Randolph Bancorp, Inc. Announces First Quarter 2021 Financial Results
STOUGHTON, Mass., April 27, 2021 (GLOBE NEWSWIRE) — Randolph Bancorp, Inc. (the “Company”) (NASDAQ Global Market: RNDB), the holding company for Envision Bank (the “Bank”), today announced net income of $4.1 million, or $0.81 per basic share and $0.78 per diluted share, for the three months ended March 31, 2021 compared to net income of $5.3 million, or $1.03 per basic and $1.01 per diluted share for the three months ended December 31, 2020 and a net loss of $0.8 million, or $0.16 per basic and diluted share, for the three months ended March 31, 2020. Excluding one-time charges of $109,000 in severance expenses, earnings were $4.2 million, or $0.79 per diluted share for the three months ended March 31, 2021. Excluding one-time charges of $294,000 related to the closing of a residential lending office and $69,000 in severance expenses, earnings were $5.6 million, or $1.06 per diluted share, for the three months ended December 31, 2020.
At March 31, 2021, total assets amounted to $738.2 million, compared to $721.1 million at December 31, 2020, an increase of $17.1 million, or 2.4%. An increase in cash and cash equivalents of $41.2 million was partially offset by a decrease in loans held for sale of $25.9 million relative to the prior quarter. Compared to March 31, 2020, total assets grew $85.3 million, or 13.1% from $652.9 million. The growth from the prior year period was caused by an increase in loans held for sale of $34.4 million, or 58.5%, an increase in commercial real estate loans of $20.3 million, or 16.1%, and an increase in commercial and industrial loans of $14.8 million, or 164.3%, driven by lending associated with the Small Business Administration’s (the “SBA’s”) Paycheck Protection Program (“PPP”).
William M. Parent, President and Chief Executive Officer, stated, “The first quarter was another strong quarter for our Company, as mortgage refinancing volume, combined with improving banking results, drove performance metrics to elevated levels. We are very pleased with our performance as we migrate our mortgage banking operations from a higher volume refinance environment to more normalized levels while continuing to expand our consumer and commercial banking business. We remain optimistic regarding local economic activity, our ability to continue to grow our business and generate recurring operating leverage.”
First Quarter Operating Results
Net interest income increased by $51,000, or 1.0%, to $5.1 million for the three months ended March 31, 2021 from $5.0 million for the three months ended December 31, 2020. This increase was primarily due to an increase in average loans and a decrease in the cost of funds driven by a shortening of deposit liabilities and a decline in the cost of non-maturity deposits from the prior quarter. The average balance of term certificates decreased $15.3 million, or 13.6%, from the prior quarter and the average balance of savings and NOW accounts increased $19.2 million, or 8.0%, from the prior quarter. This contributed to a decrease of 9 basis points in the cost of interest-bearing liabilities. The net interest margin decreased in the first quarter by 6 basis points to 2.96% from 3.02% in the prior quarter. The change reflects a decrease of 11 basis points in loan yields, due to a decline in the forgiveness of SBA PPP loans, which resulted in a decline in loan yields of 2 basis points, and payoffs of higher yielding loans.
The net interest margin increased in the first quarter of 2021 to 2.96%, from 2.91% in the first quarter of 2020. The change reflects the shortening and downward pricing of deposit liabilities, exceeding the decreases in the rates earned on interest-earning assets because of the lower interest-rate environment. Net interest income increased by $666,000, or 15.1%, to $5.1 million for the three months ended March 31, 2021 from $4.4 million the same period in the prior year. This increase was primarily due to a decrease in deposit costs, complemented by change in the mix of deposits. The average balance of savings and NOW accounts in the first quarter of 2021 increased $55.5 million, or 41.1% and $30.5 million, or 78.0%, respectively, from the prior year quarter and the average balance of term certificates decreased $91.7 million, or 48.6%, from the prior year quarter, contributing to an 80 basis point decrease in the cost of interest-bearing liabilities. This decrease was primarily driven by an 89 basis point decline in the cost of interest-bearing deposits, as market interest rates declined sharply from the prior year.
The Company recognized a credit for loan losses of $213,000 for the quarter ended March 31, 2021, driven by changes in the qualitative factors related to the impact of the COVID-19 pandemic and the economic outlook used in the Company’s calculation. The allowance for loan losses was 1.32%, 1.38% and 1.04% of total loans at March 31, 2021, December 31, 2020 and March 31, 2020, respectively, and was 79.0%, 94.6% and 146.6% of non-performing assets at March 31, 2021, December 31, 2020 and March 31, 2020, respectively.
Non-interest income decreased $3.2 million, or 20.3%, to $12.4 million for the quarter ended March 31, 2021 from $15.6 million in the quarter ended December 31, 2020, due to a decrease of $3.6 million in the net gain on loan origination and sale activities, partially offset by an increase of $504,000 related to net mortgage servicing fees. Sold mortgages totaled $503.3 million in the first quarter of 2021, compared to $426.5 million in the fourth quarter of 2020. The first quarter of 2021 ended with a mortgage pipeline of $239.5 million, compared to a pipeline of $396.6 million at the end of the fourth quarter of 2020, contributing to the decrease in the net gain on loan origination and sales activities. Mortgage servicing fees increased $504,000, or 183.3% for the first quarter of 2021 to $779,000 from $275,000 in the fourth quarter of 2020 due to a fair value adjustment of $421,000 in the first quarter of 2021, based on an increase in mortgage interest rates from the prior quarter.
Non-interest income increased $6.0 million, or 92.6%, to $12.4 million for the quarter ended March 31, 2021 from $6.5 million for the quarter ended March 31, 2020, principally due to an increase of $3.8 million in the net gain on loan origination and sale activities and an increase of $2.0 million in net mortgage servicing fees. Sold mortgage loans totaled $503.3 million in the first quarter of 2021, compared to sold mortgage loans of $217.9 million during the first quarter of 2020. The first quarter of 2021 ended with a mortgage pipeline of $239.5 million, compared to a pipeline of $395.6 million at the end of the first quarter of 2020. Mortgage servicing fees increased $2.0 million in the quarter ended March 31, 2021, principally due to an impairment of mortgage servicing rights of $1.6 in the quarter ended March 31, 2020.
Non-interest expenses decreased $976,000, or 7.6%, to $12.0 million in the quarter ended March 31, 2021 from $12.9 million in the quarter ended December 30, 2020. The decrease was due to a decrease in occupancy and equipment costs of $406,000, or 35.3%, and a provision for unfunded commitments of $584,000 taken in the fourth quarter of 2020. Occupancy and equipment expenses decreased $406,000 in the quarter ended March 31, 2021 from the prior quarter due to the closing of residential lending offices in the fourth quarter of 2020, which resulted in a one-time charge of $294,000. Other non-interest expenses comprising professional fees, marketing, FDIC insurance and other non-interest expenses decreased by $285,000, or 9.3% in the quarter ended March 31, 2021 versus the prior quarter, as the fourth quarter of 2020 included a $584,000 provision for unfunded loan commitments.
Non-interest expenses increased $992,000 to $12.0 million in the quarter ended March 31, 2021 from $11.0 million in the quarter ended March 31, 2020. The increase is principally due to an increase in salaries and employee benefits of $311,000, primarily attributed to higher commissions and incentives associated with increased residential loan production, partially offset by a $1.4 million charge related to the retirement of senior executives in the first quarter of 2020. In addition, other non-interest expenses increased $463,000 from the prior year quarter due to elevated loan production costs. Occupancy and equipment expenses increased $46,000 in the quarter ended March 31, 2021 over the prior year period due to seasonal increases in snowplowing expenses. Other non-interest expenses comprising professional fees, marketing, FDIC insurance and other non-interest expenses increased by $635,000, or 29.7% in the quarter ended March 31, 2021 versus the prior year period, due to elevated mortgage loan production costs.
