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Section 1: 8-K (8-K)

esq_Current_Folio_8K

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of report (Date of earliest event reported):  October 25, 2018

 

Esquire Financial Holdings, Inc.

(Exact name of the registrant as specified in its charter)

 

Maryland

001-38131

27-5107901

(State or other jurisdiction of

(Commission File Number)

(IRS Employer

incorporation or organization)

 

Identification No.)

 

100 Jericho Quadrangle, Suite 100

 

Jericho, New York

11753

(Address of principal executive offices)

(Zip Code)

 

(516) 535-2002

(Registrant's telephone number)

 

N/A

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2. below):

 

   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

Emerging growth company 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

 


 

Item 2.02     Results of Operations and Financial Condition.

On October 25, 2018, Esquire Financial Holdings, Inc. (the "Company"), the holding company for Esquire Bank, National Association, issued a press release announcing its earnings for the quarter ended September 30, 2018.  A copy of the press release is attached as Exhibit 99.1 hereto and incorporated herein by reference.  The information contained in this Item 2.02, including the related information set forth in the press release, is being "furnished" and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934.

Item 9.01     Financial Statements and Exhibits.

(d)     Exhibits.

 

 

 

Exhibit No.

    

Description

99.1

 

Press Release dated October 25, 2018.


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

 

 

 

 

 

 

ESQUIRE FINANCIAL HOLDINGS, INC.

 

 

 

 

 

 

Dated:  October 25, 2018

    

By:

/s/ Andrew C. Sagliocca

 

 

 

Andrew C. Sagliocca

 

 

 

President and Chief Executive Officer

 


(Back To Top)

Section 2: EX-99.1 (EX-99.1)

esq_Ex99_1

Exhibit 99.1

ESQUIRE FINANCIAL HOLDINGS, INC.

REPORTS THIRD QUARTER 2018 RESULTS

Growth in Net Income, Loans, Core Deposits and Fee Income

Jericho, NY – October 25, 2018 – Esquire Financial Holdings, Inc. (NASDAQ: ESQ) (the “Company”), the holding company for Esquire Bank, National Association (“Esquire Bank”), today announced its operating results for the three and nine months ended September 30, 2018. Significant achievements during the quarter include:

·

Net income was $1.7 million or $0.22 per diluted common share for the quarter ended September 30, 2018. Adjusted net income(1) increased 123% to $2.5 million, or $0.33 per diluted common share, compared to $1.1 million, or $0.16 per diluted common share, for the comparable period in 2017.  

·

Returns on average assets and common equity were 1.07% and 7.66%, respectively for the third quarter of 2018. Adjusted returns on average assets(1) and common equity(1) were 1.62% and  11.57%, respectively, compared to 0.97% and 5.56%, for the quarter ended September  30, 2017.  

·

Supported by a strong net interest margin of 4.75%, net interest income for the third quarter increased $2.1 million or 39%, to $7.3 million compared to 2017.

·

Total assets increased $164.8 million, or 34%, to $645.6 million when compared to September 30, 2017.

·

Loans increased $88.9 million or 34% annualized to $437.9 million from $349.0 million at December 31, 2017, primarily driven by our commercial and commercial real estate loan categories.

·

Continued solid asset quality metrics with no non-performing assets and an allowance for loan losses to total loans of 1.19% at September 30, 2018.

·

Non-interest income increased 34% to $1.8 million compared to 2017 and represented 20% of total revenue.

·

Efficiency ratio declined to 56.8% for the third quarter of 2018.

·

Deposits totaled $552.2 million, a $157.3 million, or 40%, increase from the third quarter of 2017 with a cost of funds of 0.25% (including demand deposits).  

·

Esquire Bank remains well above the bank regulatory “Well Capitalized” standards.

“Our management team continues to successfully execute on our long-term vision of transforming Esquire into a top performing institution in the industry,” stated Tony Coelho, Chairman. 

