Wayne Savings Bancshares, Inc. Announces Seventh Consecutive Quarter of Record Earnings

Wayne Savings Bancshares, Inc. Announces Seventh Consecutive Quarter of Record Earnings

Wooster, Ohio, April 11, 2019 – Wayne Savings Bancshares, Inc. (OTCQX: WAYN), (the “Company”), the holding company parent of Wayne Savings Community Bank, reported net income (unaudited) of $1,567,000 or $0.58 per common share for the quarter ended March 31, 2019, an increase of $602,000 or 62%, compared to $965,000 or $0.36 per common share for the quarter ended March 31, 2018. The increase in net income was due to an increase in net interest income, a decrease in provision for loan losses, an increase in noninterest income, and a decrease in non-interest expense.  The return on average equity and return on average assets for the first quarter of 2019 was 13.76% and 1.32%, respectively, compared to 9.23% and 0.86%, respectively, for the same period in 2018.

President and CEO James R. VanSickle commented, “We are thrilled to report yet another quarter of record earnings for our shareholders to start 2019.  Our excellent performance is the result of the growth in the commercial loan portfolio and continued improvement in operational efficiency.  Wayne Savings has the good fortune of being located in a region with a robust economy and organized under a guiding principle to help others succeed.” 

First Quarter 2019 Business Highlights

• Net interest income was $4.0 million for the quarter ended March 31, 2019, an increase of $271,000, or 7.3%, compared to the quarter ended March 31, 2018.  The net interest margin increased from 3.50% for the quarter ended March 31, 2018, to 3.51% for the comparable period of 2019.   The net interest margin increase was the result of an increase of 30 basis points in the average yield on interest-earning assets and an increase of 29 basis points in the average cost of interest-bearing liabilities.
• Provision for loan losses was $84,000 in the first quarter of 2019 compared to $120,000 for the period ending March 31, 2018.  This decrease was a result of declining balances requiring specific reserves from the receipt of customer payments. 
• Noninterest expense totaled $2.6 million for the three-month period ended March 31, 2019, a decrease of $393,000, or 13.3%, compared to the three months ended March 31, 2018, primarily due to reduced stockholder expenses from no proxy contest in 2019.  The Company’s efficiency ratio improved from March 2018 of 69.8% to 56.0% as of March 31, 2019. 
• On March 29, 2019, the Company announced another dividend increase to $0.17 per share, payable May 1, 2019, to stockholders of record as of April 17, 2019.  This represents a 55% increase over the March 2018 dividend of $0.11 per share. 

March 31, 2019 Financial Condition

At March 31, 2019, the Company had total assets of $478.2 million, an increase of $5.3 million, from total assets at December 31, 2018. The increase in total assets includes a $4.1 million increase in net loans compared to December 31, 2018, primarily due to an increase in commercial loans, and an increase in cash and cash equivalents of $2.0 million, and a decrease in investment securities of $1.4 million.  Short-term advances increased $1.1 million being used to partially fund the aforementioned asset growth.  The remaining asset growth was funded with deposits of $4.1 million due mainly to newly offered certificate of deposits.

The allowance for loan losses increased from $3.4 million at December 31, 2018, to $3.5 million at March 31, 2019.  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 increased from $1.8 million at December 31, 2018, to $1.9 million for the quarter ended March 31, 2019.  Past due loan balances of 30 days and more remained unchanged at $1.6 million for both March 31, 2019 and December 31, 2018.

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, and Creston, Ohio. The Bank also has a loan production office in Poland 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