Heartland BancCorp Earns $4.0 Million, or $1.99 Per Diluted
Heartland BancCorp Earns .9 Million, or .94 Per Diluted

WHITEHALL, Ohio, July 19, 2022 (GLOBE NEWSWIRE) — Heartland BancCorp (“Heartland” and “the Company”) (OTCQX: HLAN), parent company of Heartland Bank (“Bank”), today reported net income of $3.9 million, or $1.94 per diluted share in the second quarter of 2022, compared to $4.2 million, or $2.06 per diluted share in the second quarter of 2021, and $4.0 million, or $1.99 per diluted share, in the preceding quarter. Results for the second quarter of 2022 reflect lower interest and fees on Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) loans compared to the prior quarter and the year ago quarter, due to slowing PPP loan forgiveness as the program nears its conclusion. In the first six months of 2022, net income was $8.0 million, or $3.93 per diluted share, compared to $8.8 million, or $4.35 per diluted share, in the first six months of 2021.

The company announced that its board of directors declared a quarterly cash dividend of $0.69 per share. The dividend will be payable October 11, 2022, to shareholders of record as of September 24, 2022. Heartland has paid regular quarterly cash dividends since 1993.

“The highlights of the second quarter included substantial growth in the loan portfolio and the resulting net interest margin expansion,” stated G. Scott McComb, Chairman, President and Chief Executive Officer. “We continue to benefit from our strong core deposit base to fund loan activity; as a result, the cost of funds has remained flat despite rising interest rates. Additionally, we made progress in building out our presence in the Cincinnati market during the quarter. We entered that market organically towards the end of the year, and our efforts are already paying off, contributing to second quarter loan growth and revenues. With our skilled banking teams in place, combined with strong economic factors in our greater Columbus, northern Kentucky and Cincinnati markets, we are well positioned for continued growth going forward.”

Second Quarter Financial Highlights (at or for the three months ended June 30, 2022)

  • Net income was $3.9 million, or $1.94 per diluted share, compared to $4.2 million, or $2.06 per diluted share, in the second quarter of 2021.
  • Provision for loan losses was $480,000, which was unchanged compared to the second quarter a year ago.
  • Net interest margin expanded nine basis points to 3.92%, compared to 3.83% in the preceding quarter and improved 54 basis points compared to 3.38% in the second quarter a year ago.
  • Second quarter revenues (net interest income plus noninterest income) increased 5.0% to $16.2 million, compared to $15.4 million in the second quarter a year ago.
  • Annualized return on average assets was 1.10%, compared to 1.09% in the second quarter of 2021.
  • Annualized return on average tangible common equity was 11.97%, compared to 12.84% in the second quarter a year ago.
  • Excluding Paycheck Protection Program (PPP) loans, gross loans increased 15.5% to $1.21 billion at June 30, 2022, compared to $1.05 billion a year ago.
  • Credit quality remains pristine, with nonperforming loans to gross loans of 0.12% and nonperforming assets to total assets of 0.10% at June 30, 2022.
  • Tangible book value was $64.06 per share, compared to $66.53 per share a year ago.
  • Declared a quarterly cash dividend of $0.69 per share.

Balance Sheet Review

Assets

Total assets decreased nominally to $1.50 billion at June 30, 2022, compared to $1.51 billion a year earlier, and increased 2.8% compared to $1.45 billion three months earlier. The slight decrease compared to the prior year was the due to both PPP loan forgiveness and a reduction in excess liquidity, which offset core loan growth. Heartland’s loan-to-deposit ratio was 91.8% at June 30, 2022, compared to 90.6% at March 31, 2022, and 87.3% at June 30, 2021.

Liquidity levels continued to decline, with interest bearing deposits in other banks at $35.6 million, representing 2.5% of interest-earning assets as of June 30, 2022, compared to 8.0% at June 30, 2021.

Average earning assets were $1.35 billion in the second quarter of 2022 and in the first quarter of 2021, and $1.45 billion in the second quarter a year ago. The average yield on interest-earning assets was 4.17% in the second quarter of 2022, up 10 basis points from 4.07% in the preceding quarter and up 43 basis points from 3.74% in the second quarter a year ago.