“Our strong growth and performance metrics continue to demonstrate the strength of Esquire’s business model,” stated Andrew C. Sagliocca, President and Chief Executive Officer. “Our robust net interest margin coupled with our stable merchant fee income are a solid foundation as rates and competition continue to increase.”

(1) Figures have been adjusted to exclude a $1.2 million one-time charge (pretax) related to the passing of the Company’s former Executive Chairman, Dennis Shields.  See non-GAAP reconciliation provided elsewhere herein.

 

 

 


 

Net Earnings and Returns

Net income for the quarter ended September 30, 2018 was $1.7 million or $0.22 per diluted common share, compared to $1.1 million or $0.16 per diluted common share for the same period in 2017. Returns on average assets and common equity for the current quarter were 1.07% and 7.66% compared to 0.97% and 5.56% in 2017, respectively. Excluding the one-time compensation related charge for the recent passing of our Executive Chairman totaling $859 thousand after tax, net income increased to $2.5 million or $0.33 per diluted common share, representing a 122.7% increase from the prior year quarter. Returns on average assets and common equity were 1.62% and 11.57% for the quarter ended September 30, 2018 excluding the compensation charge.  Net income for the nine months ended September 30, 2018 was $5.9 million or $0.76 per diluted common share, compared to $3.0 million or $0.51 per diluted common share for 2017. Returns on average assets and common equity for the nine months ended September 30, 2018 were 1.35% and 9.19% compared to 0.91% and 6.38% in 2017, respectively. Excluding the compensation charge, net income increased to $6.7 million or $0.87 per diluted common share, representing a 125.3% increase when compared to the nine months ended 2017.

Net interest income for the third quarter of 2018 increased $2.1 million, or 39.2%, to $7.3 million, primarily due to growth in average interest earning assets totaling $149.8 million, or 32.7%, to $607.4 million when compared to 2017. Our net interest margin increased to 4.75% for the third quarter of 2018 compared to 4.53% in 2017 due to the positive effects of increases in short-term interest rates coupled with the composition of our interest earning assets. Average loans in the quarter increased $101.0 million or 32.1%, to $416.0 million and average securities increased $49.5 million, or 45.7%, to $157.6 million when compared to the third quarter of 2017.  Loan growth was primarily driven by commercial and commercial real estate loans while management also took advantage of increases in short-term interest rates, deploying excess funds into the investment portfolio. For the nine months ended September 30, 2018, net interest income increased $5.9 million, or 41.5%, to $20.0 million, primarily due to growth in average interest earning assets totaling $138.4 million, or 32.0%, to $570.7 million when compared to the nine months ended 2017. The Company’s net interest margin increased to 4.69% for the nine months ended 2018 compared to 4.37% in 2017.  Average loans for the nine months ended 2018 increased $86.2 million, or 29.2%, to $380.9 million and average securities increased $45.8 million, or 44.1%, to $149.6 million when compared to the nine months ended 2017. Increases in loans for the quarter and nine months ended September 30, 2018 represent organic growth funded with low cost core deposits.

The provision for loan losses was $450 thousand for the third quarter of 2018, $175 thousand higher than the comparable period in 2017 and $975 thousand for the nine months ended September 30, 2018, $250 thousand higher than for the same period in 2017. The higher provision for the three and nine months ended September 30, 2018 is reflective of growth in the loan portfolio. As of September 30, 2018, Esquire had no delinquent loans and no non-performing assets.

Non-interest income increased $455 thousand, or 33.8%, to $1.8 million for the third quarter of 2018, and increased $1.9 million, or 49.8%, to $5.9 million for the nine months ended 2018, primarily due to the increases in merchant processing income. The increases in merchant processing income were a result of growth in our monthly processing volumes and merchants. Other non-interest income is primarily comprised of off-balance sheet administrative service payments, which is impacted by both the volume of off-balance sheet funds and short-term interest rates. 

