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Alerus Financial Corporation Reports Fourth Quarter 2022 Net Income of $10.9 Million

Alerus Financial Corporation (Nasdaq: ALRS) reported net income of $10.9 million for the fourth quarter of 2022, or $0.53 per diluted common share, compared to net income of $9.6 million, or $0.47 per diluted common share, for the third quarter of 2022, and net income of $12.7 million, or $0.72 per diluted common share, for the fourth quarter of 2021.

CEO Comments

President and Chief Executive Officer Katie Lorenson said, “2022 was a year of transitions and milestones for our Company. We completed our largest acquisition with Metro Phoenix Bank, which was transformational to our growth in the Arizona market. We added new leadership and had continued momentum in talent acquisitions with successful lift outs and additions of commercial bankers, treasury management professionals, and wealth and retirement advisors. We remain focused on client acquisition and deepening of relationships with existing clients through our diversified business model. We continue to right size our infrastructure and manage expenses, despite facing inflationary pressures. During the year, we returned over 33% of our earnings to our shareholders by increasing our dividend 11%. We remain focused on creating long-term value for our clients, and in return, our shareholders. I want to thank our employees for all their continued hard work in developing the strong foundation from which we will continue to grow from in 2023 and beyond.”

Quarterly Highlights

  • Return on average total assets of 1.17%, compared to 1.02% for the third quarter of 2022
  • Return on average common equity of 12.37%, compared to 10.25% for the third quarter of 2022
  • Return on average tangible common equity(1) of 16.63%, compared to 13.89% for the third quarter of 2022
  • Net interest margin (tax-equivalent) was 3.09%, compared to 3.21% for the third quarter of 2022
  • Noninterest expense was $37.9 million, a $4.8 million, or 11.3%, decrease compared to $42.8 million for the third quarter of 2022
  • Efficiency ratio(1) of 69.6%, compared to 74.8% for the third quarter of 2022
  • Allowance for loan losses to total loans was 1.27% compared to 1.80% as of December 31, 2021. Excluding the acquisition of Metro Phoenix Bank the allowance for loan losses to total loans was 1.43% as of December 31, 2022
  • Noninterest income for the third quarter of 2022 was 48.62% of total revenue, compared to 48.82% for the third quarter of 2022
  • Loan to deposit ratio was 83.8%, compared to 60.2% as of December 31, 2021
  • Common equity tier 1 capital to risk weighted assets was 13.39%, compared to 14.65% as of December 31, 2021

Full Year 2022 Highlights

  • Net income of $40.0 million, a decrease of $12.7 million, or 24.1%, compared to $52.7 million in 2021
  • Noninterest expense of $158.8 million, a decrease of $10.1 million, or 6.0%, compared to $168.9 million in 2021
  • No provision for loan losses expense in 2022, compared to a $3.5 million reversal of provision for loan losses expense in 2021
  • Loans held for investment increased $686.0 million, or 39.0%, since December 31, 2021, including $270.4 million of loans acquired from Metro Phoenix Bank. Excluding the acquisition of Metro Phoenix Bank and Paycheck Protection Program, or PPP, loans, loans held for investment increased $448.4 million, or 25.5%, since December 31, 2021
  • Average loans of $2.1 billion, an increase of $200.7 million, or 10.8%, from 2021
  • Average deposits of $2.9 billion, an increase of $158.0 million, or 5.8%, from 2021
  • Diluted earnings per share, or EPS, of $2.10, compared to $2.97 in 2021
  • Return on average total assets of 1.14%, compared to 1.66% in 2021
  • Return on average common equity of 11.55%, compared to 15.22% in 2021
  • Return on average tangible common equity(1) of 15.09%, compared to 18.89% in 2021
  • Revenue of $211.0 million, a decrease of $23.5 million, or 10.0%, compared to $234.5 million in 2021
    • Net interest income was $99.7 million, an increase of $12.6 million, or 14.5%, compared to $87.1 million in 2021
    • Noninterest income was $111.2 million, a decrease of $36.2 million, or 24.5%, compared to $147.4 million in 2021
  • Dividends declared per common share were $0.70, a $0.07, or 11.1% increase compared to $0.63 in 2021

(1)

Represents a non-GAAP financial measure. See “Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures.”

 

Selected Financial Data (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of and for the

 

 

 

Three months ended

 

Year ended

 

 

 

December 31,

 

September 30,

 

December 31,

 

December 31,

 

December 31,

 

(dollars and shares in thousands, except per share data)

 

2022

 

2022

 

2021

 

2022

 

2021

 

Performance Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average total assets

 

 

1.17

%

 

1.02

%

 

1.50

%

 

1.14

%

 

1.66

%

Return on average common equity

 

 

12.37

%

 

10.25

%

 

14.12

%

 

11.55

%

 

15.22

%

Return on average tangible common equity (1)

 

 

16.63

%

 

13.89

%

 

17.36

%

 

15.09

%

 

18.89

%

Noninterest income as a % of revenue

 

 

48.62

%

 

48.82

%

 

59.67

%

 

52.72

%

 

62.86

%

Net interest margin (tax-equivalent)

 

 

3.09

%

 

3.21

%

 

2.84

%

 

3.04

%

 

2.90

%

Efficiency ratio (1)

 

 

69.62

%

 

74.76

%

 

71.06

%

 

72.86

%

 

70.02

%

Net charge-offs/(recoveries) to average loans

 

 

(0.03)

%

 

0.07

%

 

(0.22)

%

 

0.02

%

 

(0.04)

%

Dividend payout ratio

 

 

33.96

%

 

38.30

%

 

22.22

%

 

33.33

%

 

21.21

%

Per Common Share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share - basic

 

$

0.54

 

$

0.48

 

$

0.73

 

$

2.12

 

$

3.02

 