Loan Portfolio

Over the course of the SBA PPP, Heartland originated 1,845 PPP loans, or $199.0 million in loans, and generated total PPP loan fees receivable of approximately $8.6 million. As of June 30, 2022, Heartland had received forgiveness from the SBA for $195.8 million. Approximately $132,000 of the income recognized during the second quarter of 2022 was related to recognizing origination fees for PPP loan payoffs or forgiveness, compared to $347,000 of income recognized during the first quarter of 2022, and $368,000 of income recognized during the second quarter of 2021. The balance of net unamortized PPP fees remaining to be recognized in fee income over the life of the associated loans, was $62,000 as of June 30, 2022.

“Core loan growth was robust during the second quarter, increasing 5.4% over the prior quarter end, or 21.6% annualized. We had great activity in the 1-4 family loan segment as well as in owner occupied CRE. Additionally, our loan pipeline remains strong, and we are replacing PPP loans with higher yielding loans, which is helping our net interest margin expand,” said Ben Babcanec, EVP and Chief Operating Officer.

The total loan portfolio increased substantially during the quarter, even with $5.7 million in PPP loan forgiveness during the quarter. Excluding PPP loans, gross loans increased 5.4% to $1.21 billion at June 30, 2022, compared to $1.15 billion at March 31, 2022, and increased 15.5% compared to $1.05 billion a year earlier. Including PPP loans, net loans were $1.20 billion at June 30, 2022, which was a 4.9% increase compared to $1.14 billion at March 31, 2022, and a 5.3% increase compared to $1.13 billion at June 30, 2021.

Commercial loans decreased 38.9% from year ago levels to $134.0 million, and comprise 11.1% of the total loan portfolio at June 30, 2022. The decrease was primarily due to the $99.7 million reduction in PPP loan balances compared to a year ago. Owner occupied commercial real estate loans (CRE) increased 11.2% to $306.5 million at June 30, 2022, compared to a year ago, and comprise 25.3% of the total loan portfolio. Non-owner occupied CRE loans increased 18.4% to $346.9 million, compared to a year ago, and comprise 28.6% of the total loan portfolio at June 30, 2022. 1-4 family residential real estate loans increased 17.7% from year ago levels to $370.4 million and represent 30.6% of total loans. Home equity loans increased 6.2% from year ago levels to $37.7 million and represent 3.1% of total loans, and consumer loans increased 53.5% from year ago levels to $15.3 million and represent 1.3% of the total loan portfolio at June 30, 2022.

Deposits

Total deposits were $1.30 billion at June 30, 2022, a 3.6% increase compared to $1.26 billion at March 31, 2022. Total deposits were unchanged compared to a year earlier, largely due to the reduction in CD’s as the Bank continues to focus on shifting its deposit mix to gathering and retaining low-cost deposits. “We were able to capitalize on our excess liquidity and improve our deposit mix, remaining focused on using low-cost deposits to fund new loan growth,” said Babcanec. At June 30, 2022, noninterest bearing demand deposit accounts increased 10.7% compared to a year ago and represented 37.6% of total deposits; savings, NOW and money market accounts increased 4.1% compared to a year ago and represented 46.6% of total deposits, and CDs decreased 24.7% compared to a year ago and comprised 15.9% of total deposits. The average cost of deposits was 0.16% in the second quarter of 2022, compared to 0.15% in the first quarter of 2022, and 0.27% in the second quarter of 2021.

Shareholders’ Equity

Shareholders’ equity was $141.9 million at June 30, 2022, compared to $147.7 million three months earlier and $146.5 million a year earlier. The decrease in shareholders’ equity during the current quarter was primarily due to a $8.5 million decrease in accumulated other comprehensive income related to an increase in the unrealized loss on available for sale securities reflecting the increase in market interest rates during the current quarter. At June 30, 2022, Heartland’s tangible book value was $64.06 per share, compared to $66.92 at March 31, 2022, and $66.53 at June 30, 2021.

Heartland continues to maintain capital levels in excess of the requirements to be categorized as “well-capitalized” with tangible equity to tangible assets of 8.68% at June 30, 2022, compared to 9.32% at March 31, 2022, and 8.89% at June 30, 2021.

Operating Results

In the second quarter of 2022, Heartland generated a ROAA of 1.10% and a ROAE of 10.87%, compared to 1.14% and 10.66%, respectively, in the first quarter of 2022 and 1.09% and 11.63%, respectively, in the second quarter a year ago.

