InsCorp Reports Quarterly Profit Increase as Healthcare Brand Grows. Nashville-based Lender Resumes and Increases Dividend After Pandemic Pause

NASHVILLE, Tenn., May 7, 2021 /PRNewswire/ — InsCorp, parent company to INSBANK (OTCQX: IBTN), today reported first quarter earnings of $1,290,000,…

NASHVILLE, Tenn., May 7, 2021 /PRNewswire/ — InsCorp, parent company to INSBANK (OTCQX: IBTN), today reported first quarter earnings of $1,290,000, or $0.44 per common share. This represents an increase of $482,000, or 60%, over the previous quarter, and a $557,000 increase over the same quarter the prior year. Factors contributing to the results included core loan growth; PPP loan fee income; decreased funding costs; and income recognized from interest rate hedges. «Our team members have been purposeful throughout the pandemic, allocating resources to pandemic-driven matters such as industry-specific credit challenges, PPP loans, and the Fed’s zero interest rate policy, while concurrently executing innovation strategies in a rapidly-changing, technology-driven economy,» said Jim Rieniets, President & CEO of INSBANK. «In the midst of the pandemic we launched our niche healthcare brand, Medquity, to promote a national presence for physician-focused lending programs that already serve clients in 15 states. Medquity offers a unique blend of industry expertise in commercial banking as well as web-driven products serving the needs of medical professionals,» Rieniets continued.  Steady growth of the bank’s diverse healthcare portfolio in recent years now accounts for 25% of all loans. 

Net interest income was $4,444,000 for the quarter, representing a 14 percent increase over the same period for prior year, while quarterly operating expenses of $2,729,0000 were just 2% higher than those of the prior year. Loan loss provision expense was $650,000, which was $350,000 higher than the prior year period. «Our team’s depth of knowledge of our borrowers and diligence in monitoring our loan portfolio during the pandemic finds us cautiously optimistic that our loan loss reserves will provide a sufficient buffer against anticipated losses,» said Jim Rieniets. «Now a year into the pandemic we expect losses in just a few credits, for which there is little concentration within a particular industry. In general, most of our affected borrowers have navigated adversity and are reporting revenue gains this spring.»    

Additionally, InsCorp’s board of directors recently voted to distribute a semi-annual dividend of $0.12 per share, after having suspended dividend payments during 2020. «A year ago we felt the prudent course of action was to preserve capital given the level of uncertainty surrounding the pandemic, said Michael Qualls, Chairman of InsCorp. «Recent months, however, have provided greater clarity both for our company and the industry and we’re pleased to restore and increase our dividend based on current and projected operations,» Qualls continued. InsCorp’s dividend will be distributed on June 11th, 2021 and payable to shareholders of record as of May 21st, 2021.

Highlights of the quarter included:

  • Modified loans, due to the pandemic, represent 12% of the loan portfolio at March 31, 2021, with 50% being on payment deferral and 50% interest only. Total deferments are $69 million.
  • Payment deferrals are primarily in the restaurant, bar and tour/coach services industries, while the interest only modifications were in the hospitality and tour/coach services industries. 76% of total deferments were secured by real estate.
  • Loans generated through the government’s SBA-PPP program Round 2 totaled $16.8 million through March 31, 2021.
  • Deferred loan fees related to the PPP loans is approximately $930,000 at March 31, 2021.
  • Non-performing assets to total loans and OREO were 1.9% at March 31, 2021, compared to 0.68% at March 31, 2020.
  • Yield on loans was 4.19% for the three months ended March 31, 2021 compared to 4.88% for the same period in 2020.
  • Cost of all interest-bearing funding was 1.05% for the three months ended March 31, 2021 decreasing from 1.93% for the same period in 2020.
  • Efficiency ratio was 50.7% at March 31, 2021, comparing favorably to the bank’s FDIC peer group average of 60.7%.
  • Non-Interest Expense to Total Assets was 1.70% for the three months ended March 31, 2021, slightly lower than 1.85% for the same period in 2020 and compared favorably to the bank’s FDIC peer group average of 2.42%.
  • Assets per employee remained strong at $13.22 million, compared to the FDIC peer group of $6.59 million.
  • The allowance for loan and lease losses was 1.38%, slightly higher than the bank’s FDIC peer group average of 1.37%.
  • Annualized return on tangible common equity for the first quarter was 10.03%
  • Tangible book value increased $0.41 to $17.69 during the quarter primarily by virtue of retained earnings.
  • The bank’s tier 1 capital ratio was 11.9%, while total risk-based capital was 13.2%.

