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JD Bancshares, Inc. Reports Strong Financial Results for Three and Twelve-Month Periods Ended December 31, 2022

JENNINGS, LA / ACCESSWIRE / January 19, 2023 / JD Bancshares, Inc. (the "Company"), (OTCQX:JDVB), the parent holding company of JD Bank (the "Bank"), reports its unaudited financial results for the three and twelve-month periods ended December 31, 2022.

Net income is $3,492,661 or $1.02 per share for the three-month period ended December 31, 2022 compared to $3,388,452 or $0.99 per share for the linked quarter ended September 30, 2022 and $2,977,469 or $0.87 per common share for the prior year quarter ended December 31, 2021. Pre-tax, pre-provision operating income (PTPPOI) for the current quarter is $4,734,605 compared to $4,261,659 for the linked quarter and $3,056,079 for the comparative prior year quarter. The 11.10% and 54.92% increases in PTPPOI over the linked and prior year quarters, respectively, are due primarily to increases in the volume of loans outstanding and the impact of higher interest rates on both loan and investment securities income. PTPPOI excludes taxes, provision for loan losses, recognized origination fees earned from the Paycheck Protection Program (PPP), net gains and losses on the sale of other real estate owned (OREO), gains on the sale of investment securities and other non-recurring items.

For the twelve-month period ended December 31, 2022, net income is $12,166,756 or $3.56 per share compared to $11,014,968 or $3.21 per share for the prior year period ended December 31, 2021. Pre-tax, pre-provision operating earnings for the two comparative twelve-month periods increased by 33.68% and is $14,712,149 compared to $11,005,324.

Bruce W. Elder, President & CEO commented, "After growing total assets by 53% or $471.3 million between December 31, 2019 and December 31, 2021 due to COVID-19 stimulus and insurance proceeds resulting from hurricanes in southwest Louisiana, we experienced outflows from deposit accounts as pandemic relief came to an end and our customers were able to finally make repairs to their homes and businesses. Total assets shrunk by 9% or $120.4 million during 2022. Approximately half of the total decrease is due to declines in deposit levels. Approximately 43% of the decrease in the balance sheet is attributable to a decline in the fair market value of investment securities, net of the tax benefits. In 2020 and 2021, we invested significant portions of excess liquidity in investment securities and when interest rates moved higher beginning in March 2022, the value of those investments declined. While those unrealized losses adversely impact our book capital, they will only become realized should we sell the securities prior to maturity."

Elder continued "we are very pleased with earnings performance for both the three and twelve-month periods of 2022. The sharp increase in interest rates had a positive impact on net interest income, but also dampened the demand for mortgage loans which had a negative impact on non-interest income. We made progress improving our loan to deposit ratio from 52% to 59% and we continue to see reasonably strong loan demand into 2023. Several headwinds will need to be successfully navigated in 2023 including our eastern expansion into Baton Rouge and the Northshore of Louisiana, the ability to continue to control deposit rates in the face of growing pressure and our ability to manage overhead expenses. Despite these challenges, we remain cautiously optimistic for 2023."

Paycheck Protection Program Lending

During 2020 and 2021, the Company made 1,422 PPP loans totaling $110.4 million. As of December 31, 2022, there are two loans totaling $1.2 million that remain outstanding and $109.2 million have been repaid through Small Business Administration (SBA) forgiveness and customer payments. The two remaining PPP borrowers have received partial forgiveness from the SBA and are in the process of appeal and/or are making payments on the loans. Prior to year-end, the Company requested the SBA to honor its guarantee on one of the loans and we received payment in full of $210,000 in early January, 2023. The Company continues to have the full guarantee of the SBA for the one remaining PPP loan.

The Company received origination fees from the SBA for participating in the program. At origination, we recognized as interest income that portion of the fee estimated to be our internal cost of origination. The remainder is amortized over the contractual life of the loan. If the loan is forgiven or repaid early, the remaining unamortized portion is recognized as interest income in the month of repayment. There are no recognition of PPP origination fees for the quarter ended December 31, 2022, $32,000 in the linked quarter and $498,000 in the prior year quarter. Origination fees recognized for the two twelve-month periods ended December 31, 2022 and 2021 are $605,000 and $2,683,000, respectively. These fee recognitions have been excluded from PTPPOI calculations. As of December 31, 2022, the Company has recognized 100% of the origination fees collected pursuant to the PPP program.

