A Letter From Our CEO
October 9, 2015
Landmark Bancorp Inc. recorded year to date results as of September 30, 2015 that improved significantly compared to the same period in 2014. Net income increased almost 32% compared to the same period of 2014.
Landmark’s net income was $1.94 million compared to $1.48 million for the same nine month period in 2014. Earnings per share were $1.01 compared to $.77 for the same period of 2014. Year to date return on assets was .95% compared to .72% for the third quarter of 2014. Return on equity was 9.49% compared to 7.85% during the same period in 2014.
The continued impact of rate compression, caused by this extended period of low rates, has reduced the bank’s net interest margin by .14% on earning assets which equates to an annualized reduction of more than $360 thousand of interest income.
Asset growth has been challenging as over $10 million of loan balances have paid off since January 1, 2015. These loan payoffs were anticipated. Several of these loans supported municipal water and sewer projects which, when completed, were refunded by long term government financing programs like PennVest and USDA. It is difficult to grow assets when we first need to replace these paid off loans.
Fortunately, 2015 has seen strong recoveries of loan losses recognized in prior years so that, in spite of the challenges of margin compression and asset growth, earnings have increased.
Assets are down about 1.5% year over year, driven primarily by the decline in net loans due to the payoffs mentioned earlier. The investment portfolio expanded 5.67% to $55.84 million and overall yields have improved compared to the same period in 2014. The deposit portfolio contracted by 5.45% compared to the same period in 2014. Non-interest bearing deposits continue to grow and are up 4.14% compared to September 30, 2014.
Landmark remains well capitalized with the Tier 1 Leverage Ratio growing to 10.17% compared to 9.17% at September 30, 2014. Stockholders’ equity grew 8.98% to $28.2 million compared to $25.9 million at quarter end 2014. Book value per share was $14.12 compared to $12.94 last year.
On October 8, 2015 the Board of Directors of Landmark Bancorp, Inc. declared a dividend of $.08 per share, payable on November 3, 2015 to stockholders of record on October 23, 2015.
Landmark Community Bank’s staff, management, Board of Directors and Advisory Board members are committed to building a strong community bank and providing unparalleled service to our clients as well as delivering long term value to our shareholders. We appreciate your support and we encourage you to continue to use Landmark Community Bank for all your banking needs and request that you refer prospective clients to your bank.
Very Truly Yours,
Daniel R. Nulton
President & CEO
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