Earnings per common share - diluted

 

$

0.53

 

$

0.47

 

$

0.72

 

$

2.10

 

$

2.97

 

Dividends declared per common share

 

$

0.18

 

$

0.18

 

$

0.16

 

$

0.70

 

$

0.63

 

Book value per common share

 

$

17.85

 

$

17.25

 

$

20.88

 

 

 

 

 

 

 

Tangible book value per common share (1)

 

$

14.37

 

$

13.76

 

$

17.87

 

 

 

 

 

 

 

Average common shares outstanding - basic

 

 

19,988

 

 

19,987

 

 

17,210

 

 

18,640

 

 

17,189

 

Average common shares outstanding - diluted

 

 

20,232

 

 

20,230

 

 

17,480

 

 

18,884

 

 

17,486

 

Other Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retirement and benefit services assets under administration/management

 

$

32,122,520

 

$

30,545,694

 

$

36,732,938

 

 

 

 

 

 

 

Wealth management assets under administration/management

 

$

3,582,648

 

$

3,435,786

 

$

4,039,931

 

 

 

 

 

 

 

Mortgage originations

 

$

126,254

 

$

229,901

 

$

356,821

 

$

812,314

 

$

1,836,064

 

(1)

Represents a non-GAAP financial measure. See “Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures.”

Results of Operations

Net Interest Income

Net interest income for the third quarter of 2022 was $27.0 million, a $1.4 million, or 4.8%, decrease from the third quarter of 2022. Net interest income increased $4.2 million, or 18.3%, from $22.8 million for the fourth quarter of 2021. The quarter over quarter decrease in net interest income was primarily driven by an increase of $4.8 million, or 123.5%, in interest expense, partially offset by a $3.5 million, or 11.0%, increase in interest income. The increase in interest expense was primarily due to increases of $3.8 million in interest expense paid on deposits and $1.0 million in interest expense paid on short-term borrowings. The increase in interest expense paid on deposits was primarily due to deposit rate increases in response to a highly competitive deposit environment arising from the Federal Reserve Bank raising short-term rates. Short-term borrowings expense increased as short-term rates increased and the average balance of short-term borrowings increased as loan growth outpaced deposit growth in the fourth quarter of 2022.

Net interest margin (tax-equivalent), a non-GAAP financial measure, was 3.09% for the fourth quarter of 2022, a 12 basis point decrease from 3.21% for the third quarter of 2022, and a 25 basis point increase from 2.84% in the fourth quarter of 2021. The linked quarter decrease was primarily driven by a 79 basis point increase in the rate paid on interest-bearing liabilities, partially offset by a 45 basis point increase in interest earning asset yields. The increase in the rate paid on interest-bearing liabilities was the result of a 73 basis point increase on the rate paid on interest-bearing deposits and a 143 basis point increase in the rate paid on fed funds purchased and short-term borrowings. The increase in interest earning asset yields was primarily driven by a 49 basis point increase in loan yields. Additionally, we saw a $97.4 million increase in average total loans, primarily due to a $56.6 million increase in the average balance of commercial real estate and real estate construction loans.

Noninterest Income

Noninterest income for the fourth quarter of 2022 was $25.5 million, a $1.5 million, or 5.5%, decrease from the third quarter of 2022. The quarter over quarter decrease was primarily driven by a $1.6 million decrease in mortgage banking revenue, partially offset by a $292 thousand increase in wealth management revenue. The decrease in mortgage banking revenue was primarily due to a $103.6 million, or 45.1%, decrease in mortgage originations driven by macroeconomic challenges, partially offset by a 41 basis point increase in the gain on sale margin. The increase in wealth management revenue was primarily driven by a $146.9 million increase in assets under management, due to increased market value from improved bond and equity markets.

Noninterest income for the fourth quarter of 2022 decreased $8.2 million, or 24.3%, from $33.7 million in the fourth quarter of 2021. The decrease in noninterest income was primarily due to decreases of $5.8 million in mortgage banking revenue, $2.0 million in retirement and benefit services revenue and $489 thousand in wealth management revenue. The decrease in mortgage banking revenue was primarily due to a $230.6 million decrease in mortgage originations driven by macroeconomic challenges. The decrease in retirement and benefit services revenue was primarily due to a $4.6 billion decrease in assets under administration/management. Wealth management revenue decreased primarily due to a $457.3 million decrease in assets under management. Both decreases in assets under administration/management were mainly driven by lower bond and equity markets.

Noninterest Expense

Noninterest expense for the fourth quarter of 2022 was $37.9 million, a $4.8 million, or 11.3%, decrease compared to the third quarter of 2022. The linked quarter decrease in noninterest expense was primarily due to decreases of $2.0 million in compensation expense, $1.7 million in professional fees and assessments, and $968 thousand in business services, software and technology expense. Compensation expense decreased primarily due to lower mortgage incentives associated with the decrease in mortgage originations as well as an accrual adjustment to performance bonus accruals. The decrease in professional fees and assessments was primarily driven by a decline in the one-time expenses associated with the acquisition of Metro Phoenix Bank. Business services, software and technology expense decreased primarily due to the timing of contract renewals.

Noninterest expense for the fourth quarter of 2022 decreased $3.3 million, or 8.1%, from $41.3 million in the fourth quarter of 2021. The year over year decrease in noninterest expense was primarily driven by decreases of $2.9 million in compensation expense, $815 thousand of business services, software and technology expense, and $703 thousand in employee taxes and benefits expense, partially offset by a $1.0 million increase in other noninterest expense. The decrease in compensation expense was primarily due to lower mortgage incentives associated with the decrease in mortgage originations. Business services, software and technology expense decreased primarily due to the timing of contract renewals. The decrease in employee taxes and benefits expense was primarily due to a $531 thousand decrease in share-based compensation from an acceleration upon employee retirements. The increase in other noninterest expense included $469 thousand in one-time expenses from our divestiture of payroll services and $247 thousand increase in the provision for unfunded commitments.