Asset Quality

Loans past due of 30 to 89 days at December 31, 2022 are $2.3 million or 0.35% of the total loans outstanding compared to $2.0 million or 0.30% of the total loan portfolio at September 30, 2022 and $1.3 million or 0.21% of total loans reported at December 31, 2021. Total nonperforming assets, including loans on non-accrual status, OREO and repossessed assets are $14.3 million at December 31, 2022 compared to $5.2 million at December 31, 2021. Loans on non-accrual status at December 31, 2022 increased to $13.4 million from $4.1 million at December 31, 2021, OREO declined to $863,000 from $1.1 million and repossessed assets are $37,000 compared to $33,000 a year ago. During the fourth quarter of 2022, the Company moved one relationship totaling approximately $11.0 million to nonaccrual status. Management believes the issues associated with this relationship will be resolved in a favorable manner and all principal and interest should be repaid in accordance with the terms of the underlying loan contracts. We perform a quarterly evaluation of OREO properties and repossessions and believe the adjusted carrying values are representative of their fair market values, although there is no assurance that the ultimate sales will be equal or greater than the carrying values.

The Company recognized a provision for credit losses in the current quarter of $533,000 compared to $189,000 for the linked quarter and no provision for the prior year quarter. The allowance for loan losses (ALLL) is $9.2 million at December 31, 2022 or 1.37% of total loans compared to $8.2 million at December 31, 2021 or 1.32% of total loans. Provision for credit losses for the twelve-months ended December 31, 2022 is $722,000 compared to $330,000 for the comparative prior year period. The Company recorded net recoveries in 2022 of $296,000 and net charge offs of $723,000 for 2021. Approximately $488,000 of recoveries were recognized as a result of adjusting a loan accounting process in the second quarter of 2022. We believe the current level of our ALLL is adequate, but there is no assurance that regulators, increased risks in the loan portfolio or changes in economic conditions will not require future adjustments to the ALLL.

Net Interest Income

Net interest income for the current quarter is $11.3 million compared to $10.5 million for the linked quarter and $9.0 million compared to the prior year quarter. Current quarter net interest income increased by 6.85% and 25.27% over the linked and prior year periods, respectively. The increase is primarily attributable to higher interest income due to a larger volume of outstanding loans and higher average yields on loans, investment securities and other interest earning assets. Average loans outstanding for the current period are $674.3 million or $53.0 million higher than that of the prior year quarter. Yields on loans averaged 5.47% for the three-month period ended December 31, 2022 compared to 5.12% for the December 31, 2021 period and the average yield on all other assets increased by 83 basis points to 4.08%. There are no PPP origination fees recognized in the current quarter and therefore no impact on average loan yields. The recognition of PPP origination fees during the prior year quarter represented 0.32% of the total average yield on loans. Interest expense is relatively flat over the three comparative periods with an $82,000 increase between current and linked due to a slightly higher cost of funds and a $50,000 decrease between current and prior year due to a decline in the volume of interest-bearing liabilities.

Net interest income for the year ended December 31, 2022 is $40.5 million reflecting a $4.7 million or 13.15% increase over the $35.8 million reported for the year ended December 31, 2021. The increase is attributable to higher volumes of loans and investment securities and the higher interest rate environment. The average volume of loans and investment securities for the current year increased by $23.2 million and $67.6 million, respectively compared to the prior year. The average yield on all earning assets increased by 41 basis points to 3.68% for 2022 from 3.27% for 2021. The increase in average yield of 99 basis points on interest-earning deposits with banks had a positive impact on interest income despite the $114.9 million decline in volume for that category of earning assets. The recognition of PPP origination fees is $605,000 for 2022 compared to $2.7 million in 2021 and account for 8 basis points of the total average yield from loans of 5.26% for 2022 and 44 basis points of the 5.23% for the prior year. Interest expense declined by $570,000 year over year due to a reduction in the average cost of the overall volume of interest-bearing liabilities. The average volume of interest-bearing deposits declined by $23.7 million while the average volume of borrowings increased by $11.5 million. In late December 2021, the Company issued $30 million in subordinated debt at 3.75% which replaced $17.5 million of subordinated debt at a rate of 6.75%. The lower rate on the debt was the primary driver of the reduction in overall cost of interest-bearing liabilities. In the second quarter of 2022, we recorded a one-time addition to interest income of $291,000 due to an adjustment in the manner in which our loan system accounted for loan payments applied to loans previously charged-off and in non-accrual status.

The net interest margin for the current quarter is 3.74% and increased by 25 basis points from 3.49% for the linked quarter and 84 basis points compared to 2.90% for the prior year quarter. The yield on earning assets for the current quarter is 4.08% compared to 3.81% and 3.25% for the two comparative periods, respectively. The cost of funds is 0.35% for both the current and prior year quarters compared to 0.32% for the linked quarter. Net interest margin for the twelve-month period ended December 31, 2022 is 3.36% compared to 2.91% for the prior year. For the two comparative year end periods, the yield on earning assets is 3.68% and 3.27%, respectively, and the cost of funds is 0.33% and 0.36%, respectively. After experiencing lower margins in 2021 due to large amounts of on balance sheet liquid assets earning very low rates of interest, margins were positively impacted in 2022 from the Company's ability to deploy some liquidity into the loan portfolio and the sharp increases in interest rates initiated by the Federal Reserve Open Market Committee (FOMC).

