0000893847FALSE00008938472024-07-302024-07-30

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 
 
FORM 8-K
 
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 30, 2024 
 
Hawthorn Bancshares, Inc.
(Exact Name of Registrant as Specified in Charter) 
 
 
Missouri0-2363643-1626350
(State or Other Jurisdiction
of Incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)

132 East High Street, PO Box 688, Jefferson City, Missouri 65102
(Address of Principal Executive Offices) (Zip Code)
573-761-6100
(Registrant’s telephone number, including area code)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $1.00 par valueHWBKThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).  
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐ 



Item 2.02 Results of Operations and Financial Condition.
On July 30, 2024, Hawthorn Bancshares, Inc. issued a press release announcing its financial results for the three and six months ended June 30, 2024. A copy of the press release is attached to this report as Exhibit 99.1.
The information set forth in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1, is being “furnished” and shall not be deemed “filed” for the purposes of or otherwise subject to liabilities under Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed to be incorporated by reference into the filings of Hawthorn Bancshares, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
Item 8.01 Other Events.
On July 30, 2024, Hawthorn Bancshares, Inc. announced that its Board of Directors approved a quarterly cash dividend of $0.19 per common share, payable October 1, 2024 to shareholders of record at the close of business on September 15, 2024. A copy of the press release relating to such announcement is attached to this report as Exhibit 99.2.
Item 9.01 Financial Statements and Exhibits.

2


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Dated: July 30, 2024
Hawthorn Bancshares, Inc.
By: /s/ Brent M. Giles
      Name: Brent M. Giles
     Title: Chief Executive Officer

3

Exhibit 99.1
Hawthorn Bancshares Reports Second Quarter 2024 Results

Jefferson City, MO — July 30, 2024 — Hawthorn Bancshares, Inc. (NASDAQ: HWBK), (the “Company”), the bank holding company for Hawthorn Bank, reported second quarter 2024 net income of $4.6 million and earnings per diluted share (“EPS”) of $0.66.
Second Quarter 2024 Results
•Net income improved $0.2 million and EPS improved $0.03 per share from the first quarter 2024 (the "prior quarter”)
•Net interest margin, fully taxable equivalent ("FTE") of 3.33%
•Return on average assets and equity of 1.02% and 13.75%, respectively
•Loans decreased $20.3 million, or 1.3%, compared to the prior quarter
•Investments increased $1.4 million, or 0.7%, compared to the prior quarter
•Deposits increased $22.4 million, or 1.5%, compared to the prior quarter, while other borrowings decreased $9.9 million, or 6.2%, compared to the prior quarter
•Credit quality remained strong with non-performing loans to total loans of 0.30%
•Book Value increased to $19.76, an increase of 1.8%, compared to the end of the prior quarter
Brent Giles, Chief Executive Officer of Hawthorn Bancshares, Inc. commented, “In the second quarter, we continued to see a positive impact from focusing on the core business of the Bank. The sale of our mortgage servicing rights portfolio closed during the quarter, and we remain committed to expanding our products and services to our core customer base, while managing our operating expenses."
1

Financial Summary
(unaudited)
$000, except per share data
June 30,March 31,June 30,
202420242023
Balance sheet information:
Total assets$1,847,810$1,833,760$1,900,709
Loans held for investment1,498,5041,518,8531,563,206
Investment securities191,159189,741260,714
Deposits1,550,2501,527,8741,543,270
Total stockholders’ equity$138,241$136,620$126,473
Key ratios and per share data:
Book value per share (QTR)
$19.76 $19.43 $17.97 
Market price per share (QTR)
$19.80 $20.43 $17.95 
Diluted earnings (loss) per share (QTR)
$0.66 $0.63 $0.36 
Net interest margin (FTE) (QTR)3.33 %3.39 %3.19 %
Efficiency ratio (QTR)66.24 %70.78 %80.55 %
Financial Results for the Quarter and Six Months Ended June 30, 2024
Earnings
Net income for the second quarter 2024 was $4.6 million, an increase of $0.2 million, or 3.9%, from the prior quarter, and an increase of $2.1 million, or 81.6%, from the second quarter 2023 (the "prior year quarter"). EPS was $0.66 for the second quarter 2024 compared to $0.63 for the prior quarter, and $0.36 for the prior year quarter.