Financial Condition

Total assets were $3.8 billion as of December 31, 2022, an increase of $386.9 million, or 11.4%, from December 31, 2021. The increase in assets included an increase of $686.0 million in loans held for investment, partially offset by decreases of $184.1 million in cash and cash equivalents and $166.5 million in investment securities.

Loans

Total loans were $2.4 billion as of December 31, 2022, an increase of $686.0 million, or 39.0%, from December 31, 2021. The increase in total loans was primarily due to increases of $415.6 million in organic loan growth and $270.4 million in loans acquired from Metro Phoenix Bank. Excluding loans acquired from Metro Phoenix Bank, the increase in organic loan growth included increases of $154.5 million in commercial real estate, $149.2 million in residential real estate first mortgages and $50.5 million in commercial and industrial loans. Excluding PPP loans and loans acquired from Metro Phoenix Bank, commercial and industrial loans increased $83.4 million.

The following table presents the composition of our loan portfolio as of the dates indicated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

(dollars in thousands)

 

2022

 

2022

 

2022

 

2022

 

2021

Commercial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial (1)

 

$

583,876

 

$

564,655

 

$

484,426

 

$

467,449

 

$

436,761

Real estate construction

 

 

97,810

 

 

89,215

 

 

48,870

 

 

41,604

 

 

40,619

Commercial real estate

 

 

881,670

 

 

819,068

 

 

599,737

 

 

602,158

 

 

598,893

Total commercial

 

 

1,563,356

 

 

1,472,938

 

 

1,133,033

 

 

1,111,211

 

 

1,076,273

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential real estate first mortgage

 

 

679,551

 

 

649,818

 

 

568,571

 

 

522,489

 

 

510,716

Residential real estate junior lien

 

 

150,479

 

 

143,681

 

 

135,255

 

 

130,604

 

 

125,668

Other revolving and installment

 

 

50,608

 

 

51,794

 

 

53,384

 

 

53,738

 

 

45,363

Total consumer

 

 

880,638

 

 

845,293

 

 

757,210

 

 

706,831

 

 

681,747

Total loans

 

$

2,443,994

 

$

2,318,231

 

$

1,890,243

 

$

1,818,042

 

$

1,758,020

(1)

Includes PPP loans of $737 thousand at December 31, 2022, $2.9 million at September 30, 2022, $6.9 million at June 30, 2022, $13.1 million at March 31, 2022 and $33.6 million at December 31, 2021.

Deposits

Total deposits were $2.9 billion as of December 31, 2022, a decrease of $5.1 million, or 0.2%, from December 31, 2021. Interest-bearing deposits increased $72.8 million, while noninterest-bearing deposits decreased $77.9 million in the fourth quarter of 2022. In the third quarter of 2022, we acquired $353.7 million in deposits from our acquisition of Metro Phoenix Bank. Excluding deposits acquired from Metro Phoenix Bank, deposits decreased $358.8 million, or 12.3%, from December 31, 2021. The decrease was primarily due to decreases of $184.7 million in interest-bearing deposits and $174.0 million in noninterest-bearing deposits. Interest-bearing deposits decreased primarily due to a $84.9 million decrease in money market savings accounts, and a $69.0 million decrease in time deposits. Noninterest-bearing deposits decreased primarily due to a $68.3 million decrease in synergistic deposits. Synergistic deposits, which include deposits from our retirement and benefit services and wealth management segments as well as HSA deposits, increased $22.6 million from December 31, 2021, primarily due to increases in our synergistic deposits from our wealth management division.

The following table presents the composition of our deposit portfolio as of the dates indicated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

(dollars in thousands)

 

2022

 

2022

 

2022

 

2022

 

2021

Noninterest-bearing demand

 

$

860,987

 

$

905,228

 

$

764,808

 

$

831,558

 

$

938,840

Interest-bearing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand

 

 

706,275

 

 

653,216

 

 

642,641

 

 

760,321

 

 

714,669

Savings accounts

 

 

99,882

 

 

101,820

 

 

97,227

 

 

99,299

 

 

96,825

Money market savings

 

 

1,035,981

 

 

1,079,520

 

 

914,423

 

 

976,905

 

 

937,305

Time deposits

 

 

212,359

 

 

222,027

 

 

200,451

 

 

224,184

 

 

232,912

Total interest-bearing

 

 

2,054,497

 

 

2,056,583

 

 

1,854,742

 

 

2,060,709

 

 

1,981,711

Total deposits

 

$

2,915,484

 

$

2,961,811

 

$

2,619,550

 

$

2,892,267

 

$

2,920,551

Asset Quality

Total nonperforming assets were $3.8 million as of December 31, 2022, an increase of $742 thousand, or 24.1%, from December 31, 2021. As of December 31, 2022, the allowance for loan losses was $31.1 million, or 1.27% of total loans, compared to $31.6 million, or 1.80% of total loans, as of December 31, 2021. Excluding Metro Phoenix Bank, the allowance for loan losses to total loans was 1.43% as of December 31, 2022.