The FOMC began raising short-term interest rates on March 17, 2022 with a 25 basis points increase which moved the Wall Street Journal (WSJ) Prime Rate from 3.25% to 3.50%. There have been six additional rate hikes, the last of which occurred on December 15, 2022, which has pushed the WSJ Prime to 7.50%. The FOMC has signaled that they plan to continue to push rates higher in order to curb inflation. The Consumer Price Index is currently 6.5% and has declined for several consecutive months. Many economists expect the FOMC to continue to raise short-term interest rates into the first half of 2023. Despite the FOMC's goal to fight inflation by reducing demand for goods and services, the economy remains relatively resilient due to a strong labor market. While we still believe that a recession in the second half of 2023 is likely, if the economy remains strong, perhaps the recession will be mild and short-lived.

Non-Interest Income

Total non-interest income is $2.9 million for the current three-month period compared to $3.0 million for the linked quarter and $3.3 million for the prior year quarter. Service charges and fees associated with deposit accounts are $2.3 million for quarter ended December 31, 2022 and have declined by $101,000 and $49,000 compared to the linked and prior year quarters. Interchange revenue from debit card usage is the largest component of service charges and fees and is $1.3 million in both the current and prior year quarters and $1.2 million for the linked quarter. During the fourth quarter of 2022, the Company discontinued charging additional NSF fees on items presented against a customers' deposit accounts multiple times. Although the Company had properly disclosed the possibility of incurring this additional fee, there has been intense regulatory pressure to discontinue this practice. The Company anticipates a reduction in NSF fees in future periods.

The actions of the FOMC beginning in March 2022 have resulted in higher interest rates on home mortgage loan products. The higher interest rate environment over the past nine months has significantly impacted our mortgage loan origination activities and therefore the gains we recognize on the sale of those originations. Gain on the sale of mortgages for the current quarter is $98,000 compared to $222,000 for the linked quarter and $342,000 for the prior year quarter. Although our region continues to recover from the hurricanes of 2020 keeping demand for housing elevated, the higher mortgage loan rates will have an adverse impact on our level of mortgage originations in the foreseeable future.

Other non-interest income is $580,000 for the current quarter compared to $424,000 for the linked quarter and $660,000 for the prior year quarter. Revenue from our Trust and Wealth Divisions are the largest components of other non-interest income. Revenue from trust services is $203,000, $146,000 and $161,000 and revenue from wealth activities is $82,000, $71,000 and $313,000 for the three comparative periods, respectively. There are no non-recurring, non-operating revenue items attributable to any of the three comparative periods.

Non-interest income for the twelve-month period ended December 31, 2022 was $11.7 million, a decrease of $1.2 million compared to the $12.9 million reported for the comparative 2021 period. Service charges and fees increased by $430,000 to $9.2 million. Gain on the sale of originated mortgage loans is $839,000 compared to $1.6 million for the prior year. Other non-interest income declined by 33.36% to $1.7 million in the 2022 compared to $2.6 million in 2021. The decrease is due to a non-recurring, non-operating gain on a land swap completed in 2021, a $415,000 decline in wealth management revenue and the net loss on an investment in marketable equity securities. In addition to the aforementioned gain on the land swap, the prior year period also included a $7,000 gain on the sale of investment securities.

Non-Interest Expense

Total non-interest expense is $9.5 million for the current quarter compared to $9.3 million for linked quarter and $8.7 million for the fourth quarter of 2021. Salary and benefits expense is the largest component of non-interest expenses and is $4.9 million for the current period compared to $4.7 million for the linked and $4.6 million for the prior year quarter. Salary expenses have increased as we are executing on our strategy to expand into Baton Rouge and the Northshore of Louisiana.

Occupancy and data processing expenses are $1.4 million and $1.2 million, respectively, for the quarter ended December 31, 2022 and $1.3 million and $1.0 million, respectively, for both the linked September 30, 2022 quarter and the December 31, 2021 quarter. Advertising and public relations expenses total $401,000 in the current quarter compared to $387,000 in the linked quarter and $313,000 for the prior year quarter. Other non-interest expenses were $1.6 million for the current quarter compared to $1.8 million for the linked quarter and $1.5 million for the prior year quarter. The largest components of other non-interest expenses include real estate ad valorem fees, professional fees, FDIC insurance premiums, telecommunication costs, and losses associated with fraud. Net losses (gains) on the sale of OREO are $(12,000), $41,400 and $5,000 for the three comparative periods, respectively.

Non-interest expenses for the twelve-month period ended December 31, 2022 are $36.9 million, reflecting a $1.7 million increase compared to $35.2 million for the prior year. Increases in salary and employee benefits, advertising and public relations, data processing, and professional fees were partially offset by decreases in OREO expenses, FDIC insurance premiums, and occupancy expenses. Net losses on the sale of OREO for the current and prior twelve-month periods are $30,000 and $384,000, respectively. Other non-recurring, non-operating expense include a $283,000 loss on the sale of a former bank branch in 2022 and a $200,000 penalty on the pre-payment of a Federal Home Loan Bank advance in 2021.