Non-interest expense increased $1.9 million to $6.3 million in the third quarter of 2018 and increased $4.3 million to $16.9 million for the nine months ended September 30, 2018. These increases were primarily driven by increases in employee compensation and benefits costs, professional and consulting services and other operating expenses. The increase in compensation and benefits costs was due to the previously mentioned $1.2 million one-time compensation charge, hiring to support our future growth and technology efforts, and salary and incentive increases. The increase in professional and consulting services as well as other expenses was due primarily to additional costs related to being a public company and costs related to certain strategic projects. The Company’s efficiency ratio continued to improve to 56.8% and 60.8% for the three and nine months ended September 30, 2018.

The effective tax rate on a year to date basis and for the third quarter of 2018 was 26.8%.

Balance Sheet

At September 30, 2018, total assets were $645.6 million, reflecting a $164.8 million, or 34.3% increase from September 30, 2017. This increase is primarily attributable to increases in loans totaling $109.2 million, or 33.2%, to $437.9 million and increases in securities totaling $39.7 million, or 36.8%, to $147.5 million at September 30, 2018. Loan growth was primarily driven by commercial and commercial real estate loans while management also took advantage of increases in short-term interest rates, deploying excess funds into the investment portfolio. The growth in loans and securities was funded with low cost core deposits. The allowance for loan losses was $5.2 million, or 1.19% of total loans, as compared to $4.1 million, or 1.24% of total loans, at September 30, 2017.

Total deposits were $552.2 million at September 30, 2018, a $157.3 million, or 39.8% increase from September 30, 2017. This was primarily due to a $100.7 million, or 43.5% increase in Savings, NOW and Money Market deposits to $332.0 million and a $53.8 million, or 39.5% increase in non-interest bearing demand deposits to $190.0 million.


 

Stockholders’ equity increased $5.2 million to $88.5 million at September 30, 2018 compared to September 30, 2017. Esquire Bank remains well above bank regulatory “Well Capitalized” standards.

With excess capital as a foundation, the Company anticipates continued earnings growth in 2018 driven by its lending pipelines as well as its merchant services fee income opportunities.

About Esquire Financial Holdings, Inc.

Esquire Financial Holdings, Inc. is a bank holding company headquartered in Jericho, New York, with one branch office in Garden City, New York and an administrative office in Boca Raton, Florida. Its wholly-owned subsidiary, Esquire Bank, National Association, is a full service commercial bank dedicated to serving the financial needs of the legal industry and small businesses nationally, as well as commercial and retail customers in the New York metropolitan area. The bank offers tailored products and solutions to the legal community and their clients as well as dynamic and flexible merchant services solutions to small business owners. For more information, visit www.esquirebank.com.

Cautionary Note Regarding Forward-Looking Statements

This press release includes “forward-looking statements”  relating to future results of the Company. Forward-looking statements are subject to many risks and uncertainties, including, but not limited to: changes in business plans as circumstances warrant; changes in general economic, business and political conditions, including changes in the financial markets; and other risks detailed in the “Cautionary Note Regarding Forward-Looking Statements,” “Risk Factors” and other sections of the Company’s 10-K as filed with the Securities and Exchange Commission. The forward-looking statements included in this press release are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “might,” “should,” “could,” “predict,” “potential,” “believe,” “expect,” “attribute,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “goal,” “target,” “outlook,” “aim,” “would,” “annualized” and “outlook,” or similar terminology. Any forward-looking statements presented herein are made only as of the date of this press release, and the Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, except as may be required by law.

Contact Information:

Eric S. Bader

Executive Vice President and Chief Financial Officer

Esquire Financial Holdings, Inc.

(516) 535-2002

eric.bader@esqbank.com

 


 

ESQUIRE FINANCIAL HOLDINGS, INC.