Balance Sheet
At March 31, 2021, total assets amounted to $738.2 million, compared to $721.1 million at December 31, 2020, an increase of $17.1 million, or 2.4%. A $41.2 million increase in cash and cash equivalents from the prior quarter was partially offset by a $25.9 million decrease in loans held for sale. Net loan growth of $8.4 million, or 1.7%, was driven by SBA PPP loan originations of $10.2 million. SBA PPP loans totaled $14.7 million at the end of the first quarter of 2021. Non-brokered deposits increased by $31.5 million, or 6.3%, to $528.0 million from $496.6 million in the prior quarter.
Total assets at March 31, 2021 increased $85.3 million, or 13.1% from $652.9 million at March 31, 2020. Contributing to asset growth was a $34.4 million increase in loans held for sale to $93.2 million at March 31, 2021 from $58.8 million at March 31, 2020. Cash and cash equivalents increased by $33.7 million, or 159.0%, to $55.0 million at March 31, 2021 from $21.2 million at March 31, 2020, mainly as a result of strong core growth in deposits and higher loan sales at quarter end. Net loans increased by $15.8 million, or 3.3%, to $492.0 million at March 31, 2021 from $476.2 million at March 31, 2020, mainly as a result commercial real estate growth of $20.3 million, or 16.1%, as we focus on diversifying our loan mix and reducing our exposure to long-term fixed rate 1-4 family residential loans. Another factor for net loan growth was an increase in commercial and industrial loans of $14.8 million, or 164.3%, driven by SBA PPP lending.
The increase in total assets at March 31, 2021 from the prior quarter was funded by deposit growth. Non-brokered deposits totaled $528.0 million at March 31, 2021, increasing by $31.5 million, or 6.3%, during the quarter from $496.6 million at December 31, 2020. Driving the growth in non-brokered deposits were customers’ receipt of government stimulus and our focus on deposit gathering. Federal Home Loan Bank of Boston (“FHLBB”) and Federal Reserve Bank advances decreased by $13.3 million to $60.0 million at March 31, 2021, from $73.3 million at December 31, 2020, primarily as a result of the full repayment of Federal Reserve Bank advances.
The increase in total assets from the prior year quarter was also funded by continued deposit growth. Non-brokered deposits totaled $528.0 million at March 31, 2021, increasing by $109.0 million, or 26.0%, during the quarter ended March 31, 2021 from $419.1 million at March 31, 2020. Driving the growth in non-brokered deposits was customers’ receipt of government stimulus and our focus on deposit gathering. Brokered deposits decreased by $53.7 million to $32.2 million at March 31, 2021, from $86.0 million at March 31, 2020. FHLBB advances increased by $8.0 million to $60.0 million at March 31, 2021, from $52.0 million at March 31, 2020.
Total stockholders’ equity was $100.9 million at March 31, 2021 compared to $99.8 million at December 31, 2020. The increase of $1.0 million reflects net income during the first quarter of $4.1 million, partially offset by share repurchases of $2.7 million and a decrease in the fair value of available-for-sale equity securities, net of taxes, of $794,000.
Total stockholders’ equity was $100.9 million at March 31, 2021 compared to $79.0 million at March 31, 2020. The increase of $21.9 million relates mainly to net income from the previous twelve months of $24.9 million, partially offset by share repurchases of $3.2 million and a decrease in the fair value of available-for-sale securities, net of taxes, of $927,000. In addition, equity adjustments related to equity-based compensation amounted to an increase of $1.1 million.
COVID-19 Impact
In response to the impact of the COVID-19 pandemic on our customers and our business, the Company implemented a series of measures through the date of this release, including participation in the PPP, for which we funded $25.6 million of SBA PPP Loans through March 31, 2021, and granting payment deferrals for residential mortgage, home equity and certain commercial borrowers who were current in their payments at the time the deferral was requested. Depending on the circumstances of the borrowers, the forbearance calls for a reduced or full deferral of payment. Please refer to the Loan Payment Deferrals and COVID-19 Most Impacted Sections for statistics on loan payment deferrals and the commercial loan sectors we believe could be exposed to the economic impact of the COVID-19 pandemic.
About Randolph Bancorp, Inc.
Randolph Bancorp, Inc. is the holding company for Envision Bank and its Envision Mortgage Division. Envision Bank is a full-service community bank with five retail branch locations, loan operations centers in North Attleboro and Stoughton, Massachusetts, three loan production offices located in Massachusetts and one loan production office in Southern New Hampshire.
Forward Looking Statements
Certain statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the negative impacts and disruptions of the COVID-19 pandemic and the measures taken to contain its spread on our employees, customers, business operations, credit quality, financial position, liquidity and results of operations; changes in the general business and economic conditions on a national basis and in the local markets in which the Company operates, including changes that adversely affect borrowers’ ability to service and repay the Company’s loans; changes in consumer behavior due to changing political, business and economic conditions or legislative or regulatory initiatives; reputational risk relating to the Company’s participation in the Paycheck Protection Program and other pandemic-related legislative and regulatory initiatives and programs; turbulence in the capital and debt markets and the impact of such conditions on the Company’s business activities; and the risk factors described in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission. The Company 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.
Non-GAAP Financial Measures
The Company uses certain non-GAAP financial measures, such as return on average assets, return on average equity, the efficiency ratio, profit percentage, tangible book value per share and, where applicable, as adjusted for non-recurring items. These non-GAAP financial measures provide information for investors to effectively analyze financial trends of on-going business activities, and to enhance comparability with peers across the financial services sector.
Randolph Bancorp, Inc.
Consolidated Balance Sheet
(Dollars in thousands)
(Unaudited)
| % Change | ||||||||||||||||||||
| March 31, | December 31, | March 31, | Mar 2021 vs. | Mar 2021 vs. | ||||||||||||||||
| 2021 | 2020 | 2020 | Dec 2020 | Mar 2020 | ||||||||||||||||
| Assets | ||||||||||||||||||||
| Cash and cash equivalents | $ | 54,950 | $ | 13,774 | $ | 21,245 | 298.9 | % | 158.6 | % | ||||||||||
| Certificates of deposit | – | – | 490 | – % | (100.0 | )% | ||||||||||||||
| Securities available for sale, at fair value | 54,148 | 55,366 | 55,465 | (2.2 | )% | (2.4 | )% | |||||||||||||
| Loans held for sale, at fair value | 93,176 | 119,112 | 58,781 | (21.8 | )% | 58.5 | % | |||||||||||||
| Loans: | ||||||||||||||||||||
| 1-4 family residential | 239,190 | 235,648 | 250,006 | 1.5 | % | (4.3 | )% | |||||||||||||
| Home equity | 49,073 | 48,166 | 43,503 | 1.9 | % | 12.8 | % | |||||||||||||
| Commercial real estate | 146,930 | 143,893 | 126,608 | 2.1 | % | 16.1 | % | |||||||||||||
| Construction | 29,975 | 31,050 | 35,327 | (3.5 | )% | (15.1 | )% | |||||||||||||
| Total real estate loans | 465,168 | 458,757 | 455,444 | 1.4 | % | 2.1 | % | |||||||||||||