Income tax expense is $721,000 for the current quarter compared to $675,000 for the linked quarter and $571,000 for prior year quarter. The effective tax rates for the three consecutive quarters are 17.11%, 16.61% and 16.10%, respectively. Income tax expense for the twelve months ended December 31, 2022 is $2.4 million with an effective rate of 16.52% compared to $2.1 million and 16.21% for the prior year twelve-month period. The increase in effective tax rate is primarily due to a larger percentage of revenue being derived from taxable sources.

Balance Sheet

Total assets are $1.2 billion at December 31, 2022, reflecting a $120.4 million or 8.87% decline from the $1.4 billion at December 31, 2021. The decline was attributable to an outflow of deposits generated during the past several years from pandemic related stimulus, insurance proceeds received from customers related to damages sustained during a series of hurricanes in the fall of 2020 and the impact of higher interest rates on our available for sale investment portfolio. Changes in the balance sheet include a reduction in interest bearing deposits with banks of $153.8 million. The money was used to fund a net increase in loans and investment securities of $50.1 million and $33.3 million, respectively, a decrease in deposits of $57.4 million, and the redemption of $17.5 million in subordinated debt. The total investment portfolio at December 31, 2022 was $452.7 million reflecting a $32.7 million decline from $485.3 million at December 31, 2021. The decrease resulted from $66.0 million in fair market value declines on available for sale securities due to the higher interest rate environment which is partially offset by new purchases net of principal repayments of $33.3 million. The loan portfolio, net of unearned income, is $672.6 million compared to $622.6 million a year ago. The percentage loan growth for the year was 8.04%.

Total deposits are $1.1 billion at December 31, 2022, reflecting a $57.4 million or 4.78% decline over the total deposits reported at year end 2021. Money market accounts experienced the largest decrease of $25.6 million to $52.8 million from $78.4 million. We lost a $16.0 million relationship early in 2022 as a long-term customer sold their business to a larger, state-wide competitor. Savings account balances decreased by $24.1 million to $323.3 million from $347.4 million. These two deposit categories benefited most over the two years prior to 2022 from the pandemic stimulus and the hurricane insurance proceeds. For the two-year period between December 31, 2019 and December 31, 2021, we experienced a combined increase of $194.9 million in savings and money market deposits. The 2022 decrease represents 25% of the total increase in the prior years. Time deposits declined over the past year by $13.4 million or 11.62% to $102.2 million from $115.6 million. Non-interest bearing and interest-bearing demand deposits increased by $2.2 million and $3.4 million, respectively.

Other borrowings declined by $17.4 million to $29.8 million at December 31, 2022. The decrease is due to the repayment of $17.5 million in subordinated debt in January 2022. The Company had issued $30.0 million in subordinated debt in December 2021 at a rate of 3.75% to replace the $17.5 million issued in January 2017 at a rate of 6.75%. Accrued expenses and other liabilities decreased by $1.4 million to $5.3 million at December 31, 2022.

Stockholders' equity decreased by $44.1 million to $57.2 million at December 31, 2022 from $101.2 million at December 31, 2021. The decrease is primarily due to a decline in the fair market value of available for sale securities, net of associated tax benefits, of $52.1 million. Partially offsetting this decrease is an $8.0 million increase in capital comprised of net income of $12.2 million less dividends paid of $3.4 million and repurchases of outstanding shares of $0.8 million. The tangible equity to assets ratio decreased to 4.29% at December 31, 2022 from 7.15% at December 31, 2021 due to the drop in accumulated other comprehensive income. There were 3,420,560 common shares outstanding at December 31, 2022 and 3,430,060 shares outstanding at December 31, 2021. The decrease in shares issued and outstanding results from the repurchase of 26,500 shares and partially offset by the issuance of 17,000 shares under a long-term equity incentive plan. Tangible book value per common share decreased to $15.49 at December 31, 2022 compared to $28.29 at December 31, 2021.

Key Performance Ratios

Return on average assets (ROA) is 1.12% for the current quarter compared to 1.07% for the linked quarter and 0.88% for prior year quarter. Return on average equity (ROE) is 28.20%, 20.61% and 11.87% for the three comparative quarters, respectively. ROA and ROE for the twelve-month periods ended December 31, 2022 and 2021 were 0.95% and 0.82%, and 16.47% and 11.24%, respectively. ROE for all 2022 periods is favorably impacted by the significant drop in accumulated other comprehensive income during the course of the year.

About JD Bancshares, Inc.

JD Bancshares, Inc. is the bank holding company of JD Bank, a state chartered bank headquartered in Jennings, Louisiana. JD Bank has been serving the citizens of south Louisiana since 1947 and offers a variety of personal and commercial lending and deposit products through both physical and digital delivery channels. The Bank also offers both trust and investment services. JD Bank operates through 22 full service branch offices and two Loan Production/Deposit Production offices located along the Interstate 10/12 corridor from Lake Charles to Mandeville, Louisiana. JD Bancshares, Inc. may be accessed on its website at jdbank.com.

