More annual reports from Peoples Bancorp of North Carolina Inc.:
2023 ReportPeers and competitors of Peoples Bancorp of North Carolina Inc.:
Atlantic Capital Bank2 0 2 2 A N N U A L R E P O R T Our Promise Our Core Values: We strive to be exceptional Employees and inspire others to be exceptional too. Our Vision To be the bank that’s exceptional at serving our communities, including We are informed, encouraged, and committed. Integrity We are fair and truthful. Exceptional Customer Service We surpass our customers’ expectations. employees, customers Accountability and shareholders. We are accountable for our own actions and bank goals. Progressive and Positive We see change as an opportunity. Our Mission To provide exceptional customer service while selling to customer needs. Table of Contents Message from the President Financial Highlights Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets Consolidated Statements of Earnings Our Leadership 2 4 5 6 7 8 From the President 2 0 2 2 A n n u a l R e p o r t 2022 was the Bank’s 110th consecutive year of business, continuing to build relationships, achieve goals, and contribute to making communities stronger. Once again, this year’s annual report will reflect the continued dedication of our employees who go the extra mile to serve, inform, and support our customers and are always willing to give back to the communities where we live and work. Thank you for all you do to help others reach their potential. At Peoples Bank, we don’t just offer financial services solutions, we also educate. We want our customers to make smart decisions when it comes to saving, spending, and managing their finances. It’s important that our customers know we have the resources and knowledge to guide them to stronger financial wellness. Having made financial education a key focus, we launched our Financial Wellness Learning Center, which provides online financial education. Also, we provide resources to our community’s teachers to use in the classroom. In addition to the Bank, which operates as a wholly-owned subsidiary of the Company, we would like to remind you of Year-to-date highlights are as follows: our three subsidiary companies: l Net earnings were $16.1 million or $2.94 per share and $2.85 per diluted share for the year ended December 31, 2022, as compared to $15.1 million or $2.71 per share and $2.63 per diluted share for the year ended December 31, 2021. Peoples Investment Services, Inc., licensed financial advisors who provide access to investment products, which include stocks, bonds, mutual funds, annuities, and other suitable monetary investments through our affiliation with Raymond James Financial Services, Inc. l Total loans increased $147.7 million to $1.0 billion at December 31, 2022, compared Real Estate Advisory Services, Inc., which provides real estate appraisals (both residential and commercial) to the to $884.9 million at December 31, 2021. Peoples Bank market area, thereby becoming a valued partner with respect to real estate lending. l Core deposits were $1.4 billion or 97.84% of total deposits at December 31, 2022, compared to $1.4 billion or 98.14% of total deposits at December 31, 2021. Peoples Bank continues to be a well-capitalized Bank with strong earnings and operating standards. In addition to extending our gratitude to our employees for our many successes, we must also recognize our board of directors who lead with extraordinary insights and vision. Thank you for your guidance and strength, and for helping us make a difference. Community Bank Real Estate Solutions, LLC, assists community banks across the country with appraisal management services. We hope you will continue to recommend our Bank and subsidiary companies to members of your communities. Sincerely, Here is a recap of some of our more noteworthy achievements and announcements Lance A. Sellers this year. President and Chief Executive Officer Many people rely on Peoples Bank. It’s important to be where we are needed most, and to be easily accessible for our customers. To that end, we relocated our Cornelius