The following table presents selected asset quality data as of and for the periods indicated:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of and for the three months ended

 

 

 

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

(dollars in thousands)

 

2022

 

2022

 

2022

 

2022

 

2021

 

Nonaccrual loans

 

$

3,794

 

$

4,303

 

$

4,370

 

$

4,069

 

$

2,076

 

Accruing loans 90+ days past due

 

 

 

 

1,000

 

 

 

 

146

 

 

121

 

Total nonperforming loans

 

 

3,794

 

 

5,303

 

 

4,370

 

 

4,215

 

 

2,197

 

OREO and repossessed assets

 

 

30

 

 

904

 

 

860

 

 

865

 

 

885

 

Total nonperforming assets

 

$

3,824

 

$

6,207

 

$

5,230

 

$

5,080

 

$

3,082

 

Net charge-offs/(recoveries)

 

 

(178)

 

 

405

 

 

340

 

 

(141)

 

 

(1,006)

 

Net charge-offs/(recoveries) to average loans

 

 

(0.03)

%

 

0.07

%

 

0.07

%

 

(0.03)

%

 

(0.22)

%

Nonperforming loans to total loans

 

 

0.16

%

 

0.23

%

 

0.23

%

 

0.23

%

 

0.12

%

Nonperforming assets to total assets

 

 

0.10

%

 

0.17

%

 

0.16

%

 

0.15

%

 

0.09

%

Allowance for loan losses to total loans

 

 

1.27

%

 

1.34

%

 

1.66

%

 

1.74

%

 

1.80

%

Allowance for loan losses to nonperforming loans

 

 

821

%

 

584

%

 

718

%

 

752

%

 

1,437

%

For the fourth quarter of 2022, we had net recoveries of $178 thousand compared to net charge-offs of $405 thousand for the third quarter of 2022 and $1.0 million of net recoveries for the fourth quarter of 2021.

There was no provision expense recorded for the three months ended December 31, 2022, no change compared to the three months ended September 30, 2022, and a $1.5 million increase as compared to the three months ended December 31, 2021. With the decrease in nonperforming assets, as well as adjustments for pandemic related qualitative factors, management concluded no need for additional provision expense in the period.

Capital

Total stockholders’ equity was $356.9 million as of December 31, 2022, a decrease of $2.5 million, or 0.7%, from December 31, 2021. The decrease in stockholders’ equity was primarily due to a $94.4 million decrease in other comprehensive loss, due to rising interest rates, which resulted in a lower fair value of our available-for-sale investment securities portfolio. Tangible book value per common share, a non-GAAP financial measure, decreased to $14.37 as of December 31, 2022, from $17.87 as of December 31, 2021. Tangible common equity to tangible assets, a non-GAAP financial measure, decreased to 7.74% as of December 31, 2022, from 9.21% as of December 31, 2021. Common equity tier 1 capital to risk weighted assets decreased to 13.39% as of December 31, 2022, from 14.65% as of December 31, 2021.

The following table presents our capital ratios as of the dates indicated:

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

September 30,

 

December 31,

 

 

 

2022

 

2022

 

2021

 

Capital Ratios(1)

 

 

 

 

 

 

 

 

 

 

Alerus Financial Corporation Consolidated

 

 

 

 

 

 

 

 

 

 

Common equity tier 1 capital to risk weighted assets

 

 

13.39

%

 

13.63

%

 

14.65

%

Tier 1 capital to risk weighted assets

 

 

13.69

%

 

13.94

%

 

15.06

%

Total capital to risk weighted assets

 

 

16.48

%

 

16.84

%

 

18.64

%

Tier 1 capital to average assets

 

 

11.25

%

 

10.82

%

 

9.79

%

Tangible common equity / tangible assets (2)

 

 

7.74

%

 

7.59

%

 

9.21

%

 

 

 

 

 

 

 

 

 

 

 

Alerus Financial, N.A.

 

 

 

 

 

 

 

 

 

 

Common equity tier 1 capital to risk weighted assets

 

 

12.76

%

 

13.01

%

 

13.87

%

Tier 1 capital to risk weighted assets

 

 

12.76

%

 

13.01

%

 

13.87

%

Total capital to risk weighted assets

 

 

13.83

%

 

14.11

%

 

15.12

%

Tier 1 capital to average assets

 

 

10.48

%

 

11.12

%

 

9.01

%

(1)

Capital ratios for the current quarter are to be considered preliminary until the Call Report for Alerus Financial, N.A. is filed.

(2)

Represents a non-GAAP financial measure. See “Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures.”

Conference Call

The Company will host a conference call at 11:00 a.m. Central Time on Thursday, January 26, 2023, to discuss its financial results. The call can be accessed via telephone at (844) 200-6205, using access code 249132. A recording of the call and transcript will be available on the Company’s investor relations website at investors.alerus.com following the call.

About Alerus Financial Corporation

Alerus Financial Corporation is a diversified financial services company with corporate offices in Grand Forks, North Dakota, and the Minneapolis-St. Paul, Minnesota metropolitan area. Through its subsidiary, Alerus Financial, N.A., Alerus provides innovative and comprehensive financial solutions to business and consumer clients through four distinct business segments—banking, retirement and benefit services, wealth management, and mortgage. Alerus provides clients with a primary point of contact to help fully understand the unique needs and delivery channel preferences of each client. Clients are provided with competitive products, valuable insight and sound advice supported by digital solutions designed to meet the clients’ needs. Alerus has banking, mortgage, and wealth management offices in Grand Forks and Fargo, North Dakota, the Minneapolis-St. Paul, Minnesota metropolitan area, and Phoenix, Scottsdale, and Mesa Arizona. Alerus Retirement and Benefits plan administration hubs are located in Minnesota, Michigan, and Colorado.

Non-GAAP Financial Measures

Some of the financial measures included in this press release are not measures of financial performance recognized by U.S. Generally Accepted Accounting Principles, or GAAP. These non-GAAP financial measures include the ratio of tangible common equity to tangible assets, tangible common equity per share, return on average tangible common equity, net interest margin (tax-equivalent), and the efficiency ratio. Management uses these non-GAAP financial measures in its analysis of its performance, and believes financial analysts and investors frequently use these measures, and other similar measures, to evaluate capital adequacy and financial performance. Reconciliations of non-GAAP disclosures used in this press release to the comparable GAAP measures are provided in the accompanying tables. Management, banking regulators, many financial analysts and other investors use these measures in conjunction with more traditional bank capital ratios to compare the capital adequacy of banking organizations with significant amounts of goodwill or other intangible assets, which typically stem from the use of the purchase accounting method of accounting for mergers and acquisitions.