| Commercial and industrial | 23,869 | 20,259 | 9,030 | 17.8 | % | 164.3 | % | |||||||||||||
| Consumer | 8,724 | 10,289 | 15,344 | (15.2 | )% | (43.1 | )% | |||||||||||||
| Total loans | 497,761 | 489,305 | 479,818 | 1.7 | % | 3.7 | % | |||||||||||||
| Allowance for loan losses | (6,563 | ) | (6,784 | ) | (4,996 | ) | (3.3 | )% | 31.4 | % | ||||||||||
| Net deferred loan costs and fees, and purchase premiums | 785 | 1,123 | 1,404 | (30.1 | )% | (44.1 | )% | |||||||||||||
| Loans, net | 491,983 | 483,644 | 476,226 | 1.7 | % | 3.3 | % | |||||||||||||
| Federal Home Loan Bank of Boston stock, at cost | 3,576 | 3,576 | 2,873 | 0.0 | % | 24.5 | % | |||||||||||||
| Accrued interest receivable | 1,501 | 1,562 | 1,397 | (3.9 | )% | 7.4 | % | |||||||||||||
| Mortgage servicing rights, net | 14,744 | 12,377 | 7,488 | 19.1 | % | 96.9 | % | |||||||||||||
| Premises and equipment, net | 4,709 | 4,781 | 5,667 | (1.5 | )% | (16.9 | )% | |||||||||||||
| Bank-owned life insurance | 8,662 | 8,622 | 8,486 | 0.5 | % | 2.1 | % | |||||||||||||
| Foreclosed real estate, net | 132 | 132 | 132 | 0.0 | % | 0.0 | % | |||||||||||||
| Other assets | 10,607 | 18,126 | 14,636 | (41.5 | )% | (27.5 | )% | |||||||||||||
| Total assets | $ | 738,188 | $ | 721,072 | $ | 652,886 | 2.4 | % | 13.1 | % | ||||||||||
| Liabilities and Stockholders’ Equity | ||||||||||||||||||||
| Deposits: | ||||||||||||||||||||
| Non-interest bearing | $ | 118,623 | $ | 96,731 | $ | 65,017 | 22.6 | % | 82.4 | % | ||||||||||
| Savings accounts | 192,712 | 185,481 | 144,980 | 3.9 | % | 32.9 | % | |||||||||||||
| NOW accounts | 62,772 | 53,530 | 39,598 | 17.3 | % | 58.5 | % | |||||||||||||
| Money market accounts | 78,236 | 77,393 | 67,220 | 1.1 | % | 16.4 | % | |||||||||||||
| Term certificates | 75,690 | 83,444 | 102,253 | (9.3 | )% | (26.0 | )% | |||||||||||||
| Brokered | 32,225 | 31,728 | 85,951 | 1.6 | % | (62.5 | )% | |||||||||||||
| Total deposits | 560,258 | 528,307 | 505,019 | 6.0 | % | 10.9 | % | |||||||||||||
| Federal Reserve Bank advances | – | 11,431 | – | (100.0 | )% | – % | ||||||||||||||
| Federal Home Loan Bank of Boston advances | 60,024 | 61,895 | 52,013 | (3.0 | )% | 15.4 | % | |||||||||||||
| Mortgagors’ escrow accounts | 1,924 | 2,338 | 2,074 | (17.7 | )% | (7.2 | )% | |||||||||||||
| Post-employment benefit obligations | 2,235 | 2,382 | 2,329 | (6.2 | )% | (4.0 | )% | |||||||||||||
| Other liabilities | 12,888 | 14,900 | 12,495 | (13.5 | )% | 3.1 | % | |||||||||||||
| Total liabilities | 637,329 | 621,253 | 573,930 | 2.6 | % | 11.0 | % | |||||||||||||
| Stockholders’ Equity: | ||||||||||||||||||||
| Common stock | 53 | 54 | 55 | (1.9 | )% | (3.6 | )% | |||||||||||||
| Additional paid-in capital | 48,613 | 50,937 | 50,832 | (4.6 | )% | (4.4 | )% | |||||||||||||
| Retained earnings | 55,801 | 51,689 | 30,939 | 8.0 | % | 80.4 | % | |||||||||||||
| ESOP-Unearned compensation | (3,709 | ) | (3,756 | ) | (3,897 | ) | (1.3 | )% | (4.8 | )% | ||||||||||
| Accumulated other comprehensive income, net of tax | 101 | 895 | 1,027 | (88.7 | )% | (90.2 | )% | |||||||||||||
| Total stockholders’ equity | 100,859 | 99,819 | 78,956 | 1.0 | % | 27.7 | % | |||||||||||||
| Total liabilities and stockholders’ equity | $ | 738,188 | $ | 721,072 | $ | 652,886 | 2.4 | % | 13.1 | % | ||||||||||
Randolph Bancorp, Inc.
Consolidated Balance Sheet Trend
(Dollars in thousands)
(Unaudited)
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||
| 2021 | 2020 | 2020 | 2020 | 2020 | ||||||||||||||||
| Assets | ||||||||||||||||||||
| Cash and cash equivalents | $ | 54,950 | $ | 13,774 | $ | 49,091 | $ | 76,003 | $ | 21,245 | ||||||||||
| Certificates of deposit | – | – | – | 490 | 490 | |||||||||||||||
| Securities available for sale, at fair value | 54,148 | 55,366 | 55,551 | 54,462 | 55,465 | |||||||||||||||
| Loans held for sale, at fair value | 93,176 | 119,112 | 87,805 | 61,673 | 58,781 | |||||||||||||||
| Loans: | ||||||||||||||||||||
| 1-4 family residential | 239,190 | 235,648 | 235,955 | 246,236 | 250,006 | |||||||||||||||
| Home equity | 49,073 | 48,166 | 48,097 | 43,493 | 43,503 | |||||||||||||||
| Commercial real estate | 146,930 | 143,893 | 141,862 | 134,750 | 126,608 | |||||||||||||||
| Construction | 29,975 | 31,050 | 32,064 | 35,181 | 35,327 | |||||||||||||||
| Total real estate loans | 465,168 | 458,757 | 457,978 | 459,660 | 455,444 | |||||||||||||||
| Commercial and industrial | 23,869 | 20,259 | 20,388 | 22,940 | 9,030 | |||||||||||||||
| Consumer | 8,724 | 10,289 | 11,696 | 13,435 | 15,344 | |||||||||||||||
| Total loans | 497,761 | 489,305 | 490,062 | 496,035 | 479,818 | |||||||||||||||
| Allowance for loan losses | (6,563 | ) | (6,784 | ) | (6,597 | ) | (6,059 | ) | (4,996 | ) | ||||||||||
| Net deferred loan costs and fees, and purchase premiums | 785 | 1,123 | 1,083 | 962 | 1,404 | |||||||||||||||
| Loans, net | 491,983 | 483,644 | 484,548 | 490,938 | 476,226 | |||||||||||||||
| Federal Home Loan Bank of Boston stock, at cost | 3,576 | 3,576 | 3,797 | 4,072 | 2,873 | |||||||||||||||
| Accrued interest receivable | 1,501 | 1,562 | 1,654 | 1,760 | 1,397 | |||||||||||||||
| Mortgage servicing rights, net | 14,744 | 12,377 | 10,944 | 8,094 | 7,488 | |||||||||||||||
| Premises and equipment, net | 4,709 | 4,781 | 5,133 | 5,313 | 5,667 | |||||||||||||||
| Bank-owned life insurance | 8,662 | 8,622 | 8,577 | 8,532 | 8,486 | |||||||||||||||
| Foreclosed real estate, net | 132 | 132 | 132 | 132 | 132 | |||||||||||||||
| Other assets | 10,607 | 18,126 | 15,736 | 12,572 | 14,636 | |||||||||||||||
| Total assets | $ | 738,188 | $ | 721,072 | $ | 722,968 | $ | 724,041 | $ | 652,886 | ||||||||||
| Liabilities and Stockholders’ Equity | ||||||||||||||||||||
| Deposits: | ||||||||||||||||||||
| Non-interest bearing | $ | 118,623 | $ | 96,731 | $ | 93,352 | $ | 89,014 | $ | 65,017 | ||||||||||
| Savings accounts | 192,712 | 185,481 | 175,316 | 165,234 | 144,980 | |||||||||||||||
| NOW accounts | 62,772 | 53,530 | 47,032 | 48,014 | 39,598 | |||||||||||||||
| Money market accounts | 78,236 | 77,393 | 74,874 | 75,827 | 67,220 | |||||||||||||||
| Term certificates | 75,690 | 83,444 | 94,438 | 104,905 | 102,253 | |||||||||||||||
| Brokered | 32,225 | 31,728 | 37,273 | 55,972 | 85,951 | |||||||||||||||
| Total deposits | 560,258 | 528,307 | 522,285 | 538,966 | 505,019 | |||||||||||||||
| Federal Reserve Bank advances | – | 11,431 | 15,318 | 15,010 | – | |||||||||||||||
| Federal Home Loan Bank of Boston advances | 60,024 | 61,895 | 66,903 | 71,944 | 52,013 | |||||||||||||||
| Mortgagors’ escrow accounts | 1,924 | 2,338 | 1,959 | 1,824 | 2,074 | |||||||||||||||
| Post-employment benefit obligations | 2,235 | 2,382 | 2,289 | 2,319 | 2,329 | |||||||||||||||
| Other liabilities | 12,888 | 14,900 | 19,276 | 9,449 | 12,495 | |||||||||||||||
| Total liabilities | 637,329 | 621,253 | 628,030 | 639,512 | 573,930 | |||||||||||||||
| Stockholders’ Equity: | ||||||||||||||||||||
| Common stock | 53 | 54 | 55 | 55 | 55 | |||||||||||||||
| Additional paid-in capital | 48,613 | 50,937 | 51,201 | 51,013 | 50,832 | |||||||||||||||
| Retained earnings | 55,801 | 51,689 | 46,415 | 36,130 | 30,939 | |||||||||||||||
| ESOP-Unearned compensation | (3,709 | ) | (3,756 | ) | (3,803 | ) | (3,850 | ) | (3,897 | ) | ||||||||||
| Accumulated other comprehensive income, net of tax | 101 | 895 | 1,070 | 1,181 | 1,027 | |||||||||||||||
| Total stockholders’ equity | 100,859 | 99,819 | 94,938 | 84,529 | 78,956 | |||||||||||||||
| Total liabilities and stockholders’ equity | $ | 738,188 | $ | 721,072 | $ | 722,968 | $ | 724,041 | $ | 652,886 | ||||||||||
Randolph Bancorp, Inc.