JD Bancshares, Inc. (OTCQX:JDVB) trades on the OTCQX Best Market. Companies meet high financial standards, follow best practice corporate governance, demonstrate compliance with U.S. securities laws, and have a professional third-party sponsor introduction. Investors can find current financial disclosure and Real-Time Level 2 quotes for the Company on otcmarkets.com.

Forward-Looking Statements

Statements contained in this release, which are not historical facts, are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors which include the effects of future economic conditions, governmental fiscal and monetary policies, legislative and regulatory changes, the risks of changes in interest rates, the effects of competition, and including without limitation to other factors that could cause actual results to differ materially as discussed in documents filed by the Company with the Securities and Exchange Commission from time to time.

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(OTCQX:JDVB)

CONTACT:

JD Bancshares, Inc.
Bruce Elder (CEO) 337-246-5399
Paul Brummett (CFO) 337-246-5395
Website: www.jdbank.com

JD BANCSHARES, INC. AND SUBSIDIARIES
JENNINGS, LOUISIANA
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

Actual
Dec 2022
Actual
Dec 2021
$ Variance % Variance
Assets
Cash and due from banks
26,434,524 18,552,783 7,881,741 42.48
Interest bearing deposits with banks
21,855,505 175,657,295 (153,801,790 ) (87.56 )
Investment Securities - Taxable
321,185,999 354,300,423 (33,114,424 ) (9.35 )
Investment Securities - Tax-exempt
131,488,014 131,081,611 406,403 0.31
Mortgage loans held for sale
549,984 705,950 (155,966 ) (22.09 )
Loans, net of unearned income
672,632,940 622,565,024 50,067,916 8.04
Less: Allowance for loan losses
(9,208,070 ) (8,189,747 ) (1,018,323 ) 12.43
Premises and equipment, net
22,692,381 23,160,984 (468,603 ) (2.02 )
Accrued interest receivable
4,985,487 4,492,037 493,450 10.98
Other real estate
863,101 1,053,698 (190,597 ) (18.09 )
Other assets
42,724,704 33,196,334 9,528,370 28.70
Total Assets
1,236,204,569 1,356,576,392 (120,371,823 ) (8.87 )
Liabilities
Non-Interest Bearing Deposits
421,213,684 419,021,687 2,191,997 0.52
Interest bearing demand deposits
244,493,968 241,045,730 3,448,238 1.43
Savings and Money Market Deposits
376,093,240 425,749,299 (49,656,060 ) (11.66 )
Time Deposits - Retail
102,193,314 115,623,464 (13,430,149 ) (11.62 )
Total Deposits
1,143,994,206 1,201,440,180 (57,445,974 ) (4.78 )
Accrued expenses and other liabilities
5,279,111 6,703,008 (1,423,897 ) (21.24 )
Other Borrowings
29,764,526 47,203,745 (17,439,219 ) (36.94 )
Total Liabilities
1,179,037,843 1,255,346,933 (76,309,090 ) (6.08 )
Equity
Common stock
21,378,500 21,437,875 (59,375 ) (0.28 )
3,420,560 shares outstanding at 12.31.22
3,430,060 shares outstanding at 12.31.21
Capital surplus
10,312,636 10,525,694 (213,058 ) (2.02 )
Retained earnings
76,915,899 68,164,751 8,751,148 12.84
Accumulated other comprehensive income (loss)
(50,873,123 ) 1,271,641 (52,144,764 ) (4,100.59 )
Less: Unearned common stock awards
(567,186 ) (170,502 ) (396,684 ) 232.66
Total Equity
57,166,726 101,229,459 (44,062,733 ) (43.53 )
Total Liabilities & Equity
1,236,204,569 1,356,576,392 (120,371,823 ) (8.87 )

