The unprecedented pandemic environment has seen net income and earnings per share take double digit drops for Southern Michigan Bancorp which operates in multiple counties across the southern tier of the state from headquarters in Coldwater.
The bank today has announced first quarter net income of $1,513,000, a 21.2-percent decrease compared to net income of $1,920,000 for the first quarter of 2019. Earnings per share for the first quarter of 2020 were $0.66 per share, a decrease of 20.5-percent compared to $0.83 per share for the first quarter of 2019.
John H. Castle, Chairman and Chief Executive Officer of Southern Michigan Bancorp, Inc., says, “These are unprecedented times. We are proud of the work our employees are doing to help our customers and each other through this pandemic.”
As of March 31, 2020, total consolidated assets were $828.3 million compared to $809.7 million at December 31, 2019.
Castle reports, “While our asset quality metrics remained strong at March 31, 2020, the overall impact COVID-19 will have on the economy and our customers is unknown. Given this uncertainty, we believed it prudent to increase our provision for loan losses during the quarter.”
As a result of current economic conditions, Southern provided $1,000,000 for provision expense during the first quarter of 2020, raising the allowance for loan losses to $6,177,000, or 1.10-percent of loans. That’s in sharp contrast with the $150,000 provision for loan losses during the first quarter a year ago. The allowance for loan losses totaled $5,264,000, or 0.96-percent of loans at March 31, 2019. Net charge-offs totaled $7,000 for the first quarter of 2020, compared to $3,000 during the first quarter of 2019.
The annualized return on average assets for the three-month periods ended March 31, 2020 and March 31, 2019 were 0.73-percent and 1.01-percent respectively. The annualized return on average equity was 7.06-percent for the first quarter of 2020 compared to 10.03-percent for the first quarter of 2019. The tax equivalent net interest margin for the three-month period ending March 31, 2020 was 3.49-percent compared to 3.72-percent for the same period in 2019.
Southern Michigan Bancorp, Inc. is a bank holding company and the parent company of Southern Michigan Bank & Trust. They operate 13 branches within Branch, Calhoun, Hillsdale, Kalamazoo and St. Joseph Counties, providing a broad range of consumer, business and wealth management services throughout the region.