office to Huntersville, North Carolina. The new full-service branch opened for business on May 3, 2022, at 9617 Holly Point Drive. This location allows us to extend service to more people and local businesses. Also, it provides a drive-thru service and an easily accessible ATM for customers. Our customers—both consumer and business—rely on lending solutions to get ahead in life and in business. Loans have the power to turn challenges into opportunities, and are often necessary to start a business, buy a home, achieve a goal, or pursue a passion. It’s a privilege to announce that our loan performance has been exceptional this year, particularly in our newer markets. Through our competitive loans and superior service, Peoples Bank has played a significant role in helping our communities flourish. “ Being there for our customers and communities with financial services solutions and education has produced another successful year.” 2 3 Financial Highlights Dollars in Thousands Except Per Share Amounts Interest income Interest expense Net interest earnings Provision for (recovery of) loan losses Net interest earnings after provision for loan losses Non-interest income Non-interest expense Income taxes Net earnings Per Share of Common Stock Basic net earnings Diluted net earnings Cash dividends Market price at December 31 Book value at December 31 At Year-end Loans, net Available for sale securities Assets Deposits Shareholders’ equity Key Performance Ratios Return on average assets Return on average shareholders’ equity Dividend payout ratio Average shareholders’ equity to total average assets $ $ $ 2022 54,431 3,323 51,108 1,472 49,636 26,689 56,030 4,172 16,123 2.94 2.85 0.87 32.56 19.24 $ 1,022,114 445,394 1,620,927 1,435,215 105,195 0.97% 13.01% 30.61% 7.45% 2021 Change Report of Independent Registered Public Accounting Firm 2 0 2 2 A n n u a l R e p o r t 15% 4% 16% -227% 10% 7% 10% 10% 7% 8% 8% 32% 18% -26% 17% 10% 0% 2% -26% 47,179 3,205 43,974 (1,163) 45,137 24,919 51,127 3,796 15,133 2.71 2.63 0.66 27.59 25.89 875,514 406,549 1,624,193 1,412,748 142,369 0.96% 10.24% 24.83% 9.42% To the Shareholders and the Board of Directors of Peoples Bancorp of North Carolina, Inc. We have audited, in accordance with the standards of the Public Company Accounting Oversight Board Report of Independent Registered Public Accounting Firm (United States), the consolidated balance sheets of Peoples Bancorp of North Carolina, Inc. as of December 31, 2018 and 2017, and the related consolidated statements of earnings, comprehensive income, shareholders' equity and cash flows for each of the three years in the period ended December To the Shareholders and the Board of Directors of Peoples Bancorp of North Carolina, Inc. 31, 2018 (not presented herein); and in our report, dated March 14, 2019, we expressed an unqualified opinion on those consolidated financial statements. We have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Peoples Bancorp of North Carolina, Inc. as of December 31, 2022 In our opinion, the information set forth in the accompanying condensed consolidated financial and 2021, and the related consolidated statements of earnings, comprehensive income (loss), changes in statements is fairly stated, in all material respects, in relation to the consolidated financial statements shareholders' equity and cash flows for each of the three years in the period ended December 31, 2022 (not from which it has been derived. presented herein); and in our report, dated March 17, 2023, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated financial statements is fairly stated, in all material respects, in relation to the consolidated financial statements from which it has been Charlotte, North Carolina derived. March 14, 2019 Raleigh, North Carolina March 17, 2023 elliottdavis.com 4 5 elliottdavis.com Consolidated Balance Sheets December 31, 2022 and December 31, 2021 Consolidated Statements of Earnings For the Years Ended December 31, 2022, 2021 and 2020 (Dollars in thousands) Assets Cash and due from banks, including reserve requirements