RBKB Rhinebeck Bancorp Inc

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Rhinebeck Bancorp, Inc. Reports

Results for the Quarter Ended March 31, 2025

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News provided by

Rhinebeck Bancorp, Inc.

Poughkeepsie, New York, April 24, 2025 /ACCESSWIRE/ Rhinebeck Bancorp, Inc. (the “Company”) (NASDAQ: RBKB), the holding company of Rhinebeck Bank (the “Bank”), reported net income for the three months ended March 31, 2025 of $2.3 million ($0.21 per basic and diluted share), which was $1.2 million, or 104.1%, higher than the comparable prior year period of $1.1 million ($0.10 per basic and diluted share).

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The increase in net income for the quarter ended March 31, 2025 as compared to the quarter ended March 31, 2024 was primarily due to increases in net interest income and non-interest income, partially offset by increases in the provision for credit losses and non-interest expense. The Company’s return on average assets and return on average equity were 0.73% and 7.49% for the first quarter of 2025, respectively, as compared to 0.34% and 3.92% for the first quarter of 2024, respectively.

President and Chief Executive Officer Michael J. Quinn said, “We’re very pleased with our first quarter results, which saw earnings more than double to $2.3 million from $1.1 million a year ago. This performance reflects the positive impact of the balance sheet restructuring we executed in the second half of 2024, which took advantage of the interest rate environment. As a result, we delivered significant expansion in both our interest rate spread, up from 2.19% to 3.13%, and our net interest margin, which increased from 2.90% to 3.79%. Profitability metrics improved across the board, with return on average assets rising to 0.73% and return on average equity reaching 7.49%. We also drove meaningful improvement in operating efficiency and maintained strong credit quality. We believe these results set a solid foundation for continued growth as we move through 2025.”

Income Statement Analysis

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Net interest income increased $2.2 million, or 25.2%, to $11.0 million for the three months ended March 31, 2025, from $8.8 million for the three months ended March 31, 2024. The increase was primarily due to higher yields on interest earning assets and lower costs on interest bearing liabilities. Interest rate spread improved 94 basis points from 2.19% for the three months ended March 31, 2024 to 3.13% for the three months ended March 31, 2025, reflecting better pricing on assets versus liabilities. A balance sheet restructuring in the second half of 2024 significantly increased the yield on our available for sale securities.

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For the three months ended March 31, 2025, when compared to the three months ended March 31, 2024, the average yield improved by 60 basis points to 5.71% while the average balance of interest-earning assets decreased by $42.2 million, or 3.5%, to $1.18 billion. The average balance of interest-bearing liabilities decreased by $46.2 million, or 5.0%, primarily due to a $48.0 million decrease in the average balance of FHLB advances, while the cost of interest-bearing liabilities decreased by 34 basis points to 2.58%. The overall net interest margin increased by 89 basis points to 3.79% and the overall interest rate spread increased by 94 basis points to 3.13% for the three months ended March 31, 2025.

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The provision for credit losses on loans increased by $270,000, or 325.3%, from $83,000 for the quarter ended March 31, 2024 to $353,000 for the current quarter. The increase was primarily attributable to increased loan production during the quarter and increased charge-offs. Net charge-offs increased $260,000 from $250,000 for the first quarter of 2024 to $510,000 for the first quarter of 2025. The increase was primarily due to increased net charge-offs of $162,000 and $139,000 in indirect automobile loans and commercial loans, respectively.

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The percentage of overdue account balances to total loans decreased to 1.38% as of March 31, 2025 from 1.71% as of December 31, 2024, while non-performing assets decreased $622,000, or 15.0%, to $3.5 million at March 31, 2025.

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Non-interest income totaled $1.8 million for the three months ended March 31, 2025, an increase of $161,000, or 10.1%, from the comparable period in 2024, due primarily to an increase of $166,000, or 66.4%, in other non-interest income investment as swap income increased.  Service charges on deposit accounts also increased by $30,000, or 4.0%, as deposits increased. These increases were partially offset by a decrease in investment advisory income of $45,000, or 11.8%, resulting from a decline in the market due to unpredictable economic conditions. Gains on sales of loans also decreased $8,000 as we sold $385,000 of residential mortgage loans in the first quarter of 2025 as compared to sales of $2.0 million in the first quarter of 2024.

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For the first quarter of 2025, non-interest expense rose to $9.5 million, reflecting a $631,000, or 7.1%, increase compared to the same period in 2024. The increase was broad-based, with almost all major expense categories rising. Other non-interest expense grew by $256,000, or 16.8%, driven by higher retail banking costs. Salaries and benefits rose $142,000, primarily due to increased production commissions. Marketing expense rose by $79,000, or 65.3%, largely due to promotional initiatives associated with the launch of higher-yielding deposit products. Additionally, professional fees, FDIC insurance expense, and data processing fees increased by $63,000, $44,000, and $30,000, respectively.

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Balance Sheet Analysis

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Total assets increased slightly by $159,000 to remain relatively stable at $1.26 billion as of March 31, 2025. Cash and cash equivalents rose by $13.0 million, or 34.8%, driven by higher deposits held at the FHLB and the Federal Reserve Bank of New York, funded by proceeds from maturing securities. Loans receivable grew by $4.7 million, or 0.5%, to $976.5 million, primarily reflecting a $17.9 million increase in commercial real estate loans and a $4.3 million increase in residential real estate loans. This was partially offset by a decline of $17.7 million in indirect automobile loans, in line with a strategic decision to reduce their share of the portfolio. These increases were largely offset by a $15.1 million, or 9.4%, decrease in available-for-sale securities, primarily due to $18.1 million in paydowns, calls, and maturities, partially offset by a $2.3 million reduction in unrealized losses.