Net Interest Income/Net Interest Margin

Net interest income, before the provision for loan losses, increased 7.6% to $13.2 million in the second quarter of 2022, compared to $12.2 million in the second quarter a year ago, and increased 2.9% compared to $12.8 million in the preceding quarter. Interest income benefitted from the amortization of PPP loan fees and the full recognition of the deferred PPP loan fees upon forgiveness by the SBA. During the second quarter of 2022, Heartland received $5.7 million in loan forgiveness through the SBA, compared to $18.7 million in loan forgiveness during the prior quarter, resulting in total net PPP fee income of $132,000 and $347,000, respectively. As of June 30, 2022, there was $62,000 of net deferred PPP fee income remaining. In the first six months of 2022, net interest income increased 6.8% to $26.0 million, compared to $24.3 million in the first six months of 2021.

Total revenues (net interest income, before the provision for loan losses, plus noninterest income) was $16.2 million in the second quarter, a 5.0% increase compared to $15.4 million in the second quarter a year ago, and a nominal increase compared to $16.1 million in the preceding quarter. Year-to-date, total revenues increased 3.4% to $32.2 million, compared to $31.2 million in the same period a year earlier.

Heartland’s net interest margin expanded nine basis points to 3.92% in the second quarter of 2022, compared to 3.83% in the preceding quarter and improved by 54 basis points compared to 3.38% in the second quarter of 2021. “Our net interest margin for the quarter benefitted from strong net interest income generation, robust loan growth and rising interest rates. New core loans that carry a higher interest rate are replacing lower rate PPP loans, which is helping our net interest margin expand compared to a year ago,” said Carrie Almendinger, EVP, and Chief Financial Officer. “We believe we are well positioned for additional interest rate increases, with a low-cost core deposit base and strong balance sheet liquidity to support continued loan demand.”

“Our strategy of patience in deploying excess liquidity in the investment portfolio is starting to benefit us as we continue to ladder into significantly higher yielding securities over the next few quarters,” said McComb.

Heartland’s net interest margin continues to remain above the peer average posted by the Dow Jones U.S. MicroCap Bank Index with total market capitalization under $250 million as of March 31, 2022.*

Provision for Loan Losses

“We have a very solid risk management culture in place, and continue to make additions to the allowance for loan losses to reflect the steady level of new loan growth,” said McComb.

Heartland recorded a $480,000 provision for loan losses in the second quarter of 2022, which was the same amount recorded in both the preceding quarter and the year ago quarter.

Noninterest Income

Noninterest income decreased 4.9% to $3.0 million in the second quarter of 2022, compared to $3.2 million in the second quarter a year ago, and decreased 7.8% compared to $3.3 million in the preceding quarter. Gains on sale of loans, and originated mortgage servicing rights, decreased 46.5% to $431,000 in the second quarter of 2022, compared to $805,000 in the second quarter a year ago, and decreased 36.9% compared to $683,000 in the preceding quarter. In the first six months of 2022, noninterest income decreased 8.6% to $6.3 million, compared to $6.9 million in the first six months of 2021.

“The mortgage market continues to be strong for mortgage originations through the second quarter of 2022, although we’ve seen volumes make their way on to the balance sheet leading to lower gains on sale,” said Almendinger.

Noninterest Expense

Heartland’s second quarter noninterest expenses totaled $10.8 million, compared to $10.6 million in the preceding quarter and $9.8 million in the second quarter a year ago. Salary and employee benefit expenses, the largest component of noninterest expense, were $6.8 million in the second quarter of 2022, compared to $6.9 million in the first quarter of 2022 and $5.6 million in the second quarter of 2021. “The increase in noninterest expenses compared to the year ago quarter is primarily a result of our expansion into the Cincinnati market during the fourth quarter of 2021 and a $1.5 million reduction of deferred PPP loan costs from the second quarter of 2021,” said Almendinger. “By expanding into the Cincinnati market organically, with a seasoned leader who has been established in that market for years, we have begun to broaden our client base and our operations without a significant increase to operating expenses.” Year-to-date, noninterest expense totaled $21.4 million, compared to $19.4 million in the first six months of 2021.

The efficiency ratio for the second quarter of 2022 was 66.9%, compared to 65.9% for the preceding quarter and 63.6% for the second quarter of 2021.