These non-GAAP financial measures should not be considered in isolation or as a substitute for total stockholders’ equity, total assets, book value per share, return on average assets, return on average equity, or any other measure calculated in accordance with GAAP. Moreover, the manner in which we calculate these non-GAAP financial measures may differ from that of other companies reporting measures with similar names.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of Alerus Financial Corporation. These statements are often, but not always, identified by words such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized”, “target” and “outlook”, or the negative version of those words or other comparable words of a future or forward-looking nature. Examples of forward-looking statements include, among others, statements we make regarding our projected growth, anticipated future financial performance, financial condition, credit quality, management’s long-term performance goals and the future plans and prospects of Alerus Financial Corporation.

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: interest rate risks associated with our business, including the effects of recent and anticipated rate increases by the Federal Reserve; our ability to successfully manage credit risk and maintain an adequate level of allowance for loan losses; new or revised accounting standards, including as a result of the implementation of the new Current Expected Credit Loss Standard; business and economic conditions generally and in the financial services industry, nationally and within our market areas, including continued rising rates of inflation; the overall health of the local and national real estate market; concentrations within our loan portfolio; the level of nonperforming assets on our balance sheet; our ability to implement our organic and acquisition growth strategies, including the integration of Metro Phoenix Bank which we acquired in 2022; the impact of economic or market conditions on our fee-based services; our ability to continue to grow our retirement and benefit services business; our ability to continue to originate a sufficient volume of residential mortgages; the occurrence of fraudulent activity, breaches or failures of our information security controls or cybersecurity-related incidents; interruptions involving our information technology and telecommunications systems or third-party servicers; potential losses incurred in connection with mortgage loan repurchases; the composition of our executive management team and our ability to attract and retain key personnel; rapid technological change in the financial services industry; increased competition in the financial services industry from non-banks such as credit unions and Fintech companies, including digital asset service providers; our ability to successfully manage liquidity risk, including our need to access higher cost sources of funds such as fed funds purchased and short-term borrowings; the effectiveness of our risk management framework; the commencement and outcome of litigation and other legal proceedings and regulatory actions against us or to which we may become subject; potential impairment to the goodwill we recorded in connection with our past acquisitions, including the acquisition of Metro Phoenix Bank; the extensive regulatory framework that applies to us; the impact of recent and future legislative and regulatory changes; fluctuations in the values of the securities held in our securities portfolio, including as a result of rising interest rates, which has resulted in unrealized losses in our portfolio; governmental monetary, trade and fiscal policies; risks related to climate change and the negative impact it may have on our customers and their businesses; severe weather, natural disasters, widespread disease or pandemics, such as the COVID-19 global pandemic, the negative effects of the ongoing COVID-19 pandemic, including its effects on the economic environment, our clients, and our operations, including due to supply chain disruptions, as well as any changes to federal, state, or local government laws, regulations, or orders in response to the pandemic; acts of war or terrorism, including the Russian invasion of Ukraine, or other adverse external events; any material weaknesses in our internal control over financial reporting; developments and uncertainty related to the future use and availability of some reference rates, such as the expected discontinuation of the London Interbank Offered Rate, as well as the development and implementation of other alternative reference rates; changes to U.S. or state tax laws, regulations and guidance, including the new 1.0% excise tax on stock buybacks by publicly traded companies; talent and labor shortages and employee turnover; our success at managing the risks involved in the foregoing items; and any other risks described in the “Risk Factors” sections of the reports filed by Alerus Financial Corporation with the Securities and Exchange Commission.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Alerus Financial Corporation and Subsidiaries

Consolidated Balance Sheets

(dollars in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

December 31,

 

December 31,

 

 

2022

 

2021

Assets

 

(Unaudited)

 

(Audited)

Cash and cash equivalents

 

$

58,242

 

$

242,311

Investment securities

 

 

 

 

 

 

Available-for-sale, at fair value

 

 

717,324

 

 

853,649

Held-to-maturity, at carrying value

 

 

321,902

 

 

352,061

Fed funds sold

 

 

 

 

Loans held for sale

 

 

9,488

 

 

46,490

Loans

 

 

2,443,994

 

 

1,758,020

Allowance for loan losses

 

 

(31,146)

 

 

(31,572)

Net loans

 

 

2,412,848

 

 

1,726,448

Land, premises and equipment, net

 

 

17,288

 

 

18,370

Operating lease right-of-use assets

 

 

5,419

 

 

3,727

Accrued interest receivable

 

 

12,869

 

 

8,537

Bank-owned life insurance

 

 

33,991

 

 

33,156

Goodwill

 

 

47,087

 

 

31,490

Other intangible assets

 

 

22,455

 

 

20,250

Servicing rights

 

 

2,643

 

 

1,880

Deferred income taxes, net

 

 

42,369

 

 

11,614

Other assets

 

 

75,712

 

 

42,708

Total assets

 

$

3,779,637

 

$

3,392,691

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

Noninterest-bearing

 

$

860,987

 

$

938,840

Interest-bearing

 

 

2,054,497

 

 

1,981,711

Total deposits

 

 

2,915,484

 

 

2,920,551

Short-term borrowings

 

 

378,080

 

 

Long-term debt

 

 

58,843

 

 

58,933

Operating lease liabilities

 

 

5,902

 

 

4,275

Accrued expenses and other liabilities

 

 

64,456

 

 

49,529

Total liabilities

 

 

3,422,765

 

 

3,033,288

Stockholders’ equity

 

 

 

 

 

 

Preferred stock, $1 par value, 2,000,000 shares authorized: 0 issued and outstanding