Consolidated Statements of Operations
(Dollars in thousands except per share amounts)
(Unaudited)
| Three Months Ended | % Change | |||||||||||||||||||
| March 31, | December 31, | March 31, | Mar 2021 vs. | Mar 2021 vs. | ||||||||||||||||
| 2021 | 2020 | 2020 | Dec 2020 | Mar 2020 | ||||||||||||||||
| Interest and dividend income: | ||||||||||||||||||||
| Loans | $ | 5,508 | $ | 5,532 | $ | 5,620 | (0.4 | )% | (2.0 | )% | ||||||||||
| Other interest and dividend income | 253 | 296 | 433 | (14.5 | )% | (41.6 | )% | |||||||||||||
| Total interest and dividend income | 5,761 | 5,828 | 6,053 | (1.1 | )% | (4.8 | )% | |||||||||||||
| Interest expense | 670 | 788 | 1,628 | (15.0 | )% | (58.8 | )% | |||||||||||||
| Net interest income | 5,091 | 5,040 | 4,425 | 1.0 | % | 15.1 | % | |||||||||||||
| Provision (credit) for loan losses | (213 | ) | 215 | 724 | (199.1 | )% | (129.4 | )% | ||||||||||||
| Net interest income after provision (credit) for loan losses | 5,304 | 4,825 | 3,701 | 9.9 | % | 43.3 | % | |||||||||||||
| Non-interest income: | ||||||||||||||||||||
| Customer service fees | 367 | 381 | 306 | (3.7 | )% | 19.9 | % | |||||||||||||
| Gain on loan origination and sale activities, net | 10,993 | 14,620 | 7,144 | (24.8 | )% | 53.9 | % | |||||||||||||
| Mortgage servicing fees, net | 779 | 275 | (1,254 | ) | 183.3 | % | (162.1 | )% | ||||||||||||
| Other | 284 | 311 | 255 | (8.7 | )% | 11.4 | % | |||||||||||||
| Total non-interest income | 12,423 | 15,587 | 6,451 | (20.3 | )% | 92.6 | % | |||||||||||||
| Non-interest expenses: | ||||||||||||||||||||
| Salaries and employee benefits | 8,437 | 8,722 | 8,126 | (3.3 | )% | 3.8 | % | |||||||||||||
| Occupancy and equipment | 744 | 1,150 | 698 | (35.3 | )% | 6.6 | % | |||||||||||||
| Professional fees | 561 | 389 | 405 | 44.2 | % | 38.5 | % | |||||||||||||
| Marketing | 170 | 231 | 152 | (26.4 | )% | 11.8 | % | |||||||||||||
| FDIC insurance | 54 | 51 | 56 | 5.9 | % | (3.6 | )% | |||||||||||||
| Other non-interest expenses | 1,985 | 2,384 | 1,522 | (16.7 | )% | 30.4 | % | |||||||||||||
| Total non-interest expenses | 11,951 | 12,927 | 10,959 | (7.6 | )% | 9.1 | % | |||||||||||||
| Income (loss) before income taxes | 5,776 | 7,485 | (807 | ) | (22.8 | )% | (815.7 | )% | ||||||||||||
| Income tax expense | 1,664 | 2,211 | 11 | (24.7 | )% | 15027.3 | % | |||||||||||||
| Net income (loss) | $ | 4,112 | $ | 5,274 | $ | (818 | ) | (22.0 | )% | (602.7 | )% | |||||||||
| Net income (loss) per share: | ||||||||||||||||||||
| Basic | $ | 0.81 | $ | 1.03 | $ | (0.16 | ) | |||||||||||||
| Diluted | $ | 0.78 | $ | 1.01 | $ | (0.16 | ) | |||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||
| Basic | 5,056,165 | 5,135,069 | 5,158,294 | |||||||||||||||||
| Diluted | 5,254,907 | 5,244,414 | 5,158,294 | |||||||||||||||||
Randolph Bancorp, Inc.
Consolidated Statements of Operations Trend
(Dollars in thousands except per share amounts)
(Unaudited)
| Three Months Ended | ||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||
| 2021 | 2020 | 2020 | 2020 | 2020 | ||||||||||||||||
| Interest and dividend income: | ||||||||||||||||||||
| Loans | $ | 5,508 | $ | 5,532 | $ | 5,337 | $ | 5,723 | $ | 5,620 | ||||||||||
| Other interest and dividend income | 253 | 296 | 311 | 336 | 433 | |||||||||||||||
| Total interest and dividend income | 5,761 | 5,828 | 5,648 | 6,059 | 6,053 | |||||||||||||||
| Interest expense | 670 | 788 | 979 | 1,326 | 1,628 | |||||||||||||||
| Net interest income | 5,091 | 5,040 | 4,669 | 4,733 | 4,425 | |||||||||||||||
| Provision (credit) for loan losses | (213 | ) | 215 | 546 | 1,068 | 724 | ||||||||||||||
| Net interest income after provision (credit) for loan losses | 5,304 | 4,825 | 4,123 | 3,665 | 3,701 | |||||||||||||||
| Non-interest income: | ||||||||||||||||||||
| Customer service fees | 367 | 381 | 330 | 266 | 306 | |||||||||||||||
| Gain on loan origination and sale activities, net | 10,993 | 14,620 | 18,102 | 14,370 | 7,144 | |||||||||||||||
| Mortgage servicing fees, net | 779 | 275 | 1,180 | (1,354 | ) | (1,254 | ) | |||||||||||||
| Other | 284 | 311 | 262 | 217 | 255 | |||||||||||||||
| Total non-interest income | 12,423 | 15,587 | 19,874 | 13,499 | 6,451 | |||||||||||||||
| Non-interest expenses: | ||||||||||||||||||||
| Salaries and employee benefits | 8,437 | 8,722 | 7,911 | 8,402 | 8,126 | |||||||||||||||
| Occupancy and equipment | 744 | 1,150 | 859 | 838 | 698 | |||||||||||||||
| Professional fees | 561 | 389 | 253 | 230 | 405 | |||||||||||||||
| Marketing | 170 | 231 | 154 | 152 | 152 | |||||||||||||||
| FDIC insurance | 54 | 51 | 41 | 39 | 56 | |||||||||||||||
| Other non-interest expenses | 1,985 | 2,384 | 1,833 | 1,718 | 1,522 | |||||||||||||||
| Total non-interest expenses | 11,951 | 12,927 | 11,051 | 11,379 | 10,959 | |||||||||||||||
| Income (loss) before income taxes | 5,776 | 7,485 | 12,946 | 5,785 | (807 | ) | ||||||||||||||
| Income tax expense | 1,664 | 2,211 | 2,661 | 594 | 11 | |||||||||||||||
| Net income (loss) | $ | 4,112 | $ | 5,274 | $ | 10,285 | $ | 5,191 | $ | (818 | ) | |||||||||
| Net income (loss) per share: | ||||||||||||||||||||
| Basic | $ | 0.81 | $ | 1.03 | $ | 2.01 | $ | 1.02 | $ | (0.16 | ) | |||||||||
| Diluted | $ | 0.78 | $ | 1.01 | $ | 2.01 | $ | 1.02 | $ | (0.16 | ) | |||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||
| Basic | 5,056,165 | 5,135,069 | 5,120,367 | 5,092,490 | 5,158,294 | |||||||||||||||
| Diluted | 5,254,907 | 5,244,414 | 5,120,367 | 5,092,490 | 5,158,294 | |||||||||||||||
Randolph Bancorp, Inc.