Net income for the six months ended June 30, 2024 was $9.1 million, or $1.29 per diluted share, an increase of $3.3 million compared to $5.8 million, or $0.83 per diluted share, for the six months ended June 30, 2023.

Net Interest Income and Net Interest Margin
Net interest income for the second quarter 2024 was $14.2 million, a decrease of $0.6 million from the prior quarter, and a decrease of $0.03 million from the prior year quarter. Net interest income for the six months ended June 30, 2024 was $28.9 million, an increase of $0.7 million compared to $28.2 million for the six months ended June 30, 2023.
Interest income increased $1.6 million in the current quarter compared to the prior year quarter, driven primarily by higher yields on interest earning assets, while interest expense increased $1.7 million compared to the prior year quarter. Net interest margin, on an FTE basis, was 3.33% for the current quarter, compared to 3.39% for the prior quarter, and 3.19% for the prior year quarter.
The yield earned on average loans held for investment was consistent at 5.75%, on an FTE basis, for both the second quarter 2024 and the prior quarter, compared to 5.23% for the prior year quarter.
The average cost of deposits was 2.69% for the second quarter 2024, compared to 2.61% for the prior quarter and 2.07% for the prior year quarter. Non-interest bearing demand deposits
2

as a percent of total deposits was 25.9% as of June 30, 2024, compared to 25.7% and 28.4% at March 31, 2024 and June 30, 2023, respectively.
Non-interest Income
Total non-interest income for the second quarter 2024 was $4.0 million, an increase of $1.0 million, or 32.3%, from the prior quarter, and an increase of $2.4 million, or 150.3%, from the prior year quarter. For the six months ended June 30, 2024, non-interest income was $7.0 million, an increase of $2.2 million as compared to $4.8 million for the six months ended June 30, 2023.
The increase in the current quarter compared to the prior quarter was primarily due to an increase in earnings on bank owned life insurance and the recognition of a gain on sale on foreclosed property.
Non-interest Expense
Total non-interest expense for the second quarter 2024 was $12.0 million, a decrease of $0.5 million, or 4.3%, from the prior quarter, and a decrease of $0.7 million, or 5.4%, from the prior year quarter. For the six months ended June 30, 2024, non-interest expense was $24.6 million, a decrease of $0.6 million as compared to $25.2 million for the six months ended June 30, 2023.
The second quarter efficiency ratio was 66.2% compared to 70.8% and 80.5% for the prior quarter and prior year quarter, respectively. The decrease in the current quarter compared to the prior quarter was primarily due to decreases in legal, examination, and professional fees and occupancy expense.
Loans
Loans held for investment decreased $20.3 million, or 1.3%, to $1.5 billion as of June 30, 2024 as compared to March 31, 2024 and decreased $64.7 million, or 4.1%, from June 30, 2023.
Investments
Investments increased $1.4 million, or 0.7%, to $191.2 million as of June 30, 2024 compared to March 31, 2024 and decreased $69.6 million, or 26.7%, from June 30, 2023.
Asset Quality
Non-performing loans totaled $4.4 million at June 30, 2024, a decrease from $8.5 million at March 31, 2024, and an increase from $3.8 million at June 30, 2023. The decrease in non-performing loans in the current quarter compared to the prior quarter is primarily due to a $1.8 million charged off commercial loan relationship and a $2.7 million commercial real estate loan that went to foreclosure. Non-performing loans to total loans was 0.30% at June 30, 2024, compared to 0.56% and 0.25% at March 31, 2024 and June 30, 2023, respectively.
In the second quarter 2024, the Company had net loan charge-offs of $2.0 million compared to net loan charge-offs of $0.1 million in the prior quarter and net recoveries of $0.1 million in the prior year quarter. The charge-offs in the current quarter primarily related to one commercial loan relationship that was adequately reserved for in the prior quarter.
The Company recorded a $0.5 million provision for credit losses on loans and unfunded commitments for the second quarter 2024 compared to a release of provision for credit losses on loans and unfunded commitments of $0.2 million in the prior quarter and a provision expense of $0.7 million for the prior year quarter.
3