 

 

 

 

Common stock, $1 par value, 30,000,000 shares authorized: 19,991,681 and 17,212,588 issued and outstanding

 

 

19,992

 

 

17,213

Additional paid-in capital

 

 

155,095

 

 

92,878

Retained earnings

 

 

280,426

 

 

253,567

Accumulated other comprehensive income (loss)

 

 

(98,641)

 

 

(4,255)

Total stockholders’ equity

 

 

356,872

 

 

359,403

Total liabilities and stockholders’ equity

 

$

3,779,637

 

$

3,392,691

Alerus Financial Corporation and Subsidiaries

Consolidated Statements of Income

(dollars and shares in thousands, except per share data)

 

 

 

Three months ended

 

Year ended

 

 

December 31,

 

September 30,

 

December 31,

 

December 31,

 

December 31,

 

 

2022

 

2022

 

2021

 

2022

 

2021

Interest Income

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Unaudited)

 

(Audited)

Loans, including fees

 

$

29,248

 

$

25,379

 

$

19,354

 

$

89,907

 

$

78,133

Investment securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Taxable

 

 

5,813

 

 

5,939

 

 

4,454

 

 

23,260

 

 

13,001

Exempt from federal income taxes

 

 

210

 

 

209

 

 

231

 

 

848

 

 

925

Other

 

 

541

 

 

748

 

 

166

 

 

1,562

 

 

598

Total interest income

 

 

35,812

 

 

32,275

 

 

24,205

 

 

115,577

 

 

92,657

Interest Expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

 

5,675

 

 

1,852

 

 

880

 

 

9,169

 

 

3,661

Short-term borrowings

 

 

2,545

 

 

1,516

 

 

 

 

4,339

 

 

Long-term debt

 

 

628

 

 

591

 

 

536

 

 

2,340

 

 

1,897

Total interest expense

 

 

8,848

 

 

3,959

 

 

1,416

 

 

15,848

 

 

5,558

Net interest income

 

 

26,964

 

 

28,316

 

 

22,789

 

 

99,729

 

 

87,099

Provision for loan losses

 

 

 

 

 

 

(1,500)

 

 

 

 

(3,500)

Net interest income after provision for loan losses

 

 

26,964

 

 

28,316

 

 

24,289

 

 

99,729

 

 

90,599

Noninterest Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retirement and benefit services

 

 

16,599

 

 

16,597

 

 

18,552

 

 

67,135

 

 

71,709

Wealth management

 

 

5,144

 

 

4,852

 

 

5,633

 

 

20,870

 

 

21,052

Mortgage banking

 

 

2,170

 

 

3,782

 

 

7,967

 

 

16,921

 

 

48,502

Service charges on deposit accounts

 

 

282

 

 

377

 

 

370

 

 

1,434

 

 

1,395

Net gains (losses) on investment securities

 

 

 

 

 

 

 

 

 

 

125

Other

 

 

1,322

 

 

1,402

 

 

1,196

 

 

4,863

 

 

4,604

Total noninterest income

 

 

25,517

 

 

27,010

 

 

33,718

 

 

111,223

 

 

147,387

Noninterest Expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation

 

 

19,189

 

 

21,168

 

 

22,088

 

 

80,656

 

 

93,386

Employee taxes and benefits

 

 

4,887

 

 

5,079

 

 

5,590

 

 

21,915

 

 

22,033

Occupancy and equipment expense

 

 

1,892

 

 

1,926

 

 

1,936

 

 

7,605

 

 

8,148

Business services, software and technology expense

 

 

4,405

 

 

5,373

 

 

5,220

 

 

19,487

 

 

20,486

Intangible amortization expense

 

 

1,324

 

 

1,324

 

 

1,053

 

 

4,754

 

 

4,380

Professional fees and assessments

 

 

1,454

 

 

3,126

 

 

1,808

 

 

8,367

 

 

6,292

Marketing and business development

 

 

950

 

 

890

 

 

872

 

 

3,254

 

 

3,182

Supplies and postage

 

 

634

 

 

588

 

 

778

 

 

2,440

 

 

2,361

Travel

 

 

356

 

 

291

 

 

206

 

 

1,182

 

 

442

Mortgage and lending expenses

 

 

606

 

 

409

 

 

488

 

 

2,183

 

 

4,250

Other

 

 

2,251

 

 

2,593

 

 

1,237

 

 

6,927

 

 

3,949

Total noninterest expense

 

 

37,948

 

 

42,767

 

 

41,276

 

 

158,770

 

 

168,909

Income before income taxes

 

 

14,533

 

 

12,559

 

 

16,731

 

 

52,182

 

 

69,077

Income tax expense

 

 

3,624

 

 

2,940

 

 

4,026

 

 

12,177

 

 

16,396

Net income

 

$

10,909

 

$

9,619

 

$

12,705

 

$

40,005

 

$

52,681

Per Common Share Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share

 

$

0.54

 

$

0.48

 

$

0.73

 

$

2.12

 

$

3.02

Diluted earnings per common share

 

$

0.53

 

$

0.47

 

$

0.72

 

$

2.10

 

$

2.97

Dividends declared per common share

 

$

0.18

 

$

0.18

 

$

0.16

 

$

0.70

 

$

0.63

Average common shares outstanding

 

 

19,988

 

 

19,987

 

 

17,210

 

 

18,640

 

 

17,189

Diluted average common shares outstanding

 

 

20,232

 

 

20,230

 

 

17,480

 

 

18,884

 

 

17,486

Alerus Financial Corporation and Subsidiaries

Non-GAAP to GAAP Reconciliations and Calculation of Non-GAAP Financial Measures (unaudited)

(dollars and shares in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

September 30,

 

December 31,

 

 

 

2022

 

2022

 