Average Balances/Yields
(Dollars in thousands)
(Unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| March 31, 2021 | December 31, 2020 | March 31, 2020 | |||||||||||||||||||||||||||||||||
| Average | Interest | Average | Average | Interest | Average | Average | Interest | Average | |||||||||||||||||||||||||||
| Outstanding | Earned/ | Yield/ | Outstanding | Earned/ | Yield/ | Outstanding | Earned/ | Yield/ | |||||||||||||||||||||||||||
| (Dollars in thousands) | Balance | Paid | Rate | Balance | Paid | Rate | Balance | Paid | Rate | ||||||||||||||||||||||||||
| Interest-earning assets: | |||||||||||||||||||||||||||||||||||
| Loans (1) | $ | 594,021 | $ | 5,508 | 3.71 | % | $ | 580,002 | $ | 5,532 | 3.82 | % | $ | 531,141 | $ | 5,620 | 4.23 | % | |||||||||||||||||
| Investment securities(2) (3) | 57,818 | 247 | 1.71 | % | 58,329 | 290 | 1.99 | % | 58,799 | 379 | 2.58 | % | |||||||||||||||||||||||
| Interest-earning deposits | 35,492 | 7 | 0.08 | % | 30,573 | 8 | 0.10 | % | 18,458 | 56 | 1.21 | % | |||||||||||||||||||||||
| Total interest-earning assets | 687,331 | 5,762 | 3.35 | % | 668,904 | 5,830 | 3.49 | % | 608,398 | 6,055 | 3.98 | % | |||||||||||||||||||||||
| Noninterest-earning assets | 42,045 | 45,015 | 31,774 | ||||||||||||||||||||||||||||||||
| Total assets | $ | 729,376 | $ | 713,919 | $ | 640,172 | |||||||||||||||||||||||||||||
| Interest-bearing liabilities: | |||||||||||||||||||||||||||||||||||
| Savings accounts | 190,313 | 98 | 0.21 | % | 181,653 | 142 | 0.31 | % | 134,843 | 284 | 0.84 | % | |||||||||||||||||||||||
| NOW accounts | 69,511 | 48 | 0.28 | % | 59,005 | 43 | 0.29 | % | 39,049 | 51 | 0.52 | % | |||||||||||||||||||||||
| Money market accounts | 75,994 | 54 | 0.28 | % | 75,106 | 62 | 0.33 | % | 78,394 | 197 | 1.01 | % | |||||||||||||||||||||||
| Term certificates | 96,978 | 238 | 0.98 | % | 112,260 | 293 | 1.04 | % | 188,654 | 893 | 1.89 | % | |||||||||||||||||||||||
| Total interest-bearing deposits | 432,796 | 438 | 0.40 | % | 428,024 | 540 | 0.50 | % | 440,940 | 1,425 | 1.29 | % | |||||||||||||||||||||||
| FHLBB and FRB advances | 70,857 | 232 | 1.31 | % | 77,584 | 247 | 1.27 | % | 47,102 | 203 | 1.72 | % | |||||||||||||||||||||||
| Total interest-bearing liabilities | 503,653 | 670 | 0.53 | % | 505,608 | 787 | 0.62 | % | 488,042 | 1,628 | 1.33 | % | |||||||||||||||||||||||
| Noninterest-bearing liabilities: | |||||||||||||||||||||||||||||||||||
| Noninterest-bearing deposits | 106,929 | 94,540 | 62,718 | ||||||||||||||||||||||||||||||||
| Other noninterest-bearing liabilities | 15,375 | 13,539 | 9,549 | ||||||||||||||||||||||||||||||||
| Total liabilities | 625,957 | 613,687 | 560,309 | ||||||||||||||||||||||||||||||||
| Total stockholders’ equity | 103,419 | 100,232 | 79,863 | ||||||||||||||||||||||||||||||||
| Total liabilities and stockholders’ equity | $ | 729,376 | $ | 713,919 | $ | 640,172 | |||||||||||||||||||||||||||||
| Net interest income | $ | 5,092 | $ | 5,043 | $ | 4,427 | |||||||||||||||||||||||||||||
| Interest rate spread(4) | 2.82 | % | 2.87 | % | 2.65 | % | |||||||||||||||||||||||||||||
| Net interest-earning assets(5) | $ | 183,678 | $ | 163,296 | $ | 120,356 | |||||||||||||||||||||||||||||
| Net interest margin(6) | 2.96 | % | 3.02 | % | 2.91 | % | |||||||||||||||||||||||||||||
| Ratio of interest-earning assets to interest-bearing liabilities | 136.47 | % | 132.30 | % | 124.66 | % | |||||||||||||||||||||||||||||
(1) Includes nonaccruing loan balances and interest received on such loans.
(2) Includes carrying value of securities classified as available-for-sale and FHLBB stock.
(3) Includes tax equivalent adjustments for municipal securities, based on a statutory tax rate of 21%, of $1,000, $1,000 and $2,000 for the three months ended March 31, 2021, December 31, 2020 and March 31, 2020, respectively.
(4) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(6) Net interest margin represents net interest income divided by average total interest-earning assets.
Randolph Bancorp, Inc.
Average Balances Trend
(Dollars in thousands)
(Unaudited)
| Three Months Ended | ||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||
| 2021 | 2020 | 2020 | 2020 | 2020 | ||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||
| Total loans | $ | 594,021 | $ | 580,002 | $ | 559,370 | $ | 576,964 | $ | 531,141 | ||||||||||
| Investment securities | 57,818 | 58,329 | 57,211 | 58,119 | 58,799 | |||||||||||||||
| Interest-earning deposits | 35,492 | 30,573 | 48,949 | 22,918 | 18,458 | |||||||||||||||
| Total interest-earning assets | 687,331 | 668,904 | 665,530 | 658,001 | 608,398 | |||||||||||||||
| Non-interest earning assets | 42,045 | 45,015 | 41,037 | 40,156 | 31,774 | |||||||||||||||
| Total assets | $ | 729,376 | $ | 713,919 | $ | 706,567 | $ | 698,157 | $ | 640,172 | ||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||
| Savings accounts | $ | 190,313 | $ | 181,653 | $ | 170,762 | $ | 158,427 | $ | 134,843 | ||||||||||
| NOW accounts | 69,511 | 59,005 | 57,646 | 46,593 | 39,049 | |||||||||||||||
| Money market accounts | 75,994 | 75,106 | 72,369 | 71,396 | 78,394 | |||||||||||||||
| Term certificates | 96,978 | 112,260 | 131,053 | 159,224 | 188,654 | |||||||||||||||
| Total interest-bearing deposits | 432,796 | 428,024 | 431,830 | 435,640 | 440,940 | |||||||||||||||
| FHLBB and FRB advances | 70,857 | 77,584 | 82,639 | 79,133 | 47,102 | |||||||||||||||
| Total interest-bearing liabilities | 503,653 | 505,608 | 514,469 | 514,773 | 488,042 | |||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||
| Noninterest-bearing deposits | 106,929 | 94,540 | 88,394 | 77,947 | 62,718 | |||||||||||||||
| Other noninterest-bearing liabilities | 15,375 | 13,539 | 12,724 | 22,893 | 9,549 | |||||||||||||||
| Total liabilities | 625,957 | 613,687 | 615,587 | 615,613 | 560,309 | |||||||||||||||
| Total stockholders’ equity | 103,419 | 100,232 | 90,980 | 82,544 | 79,863 | |||||||||||||||
| Total liabilities and stockholders’ equity | $ | 729,376 | $ | 713,919 | $ | 706,567 | $ | 698,157 | $ | 640,172 | ||||||||||
Randolph Bancorp, Inc.