The allowance for credit losses at June 30, 2024 was $22.0 million, or 1.47% of outstanding loans, and 495.38% of non-performing loans. At March 31, 2024, the allowance for credit losses was $23.7 million, or 1.56% of outstanding loans, and 276.93% of non-performing loans. At June 30, 2023, the allowance for credit losses was $22.2 million, or 1.42% of outstanding loans, and 578.01% of non-performing loans. The allowance for credit losses represents management’s best estimate of expected losses inherent in the loan portfolio and is commensurate with risks in the loan portfolio as of June 30, 2024 as determined by management.
Deposits
Total deposits at June 30, 2024 were $1.6 billion, an increase of $22.4 million, or 1.5%, from March 31, 2024, and an increase of $7.0 million, or 0.5%, from June 30, 2023. The increase in deposits at June 30, 2024 as compared to June 30, 2023 was primarily a result of an increase in time deposits partially offset by decreases in demand deposits and other interest bearing deposits.
Capital
The Company maintains its “well capitalized” regulatory capital position. At June 30, 2024, capital ratios were as follows: total risk-based capital to risk-weighted assets 14.30%; tier 1 capital to risk-weighted assets 12.94%; tier 1 leverage 10.94%; and common equity to assets 7.48%.
Pursuant to the Company's 2019 Repurchase Plan, management is given discretion to determine the number and pricing of the shares to be purchased under the plan, as well as the timing of any such purchases. The Company repurchased 51,692 common shares under the repurchase plan during the first six months of 2024 at an average cost of $19.46 per share totaling $1.0 million. As of June 30, 2024, $4.0 million remains available for share repurchases pursuant to the plan.
During the third quarter of 2024, the Company's Board of Directors approved a quarterly cash dividend of $0.19 per common share payable October 1, 2024 to shareholders of record at the close of business on September 15, 2024.


[Tables follow]
4

FINANCIAL SUMMARY
(unaudited)
$000, except per share data
Three Months Ended
June 30,March 31,June 30,
Statement of income information:202420242023
Total interest income$23,556$24,052$21,927
Total interest expense9,3849,3047,725
Net interest income14,17214,74814,202
Provision for (release of) credit losses on loans and unfunded commitments456(230)—
Non-interest income3,9953,0191,596
Investment securities (losses) gains, net(15)—7
Non-interest expense12,03412,57512,725
Pre-tax income5,6625,4223,080
Income taxes1,033966531
Net income$4,629$4,456$2,549
Earnings per share:    
Basic:$0.66 $0.63 $0.36 
Diluted:$0.66 $0.63 $0.36 
Six Months Ended
June 30,
Statement of income information:20242023
Total interest income$47,608$42,860
Total interest expense18,68814,710
Net interest income28,92028,150
Provision for credit losses on loans and unfunded commitments227680
Non-interest income7,0154,778
Investment securities (losses) gains, net(15)15
Non-interest expense24,60925,202
Pre-tax income11,0847,061
Income taxes1,9991,241
Net income$9,085$5,820
Earnings per share:
Basic:$1.29 $0.83 
Diluted:$1.29 $0.83 
5