Income Tax Provision

In the second quarter of 2022, Heartland recorded $933,000 in state and federal income tax expense for an effective tax rate of 19.2%, compared to $952,000, or 19.1% in the first quarter of 2022 and $942,000 or 18.4% in the second quarter a year ago.

__________________
*As of March 31, 2022, the Dow Jones U.S. MicroCap Bank Index tracked 155 banks with total common market capitalization under $250 million for the following ratios: NIM* of 3.17%.

Credit Quality

“We are beginning to step up our risk mitigation process due to inflation concerns and rising interest rates, and are implementing all the necessary procedures to ensure we are well positioned for all economic cycles,” said McComb.

At June 30, 2022, the allowance for loan losses (ALLL) was $15.9 million, or 1.32% of total loans, compared to $15.5 million, or 1.34% of total loans at March 31, 2022, and $13.9 million, or 1.21% of total loans a year ago. As of June 30, 2022, the ALLL represented 1,316.1% of nonaccrual loans, compared to 1,636.7% three months earlier and 488.1% one year earlier.

Nonaccrual loans were $1.2 million at June 30, 2022, compared to $944,000 at March 31, 2022, and decreased 57.4% when compared to $2.8 million at June 30, 2021. Heartland had net loan charge-offs of $5,000 at June 30, 2022. This compared to $5,000 in net loan recoveries at March 31, 2022, and $1.3 million in net loan charge-offs at June 30, 2021. There was $245,000 in loans past due 90 days and still accruing at June 30, 2022, compared to $383,000 at March 31, 2022, and $359,000 at June 30, 2021.

Heartland’s performing restructured loans, that were not included in nonaccrual loans, totaled $4.5 million at June 30, 2022, compared to $5.1 million at March 31, 2022. Borrowers who are in financial difficulty, and who have been granted concessions, including interest rate reductions, term extensions, or payment alterations, are categorized as restructured loans.

There was $5,000 in other real estate owned and other non-performing assets on the books at June 30, 2022, unchanged from three months earlier and one year earlier. Non-performing assets (NPAs), consisting of non-performing loans and loans past due 90 days or more, was $1.5 million, or 0.10% of total assets inclusive of PPP loans, at June 30, 2022, compared to $1.3 million, or 0.09% of total assets, at March 31, 2022, and decreased 54.4% when compared to $3.2 million, or 0.21% of total assets a year ago.

About Heartland BancCorp

Heartland BancCorp is a registered Ohio bank holding company and the parent of Heartland Bank, which operates 18 full-service banking offices and TransCounty Title Agency, LLC. Heartland Bank, founded in 1911, provides full-service commercial, small business, and consumer banking services; professional financial planning services; and other financial products and services. Heartland Bank is a member of the Federal Reserve, a member of the FDIC, and an Equal Housing Lender. Heartland BancCorp is currently quoted on the OTC Markets (OTCQX) under the symbol HLAN. Learn more about Heartland Bank at Heartland.Bank.

In May of 2022, Heartland was ranked #112 on the American Banker Magazine’s list of Top 200 Publicly Traded Community Banks and Thrifts based on three-year average return on equity as of December 31, 2021.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about (i) the benefits of a merger between Heartland Bank and Victory Community Bank, including future financial and operating results, cost savings enhancements to revenue and accretion to reported earnings that may be realized from the merger; (ii) Heartland’s plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts; and (iii) other statements identified by words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “targets,” “projects,” or words of similar meaning generally intended to identify forward-looking statements. These forward-looking statements are based upon the current beliefs and expectations of Heartland’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of Heartland. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the anticipated results discussed in these forward-looking statements because of the following factors, among others: (1) the assumptions and estimates used by Heartland’s management include both assumptions as to certain business decisions that are subject to change and, in many respects, subjective judgment, and thus is susceptible to multiple interpretations and periodic revisions based on actual experience and business developments, and thus, may not be realized; (2) legislative or regulatory changes, including changes in accounting standards, may adversely affect the businesses in which Heartland is engaged; (3) changes in the interest rate environment may adversely affect net interest income; (4) results may be adversely affected by continued diversification of assets and adverse changes to credit quality; (5) competition from other financial services companies in Heartland’s markets could adversely affect operations; (6) the impact of the coronavirus (COVID-19) pandemic on the employees and customers of Heartland, as well as the resulting effect on the business, financial condition and results of operations on Heartland; and (7) the current economic slowdown could adversely affect credit quality and loan originations.