Average Balances Trend
(Dollars in thousands)
(Unaudited)
| Three Months Ended | ||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||
| 2021 | 2020 | 2020 | 2020 | 2020 | ||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||
| Total loans | 3.71 | % | 3.82 | % | 3.82 | % | 3.97 | % | 4.23 | % | ||||||||||
| Investment securities | 1.71 | % | 1.99 | % | 2.13 | % | 2.28 | % | 2.58 | % | ||||||||||
| Interest-earning deposits | 0.08 | % | 0.10 | % | 0.06 | % | 0.09 | % | 1.21 | % | ||||||||||
| Total interest-earning assets | 3.35 | % | 3.49 | % | 3.40 | % | 3.68 | % | 3.98 | % | ||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||
| Savings accounts | 0.21 | % | 0.31 | % | 0.40 | % | 0.59 | % | 0.84 | % | ||||||||||
| NOW accounts | 0.28 | % | 0.29 | % | 0.28 | % | 0.43 | % | 0.52 | % | ||||||||||
| Money market accounts | 0.28 | % | 0.33 | % | 0.41 | % | 0.68 | % | 1.01 | % | ||||||||||
| Term certificates | 0.98 | % | 1.04 | % | 1.35 | % | 1.70 | % | 1.89 | % | ||||||||||
| Total interest-bearing deposits | 0.40 | % | 0.50 | % | 0.68 | % | 0.99 | % | 1.29 | % | ||||||||||
| FHLBB and FRB advances | 1.31 | % | 1.27 | % | 1.21 | % | 1.23 | % | 1.72 | % | ||||||||||
| Total interest-bearing liabilities | 0.53 | % | 0.62 | % | 0.76 | % | 1.03 | % | 1.33 | % | ||||||||||
| Interest rate spread | 2.82 | % | 2.87 | % | 2.64 | % | 2.65 | % | 2.65 | % | ||||||||||
| Net interest rate margin | 2.96 | % | 3.02 | % | 2.81 | % | 2.88 | % | 2.91 | % | ||||||||||
| Ratio of interest-earning assets to interest-bearing liabilities | 136.47 | % | 132.30 | % | 129.36 | % | 127.82 | % | 124.66 | % | ||||||||||
Randolph Bancorp, Inc.
Rate/Volume Analysis
(Dollars in thousands)
(Unaudited)
| Three Months Ended | ||||||||||||
| March 31, 2021 vs. December 31, 2020 | ||||||||||||
| Increase (Decrease) | Total | |||||||||||
| Due to Changes in | Increase | |||||||||||
| Volume | Rate | (Decrease) | ||||||||||
| Interest-earning assets: | ||||||||||||
| Loans | $ | 135 | $ | (159 | ) | $ | (24 | ) | ||||
| Investment securities | (3 | ) | (40 | ) | (43 | ) | ||||||
| Interest-earning deposits | 1 | (1 | ) | – | ||||||||
| Total interest-earning assets | 133 | (200 | ) | (67 | ) | |||||||
| Interest-bearing liabilities: | ||||||||||||
| Savings accounts | 6 | (50 | ) | (44 | ) | |||||||
| NOW accounts | 7 | (2 | ) | 5 | ||||||||
| Money market accounts | 1 | (9 | ) | (8 | ) | |||||||
| Term certificates | (39 | ) | (16 | ) | (55 | ) | ||||||
| Total interest-bearing deposits | (25 | ) | (77 | ) | (102 | ) | ||||||
| FHLBB and FRB advances | (22 | ) | 6 | (16 | ) | |||||||
| Total interest-bearing liabilities | (47 | ) | (71 | ) | (118 | ) | ||||||
| Change in net interest income | $ | 180 | $ | (129 | ) | $ | 51 | |||||
| Three Months Ended | ||||||||||||
| March 31, 2021 vs. 2020 | ||||||||||||
| Increase (Decrease) | Total | |||||||||||
| Due to Changes in | Increase | |||||||||||
| Volume | Rate | (Decrease) | ||||||||||
| Interest-earning assets: | ||||||||||||
| Loans | $ | 623 | $ | (735 | ) | $ | (112 | ) | ||||
| Investment securities | (6 | ) | (126 | ) | (132 | ) | ||||||
| Interest-earning deposits | 27 | (75 | ) | (48 | ) | |||||||
| Total interest-earning assets | 644 | (936 | ) | (292 | ) | |||||||
| Interest-bearing liabilities: | ||||||||||||
| Savings accounts | 85 | (271 | ) | (186 | ) | |||||||
| NOW accounts | 28 | (31 | ) | (3 | ) | |||||||
| Money market accounts | (6 | ) | (137 | ) | (143 | ) | ||||||
| Term certificates | (329 | ) | (326 | ) | (655 | ) | ||||||
| Total interest-bearing deposits | (222 | ) | (765 | ) | (987 | ) | ||||||
| FHLBB and FRB advances | 85 | (56 | ) | 29 | ||||||||
| Total interest-bearing liabilities | (137 | ) | (821 | ) | (958 | ) | ||||||
| Change in net interest income | $ | 781 | $ | (115 | ) | $ | 666 | |||||
Randolph Bancorp, Inc.
Segment Information
(Dollars in thousands)
(Unaudited)
| For the Three Months Ended March 31, 2021 | ||||||||||||
| Envision Bank | Envision Mortgage | Consolidated Total | ||||||||||
| Net interest income | $ | 4,201 | $ | 890 | $ | 5,091 | ||||||
| Provision (credit) for loan losses | (213 | ) | – | (213 | ) | |||||||
| Net interest income after provision for loan losses | 4,414 | 890 | 5,304 | |||||||||
| Non-interest income: | ||||||||||||
| Customer service fees | 340 | 27 | 367 | |||||||||
| Gain on loan origination and sale activities, net (1) | – | 11,674 | 11,674 | |||||||||
| Mortgage servicing fees, net | (94 | ) | 873 | 779 | ||||||||
| Other | 151 | 133 | 284 | |||||||||
| Total non-interest income | 397 | 12,707 | 13,104 | |||||||||
| Non-interest expenses: | ||||||||||||
| Salaries and employee benefits | 1,802 | 6,635 | 8,437 | |||||||||
| Occupancy and equipment | 443 | 301 | 744 | |||||||||
| Other non-interest expenses | 1,087 | 1,683 | 2,770 | |||||||||
| Total non-interest expenses | 3,332 | 8,619 | 11,951 | |||||||||
| Income before income taxes and elimination of inter-segment profit | $ | 1,479 | $ | 4,978 | 6,457 | |||||||
| Elimination of inter-segment profit | (681 | ) | ||||||||||
| Income before income taxes | 5,776 | |||||||||||
| Income tax expense | 1,664 | |||||||||||
| Net income | $ | 4,112 | ||||||||||
(1) Before elimination of inter-segment profit.
