First quarter net income down 36% at Signature Bank of Arkansas

White River Bancshares Co., the holding company of Fayetteville-based Signature Bank of Arkansas, reported Wednesday (May 6) that first quarter net income was $742,500, down from $1.17 million during the same quarter of 2019.

The over-the-counter (OTCQX: WRIV) publicly held company, ended the first quarter (ended March 31, 2020) with assets of $711.6 million, up nearly 10% from the same quarter a year ago.

“Our first quarter results were highlighted by the sale of multiple properties, reducing nonperforming assets by 43% compared to three months earlier and bringing NPAs to their lowest levels in years,” President and CEO Gary Head said in a statement. “However, we are being proactive in our approach to COVID-19’s impact on our local economy, and as a result booked a $677,000 provision during the first quarter, which compares to a $500,000 provision during the preceding quarter and no provision in the first quarter a year ago.”

Head said amid ongoing concerns about the pandemic, the company is closely monitoring the latest reports from the Centers for Disease Control and Prevention (CDC) and has taken a number of precautionary measures.

“In mid-March, we were the first bank in Arkansas to begin limiting lobby access at branches to help reduce the spread of COVID-19,” Head said. “As the month progressed, we implemented measures to mobilize our bankers to work from home as much as possible. We began taking applications for the Small Business Administration’s Paycheck Protection Program (PPP), marking the bank’s first foray into SBA lending.

“The result was approximately $20 million dollars lent to 232 businesses, preserving roughly 2,389 jobs for Arkansans.  We also have seen a significant increase in use of our treasury services, empowering our customer through the use of our digital and mobile banking products.  We continue to closely monitor the situation and evaluate additional measures to support our customers and communities as needs arise.”

Following are other items from the bank’s first quarter report:

• First quarter net income was $742,500 or $0.77 per diluted share.
• First quarter provision for loan losses was $677,000, compared to $500,000 in the preceding quarter and no provision for loan losses in the first quarter of 2019.
• First quarter net interest margin (“NIM”) was 3.64%, compared to 3.85% in the preceding quarter and 3.97% in the first quarter a year ago.
• Net loans increased 5.8% to $558.2 million at March 31, 2020, compared to $527.4 million at March 31, 2019.
• Total deposits increased 10.7% to $592.1 million at March 31, 2020, compared to $535.0 million a year ago.
• Non-interest-bearing deposits increased 8.1% to $119.4 million at March 31, 2020, compared to $110.4 million a year ago.
• Non-performing assets decreased 42.9% to $1.5 million at March 31, 2020, compared to $2.6 million at December 31, 2019 and decreased 80.2% when compared to $7.7 million a year ago.
• Nonperforming assets (NPAs) represent 0.21% of total assets at March 31, 2020, compared to 1.18% of total assets a year ago and 0.38% of total assets three months earlier.
• Book value per diluted common share increased to $72.25 at March 31, 2020, from $66.19 a year ago.
• Total risk-based capital ratio was 14.24% and Tier 1 leverage ratio was 11.27% for the Bank at March 31, 2020.
• On December 11, 2019, the Company completed a private placement of $11 million in fixed-to-floating rate subordinated notes due December 31, 2029 to accredited institutional investors.

Signature Bank was founded in 2005 and has Arkansas locations in Fayetteville, Springdale, Bentonville, Rogers and Brinkley.