Condensed Consolidated Statement of Condition (unaudited)

(all dollars in thousands except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 

 

December 31, 

 

September 30, 

 

 

    

2018

    

2017

    

2017

 

ASSETS

 

 

  

 

 

  

 

 

  

 

Cash and cash equivalents

 

$

39,840

 

$

43,077

 

$

31,446

 

Securities available for sale, at fair value

 

 

147,522

 

 

128,758

 

 

107,816

 

Securities, restricted at cost

 

 

2,403

 

 

2,183

 

 

1,883

 

Loans

 

 

437,883

 

 

348,978

 

 

328,670

 

Less: allowance for loan losses

 

 

(5,229)

 

 

(4,264)

 

 

(4,084)

 

Loans, net of allowance

 

 

432,654

 

 

344,714

 

 

324,586

 

Premises and equipment, net

 

 

2,616

 

 

2,546

 

 

2,627

 

Other assets

 

 

20,568

 

 

12,279

 

 

12,404

 

Total Assets

 

$

645,603

 

$

533,557

 

$

480,762

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

  

 

 

  

 

 

  

 

Demand deposits

 

$

189,960

 

$

190,847

 

$

136,196

 

Savings, NOW and money market deposits

 

 

332,016

 

 

230,715

 

 

231,303

 

Certificates of deposit

 

 

30,215

 

 

26,932

 

 

27,422

 

Total deposits

 

 

552,191

 

 

448,494

 

 

394,921

 

Other liabilities

 

 

4,917

 

 

1,680

 

 

2,588

 

Total liabilities

 

 

557,108

 

 

450,174

 

 

397,509

 

Total stockholders' equity

 

 

88,495

 

 

83,383

 

 

83,253

 

Total Liabilities and Stockholders' Equity

 

$

645,603

 

$

533,557

 

$

480,762

 

 

 

 

 

 

 

 

 

 

 

 

Selected Financial Data

 

 

  

 

 

  

 

 

  

 

Common shares outstanding

 

 

7,445,723

 

 

7,326,536

 

 

7,326,536

 

Book value per common share

 

$

11.89

 

$

11.38

 

$

11.36

 

Equity to assets

 

 

13.71

%  

 

15.63

%  

 

17.32

%

 

 

 

 

 

 

 

 

 

 

 

Capital Ratios (1)

 

 

  

 

 

  

 

 

  

 

Tier 1 leverage ratio

 

 

13.40

%  

 

12.82

%  

 

13.64

%

Common equity tier 1 capital ratio

 

 

17.78

%  

 

17.32

%  

 

18.22

%

Tier 1 capital ratio

 

 

17.78

%  

 

17.32

%  

 

18.22

%

Total capital ratio

 

 

18.92

%  

 

18.47

%  

 

19.41

%

 

 

 

 

 

 

 

 

 

 

 

Asset Quality Ratios

 

 

  

 

 

  

 

 

  

 

Allowance for loan losses to total loans

 

 

1.19

%  

 

1.22

%  

 

1.24

%

Non-performing loans to total loans

 

 

 —

%  

 

 —

%  

 

 —

%

Non-performing assets to total assets

 

 

 —

%  

 

 —

%  

 

 —

%


(1) Regulatory capital ratios presented on bank-only basis

 


 

ESQUIRE FINANCIAL HOLDINGS, INC.

Condensed Consolidated Income Statement (unaudited)

(all dollars in thousands except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Nine months ended

 

 

 

September 30, 

 

September 30, 

 

 

    

2018

    

2017

    

2018

    

2017

 

Interest income

 

$

7,620

 

$

5,354

 

$

20,754

 

$

14,542

 

Interest expense

 

 

344

 

 

128

 

 

741

 

 

402

 

Net interest income

 

 

7,276

 

 

5,226

 

 

20,013

 

 

14,140

 

Provision for loan losses

 

 

450

 

 

275

 

 

975

 

 

725

 

Net interest income after provision for loan losses

 

 

6,826

 

 

4,951

 

 

19,038

 

 

13,415

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest income:

 

 

  

 

 

  

 

 

  

 

 

  

 

Merchant processing income

 

 

1,300

 

 

797

 

 

3,532

 

 

2,467

 

Other non-interest income

 

 

500

 

 

548

 

 

2,322

 

 

1,442

 

Total non-interest income

 

 