The information above was derived from the internal management reporting system used to measure performance of the segments.
Randolph Bancorp, Inc.
Segment Information
(Dollars in thousands)
(Unaudited)
| For the Three Months Ended December 31, 2020 | ||||||||||||
| Envision Bank | Envision Mortgage | Consolidated Total | ||||||||||
| Net interest income | $ | 4,265 | $ | 775 | $ | 5,040 | ||||||
| Provision for loan losses | 215 | – | 215 | |||||||||
| Net interest income after provision for loan losses | 4,050 | 775 | 4,825 | |||||||||
| Non-interest income: | ||||||||||||
| Customer service fees | 353 | 28 | 381 | |||||||||
| Gain on loan origination and sale activities, net (1) | – | 15,062 | 15,062 | |||||||||
| Mortgage servicing fees, net | (100 | ) | 375 | 275 | ||||||||
| Other | 147 | 164 | 311 | |||||||||
| Total non-interest income | 400 | 15,629 | 16,029 | |||||||||
| Non-interest expenses: | ||||||||||||
| Salaries and employee benefits | 2,178 | 6,544 | 8,722 | |||||||||
| Occupancy and equipment | 465 | 685 | 1,150 | |||||||||
| Other non-interest expenses | 1,942 | 1,113 | 3,055 | |||||||||
| Total non-interest expenses | 4,585 | 8,342 | 12,927 | |||||||||
| Income (loss) before income taxes and elimination of inter-segment profit | $ | (135 | ) | $ | 8,062 | 7,927 | ||||||
| Elimination of inter-segment profit | (442 | ) | ||||||||||
| Income before income taxes | 7,485 | |||||||||||
| Income tax expense | 2,211 | |||||||||||
| Net income | $ | 5,274 | ||||||||||
(1) Before elimination of inter-segment profit.
Randolph Bancorp, Inc.
Segment Information
(Dollars in thousands)
(Unaudited)
| For the Three Months Ended March 31, 2020 | ||||||||||||
| Envision Bank | Envision Mortgage | Consolidated Total | ||||||||||
| Net interest income | $ | 3,994 | $ | 431 | $ | 4,425 | ||||||
| Provision for loan losses | 724 | – | 724 | |||||||||
| Net interest income after credit for loan losses | 3,270 | 431 | 3,701 | |||||||||
| Non-interest income: | ||||||||||||
| Customer service fees | 273 | 33 | 306 | |||||||||
| Gain on loan origination and sale activities, net (1) | – | 7,472 | 7,472 | |||||||||
| Mortgage servicing fees, net | (87 | ) | (1,167 | ) | (1,254 | ) | ||||||
| Other | 140 | 115 | 255 | |||||||||
| Total non-interest income | 326 | 6,453 | 6,779 | |||||||||
| Non-interest expenses: | ||||||||||||
| Salaries and employee benefits | 3,098 | 5,028 | 8,126 | |||||||||
| Occupancy and equipment | 404 | 294 | 698 | |||||||||
| Other non-interest expenses | 1,145 | 990 | 2,135 | |||||||||
| Total non-interest expenses | 4,647 | 6,312 | 10,959 | |||||||||
| Income (loss) before income taxes and elimination of inter-segment profit | $ | (1,051 | ) | $ | 572 | (479 | ) | |||||
| Elimination of inter-segment profit | (328 | ) | ||||||||||
| Loss before income taxes | (807 | ) | ||||||||||
| Income tax expense | 11 | |||||||||||
| Net loss | $ | (818 | ) | |||||||||
(1) Before elimination of inter-segment profit.
The information above was derived from the internal management reporting system used to measure performance of the segments.
Randolph Bancorp, Inc.
Reconciliation of GAAP to Non-GAAP Net Income
(in thousands)
(Unaudited)
| Quarter Ended | ||||||||||||||||
| March 31, 2021 | ||||||||||||||||
| Income Before Taxes | Provision for Income Taxes | Net Income | Earnings per Common Share (diluted) | |||||||||||||
| GAAP basis | $ | 5,776 | $ | 1,664 | $ | 4,112 | $ | 0.78 | ||||||||
| Non-interest expense adjustments: | ||||||||||||||||
| Accrued severance expenses | 109 | 31 | 78 | 0.01 | ||||||||||||
| Non-GAAP basis | $ | 5,885 | $ | 1,695 | $ | 4,190 | $ | 0.79 | ||||||||
| Quarter Ended | ||||||||||||||||
| December 31, 2020 | ||||||||||||||||
| Income Before Taxes | Provision for Income Taxes | Net Income | Earnings per Common Share (diluted) | |||||||||||||
| GAAP basis | $ | 7,485 | $ | 2,211 | $ | 5,274 | $ | 1.01 | ||||||||
| Non-interest expense adjustments: | ||||||||||||||||
| Residential lending office closure | 294 | 63 | 231 | 0.04 | ||||||||||||
| COVID-19 related expenses | 69 | 15 | 54 | 0.01 | ||||||||||||
| Non-GAAP basis | $ | 7,848 | $ | 2,289 | $ | 5,559 | $ | 1.06 | ||||||||
| Quarter Ended | ||||||||||||||||
| September 30, 2020 | ||||||||||||||||
| Income Before Taxes | Provision for Income Taxes | Net Income | Earnings per Common Share (diluted) | |||||||||||||
| GAAP basis | $ | 12,946 | $ | 2,661 | $ | 10,285 | $ | 2.01 | ||||||||
| Non-interest expense adjustments: | ||||||||||||||||
| COVID-19 related expenses | 22 | 4 | 18 | – | ||||||||||||
| Non-GAAP basis | $ | 12,968 | $ | 2,665 | $ | 10,303 | $ | 2.01 | ||||||||
| Quarter Ended | ||||||||||||||||
| June 30, 2020 | ||||||||||||||||
| Income Before Taxes | Provision for Income Taxes | Net Income | Earnings per Common Share (diluted) | |||||||||||||
| GAAP basis | $ | 5,785 | $ | 594 | $ | 5,191 | $ | 1.02 | ||||||||
| Non-interest expense adjustments: | ||||||||||||||||
| COVID-19 related expenses | 189 | – | 189 | 0.04 | ||||||||||||
| Non-GAAP basis | $ | 5,974 | $ | 594 | $ | 5,380 | $ | 1.06 | ||||||||
| Quarter Ended | ||||||||||||||||
| March 31, 2020 | ||||||||||||||||
| Income (Loss) Before Taxes | Provision for Income Taxes | Net Income (Loss) | Earnings (Loss) per Common Share (diluted) | |||||||||||||
| GAAP basis | $ | (807 | ) | $ | 11 | $ | (818 | ) | $ | (0.16 | ) | |||||
| Non-interest expense adjustments: | ||||||||||||||||
| Retirement salary and benefits compensation | 692 | $ | – | 692 | 0.13 | |||||||||||
| Accelerated vesting of stock-based compensation | 683 | $ | – | 683 | 0.13 | |||||||||||
| COVID-19 related expenses | 18 | $ | – | 18 | – | |||||||||||
| Non-GAAP basis | $ | 586 | $ | 11 | $ | 575 | $ | 0.10 | ||||||||
Randolph Bancorp, Inc.