About INSBANK 

Since 2000, INSBANK has offered its clients highly personalized service provided by experienced relationship managers, while positioning itself as an innovator, utilizing technologies to deliver those services efficiently and conveniently.  In addition to its commercial focused operation, INSBANK operates three divisions, Medquity, TMA Medical Banking and INSBANK Online.  Medquity offers healthcare banking solutions to individuals nationwide, whether they are still in residency, practicing or entering retirement, while TMA Medical Banking provides banking services specifically to members of the Tennessee Medical Association. INSBANK Online offers nationally available virtual private client services for interest bearing deposits.  INSBANK is owned by InsCorp, Inc., a Tennessee bank holding company. The bank is headquartered in Nashville at 2106 Crestmoor Road, and has an office in Brentwood at 5614 Franklin Pike Circle. For more information, please visit www.insbanktn.com

 

InsCorp, Inc.

Consolidated Balance Sheets

(000’s)

(unaudited)










March 31,


December 31,


March 31,



2021


2020


2020

Assets






Cash and Cash Equivalents

$                            15,561


$                                8,219


$                              2,521

Interest Bearing Deposits

32,268


33,356


38,209

Securities

12,747


17,039


25,402








Loans

543,178


525,235


464,736

  Allowance for Loan Losses

(7,515)


(7,365)


(5,680)

Net Loans

535,663


517,870


459,056








Premises and Equipment, net

13,519


13,630


13,894

Bank Owned Life Insurance

10,176


10,115


9,927

Restricted Equity Securities

8,147


7,612


6,119

Goodwill and Related Intangibles, net

1,091


1,091


1,091

Other Assets

7,549


8,298


6,721








  Total Assets

$                          636,721


$                           617,230


$                          562,940








Liabilities and Shareholders’ Equity






Liabilities






  Deposits







Non-interest-bearing

$                            72,858


$                             52,665


$                            42,576


Interest-bearing

432,295


417,731


399,199


Total Deposits

505,153


470,396


441,775








  Federal Home Loan Bank Advances

45,000


50,000


51,000

  Paycheck Protection Program Liquidity Fund

15,485


18,412


  Subordinated Debentures

15,000


15,000


15,000

  Federal Funds Purchased


7,000


  Other Liabilities

3,117


5,328


5,475

Total Liabilities

583,755


566,136


513,250








Shareholders’ Equity







Common Stock

31,325


31,190


30,773


Treasury Stock

(681)


(681)




Accumulated Retained Earnings

21,652


20,377


18,677


Accumulated Other Comprehensive Income

670


208


240


Total Stockholders’ Equity

52,966


51,094


49,690

Total Liabilities & Shareholders’ Equity

$                          636,721


$                           617,230


$                          562,940








Tangible Book Value

$                              17.69


$                                17.28


$                              16.64











































InsCorp, Inc.

Consolidated Statements of Income

(000’s)

(Unaudited)










Three Months Ended


Twelve Months Ended


Three Months Ended



March 31, 2021


December 31, 2020


March 31, 2020








Interest Income

$                      5,876


$                             22,694


$                              6,018

Interest Expense

1,431


7,221


2,125

Net Interest Income

4,445


15,473


3,893

Provision for Loan Losses

650


2,400


300

Non-Interest Income







Service Charges on Deposit Accounts

59


212


56


Bank Owned Life Insurance

60


251


62


Gain on Interest Rate Hedges and Security Sales

505




Other

237


705


175

Non-Interest Expense







Salaries and Benefits

1,654


6,200


1,629


Occupancy and equipment

325


1,233


295


Data Processing

147


553


138


Marketing and Advertising

100


349


91


Other

503


1,843


513

Net income from Operations

1,927


4,063


1,220








Interest Expense-Subordinated Debt

239


956


239

Income Before Income Taxes

1,688


3,107


981

Income Tax Expense

(398)


(674)


(248)

Net Income

$                              1,290


$                                2,433


$                                  733








Return on Weighted Average Common Shares

$                                 0.44


$                                  0.83


$                                 0.25

 

 

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SOURCE INSBANK