1,800

 

 

1,345

 

 

5,854

 

 

3,909

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest expense:

 

 

  

 

 

  

 

 

  

 

 

  

 

Employee compensation and benefits

 

 

4,161

 

 

2,466

 

 

10,230

 

 

7,180

 

Other expenses

 

 

2,169

 

 

1,959

 

 

6,661

 

 

5,438

 

Total non-interest expense

 

 

6,330

 

 

4,425

 

 

16,891

 

 

12,618

 

Income before income taxes

 

 

2,296

 

 

1,871

 

 

8,001

 

 

4,706

 

Income taxes

 

 

614

 

 

730

 

 

2,140

 

 

1,723

 

Net income

 

$

1,682

 

$

1,141

 

$

5,861

 

$

2,983

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per Common Share

 

 

  

 

 

  

 

 

  

 

 

  

 

Basic

 

$

0.23

 

$

0.16

 

$

0.80

 

$

0.51

 

Diluted

 

$

0.22

 

$

0.16

 

$

0.76

 

$

0.51

 

Basic - adjusted (1)

 

$

0.34

 

$

0.16

 

$

0.91

 

$

0.51

 

Diluted - adjusted (1)

 

$

0.33

 

$

0.16

 

$

0.87

 

$

0.51

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Financial Data

 

 

  

 

 

  

 

 

  

 

 

  

 

Return on average assets

 

 

1.07

%  

 

0.97

%  

 

1.35

%  

 

0.91

%

Return on average common equity

 

 

7.66

%  

 

5.56

%  

 

9.19

%  

 

6.38

%

Adjusted return on average assets (1)

 

 

1.62

%  

 

0.97

%  

 

1.54

%  

 

0.91

%

Adjusted return on average common equity (1)

 

 

11.57

%  

 

5.56

%  

 

10.54

%  

 

6.38

%

Net interest margin

 

 

4.75

%  

 

4.53

%  

 

4.69

%  

 

4.37

%

Efficiency ratio (1)

 

 

56.82

%  

 

67.34

%  

 

60.76

%  

 

69.91

%


(1) Figures have been adjusted to exclude a $1.2 million one-time charge (pretax) related to the passing of the Company’s former Executive Chairman, Dennis Shields.  See non-GAAP reconciliation provided elsewhere herein. 

 

 

 


 

ESQUIRE FINANCIAL HOLDINGS, INC.

Condensed Consolidated Average Balance Sheets and Average Yields/Cost (unaudited)

(all dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended September 30, 

 

 

 

2018

 

2017

 

 

 

Average

 

    

 

 

Average

 

Average

 

    

 

 

Average

 

 

    

Balance

    

Interest

    

Yields/Cost

    

Balance

    

Interest

    

Yields/Cost

 

EARNING ASSETS

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Loans

 

$

416,004

 

$

6,432

 

6.13

%  

$

315,005

 

$

4,630

 

5.83

%

Securities, includes restricted stock

 

 

157,635

 

 

1,035

 

2.60

%  

 

108,168

 

 

631

 

2.31

%

Interest earning cash

 

 

33,777

 

 

153

 

1.80

%  

 

34,471

 

 

93

 

1.07

%

Total interest earning assets

 

 

607,416

 

 

7,620

 

4.98

%  

 

457,644

 

 

5,354

 

4.64

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-INTEREST EARNING ASSETS

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Cash and due from banks

 

 

2,766

 

 

 

 

 

 

 

537

 

 

 

 

 

 

Other assets

 

 

12,037

 

 

 

 

 

 

 

7,711

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL AVERAGE ASSETS

 

$

622,219

 

 

 

 

 

 

$

465,892

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INTEREST-BEARING LIABILITIES

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Savings, NOW, Money Markets

 

$

327,548

 

$

291

 

0.35

%  

$

212,535

 

$

101

 

0.19

%

Time deposits

 

 

17,555

 

 

41

 

0.93

%  

 

27,430

 

 

22

 

0.32

%

Total deposits

 

