
$
(102
)
$
553
$
451
Loans receivable
(195
)
558
363
3,248
2,534
5,782
Securities
(975
)
1,036
61
(554
)
1,038
484
Other interest earning assets
17
29
46
39
178
217
Total interest-earning assets
(1,060
)
1,645
585
2,631
4,303
6,934
Interest expense:
NOW and money market accounts
(495
)
$
628
$
133
(406
)
1,018
612
Savings accounts
(83
)
231
148
(51
)
447
396
Certificates of deposit
128
2,656
2,784
1,339
10,571
11,910
Federal Home Loan Bank advances
107
516
623
338
1,783
2,121
Total interest-bearing liabilities
(343
)
4,031
3,688
1,220
13,819
15,039
Net increase (decrease) in net interest
income
$
(717
)
$
(2,386
)
$
(3,103
)
$
1,411
$
(9,516
)
$
(8,105
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240206735180/en/
Kevin Pace – President & CEO, 201-862-0660 ext. 1110
Bogota Financial (NASDAQ:BSBK)
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Bogota Financial (NASDAQ:BSBK)
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