Heartland cautions that the foregoing list of factors is not exclusive. All subsequent written and oral forward-looking statements are expressly qualified in their entirety by the cautionary statements above. Heartland does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law.

 
Heartland BancCorp
Quarterly Financial Summary
                             
  Three Months Ended
Earnings and dividends: Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Jun. 30, 2021
Interest income $ 13,993     $ 13,611     $ 14,337     $ 13,912     $ 13,541  
Interest expense   832       819       925       1,126       1,309  
Net interest income   13,161       12,792       13,412       12,786       12,232  
Provision for loan losses   480       480       480       480       480  
Noninterest income   3,012       3,268       3,797       3,635       3,168  
Noninterest expense   10,824       10,589       10,407       9,917       9,789  
Provision for income taxes   933       952       1,299       1,265       942  
Net income   3,936       4,039       5,023       4,759       4,189  
                             
Share data:                            
Basic earnings per share $ 1.96     $ 2.02     $ 2.51     $ 2.38     $ 2.10  
Diluted earnings per share   1.94       1.99       2.48       2.34       2.06  
Dividends declared per share   0.69       0.69       0.63       0.63       0.63  
Book value per share   70.66       73.56       76.42       74.91       73.29  
Tangible book value per share   64.06       66.92       69.74       68.20       66.53  
                             
Common shares outstanding, 20,000,000 authorized   2,098,962       2,098,562       2,094,787       2,094,037       2,089,987  
Treasury shares   (90,612 )     (90,612 )     (90,612 )     (90,612 )     (90,612 )
Common shares, net   2,008,350       2,007,950       2,004,175       2,003,425       1,999,375  
Average common shares outstanding, net   2,008,154       2,004,901       2,003,784       2,000,839       1,995,900  
                             
Balance sheet – average balances:                            
Loans receivable, net $ 1,164,191     $ 1,153,203     $ 1,160,267     $ 1,148,103     $ 1,148,225  
PPP loans   6,094       17,889       44,321       81,932       111,667  
Earning assets   1,345,041       1,354,627       1,378,244       1,396,127       1,452,502  
Goodwill & intangible assets   13,295       13,355       13,409       13,470       13,537  
Total assets   1,437,003       1,442,050       1,461,752       1,481,787       1,540,047  
Deposits   1,237,620       1,238,275       1,248,971       1,270,425       1,328,153  
Borrowings   42,459       39,000       47,192       50,042       55,080  
Shareholders’ equity   145,218       153,591       151,620       148,306       144,381  
                             
Ratios:                            
Return on average assets   1.10 %     1.14 %     1.36 %     1.27 %     1.09 %
Return on average equity   10.87 %     10.66 %     13.14 %     12.73 %     11.63 %
Return on average tangible common equity   11.97 %     11.68 %     14.42 %     14.00 %     12.84 %
Yield on earning assets   4.17 %     4.07 %     4.13 %     3.95 %     3.74 %
Cost of deposits   0.16 %     0.15 %     0.17 %     0.22 %     0.27 %
Cost of funds   0.26 %     0.26 %     0.28 %     0.34 %     0.38 %
Net interest margin   3.92 %     3.83 %     3.86 %     3.63 %     3.38 %
Efficiency ratio   66.94 %     65.94 %     60.48 %     60.39 %     63.57 %
                             
Asset quality:                            
Net loan charge-offs to average loans   0.00 %     0.00 %     -0.05 %     0.00 %     0.44 %
Nonperforming loans to gross loans   0.12 %     0.11 %     0.14 %     0.24 %     0.28 %
Nonperforming assets to total assets   0.10 %     0.09 %     0.11 %     0.22 %     0.21 %
Allowance for loan losses to gross loans   1.32 %     1.34 %     1.28 %     1.25 %     1.21 %
                             
Heartland BancCorp
Consolidated Balance Sheets
             
                             
Assets Jun. 30, 2022   Mar. 31, 2022   Dec. 31, 2021   Sep. 30, 2021   Jun. 30, 2021
Cash and due from $ 18,139     $ 16,698     $ 10,469     $ 14,985     $ 12,925  
Interest bearing deposits   35,583       56,284       54,415       50,370       114,042  
Interest bearing time deposits                     283       281  
Available-for-sale securities   154,505       150,674       156,505       166,187       159,683  
Held-to-maturity securities   49       49       49       202       202  
                             