 

345,103

 

 

332

 

0.38

%  

 

239,965

 

 

123

 

0.20

%

Short-term borrowings

 

 

1,131

 

 

 7

 

2.46

%  

 

 2

 

 

 —

 

 —

%

Secured borrowings

 

 

273

 

 

 5

 

7.27

%  

 

282

 

 

 5

 

7.03

%

Total interest-bearing liabilities

 

 

346,507

 

 

344

 

0.39

%  

 

240,249

 

 

128

 

0.21

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-INTEREST BEARING LIABILITIES

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Demand deposits

 

 

183,864

 

 

  

 

  

 

 

142,086

 

 

  

 

  

 

Other liabilities

 

 

4,708

 

 

  

 

  

 

 

2,192

 

 

  

 

  

 

Total non-interest bearing liabilities

 

 

188,572

 

 

  

 

  

 

 

144,278

 

 

  

 

  

 

Stockholders' equity

 

 

87,140

 

 

  

 

  

 

 

81,365

 

 

  

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL AVG. LIABILITIES AND EQUITY

 

$

622,219

 

 

  

 

  

 

$

465,892

 

 

  

 

  

 

Net interest income

 

 

  

 

$

7,276

 

 

 

 

  

 

$

5,226

 

 

 

Net interest spread

 

 

 

 

 

 

 

4.58

%  

 

 

 

 

 

 

4.43

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin

 

 

  

 

 

  

 

4.75

%  

 

  

 

 

  

 

4.53

%

 


 

ESQUIRE FINANCIAL HOLDINGS, INC.

Condensed Consolidated Average Balance Sheets and Average Yields/Cost (unaudited)

(all dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Nine Months Ended September 30, 

 

 

 

2018

 

2017

 

 

 

Average

 

    

 

 

Average

 

Average

 

    

 

 

Average

 

 

    

Balance

    

Interest

    

Yields/Cost

    

Balance

    

Interest

    

Yields/Cost

 

EARNING ASSETS

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Loans

 

$

380,918

 

$

17,378

 

6.10

%  

$

294,725

 

$

12,519

 

5.68

%

Securities, includes restricted stock

 

 

149,556

 

 

2,906

 

2.60

%  

 

103,792

 

 

1,809

 

2.33

%

Interest earning cash

 

 

40,249

 

 

470

 

1.56

%  

 

33,840

 

 

214

 

0.85

%

Total interest earning assets

 

 

570,723

 

 

20,754

 

4.86

%  

 

432,357

 

 

14,542

 

4.50

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-INTEREST EARNING ASSETS

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Cash and due from banks

 

 

1,345

 

 

 

 

 

 

 

544

 

 

 

 

 

 

Other assets

 

 

10,211

 

 

 

 

 

 

 

7,646

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL AVERAGE ASSETS

 

$

582,279

 

 

 

 

 

 

$

440,547

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INTEREST-BEARING LIABILITIES

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Savings, NOW, Money Markets

 

$

281,768

 

$

580

 

0.28

%  

$

217,717

 

$

316

 

0.19

%

Time deposits

 

 

27,126

 

 

140

 

0.69

%  

 

23,289

 

 

70

 

0.40

%

Total deposits

 

 

308,894

 

 

720

 

0.31

%  

 

241,006

 

 

386

 

0.21

%

Short-term borrowings

 

 

382

 

 

 6

 

2.10

%  

 

 2

 

 

 —

 

 —

%

Secured borrowings

 

 

275

 

 

15

 

7.29

%  

 

302

 

 

16

 

7.08

%

Total interest-bearing liabilities

 

 

309,551

 

 

741

 

0.32

%  

 

241,310

 

 

402

 

0.22

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-INTEREST BEARING LIABILITIES

 

 

  

 

 

  

 

  

 

 

  

 

 

  

 

  

 

Demand deposits

 

 

184,382

 

 

  

 

  

 

 

134,533

 

 

  

 

  

 

Other liabilities

 

 