JD BANCSHARES, INC. AND SUBSIDIARIES
JENNINGS, LOUISIANA
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

QTD
Actual
Dec 2022
QTD
Actual
Sep 2022
$ Variance % Variance QTD
Actual
Dec 2021
$ Variance % Variance
Interest Income
Interest on Loans
9,295,379 8,704,143 591,236 6.79 8,018,863 1,276,516 15.92
Mortgage Loans Held For Sale
7,729 10,009 (2,280 ) (22.78 ) 7,634 95 1.24
Interest on deposits with banks
264,754 254,078 10,676 4.20 64,297 200,457 311.77
Investment Securities - Taxable
1,933,989 1,726,262 207,727 12.03 1,198,469 735,520 61.37
Investment Securities - Tax-exempt
809,529 812,774 (3,245 ) (0.40 ) 799,025 10,504 1.31
Total Interest Income
12,311,380 11,507,266 804,114 6.99 10,088,288 2,223,092 22.04
Interest Expense
Interest bearing demand deposits
220,006 215,821 4,185 1.94 212,282 7,724 3.64
Savings and Money Market Deposits
325,950 253,011 72,939 28.83 222,433 103,517 46.54
Time Deposits - Retail
182,799 179,686 3,113 1.73 267,077 (84,278 ) (31.56 )
Total Interest Expense on Deposits
728,755 648,518 80,237 12.37 701,792 26,963 3.84
Interest on other borrowings
316,366 314,788 1,578 0.50 393,261 (76,895 ) (19.55 )
Total Interest Expense
1,045,121 963,306 81,815 8.49 1,095,053 (49,932 ) (4.56 )
Net Interest Income
11,266,259 10,543,960 722,299 6.85 8,993,235 2,273,024 25.27
Provision for loan losses
533,000 189,000 344,000 182.01 - 533,000 -
Net In. Inc. After Prov. for Loan Losses
10,733,259 10,354,960 378,299 3.65 8,993,235 1,740,024 19.35
Non Interest Income
Service charges and fees
2,253,309 2,354,001 (100,692 ) (4.28 ) 2,302,098 (48,789 ) (2.12 )
Mortgage loan and related fees
97,928 221,542 (123,614 ) (55.80 ) 341,546 (243,618 ) (71.33 )
Other noninterest income
580,365 423,536 156,829 37.03 659,837 (79,472 ) (12.04 )
Total Non Interest Income
2,931,602 2,999,079 (67,477 ) (2.25 ) 3,303,481 (371,879 ) (11.26 )
Non Interest Expense
Salaries and employee benefits
4,867,737 4,743,698 124,039 2.61 4,619,398 248,339 5.38
Occupancy
1,367,330 1,343,839 23,491 1.75 1,297,825 69,505 5.36
Advertising and public relations
400,555 387,039 13,516 3.49 312,802 87,753 28.05
Data Processing
1,216,896 1,039,588 177,308 17.06 1,046,661 170,235 16.26
Other noninterest expense
1,598,786 1,776,588 (177,802 ) (10.01 ) 1,471,213 127,573 8.67
Total Non Interest Expense
9,451,304 9,290,752 160,552 1.73 8,747,899 703,405 8.04
Income Before Taxes
4,213,557 4,063,287 150,270 3.70 3,548,816 664,741 18.73
Income taxes
720,896 674,835 46,061 6.83 571,347 149,549 26.17
Net Income
3,492,661 3,388,452 104,209 3.08 2,977,469 515,192 17.30
Per common share data:
Earnings
$ 1.02 $ 0.99 $ 0.87
Weighted average number of shares outstanding
3,414,370 3,410,364 3,430,060

JD BANCSHARES, INC. AND SUBSIDIARIES
JENNINGS, LOUISIANA
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

YTD
Actual
Dec 2022
YTD
Actual
Dec 2021
$ Variance % Variance
Interest Income
Interest on Loans
34,202,175 32,747,691 1,454,484 4.44
Mortgage Loans Held For Sale
35,584 36,350 (766 ) (2.11 )
Interest on deposits with banks
773,624 260,892 512,732 196.53
Investment Securities - Taxable
6,241,272 4,089,734 2,151,538 52.61
Investment Securities - Tax-exempt
3,219,465 3,201,034 18,431 0.58
Total Interest Income
44,472,120 40,335,701 4,136,419 10.25
Interest Expense
Interest bearing demand deposits
851,903 907,787 (55,884 ) (6.16 )
Savings and Money Market Deposits
988,669 874,667 114,002 13.03
Time Deposits - Retail
810,995 1,255,034 (444,039 ) (35.38 )
Total Interest Expense on Deposits
2,651,567 3,037,488 (385,921 ) (12.71 )
FHLB Advances
- 85,263 (85,263 ) (100.00 )
Interest on other borrowings
1,309,850 1,409,120 (99,270 ) (7.04 )
Total Interest Expense
3,961,417 4,531,871 (570,454 ) (12.59 )
Net Interest Income
40,510,703 35,803,830 4,706,873 13.15
Provision for loan losses
722,000 330,000 392,000 118.79
Net In. Inc. After Prov. for Loan Losses
39,788,703 35,473,830 4,314,873 12.16
Non Interest Income
Service charges and fees
9,154,181 8,723,760 430,421 4.93
Mortgage loan and related fees
839,341 1,605,749 (766,408 ) (47.73 )
Other noninterest income
1,718,176 2,578,260 (860,084 ) (33.36 )
Total Non Interest Income
11,711,698 12,907,769 (1,196,071 ) (9.27 )
Non Interest Expense
Salaries and employee benefits
18,935,649 18,010,588 925,061 5.14
Occupancy
5,151,139 5,187,603 (36,464 ) (0.70 )
Advertising and public relations
1,519,603 1,309,977 209,626 16.00
Data Processing
4,534,272 4,206,408 327,864 7.79
Other noninterest expense
6,785,960 6,521,077 264,883 4.06
Total Non Interest Expense
36,926,623 35,235,653 1,690,970 4.80
Income Before Taxes
14,573,778 13,145,946 1,427,832 10.86
Income taxes
2,407,022 2,130,978 276,044 12.95
Net Income
12,166,756 11,014,968 1,151,788 10.46
Per common share data:
Earnings
$ 3.56 $ 3.21
Weighted average number of shares outstanding
3,416,143 3,429,564