FINANCIAL SUMMARY (continued)
(unaudited)
June 30,March 31,June 30,
202420242023
Key financial ratios:
Return on average assets (QTR)1.02 %0.97 %0.54 %
Return on average common equity (QTR)13.75 %13.12 %7.99 %
Net interest margin (FTE) (QTR)3.33 %3.39 %3.19 %
Efficiency ratio (QTR)66.24 %70.78 %80.55 %
Asset Quality Ratios:
Allowance for credit losses to total loans1.47 %1.56 %1.42 %
Non-performing loans to total loans (a)0.30 %0.56 %0.25 %
Non-performing assets to loans
0.54 %0.69 %0.66 %
Non-performing assets to assets (a)0.44 %0.57 %0.54 %
Allowance for credit losses on loans to
non-performing loans (a)495.38 %276.93 %578.01 %
Capital Ratios:
Average stockholders' equity to average total assets (QTR)7.40 %7.41 %6.76 %
Period-end stockholders' equity to period-end assets (QTR)7.48 %7.45 %6.65 %
Total risk-based capital ratio14.30 %13.92 %13.99 %
Tier 1 risk-based capital ratio12.94 %12.51 %12.51 %
Common equity Tier 1 capital10.02 %9.68 %9.92 %
Tier 1 leverage ratio10.94 %10.71 %10.46 %
(a)Non-performing loans include loans 90-days past due and accruing and non-accrual loans.
About Hawthorn Bancshares
Hawthorn Bancshares, Inc., a financial-bank holding company headquartered in Jefferson City, Missouri, is the parent company of Hawthorn Bank of Jefferson City with locations in the Missouri communities of Kansas City, Lee's Summit, Liberty, Springfield, Independence, Columbia, Clinton, Osceola, Warsaw, Belton, Drexel, Harrisonville, and California.













6

Contact:
Hawthorn Bancshares, Inc.
Brent M. Giles
Chief Executive Officer
TEL: 573.761.6100
www.HawthornBancshares.com
The financial results in this press release reflect preliminary, unaudited results, which are not final until the Company's Quarterly Report on Form 10-Q is filed. Statements made in this press release that suggest the Company's or management's intentions, hopes, beliefs, expectations, or predictions of the future include "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. It is important to note that actual results could differ materially from those projected in such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those projected in such forward-looking statements is contained from time to time in the Company's quarterly and annual reports filed with the Securities and Exchange Commission. These forward-looking statements are made as of the date of this communication, and the Company disclaims any obligation to update any forward-looking statement or to publicly announce the results of any revisions to any of the forward-looking statements included herein, except as required by law.
7

Exhibit 99.2
Hawthorn Bancshares Announces Cash Dividend
Jefferson City, MO. — July 30, 2024 — Hawthorn Bancshares, Inc. (NASDAQ: HWBK) announced today that its Board of Directors approved a quarterly cash dividend of $0.19 per common share, payable October 1, 2024 to shareholders of record at the close of business on September 15, 2024.
About Hawthorn Bancshares, Inc.
Hawthorn Bancshares, Inc., a financial-bank holding company headquartered in Jefferson City, Missouri, is the parent company of Hawthorn Bank of Jefferson City, Missouri with additional locations in the Missouri communities of Kansas City, Lee's Summit, Liberty, Springfield, Independence, Columbia, Clinton, Osceola, Warsaw, Belton, Drexel, Harrisonville, California, Missouri.

Contact:
Hawthorn Bancshares, Inc.
Brent M. Giles
Chief Executive Officer
TEL: 573.761.6100
www.HawthornBancshares.com

Statements made in this press release that suggest the Company's or management's intentions, hopes, beliefs, expectations, or predictions of the future include "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. It is important to note that actual results could differ materially from those projected in such forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those projected in such forward-looking statements is contained from time to time in the Company's quarterly and annual reports filed with the Securities and Exchange Commission. These forward-looking statements are made as of the date of this communication, and the Company disclaims any obligation to update any forward-looking statement or to publicly announce the results of any revisions to any of the forward-looking statements included herein, except as required by law.


v3.24.2
Cover Page
Jul. 30, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jul. 30, 2024
Entity Registrant Name Hawthorn Bancshares, Inc.
Entity Incorporation, State or Country Code MO
Entity File Number 0-23636
Entity Tax Identification Number 43-1626350
Entity Address, Address Line One 132 East High Street
Entity Address, Address Line Two PO Box 688
Entity Address, City or Town Jefferson City
Entity Address, State or Province MO
Entity Address, Postal Zip Code 65102
City Area Code 573
Local Phone Number 761-6100
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $1.00 par value
Trading Symbol HWBK
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000893847
Amendment Flag false
Hawthorn Bancshares (NASDAQ:HWBK)
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