2021

 

Tangible Common Equity to Tangible Assets

 

 

 

 

 

 

 

 

 

 

Total common stockholders’ equity

 

$

356,872

 

$

344,839

 

$

359,403

 

Less: Goodwill

 

 

47,087

 

 

46,060

 

 

31,490

 

Less: Other intangible assets

 

 

22,455

 

 

23,779

 

 

20,250

 

Tangible common equity (a)

 

 

287,330

 

 

275,000

 

 

307,663

 

Total assets

 

 

3,779,637

 

 

3,691,253

 

 

3,392,691

 

Less: Goodwill

 

 

47,087

 

 

46,060

 

 

31,490

 

Less: Other intangible assets

 

 

22,455

 

 

23,779

 

 

20,250

 

Tangible assets (b)

 

 

3,710,095

 

 

3,621,414

 

 

3,340,951

 

Tangible common equity to tangible assets (a)/(b)

 

 

7.74

%

 

7.59

%

 

9.21

%

Tangible Book Value Per Common Share

 

 

 

 

 

 

 

 

 

 

Total common stockholders’ equity

 

$

356,872

 

$

344,839

 

$

359,403

 

Less: Goodwill

 

 

47,087

 

 

46,060

 

 

31,490

 

Less: Other intangible assets

 

 

22,455

 

 

23,779

 

 

20,250

 

Tangible common equity (c)

 

 

287,330

 

 

275,000

 

 

307,663

 

Total common shares issued and outstanding (d)

 

 

19,992

 

 

19,987

 

 

17,213

 

Tangible book value per common share (c)/(d)

 

$

14.37

 

$

13.76

 

$

17.87

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Year ended

 

 

 

December 31,

 

September 30,

 

December 31,

 

December 31,

 

December 31,

 

 

 

2022

 

2022

 

2021

 

2022

 

2021

 

Return on Average Tangible Common Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

10,909

 

$

9,619

 

$

12,705

 

$

40,005

 

$

52,681

 

Add: Intangible amortization expense (net of tax)

 

 

1,046

 

 

1,046

 

 

832

 

 

3,756

 

 

3,460

 

Net income, excluding intangible amortization (e)

 

 

11,955

 

 

10,665

 

 

13,537

 

 

43,761

 

 

56,141

 

Average total equity

 

 

349,812

 

 

372,274

 

 

357,084

 

 

346,355

 

 

346,059

 

Less: Average goodwill

 

 

46,283

 

 

48,141

 

 

30,930

 

 

39,415

 

 

30,385

 

Less: Average other intangible assets (net of tax)

 

 

18,243

 

 

19,466

 

 

16,843

 

 

17,018

 

 

18,548

 

Average tangible common equity (f)

 

 

285,286

 

 

304,667

 

 

309,311

 

 

289,922

 

 

297,126

 

Return on average tangible common equity (e)/(f)

 

 

16.63

%

 

13.89

%

 

17.36

%

 

15.09

%

 

18.89

%

Efficiency Ratio

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expense

 

$

37,948

 

$

42,767

 

$

41,276

 

$

158,770

 

$

168,909

 

Less: Intangible amortization expense

 

 

1,324

 

 

1,324

 

 

1,053

 

 

4,754

 

 

4,380

 

Adjusted noninterest expense (g)

 

 

36,624

 

 

41,443

 

 

40,223

 

 

154,016

 

 

164,529

 

Net interest income

 

 

26,964

 

 

28,316

 

 

22,789

 

 

99,729

 

 

87,099

 

Noninterest income

 

 

25,517

 

 

27,010

 

 

33,718

 

 

111,223

 

 

147,387

 

Tax-equivalent adjustment

 

 

124

 

 

112

 

 

99

 

 

429

 

 

492

 

Total tax-equivalent revenue (h)

 

 

52,605

 

 

55,438

 

 

56,606

 

 

211,381

 

 

234,978

 

Efficiency ratio (g)/(h)

 

 

69.62

%

 

74.76

%

 

71.06

%

 

72.86

%

 

70.02

%

Alerus Financial Corporation and Subsidiaries

Analysis of Average Balances, Yields, and Rates (unaudited)

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Year ended

 

 

December 31, 2022

 

September 30, 2022

 

December 31, 2021

 

December 31, 2022

 

December 31, 2021

 

 

 

 

 

Average

 

 

 

 

Average

 

 

 

 

Average

 

 

 

 

Average

 

 

 

 

Average

 

 

Average

 

Yield/

 

Average

 

Yield/

 

Average

 

Yield/

 

Average

 

Yield/

 

Average

 

Yield/

 

 

Balance

 

Rate

 

Balance

 

Rate

 

Balance

 

Rate

 

Balance

 

Rate

 

Balance

 

Rate

Interest Earning Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits with banks

 

$

26,510

 

2.16

%

 

$

72,157

 

2.02

%

 

$

232,650

 

0.16

%

 

$

58,149

 

1.01

%

 

$

222,916

 

0.14

%

Investment securities (1)

 

 

1,046,441

 

2.30

%

 

 

1,116,458

 

2.20

%

 

 

1,119,370

 

1.68

%

 

 

1,135,426

 

2.14

%

 

 

864,273

 

1.64

%

Fed funds sold

 

 

7,119

 

3.40

%

 

 

21,893

 

2.37

%

 

 

 

%

 

 

7,313

 

2.63

%

 

 

 

%

Loans held for sale

 

 

14,505

 

4.54

%

 

 

27,032

 

4.14

%

 

 

53,357

 

2.33

%

 

 

24,497

 

3.49

%

 

 

65,968

 

2.26

%

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial and industrial

 

 

561,252

 

5.80

%

 

 

566,987

 

5.41

%

 

 

471,262

 

5.61

%

 

 

507,040

 

5.13

%

 

 