3,117

 

 

  

 

  

 

 

1,730

 

 

  

 

  

 

Total non-interest bearing liabilities

 

 

187,499

 

 

  

 

  

 

 

136,263

 

 

  

 

  

 

Stockholders' equity

 

 

85,229

 

 

  

 

  

 

 

62,974

 

 

  

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL AVG. LIABILITIES AND EQUITY

 

$

582,279

 

 

  

 

  

 

$

440,547

 

 

  

 

  

 

Net interest income

 

 

  

 

$

20,013

 

 

 

 

  

 

$

14,140

 

 

 

Net interest spread

 

 

 

 

 

 

 

4.54

%  

 

 

 

 

 

 

4.27

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin

 

 

  

 

 

  

 

4.69

%  

 

  

 

 

  

 

4.37

%

 

 

 

 

 

 

 

 

 

 


 

ESQUIRE FINANCIAL HOLDINGS, INC.

Condensed Consolidated Non-GAAP Financial Measure Reconciliation (unaudited)

(all dollars in thousands except per share data)

 

Adjusted net income, which is used to compute adjusted return on average assets, adjusted return on average common equity and adjusted earnings per common share, excludes the impact of a one-time charge relating to compensation expense as a result of the passing of our Executive Chairman. 

 

We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial position, results and ratios. However, these non-GAAP financial measures are supplemental and are not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for this measure, this presentation may not be comparable to other similarly titled measures by other companies.

The efficiency ratio is a non-GAAP measure of expense control relative to adjusted revenue. We calculate the efficiency ratio by dividing total noninterest expenses excluding non-recurring items by the sum of total net interest income and total noninterest income, each as determined under GAAP, but excluding net gains on securities and other non-recurring income sources, if applicable, from this calculation, which we refer to as recurring revenue. We believe that this provides one reasonable measure of recurring expenses relative to recurring revenue.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

Nine months ended

 

 

 

September 30, 

 

 

September 30, 

 

 

2018

 

2017

 

2018

 

2017

 

Net income

$

1,682

 

$

1,141

 

$

5,861

 

$

2,983

 

Add: compensation charge

 

1,173

 

 

 -

 

 

1,173

 

 

 -

 

Less: tax impact

 

314

 

 

 -

 

 

314

 

 

 -

 

Compensation charge, net

 

859

 

 

 -

 

 

859

 

 

 -

 

Adjusted net income

$

2,541

 

$

1,141

 

$

6,720

 

$

2,983

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets-GAAP

 

1.07

%

 

0.97

%

 

1.35

%

 

0.91

%

Add: compensation charge

 

0.55

%

 

0.00

%

 

0.19

%

 

0.00

%

Adjusted return on average assets

 

1.62

%

 

0.97

%

 

1.54

%

 

0.91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average common equity-GAAP

 

7.66

%

 

5.56

%

 

9.19

%

 

6.38

%

Add: compensation charge

 

3.91

%

 

0.00

%

 

1.35

%

 

0.00

%

Adjusted return on average common equity

 

11.57

%

 

5.56

%

 

10.54

%

 

6.38

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share-GAAP

$

0.22

 

$

0.16

 

$

0.76

 

$

0.51

 

Add: compensation charge

 

0.11

 

 

0.00

 

 

0.11

 

 

0.00

 

Adjusted diluted earnings per share

$

0.33

 

$

0.16

 

$

0.87

 

$

0.51

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency Ratio

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

$

7,276

 

$

5,226

 

$

20,013

 

$

14,140

 

Noninterest income

 

1,800

 

 

1,345

 

 

5,854

 

 

3,909

 

Recurring revenue

$

9,076

 

$

6,571

 

$

25,867

 

$

18,049

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest expense

$

6,330

 

$

4,425

 

$

16,891

 

$

12,618

 

Less: compensation charge

 

1,173

 

 

 -

 

 

1,173

 

 

 -

 

Recurring noninterest expense

$

5,157

 

$

4,425

 

$

15,718