Loans held for sale   655       2,573       4,648       3,013       1,221  
                             
Commercial   134,033       142,925       154,182       179,776       219,421  
CRE (Owner occupied)   306,507       285,287       288,261       274,368       275,727  
CRE (Non Owner occupied)   346,905       346,326       358,713       326,919       292,955  
1-4 Family   370,444       331,255       322,558       319,662       314,630  
Home Equity   37,740       35,948       36,250       36,106       35,527  
Consumer   15,343       13,218       12,620       11,118       9,995  
Allowance for loan losses   (15,925 )     (15,450 )     (14,965 )     (14,352 )     (13,867 )
Net Loans   1,195,047       1,139,508       1,157,619       1,133,597       1,134,390  
                             
Premises and equipment   30,516       29,583       29,410       29,495       29,937  
Nonmarketable equity securities   6,032       6,028       6,024       6,024       6,024  
Mortgage serving rights, net   3,268       3,261       3,096       2,882       2,665  
Foreclosed assets held for sale   5       5       5       5       5  
Goodwill   12,388       12,388       12,388       12,388       12,388  
Intangible Assets   874       929       990       1,052       1,113  
Deferred income taxes   1,404       1,404       1,404       929       929  
Life insurance assets   18,314       18,218       18,120       18,019       17,919  
Accrued interest receivable and other assets   19,083       17,023       13,967       14,964       15,456  
Total assets $ 1,495,862     $ 1,454,626     $ 1,469,109     $ 1,454,396     $ 1,509,179  
                             
Liabilities and Shareholders’ Equity                            
Liabilities                            
Deposits                            
Demand $ 489,172     $ 500,733     $ 478,893     $ 440,531     $ 441,836  
Saving, NOW and money market   606,534       578,633       588,959       577,831       582,782  
Time   206,632       178,000       188,193       223,534       274,336  
Total deposits   1,302,338       1,257,366       1,256,045       1,241,896       1,298,954  
Repurchase agreements   14,525       8,275       9,032       10,060       9,754  
FHLB Advances   0       0       12,000       14,000       17,000  
Subordinated debt   24,672       24,661       24,651       24,641       24,630  
Interest payable and other liabilities   12,413       16,628       14,223       13,717       12,312  
Total liabilities   1,353,948       1,306,930       1,315,951       1,304,314       1,362,650  
                             
Shareholders’ Equity                            
Common stock, without par value   61,641       61,488       61,231       61,039       60,917  
Retained earnings   99,841       97,294       94,638       90,874       87,370  
Accumulated other comprehensive income (expense)   (14,574 )     (6,091 )     2,283       3,164       3,237  
Treasury stock at Cost, Common   (4,994 )     (4,994 )     (4,994 )     (4,994 )     (4,994 )
Total shareholders’ equity   141,914       147,696       153,158       150,082       146,529  
Total liabilities and shareholders’ equity $ 1,495,862     $ 1,454,626     $ 1,469,109     $ 1,454,396     $ 1,509,179  
                             