JD BANCSHARES, INC. AND SUBSIDIARIES
Margin Analysis Compare

Average Yield and Rate Average Funds Interest Income/Expense
QTD
Actual
Dec 2022
QTD
Actual
Dec 2021
Change QTD
Actual
Dec 2022
QTD
Actual
Dec 2021
Change QTD
Actual
Dec 2022
QTD
Actual
Dec 2021
Change
Earning Assets
Loans
5.47 4.80 0.67 674,321,703 621,353,466 52,968,237 9,295,379 7,520,928 1,774,451
PPP fee recognition
- 0.32 (0.32 ) - - - - 497,935 (497,935 )
Loans with fees
5.47 5.12 0.35 674,321,703 621,353,466 52,968,237 9,295,379 8,018,863 1,276,516
Mortgage loans held for sale
6.12 2.81 3.31 504,835 1,088,271 (583,436 ) 7,729 7,634 95
Deposits with banks
4.18 0.17 4.01 25,146,127 146,023,699 (120,877,572 ) 264,754 64,297 200,457
Investment securities - taxable
1.99 1.34 0.65 388,281,819 357,287,190 30,994,629 1,933,989 1,198,469 735,520
Investment securities - tax-exempt
3.11 3.08 0.03 131,796,919 131,548,819 248,100 809,529 799,025 10,504
Total Earning Assets
4.08 3.25 0.83 1,220,051,403 1,257,301,445 (37,250,042 ) 12,311,380 10,088,288 2,223,092
Interest bearing liabilities
Interest bearing demand
0.38 0.37 0.01 228,555,290 228,041,526 513,764 220,006 212,282 7,724
Savings and Money Market
0.33 0.21 0.12 386,683,300 425,268,651 (38,585,351 ) 325,950 222,433 103,517
Time deposits - Retail
0.71 0.91 (0.20 ) 101,531,576 116,582,367 (15,050,791 ) 182,799 267,077 (84,278 )
Total interest bearing deposits
0.40 0.36 0.04 716,770,166 769,892,545 (53,122,379 ) 728,755 701,792 26,963
Other borrowings
4.16 6.77 (2.61 ) 29,759,059 22,745,272 7,013,787 316,366 393,261 (76,895 )
Total borrowed funds
4.16 6.77 (2.61 ) 29,759,059 22,745,272 7,013,787 316,366 393,261 (76,895 )
Total interest-bearing liabilities
0.55 0.55 - 746,529,225 792,637,816 (46,108,591 ) 1,045,121 1,095,053 (49,932 )
Net interest rate spread
3.53 2.70 0.83 11,266,259 8,993,235 2,273,024
Effect of non-interest bearing deposits
(0.20 ) (0.20 ) - 434,222,972 440,778,234 (6,555,262 )
Cost of funds
0.35 0.35 -
Net interest margin
3.74 2.90 0.84