Selected Financial Highlights
(Unaudited)
| At or for the Three Months Ended | ||||||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | March 31, | ||||||||||||||||
| 2021 | 2020 | 2020 | 2020 | 2020 | ||||||||||||||||
| Return on average assets: (1, 5) | ||||||||||||||||||||
| GAAP | 2.26 | % | 2.95 | % | 5.82 | % | 2.97 | % | (0.51 | %) | ||||||||||
| Non-GAAP (2) | 2.30 | % | 3.11 | % | 5.83 | % | 3.08 | % | 0.36 | % | ||||||||||
| Return on average equity: (1, 6) | ||||||||||||||||||||
| GAAP | 15.90 | % | 21.05 | % | 45.22 | % | 25.16 | % | (4.10 | %) | ||||||||||
| Non-GAAP (2) | 16.21 | % | 22.18 | % | 45.30 | % | 26.07 | % | 2.88 | % | ||||||||||
| Net interest margin | 2.96 | % | 3.02 | % | 2.81 | % | 2.88 | % | 2.91 | % | ||||||||||
| Non-interest income to total income: | ||||||||||||||||||||
| GAAP | 70.93 | % | 75.57 | % | 80.98 | % | 74.04 | % | 59.31 | % | ||||||||||
| Profit percentage (9) | ||||||||||||||||||||
| GAAP | 31.76 | % | 37.33 | % | 54.97 | % | 37.59 | % | (0.76 | %) | ||||||||||
| Non-GAAP (2) | 32.39 | % | 39.09 | % | 55.06 | % | 38.62 | % | 12.04 | % | ||||||||||
| Efficiency ratio: (7) | ||||||||||||||||||||
| GAAP | 68.24 | % | 62.67 | % | 45.03 | % | 62.41 | % | 100.76 | % | ||||||||||
| Non-GAAP (2) | 67.61 | % | 60.91 | % | 44.94 | % | 61.38 | % | 87.96 | % | ||||||||||
| Tier 1 capital to average assets (3) | 13.81 | % | 13.85 | % | 13.28 | % | 11.93 | % | 12.17 | % | ||||||||||
| Non-performing assets as a percentage of total assets (4) | 1.14 | % | 1.01 | % | 1.38 | % | 0.47 | % | 0.52 | % | ||||||||||
| Allowance for loan losses as a percentage of total loans (4) | 1.32 | % | 1.39 | % | 1.35 | % | 1.22 | % | 1.04 | % | ||||||||||
| Allowance for loan losses as a percentage of total loans, excluding SBA PPP Loans (4) | 1.36 | % | 1.41 | % | 1.39 | % | 1.26 | % | 1.04 | % | ||||||||||
| Allowance for loan losses as a percentage of non-performing assets | 78.99 | % | 94.58 | % | 67.21 | % | 179.31 | % | 146.64 | % | ||||||||||
| Allowance for loan losses as a percentage of non-performing loans | 77.75 | % | 92.87 | % | 66.31 | % | 186.60 | % | 152.55 | % | ||||||||||
| Tangible book value per share (8) | $ | 18.80 | $ | 18.16 | $ | 17.18 | $ | 15.43 | $ | 14.44 | ||||||||||
| Outstanding shares | 5,364,240 | 5,495,514 | 5,524,390 | 5,479,884 | 5,466,344 | |||||||||||||||
(1) Annualized for quarterly periods presented.
(2) See page 16 – Reconciliation of GAAP to Non-GAAP Net Income.
(3) Average assets calculated on a quarterly basis for all periods presented.
(4) Total loans exclude loans held for sale but includes net deferred loan costs and fees.
(5) This non-GAAP measure represents net income divided by average total assets.
(6) This non-GAAP measure represents net income divided by average stockholders’ equity.
(7) This non-GAAP measure represents total non-interest expenses divided by net interest income and non-interest income.
(8) This non-GAAP measure represents total stockholders’ equity, minus intangible assets of $31,000, $33,000, $36,000, $38,000, and $41,000 at March 31, 2021, December 31, 2020, September 30, 2020, June 30, 2020, and March 31, 2020, respectively, divided by outstanding shares at period end.
(9) This non-GAAP measure represents net interest income plus noninterest income less non-interest expense divided by net interest income plus non-interest income.
Randolph Bancorp, Inc.
COVID-19 Supplemental Disclosure
(Unaudited)
Loan Payment Deferrals
| As of March 31, 2021 | ||||||||||||
| Commercial loans | Residential and consumer loans | Residential loans serviced for others | ||||||||||
| (Dollars in thousands) | ||||||||||||
| Balance outstanding | $ | 182,277 | $ | 315,485 | $ | 1,940,443 | ||||||
| COVID-19 related loan payment deferrals: (1) | ||||||||||||
| Loans in COVID-19-related loan payment deferral | $ | 6,241 | $ | 4,777 | $ | 11,544 | ||||||
| Loans in deferral as a percentage of category loans | 3.4 | % | 1.5 | % | 0.6 | % | ||||||
| Loans with suspended payment | $ | 6,241 | $ | 4,543 | $ | 4,657 | ||||||
| Loans with reduced payment | – | 234 | 6,887 | |||||||||
| Loans which obtained a COVID-19-related payment deferral but | ||||||||||||
| have since resumed payment | $ | 31,954 | $ | 15,602 | $ | 54,450 | ||||||
| Loans reinstated (borrower paid any unpaid principal and interest) | – | 2,253 | 6,353 | |||||||||
| Loans on a repayment plan | – | – | 1,354 | |||||||||
| Loans which resumed payment but deferred principal and/or | ||||||||||||
| interest payments to maturity (2) | 26,197 | 8,713 | 36,811 | |||||||||
| Loans which were paid off completely | 5,757 | 4,636 | 9,932 | |||||||||
(1) Includes commercial loans that have been approved for loan payment deferral but for which documentation is closing or pending.
(2) Includes commercial loan for which maturity was extended.
Randolph Bancorp, Inc.
COVID-19 Supplemental Disclosure
(Unaudited)
COVID-19 Highly Impacted Sectors
| As of March 31, 2021 | ||||||||||||||||||||||||||||||||
| Exposure Balance | Exposure by Risk Weighting | |||||||||||||||||||||||||||||||
| Balance | ||||||||||||||||||||||||||||||||
| Real | Commercial | with | ||||||||||||||||||||||||||||||
| Estate | & | Deferred | ||||||||||||||||||||||||||||||
| Industry (1) | Total | Secured | Industrial | Construction | Pass | Criticized | Payments | |||||||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||||||||||||||
| Group home/care facility | $ | 1,079 | $ | 1,079 | $ | – | $ | – | $ | 1,079 | $ | – | $ | – | ||||||||||||||||||
| Hotels/hospitality | 9,635 | 9,566 | 69 | – | 69 | 9,566 | 3,543 | |||||||||||||||||||||||||
| Restaurants/food service | 2,713 | 1,554 | 1,159 | – | 2,713 | – | – | |||||||||||||||||||||||||
| Retail/shopping center | 21,887 | 17,211 | – | 4,675 | 20,261 | 1,626 | 1,006 | |||||||||||||||||||||||||
| Other sectors (2) | 11,385 | 10,972 | 113 | 300 | 9,383 | 2,002 | 1,692 | |||||||||||||||||||||||||
| Total loans in COVID-19 impacted sectors | $ | 46,698 | $ | 40,382 | $ | 1,341 | $ | 4,975 | $ | 33,505 | $ | 13,194 | $ | 6,241 | ||||||||||||||||||
| Percentage of commercial loans outstanding | 25.6 | % | 27.5 | % | 5.6 | % | 43.3 | % | ||||||||||||||||||||||||
| Commercial loans outstanding | $ | 182,277 | $ | 146,930 | $ | 23,869 | $ | 11,478 | ||||||||||||||||||||||||
| Loan to value secured by real estate (3) | 47.5 | % | 66.9 | % | ||||||||||||||||||||||||||||
(1) This disclosure focuses on industries with balances that are significant to the portfolio at March 31, 2021 and omits industries affected by the COVID-19 pandemic (oil and gas, transportation, etc.) to which the Company has minimal or no exposure. This disclosure also excludes SBA PPP Loans, given their government guarantee.
(2) Includes customers operating in various sectors which have been impacted by COVID-19.
(3) Loan to value secured by real estate equals the exposure balance divided by the most recent appraised value.
For More Information, Contact:
William M. Parent, President and Chief
Executive Officer (617-925-1955)
