Kish Bancorp : Announces Fourth Quarter Financial Results

PRESS RELEASE

State College, Pennsylvania (KISB) - January 12, 2022 - William P. Hayes, Chairman and CEO of Kish Bancorp, Inc., has announced unaudited financial results for the full year ending December 31, 2021. Highlights of 2021 include:

• Strong year-over-year net income expansion of 22.9%
• Deposit and balance sheet growth of 14.2% and 11.4%, respectively, compared to 2020
• Sustained residential mortgage lending at the exceptionally strong levels achieved in 2020, with revenue from the sale of mortgage loans holding steady
• Strong internal capital formation, up 10.2% from 2020, while achieving excellent return on shareholders' equity of 14.1%, compared to 12.9% in 2020
• Healthy credit quality metrics that have remained positive throughout the pandemic
• Continued expansion into contiguous Pennsylvania counties
• Excellent results from northeastern Ohio lending group
• Strong ROI from investments in operating technology, with data processing expense down 12.7% from 2020

Kish Bancorp's total assets ended the period at $1.233 billion, an increase of $126.2 million, or 11.40%, compared to total assets of $1.107 billion as of December 31, 2020. Total loans outstanding grew year over year by $113 million to $878.7 million, an increase of 14.75%. Loans originated in 2021 to local businesses as part of the third round of the Paycheck Protection Program totaled $35 million, which was more than offset by PPP loan forgiveness of $67.8 million during the year.
"The strongest contributor to loan growth in 2021 was the northeastern Ohio lending team, who generated over $77 million in new loans outstanding," Hayes noted.
Investment securities increased to $191.2 million, a $50 million increase over the prior year's balance. Total deposits grew by $124.8 million to $1.003 billion, a 14.22% increase from $877.8 million a year ago, with a continued notable expansion in core deposits created by new customer acquisition and the liquidity generated by government stimulus programs.
Net income for the year ended December 31, 2021, was $9.88 million, an increase of 22.91% compared to $8.04 million for 2020. The increase reflects expansion in both net interest income, up 13.45% over the prior year, and noninterest income, which increased 12.08% overall.
"The expansion in net interest income benefitted from the continued decline in interest expense on deposits," said Hayes. He continued, "The sharp increase in noninterest income is attributable to market value increases in the equity portfolio of $262 thousand, compared to losses of $313 thousand in 2020, and to the addition of insurance agency revenue resulting from the acquisition of the Sausman Insurance Agency of Mifflintown. Net income was also positively impacted by gains on sales of residential mortgage loans and the decline in the contribution to the loan loss reserve as overall credit quality metrics remain at excellent levels."
Noninterest expense increased year over year by $3.13 million, or 10.59%, to $32.67 million as of December 31, 2021, compared to $29.5 million the prior year. In part, the increase reflects higher salaries and employee benefits associated with additions to the Kish team, as well as occupancy expense related to the opening of the new Kish Innovation Center. Data processing expense for 2021 decreased to $1.9 million from $2.2 million in 2020, an improvement of 12.74%. The lower costs were the result of a core conversion completed in 2020. All other expense categories were well controlled when compared to the prior year.
The Board of Directors declared an increased quarterly dividend in the amount of $0.32 per share, payable January 31, 2022, to shareholders of record as of January 14, 2022. This is a 10.3% increase compared to $0.29 per share the prior quarter. Return on shareholders' equity remained strong, rising to 14.08%, compared to 12.86% the year prior.
Hayes noted that Kish was also pleased to take advantage of favorable market conditions with the issuance of $20 million of subordinated debt during the second quarter, stating, "This issuance enabled the redemption of higher cost debt and provides additional capital flexibility at the holding company to support future growth."
Hayes concluded that while the challenges created by the ongoing COVID-19 pandemic continue, Kish has remained vigilant while maintaining a steady focus on the Corporation's long-term strategic priorities.

About Kish Bancorp, Inc.
Kish Bancorp, Inc. is a diversified financial services corporation headquartered in Belleville, PA with executive offices in State College. Kish Bank, a subsidiary of Kish Bancorp, Inc., operates eighteen offices and financial centers serving Centre, Mifflin, Huntingdon, Blair, and Juniata counties, and northeastern Ohio. In addition to Kish Bank, other business units include: Kish Insurance, an independent property and casualty insurance agency; Kish Financial Solutions, which offers trust, fiduciary, and wealth management advisory services; Kish Benefits Consulting, which provides employee benefits consulting services; and Kish Travel, a full-service travel agency. For additional information, please visit www.kishbank.com. KISB is the OTC stock ticker symbol for Kish Bancorp, Inc.