Wayne Savings Bancshares, Inc. Announces Earnings for the first quarter 2021

WOOSTER, Ohio, April 19, 2021 (GLOBE NEWSWIRE) -- Wayne Savings Bancshares, Inc. (OTCQX: WAYN), (the “Company”), the holding company parent of Wayne Savings Community Bank, reported net income (unaudited) of $1,887,000, or $0.76 per common share, for the quarter ended March 31, 2021. This represents an increase of $570,000, or 43.3%, compared to $1,317,000, or $0.51 per common share, for the quarter ended March 31, 2020. The increase in net income was due to an increase in net interest income and a decrease in provision for loan losses, partially offset with an increase in non-interest expenses and increased provision for federal income taxes. The return on average equity and return on average assets for the first quarter of 2021 was 14.22% and 1.26%, respectively, compared to 10.65% and 1.07%, respectively, for the same period in 2020.

President and CEO James R. VanSickle commented, “Wayne Savings continues to focus on the financial needs of our community with an emphasis on providing excellent customer service. These efforts have resulted in outstanding growth of $18.5 million in net loans and $24.0 million in deposit accounts during the quarter. Our performance was highlighted by a significant increase in the commercial loans and core deposit accounts during the quarter. We surpassed $600 million in assets for the first time during the quarter and hope to maintain this momentum throughout 2021.”

First Quarter 2021 Business Highlights

• Net interest income was $4.7 million for the quarter ended March 31, 2021, an increase of $515,000, or 12.4%, compared to the quarter ended March 31, 2020. Our net interest margin decreased from 3.57% for the quarter ended March 31, 2020, to 3.28% for the comparable period of 2021. The net interest margin drop was the result of a decline of 57 basis points in the average yield on interest-earning assets, partially offset with a decrease of 28 basis points in the average cost of interest-bearing liabilities. The decline in the average yield on interest-earning assets was due to lower yields of both investment securities and interest earning deposits due to the current low interest rate environment. The decrease in average cost of interest-bearing liabilities more than offset the cost of the $86.3 million increase in average deposit balances.  
   
• Provision for loan losses was $163,000 in the first quarter of 2021.   Due to the COVID-19 uncertainty, and as a result of the mandate by the State of Ohio to close non-essential businesses, the provision for loan losses was $620,000 for the first quarter of 2020.
   
• Noninterest income totaled $615,000 in the first quarter of 2021 compared to $556,000 for the same period of 2020.   
   
• Noninterest expense totaled $2.8 million for the three-month period ended March 31, 2021, an increase of $310,000, or 12.5%, compared to the three months ended March 31, 2020. This increase was primarily due to increased salaries and employee benefits as the Company added an executive director and additional sales staff to facilitate loan growth. Net occupancy and equipment expenses also increased partially due the facility in Fredericksburg and increased ATM fees. The Company’s efficiency ratio was 52.8% for the three-month period ended March 31, 2021, compared to 52.6% for the same period in 2020.   

Financial Condition as of March 31, 2021

At March 31, 2021, the Company had total assets of $613.3 million, an increase of $21.7 million, from December 31, 2020. The growth in total assets includes a $18.5 million increase in net loans, primarily due to commercial loan additions, and $24.2 million increase in securities, partially offset by a decrease of $21.7 million in cash and cash equivalents, as compared to December 31, 2020.

The allowance for loan losses was $4.9 million at March 31, 2021, compared to $4.7 million at December 31, 2020. The allowance for loan losses and the related provision for loan losses is based on management’s judgment and evaluation of the loan portfolio. Management believes the current allowance for loan losses is adequate, however, changing economic and other conditions may require future adjustments to the allowance for loan losses.

Total nonperforming loans declined to $776,000 from $1.4 million at December 31, 2020 as the Bank received proceeds from a foreclosure sale and a loan was transferred into foreclosed assets held for sale. Past due loan balances of 30 days and more decreased from $3.0 million at December 31, 2020, to $1.3 million at March 31, 2021, mainly due to decreased commercial loan delinquencies.

Total liabilities increased $21.5 million mainly due to an increase in deposits accounts of $24.0 million caused mainly by Paycheck Protection Program loan originations which increased balances in business checking accounts and economic impact stimulus payments. The Company is continuing to enhance its deposit products in an effort to serve its customers and increase deposit balances.

Total stockholders’ equity changed mainly due to earnings of $1.9 million partially offset with a decline in the market value of available-for-sale securities, due to the general market rate increase, dividends paid and the continued repurchase of treasury stock from the Plan announced in November 2020.

Established in 1899, Wayne Savings Community Bank, the wholly owned subsidiary of Wayne Savings Bancshares, Inc., has eleven full-service banking locations in the communities of Wooster, Ashland, Millersburg, Rittman, Lodi, North Canton, Creston, and Fredericksburg, Ohio. Additional information about Wayne Savings Community Bank is available at www.waynesavings.com.

Forward-Looking-Statements
This release contains forward-looking statements that are not historical facts and that are intended to be “forward-looking statements” as that term is defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements may include, but are not limited to, statements about the Company’s plans, objectives, expectations and intentions and other statements contained in this release that are not historical facts and pertain to the Company’s future operating results. When used in this release, the words “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates” and similar expressions are generally intended to identify forward-looking statements. Actual results may differ materially from the results discussed in these forward-looking statements, because such statements are inherently subject to significant assumptions, risks and uncertainties, many of which are difficult to predict and are generally beyond the Company’s control. These include but are not limited to: the possibility of adverse economic developments that may, among other things, increase default and delinquency risks in the Company’s loan portfolios; shifts in interest rates; shifts in the rate of inflation; shifts in the demand for the Company’s loan and other products; unforeseen increases in costs and expenses; lower-than-expected revenue or cost savings in connection with acquisitions; changes in accounting policies; changes in the monetary and fiscal policies of the federal government; and changes in laws, regulations and the competitive environment. Unless legally required, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information:
Myron Swartzentruber
Senior Vice President Chief Financial Officer
(330) 264-5767