579,002

 

4.91

%

Real estate construction

 

 

96,189

 

6.02

%

 

 

70,545

 

5.60

%

 

 

41,573

 

3.89

%

 

 

63,296

 

5.21

%

 

 

41,751

 

4.10

%

Commercial real estate

 

 

838,466

 

4.85

%

 

 

807,505

 

4.07

%

 

 

587,542

 

3.90

%

 

 

713,102

 

4.16

%

 

 

571,326

 

3.77

%

Total commercial

 

 

1,495,907

 

5.28

%

 

 

1,445,037

 

4.67

%

 

 

1,100,377

 

4.63

%

 

 

1,283,438

 

4.59

%

 

 

1,192,079

 

4.34

%

Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential real estate first mortgage

 

 

665,135

 

3.64

%

 

 

624,826

 

3.54

%

 

 

504,997

 

3.30

%

 

 

587,443

 

3.50

%

 

 

477,621

 

3.47

%

Residential real estate junior lien

 

 

146,912

 

6.46

%

 

 

140,664

 

5.41

%

 

 

129,238

 

4.52

%

 

 

136,483

 

5.29

%

 

 

131,412

 

4.64

%

Other revolving and installment

 

 

51,836

 

5.62

%

 

 

51,834

 

4.98

%

 

 

48,045

 

4.53

%

 

 

52,071

 

4.85

%

 

 

57,574

 

4.41

%

Total consumer

 

 

863,883

 

4.24

%

 

 

817,324

 

3.96

%

 

 

682,280

 

3.62

%

 

 

775,997

 

3.91

%

 

 

666,607

 

3.78

%

Total loans (1)

 

 

2,359,790

 

4.90

%

 

 

2,262,361

 

4.41

%

 

 

1,782,657

 

4.25

%

 

 

2,059,435

 

4.33

%

 

 

1,858,686

 

4.14

%

Federal Reserve/FHLB stock

 

 

19,603

 

6.80

%

 

 

18,449

 

5.35

%

 

 

6,496

 

4.34

%

 

 

13,824

 

5.67

%

 

 

6,329

 

4.36

%

Total interest earning assets

 

 

3,473,968

 

4.10

%

 

 

3,518,350

 

3.65

%

 

 

3,194,530

 

3.02

%

 

 

3,298,644

 

3.52

%

 

 

3,018,172

 

3.09

%

Noninterest earning assets

 

 

232,754

 

 

 

 

 

224,804

 

 

 

 

 

159,370

 

 

 

 

 

202,011

 

 

 

 

 

160,648

 

 

 

Total assets

 

$

3,706,722

 

 

 

 

$

3,743,154

 

 

 

 

$

3,353,900

 

 

 

 

$

3,500,655

 

 

 

 

$

3,178,820

 

 

 

Interest-Bearing Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand deposits

 

$

692,217

 

0.50

%

 

$

659,696

 

0.13

%

 

$

754,432

 

0.13

%

 

$

692,287

 

0.22

%

 

$

697,276

 

0.14

%

Money market and savings deposits

 

 

1,185,502

 

1.39

%

 

 

1,180,576

 

0.40

%

 

 

1,039,492

 

0.14

%

 

 

1,113,426

 

0.55

%

 

 

1,023,677

 

0.15

%

Time deposits

 

 

214,264

 

1.20

%

 

 

234,459

 

0.74

%

 

 

225,497

 

0.46

%

 

 

221,997

 

0.70

%

 

 

215,624

 

0.54

%

Fed funds purchased

 

 

86,350

 

3.78

%

 

 

84,149

 

2.31

%

 

 

 

%

 

 

63,296

 

2.46

%

 

 

3

 

%

Short-term borrowings

 

 

178,533

 

3.82

%

 

 

168,750

 

2.41

%

 

 

 

%

 

 

89,932

 

3.10

%

 

 

 

%

Long-term debt

 

 

58,830

 

4.24

%

 

 

58,843

 

3.98

%

 

 

58,938

 

3.61

%

 

 

58,864

 

3.98

%

 

 

50,759

 

3.74

%

Total interest-bearing liabilities

 

 

2,415,696

 

1.45

%

 

 

2,386,473

 

0.66

%

 

 

2,078,359

 

0.27

%

 

 

2,239,802

 

0.71

%

 

 

1,987,339

 

0.28

%

Noninterest-Bearing Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

870,948

 

 

 

 

 

920,340

 

 

 

 

 

851,210

 

 

 

 

 

851,821

 

 

 

 

 

784,998

 

 

 

Other noninterest-bearing liabilities

 

 

70,266

 

 

 

 

 

64,067

 

 

 

 

 

67,247

 

 

 

 

 

62,677

 

 

 

 

 

60,424

 

 

 

Stockholders’ equity

 

 

349,812

 

 

 

 

 

372,274

 

 

 

 

 

357,084

 

 

 

 

 

346,355

 

 

 

 

 

346,059

 

 

 

Total liabilities and stockholders’ equity

 

$

3,706,722

 

 

 

 

$

3,743,154

 

 

 

 

$

3,353,900

 

 

 

 

$

3,500,655

 

 

 

 

$

3,178,820

 

 

 

Net interest income (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest rate spread

 

 

 

 

2.65

%

 

 

 

 

2.99

%

 

 

 

 

2.75

%

 

 

 

 

2.81

%

 

 

 

 

2.81

%

Net interest margin, tax-equivalent (1)

 

 

 

 

3.09

%

 

 

 

 

3.21

%

 

 

 

 

2.84

%

 

 

 

 

3.04

%

 

 

 

 

2.90

%

(1)

Taxable-equivalent adjustment was calculated utilizing a marginal income tax rate of 21.0%.

 

Contacts

Alan A. Villalon, Chief Financial Officer

952.417.3733 (Office)

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