JD BANCSHARES, INC. AND SUBSIDIARIES
Margin Analysis Compare

Average Yield and Rate Average Funds Interest Income/Expense
YTD
Actual
Dec 2022
YTD
Actual
Dec 2021
Change YTD
Actual
Dec 2022
YTD
Actual
Dec 2021
Change YTD
Actual
Dec 2022
YTD
Actual
Dec 2021
Change
Earning Assets
Loans
5.18 4.79 0.39 649,820,293 626,641,787 23,178,506 33,596,678 30,064,276 3,532,402
PPP fee recognition
0.08 0.44 (0.36 ) - - - 605,497 2,683,415 (2,077,918 )
Loans with fees
5.26 5.23 0.03 649,820,293 626,641,787 23,178,506 34,202,175 32,747,691 1,454,484
Mortgage loans held for sale
4.90 2.82 2.08 726,499 1,289,911 (563,412 ) 35,584 36,350 (766 )
Deposits with banks
1.13 0.14 0.99 68,194,035 183,132,101 (114,938,066 ) 773,624 260,892 512,732
Investment securities - taxable
1.63 1.28 0.35 382,434,419 320,289,550 62,144,869 6,241,272 4,089,734 2,151,538
Investment securities - tax-exempt
3.09 3.20 (0.11 ) 131,912,664 126,495,386 5,417,278 3,219,465 3,201,034 18,431
Total Earning Assets
3.68 3.27 0.41 1,233,087,910 1,257,848,735 (24,760,825 ) 44,472,121 40,335,702 4,136,419
Interest bearing liabilities
Interest bearing demand
0.37 0.39 (0.02 ) 230,819,557 232,350,830 (1,531,273 ) 851,903 907,787 (55,884 )
Savings and Money Market
0.25 0.21 0.04 403,127,597 410,157,555 (7,029,958 ) 988,669 874,667 114,002
Time deposits - Retail
0.75 1.02 (0.27 ) 107,601,836 122,693,986 (15,092,150 ) 810,995 1,255,034 (444,039 )
Total interest bearing deposits
0.36 0.40 (0.04 ) 741,548,990 765,202,371 (23,653,381 ) 2,651,567 3,037,489 (385,922 )
Federal home Loan Bank advances
- 4.61 (4.61 ) - 1,825,362 (1,825,362 ) - 85,263 (85,263 )
Other borrowings
4.23 7.31 (3.08 ) 30,509,532 19,018,043 11,491,489 1,309,850 1,409,120 (99,270 )
Total borrowed funds
4.23 7.07 (2.84 ) 30,509,532 20,843,405 9,666,127 1,309,850 1,494,383 (184,533 )
Total interest-bearing liabilities
0.51 0.57 (0.06 ) 772,058,522 786,045,776 (13,987,254 ) 3,961,417 4,531,872 (570,455 )
Net interest rate spread
3.17 2.70 0.47 40,510,704 35,803,830 4,706,874
Effect of non-interest bearing deposits
(0.18 ) (0.21 ) 0.03 427,684,861 451,752,417 (24,067,556 )
Cost of funds
0.33 0.36 (0.03 )
Net interest margin
3.36 2.91 0.45

JD BANCSHARES, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION

Financial Ratios
For the Twelve For the Twelve
For the Qtr For the Qtr For the Qtr Months Months
Ended Ended Ended Ended Ended

December 31,

2022

September 30,

2022

December 31,

2021

December 31,

2022

December 31,

2021

Performance Ratios
Return on Average Assets (ROA)
1.12 % 1.07 % 0.88 % 0.95 % 0.82 %
ROA based on Pre-tax, pre-provision operating income
1.52 % 1.35 % 0.90 % 1.15 % 0.82 %
Return on Average Equity (ROE)
28.20 % 20.61 % 11.87 % 16.47 % 11.24 %
ROE based on Pre-tax, pre-provision operating income
38.22 % 25.92 % 12.18 % 19.91 % 11.23 %
Earnings per Share
$ 1.02 $ 0.99 $ 0.87 $ 3.56 $ 3.21
Net Interest Margin
3.74 % 3.49 % 2.90 % 3.36 % 2.91 %
Efficiency Ratio **
65.66 % 67.22 % 69.89 % 69.36 % 70.44 %
Non-Interest Income as a % of Avg. Assets**
0.94 % 0.95 % 0.99 % 0.89 % 0.93 %
Non-Interest Expense as a % of Avg. Assets**
3.04 % 2.92 % 2.59 % 2.86 % 2.58 %
As of As of
December 31, 2022 December 31, 2021
Bank Level Capital Ratios:
Tier 1 Leverage Ratio
10.04% (Est.) 9.04 %
Common Equity Tier 1 Ratio
15.37% (Est.) 16.07 %
Tier 1 Risk-Based Capital Ratio
15.37% (Est.) 16.07 %
Total Risk-Based Capital Ratio
16.46% (Est.) 17.17 %
Company:
Tangible Equity / Total Assets
4.29 % 7.15 %
Tangible Book Value per Share
$ 15.49 $ 28.29
Reconcilement of GAAP to Pre-tax, Pre-Provision Operating Income:
For the Twelve For the Twelve
For the Qtr For the Qtr For the Qtr Months Months
Ended Ended Ended Ended Ended

December 31,

2022

September 30,

2022

December 31,

2021

December 31,

2022

December 31,

2021

Net Income (GAAP)
$ 3,492,661 $ 3,388,452 $ 2,977,469 $ 12,166,756 $ 11,014,968
Provision for Loan Lossess
533,000 189,000 - 722,000 330,000
Net (Gain) Loss on OREO
(11,952 ) 41,400 5,198 30,034 383,569
Net (Gain) Loss on Securities
- - - - (6,682 )
Non-recurring Revenue
- - - (291,127 ) (363,750 )
Non-recurring Expenses
- - - 282,961 199,656
Nonrecurring Revenue - PPP origination fees
- (32,028 ) (497,935 ) (605,497 ) (2,683,415 )
Income Tax Expense
720,896 674,835 571,347 2,407,022 2,130,978
Pre-tax, Pre-Provision Operating Income
$ 4,734,605 $ 4,261,659 $ 3,056,079 $ 14,712,149 $ 11,005,324
** Non-recurring items are eliminated for this ratio

SOURCE: JD Bancshares, Inc.



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