Past due loans decreased $3.2 million, or 18.9%, between December 31, 2024 and March 31, 2025, finishing at $13.6 million, or 1.38% of total loans, down from $16.7 million, or 1.71% of total loans at year-end 2024. The decrease was most notable in indirect automobile loans, reflecting the positive impact of more conservative underwriting standards. The allowance for credit losses was 0.86% of total loans and 239.35% of non-performing loans at March 31, 2025 as compared to 0.88% of total loans and 206.56% of non-performing loans at December 31, 2024. Non-performing assets totaled $3.5 million at March 31, 2025, a decrease of $622,000, from $4.1 million at December 31, 2024.

Total liabilities decreased by $4.0 million, or 0.4%, to $1.13 billion at March 31, 2025. The decline was primarily driven by a $15.9 million, or 22.8%, reduction in borrowings and a $1.8 million, or 19.1%, decrease in mortgagors’ escrow accounts. These decreases were largely offset by a $13.5 million, or 1.3%, increase in deposits. The growth in deposits was almost entirely attributable to a $13.6 million, or 1.7%, increase in interest-bearing deposits, while non-interest-bearing deposits declined slightly by $174,000, or 0.1%. The increase in savings and money market accounts reflected the Bank’s promotion of higher-yielding products in response to customer demand for better interest rates. Uninsured deposits were approximately 27.8% and 26.9% of the Bank’s total deposits as of March 31, 2025 and December 31, 2024, respectively.

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Stockholders' equity increased $4.1 million, or 3.4%, to $126.0 million at March 31, 2025. The increase was primarily due to $2.3 million in net income and a $1.8 million decrease in accumulated other comprehensive loss reflecting the results of the balance sheet restructuring. The Company's ratio of average equity to average assets was 9.77% for the three months ended March 31, 2025 and 9.23% for the year ended December 31, 2024.

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About Rhinebeck Bancorp

Rhinebeck Bancorp, Inc. is a Maryland corporation organized as the mid-tier holding company of Rhinebeck Bank and is the majority-owned subsidiary of Rhinebeck Bancorp, MHC.  The Bank is a New York chartered stock savings bank, which provides a full range of banking and financial services to consumer and commercial customers through its thirteen branches and two representative offices located in Dutchess, Ulster, Orange, and Albany counties in New York State.  Financial services including comprehensive brokerage, investment advisory services, financial product sales and employee benefits are offered through Rhinebeck Asset Management, a division of the Bank.

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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 or results 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”, “intend”, “predict”, “forecast”, “improve”, “continue”, “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, inflation, changes in the interest rate environment, fluctuations in real estate values, general economic conditions or conditions within the securities markets, potential recessionary conditions, the imposition of tariffs or other domestic or international governmental policies, changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio, our ability to access cost-effective funding, changes in asset quality, loan sale volumes, charge-offs and credit loss provisions, changes in economic assumptions that may impact our allowance for credit losses calculation, changes in demand for our products and services, legislative, accounting, tax and regulatory changes, including changes in the monetary and fiscal policies of the Board of Governors of the Federal Reserve System, the effect of our rating under the Community Reinvestment Act, political developments, uncertainties or instability, catastrophic events, acts of war or terrorism, natural disasters, such as earthquakes, drought, pandemic diseases, extreme weather events, or breach of our operational or security systems or infrastructure, including cyberattacks that could adversely affect the Company’s or the Bank’s financial condition and results of operations and the business in which the Company and the Bank are engaged.  

Accordingly, you should not place undue reliance on forward-looking statements. Rhinebeck Bancorp, Inc. undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.

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The Company’s summary consolidated statements of income and financial condition and other selected financial data follow:

Rhinebeck Bancorp, Inc. and Subsidiary

Consolidated Statements of Income (Unaudited)

(In thousands, except share and per share data)

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Rhinebeck Bancorp, Inc. and Subsidiary

Consolidated Statements of Financial Condition (Unaudited)

(In thousands, except share and per share data)

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Rhinebeck Bancorp, Inc. and Subsidiary

Average Balance Sheet (Unaudited)

(Dollars in thousands)

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Rhinebeck Bancorp, Inc. and Subsidiary

Selected Ratios (Unaudited)

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NON-GAAP FINANCIAL INFORMATION

This release contains financial information determined by methods other than in accordance with generally accepted accounting principles (“GAAP”). Such non-GAAP financial information includes the following measures: tangible book value per common share, efficiency ratio and earnings per share excluding securities loss. Management uses these non-GAAP measures because we believe that they may provide useful supplemental information for evaluating our operations and performance, as well as in managing and evaluating our business and in discussions about our operations and performance. Management believes these non-GAAP measures may also provide users of our financial information with a meaningful measure for assessing our financial results, as well as a comparison to financial results for prior periods. These non-GAAP measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP and are not necessarily comparable to other similarly titled measures used by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included below. Loss on available-for-sale securities is excluded from the following calculations as management believes that this presentation provides further comparability of net income (loss), earnings (loss) per share and the efficiency ratio and is consistent with industry practice.

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SOURCE Rhinebeck Bancorp, Inc.

Related Links

http://www.Rhinebeckbank.com

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