of $0 at both 12/31/22 and 12/31/21 Interest-bearing deposits Cash and cash equivalents Investment securities available for sale Other investments Total securities Mortgage loans held for sale Loans Less allowance for loan losses Net loans Premises and equipment, net Cash surrender value of life insurance Right of use lease asset Accrued interest receivable and other assets Total assets Liabilities and Shareholders’ Equity Deposits: Noninterest-bearing demand Interest-bearing demand, MMDA & savings Time, $250,000 or more Other time Total deposits Securities sold under agreements to repurchase Junior subordinated debentures Lease liability Accrued interest payable and other liabilities Total liabilities Commitments Shareholders’ equity: Preferred stock, no par value; authorized 5,000,000 shares; no shares issued and outstanding Common stock, no par value; authorized 20,000,000 shares; issued and outstanding 5,636,830 shares at December 31, 2022 and 5,661,569 shares at December 31, 2021 Common stock, held by deferred compensation trust, at cost: 169,004 shares at December 31, 2022 and 162,193 shares at December 31, 2021 Deferred compensation Retained earnings Accumulated other comprehensive income (loss) Total shareholders’ equity Total liabilities and shareholders’ equity December 31, December 31, 2022 (Audited) $ 50,061 21,535 71,596 445,394 2,656 448,050 211 1,032,608 (10,494) 1,022,114 18,205 17,703 5,116 37,932 2 021 (Audited) 44,711 232,788 277,499 406,549 3,668 410,217 3,637 884,869 (9,355) 875,514 16,104 17,365 4,612 19,245 $ 1,620,927 1,624,193 $ 523,088 814,128 31,001 66,998 1,435,215 47,688 15,464 5,185 12,180 514,319 797,179 26,333 74,917 1,412,748 37,094 15,464 4,677 11,841 1,515,732 1,481,824 - - 52,636 53,305 (2,181) 2,181 100,156 (47,597) 105,195 $ 1,620,927 (1,992) 1,992 88,968 96 142,369 1,624,193 See accompanying Notes to Consolidated Financial Statements. See Appendix A to the Peoples Bancorp of North Carolina, Inc. Proxy Statement for a complete set of Consolidated Financial Statements. (Dollars in thousands, except per share amounts) Interest income: Interest and fees on loans Interest on due from banks Interest on federal funds sold Interest on investment securities: U.S. Government sponsored enterprises States and political subdivisions Other Total interest income Interest expense: Demand deposits, MMDA & savings deposits Time deposits FHLB borrowings Junior subordinated debentures Other Total interest expense Net interest income Provision for (recovery of) loan losses Net interest income after provision for loan losses Non-interest income: Service charges Other service charges and fees Gain on sale of securities Mortgage banking income Insurance and brokerage commissions Appraisal management fee income Gain (loss) on sale of premises and equipment Gain (loss) on sales and write-downs of other real estate, net Miscellaneous Total non-interest income Non-interest expense: Salaries and employee benefits Occupancy Professional fees Advertising Debit card expense FDIC insurance Appraisal management fee expense Other Total non-interest expense Earnings before income taxes Income tax expense Net earnings Basic net earnings per share Diluted net earnings per share Cash dividends declared per share $ $ $ $ $ 2 022 43,077 2,223 - 4,962 4,075 94 54,431 2,019 562 - 529 213 3,323 51,108 1,472 49,636 5,290 734 - 393 945 11,663 (85) - 7,749 26,689 26,130 8,048 1,915 693 1,224 461 9,264 8,295 56,030 20,295 4,172 16,123 2.94 2.85 0.87 2 0 2 2 A n n u a l R e p o r t 2021 41,186 258 - 2,478 3,146 111 47,179 2,029 752 - 280 144 3,205 43,974 (1,163) 45,137 3,921 803 - 2,505 1,035 8,890 105 21 7,639 24,919 24,506 7,858 1,826 536 1,000 415 7,112 7,874 51,127 18,929 3,796 15,133 2.71 2.63 0.66 2020 42,314 127 204 2,361 2,691 261 47,958 1,962 947 357 370 200 3,836 44,122 4,259 39,863 3,528 742 2,639 2,469 897 6,754 - (47) 5,932 22,914 23,538 7,933 1,580 787 1,012 263 5,274 8,544 48,931 13,846 2,489 11,357 2.01 1.95 0.75 6 7 See accompanying Notes to Consolidated Financial Statements. See Appendix A to the Peoples Bancorp of North