Heartland BancCorp
Consolidated Statements of Income
                             
  Three Months Ended
Interest Income Jun. 30, 2022   Mar. 31, 2022   Dec. 31, 2021   Sep. 30, 2021   Jun. 30, 2021
Loans $ 12,778   $ 12,544   $ 13,251   $ 12,826   $ 12,484
Securities                            
Taxable   586     471     467     448     437
Tax-exempt   578     574     586     589     580
Other   51     22     33     49     40
Total interest income   13,993     13,611     14,337     13,912     13,541
Interest Expense                            
Deposits   484     454     523     715     886
Borrowings   348     365     402     411     423
Total interest expense   832     819     925     1,126     1,309
Net Interest Income   13,161     12,792     13,412     12,786     12,232
Provision for Loan Losses   480     480     480     480     480
Net Interest Income After Provision for Loan Losses   12,681     12,312     12,932     12,306     11,752
Noninterest income                            
Service charges   916     861     834     812     692
Gains on sale of loans and originated MSR   431     683     1,339     1,048     805
Loan servicing fees, net   311     509     462     463     223
Title insurance income   346     290     313     421     382
Net realized gains on sales of available-for-sale securities                  
Increase in cash value of life insurance   96     98     101     101     99
Other   912     827     748     790     967
Total noninterest income   3,012     3,268     3,797     3,635     3,168
Noninterest Expense                            
Salaries and employee benefits   6,819     6,905     6,520     6,318     5,550
Net occupancy and equipment expense   960     994     948     981     966
Software and data processing fees   907     833     801     778     1,027
Professional fees   247     233     262     230     263
Marketing expense   247     259     218     275     279
State financial institution tax   257     277     313     167     309
FDIC insurance premiums   94     69     128     60     85
Other   1,293     1,019     1,217     1,108     1,310
Total noninterest expense   10,824     10,589     10,407     9,917     9,789
Income before Income Tax   4,869     4,991     6,322     6,024     5,131
Provision for Income Taxes   933     952     1,299     1,265     942
Net Income $ 3,936   $ 4,039   $ 5,023   $ 4,759   $ 4,189
Basic Earnings Per Share $ 1.96   $ 2.02   $ 2.51   $ 2.38   $ 2.10
Diluted Earnings Per Share $ 1.94   $ 1.99   $ 2.48   $ 2.34   $ 2.06
                             
Heartland BancCorp
Consolidated Statements of Income
           
  Six Months Ended
Interest Income Jun. 30, 2022   Jun. 30, 2021
Loans $ 25,322   $ 25,230
Securities          
Taxable   1,057     761
Tax-exempt   1,152     1,181
Other   73     88
Total interest income   27,604     27,260
Interest Expense          
Deposits   938     2,016
Borrowings   713     935
Total interest expense   1,651     2,951
Net Interest Income   25,953     24,309
Provision for Loan Losses   960     960
Net Interest Income After Provision for Loan Losses   24,993     23,349
Noninterest income          
Service charges   1,777     1,265
Gains on sale of loans and originated MSR   1,114     2,355
Loan servicing fees, net   820     428
Title insurance income   636     700
Net realized gains on sales of available-for-sale securities       223
Increase in cash value of life insurance   194     198
Other   1,739     1,699
Total noninterest income   6,280     6,868
Noninterest Expense          
Salaries and employee benefits   13,724     10,754
Net occupancy and equipment expense   1,954     1,986
Software and data processing fees   1,740     1,785
Professional fees   480     641
Marketing expense   506     555
State financial institution tax   534     624
FDIC insurance premiums   163     213
Other   2,312     2,845
Total noninterest expense   21,413     19,403
Income before Income Tax   9,860     10,814
Provision for Income Taxes   1,885     2,001
Net Income $ 7,975   $ 8,813
Basic Earnings Per Share $ 3.97   $ 4.42
Diluted Earnings Per Share $ 3.93   $ 4.35
           
Heartland BancCorp
ADDITIONAL FINANCIAL INFORMATION                    
(Dollars in thousands except per share amounts)(Unaudited)                    
                     
Asset Quality Ratios and Data:    
    Jun. 30, 2022   Mar. 31, 2022   Dec. 31, 2021   Sep. 30, 2021   Jun. 30, 2021
Nonaccrual loans (excluding restructured loans)   $ 949     $ 659     $ 1,333     $ 1,657     $ 1,748  
Nonaccrual restructured loans     261       285       285       1,093       1,093  
Loans past due 90 days and still accruing     245       383       16             359  
Total non-performing loans     1,455       1,327       1,634       2,750       3,200  
                     
OREO and other non-performing assets     5       5       5       5       5  
Total non-performing assets   $ 1,460     $ 1,332     $ 1,639     $ 2,755     $ 3,205  
                     
Nonperforming loans to gross loans     0.12%     0.11%     0.14%     0.24%     0.28%
Nonperforming assets to total assets     0.10%     0.09%     0.11%     0.22%     0.21%
Allowance for loan losses to gross loans     1.32%     1.34%     1.28%     1.25%     1.21%
                     
Performing restructured loans (RC-C)   $ 4,519     $ 5,106     $ 5,119     $ 610     $ 621  
                     
Net charge-offs quarter ending   $ 5     $ (5 )   $ (133 )   $ (6 )   $ 1,263  

 

Contact:   G. Scott McComb, Chairman, President & CEO
    Heartland BancCorp 614-337-4600 

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