Carolina, Inc. Proxy Statement for a complete set of Consolidated Financial Statements. Our Leadership Peoples Bank Subsidiaries’ Board of Directors and Officers Shareholder and General Information 2 0 2 2 A n n u a l R e p o r t Peoples Bank and Peoples Bancorp Board of Directors Robert C. Abernethy Chairman of the Board Peoples Bancorp of North Carolina, Inc. and Peoples Bank President, Secretary and Treasurer Carolina Glove Company, Inc. James S. Abernethy President and Assistant Secretary Midstate Contractors, Inc. Kim Boyd-Leaks EVP, Chief Retail Banking Support Officer Peoples Bank Douglas S. Howard Vice President and Treasurer Denver Equipment Company of Charlotte, Inc. John W. Lineberger, Jr. President Lincoln Bonded Warehouse Company Gary E. Matthews President and Director Matthews Construction Company, Inc. Billy L. Price, Jr., M.D. Practitioner of Internal Medicine BL Price Jr Medical Consultants, PLLC Larry E. Robinson Chairman of the Board and Chief Executive Officer The Blue Ridge Distributing Company, Inc. W. Gregory Terry President Clemson Legacy Designs Director/Consultant Drum & Willis-Reynolds Funeral Home & Crematory Dan Ray Timmerman, Sr. Chairman of the Board and Chief Executive Officer Timmerman Manufacturing, Inc. Benjamin I. Zachary President, Treasurer, General Manager and Director Alexander Railroad Company Lance Sellers President & CEO Jeffrey N. Hooper EVP, Chief Financial Officer Bill Cable EVP, Chief Operating Officer Kim Boyd-Leaks EVP, Chief Retail Banking Support Officer Tim Turner EVP, Chief Credit Officer Jim Perry EVP, Chief Retail Banking Officer 8 Community Bank Real Estate Solutions, LLC Board of Directors Officers Robert C. Abernethy David E. Reitzel Dan Ray Timmerman, Sr. Lance A. Sellers David E. Reitzel President Lance A. Sellers Vice President John Noonan Vice President Krissy O. Price Secretary Jeffrey N. Hooper Treasurer Peoples Investment Services, Inc. Board of Directors Officers Robert C. Abernethy Billy L. Price, Jr., M.D. David C. Brown Larry E. Robinson Douglas S. Howard Lance A. Sellers William D. Cable, Sr. David C. Brown President Lance A. Sellers Vice President and Assistant Secretary Krissy O. Price Secretary Jeffrey N. Hooper Treasurer Real Estate Advisory Services, Inc. Board of Directors Officers Robert C. Abernethy Dan Ray Timmerman, Sr. David E. Reitzel Lance A. Sellers David E. Reitzel President Lance A. Sellers Vice President John Noonan Vice President Krissy O. Price Secretary Jeffrey N. Hooper Treasurer Annual Meeting The Annual Meeting of Shareholders of Peoples Bancorp will be conducted in a virtual-only format at 11:00 a.m. on Thursday, May 4, 2023. Common Stock Peoples Bancorp common stock is listed on the NASDAQ (National Association of Securities Dealers Automated Quotations) Global Market, where our symbol is PEBK. Dividend Reinvestment & Stock Purchase Peoples Bancorp offers a Dividend Reinvestment and Stock Purchase Plan for the benefit of the Company’s shareholders. The Plan provides for the full or partial reinvestment of cash dividends, optional cash purchases of the Company’s stock, safekeeping of the share certificates, liquidation of shares, and gifting of shares and enrollment of the designated recipients. Broadridge Corporate Issuer Solutions, Inc. is the Plan Administrator. For more information, one may call Peoples Bancorp at 828-464-5620 or 800-948-7195 or contact the Plan Administrator at 855-263-4988. Shareholders of Peoples Bancorp are entitled to receive dividends when and as declared by the Board of Directors out of funds legally available therefore. Such dividend payments are declared based upon the guidelines of North Carolina and federal banking law. Corporate Office Peoples Bancorp of North Carolina, Inc. 518 West C Street PO Box 467 Newton, NC 28658 828-464-5620 Stock Transfer Agent & Registrar Broadridge Corporate Issuer Solutions, Inc. P.O. Box 1342 Brentwood, NY 11717 www.broadridge.com Independent Auditors Elliott Davis, PLLC 5410 Trinity Road, Suite 320 Raleigh, NC 27607
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