Union Bankshares Announces Earnings for the Three Months Ended March 31, 2020 and Declares Quarterly Dividend

MORRISVILLE, Vt., April 15, 2020 (GLOBE NEWSWIRE) -- Union Bankshares, Inc. (NASDAQ - UNB) today announced results for the three months ended March 31, 2020 and declared a regular quarterly cash dividend.

Consolidated net income for the first quarter was $2.2 million, or $0.49 per share, compared to $2.6 million, or $0.59 per share, for the same period in 2019.  The reduction in earnings from the 2019 comparison period was due to a combination of factors including an anticipated flat interest rate environment, planned technology infrastructure spending, discretionary hiring of high value staff to allow continued growth in the franchise, continued development of newer branch locations, ongoing competition in all aspects of the business, and the initial impacts of the outbreak of the COVID-19 public health emergency.

Interest income increased $185 thousand, or 2.1%, to $8.8 million for the three months ended March 31, 2020 compared to $8.6 million for the three months ended March 31, 2019. The Federal Reserve initiated a 150 basis point reduction in short term interest rates in March 2020 which will impact interest income in future periods.  Interest expense was $1.4 million for the three months ended March 31, 2020 compared to $1.2 million for the three months ended March 31, 2019, an increase of $225 thousand, or 18.3%.

The provision for loan losses was $300 thousand for the three months ended March 31, 2020 compared to $50 thousand for the same period in 2019.  The increase in the provision resulted from management's adjustment to the economic qualitative factors utilized to estimate the allowance for loan losses due to the economic disruption currently impacting our borrowers.

Total noninterest income amounted to $2.6 million for the three months ended March 31, 2020 compared to $2.2 million for the three months ended March 31, 2019, an increase of $472 thousand, or 23.6%, due to an increase in the gain on sale of residential loans.  Sales of qualifying residential loans amounted to $42.4 million for the three months ended March 31, 2020 compared to $21.4 million for the same period in 2019.

Total noninterest expenses were $7.2 million for the three months ended March 31, 2020 compared to $6.5 million for the same period in 2019. Increases of $323 thousand in salaries and wages, $76 thousand in occupancy expenses, $175 thousand in equipment expenses, and $88 thousand in other expenses were partially offset by a decrease of $12 thousand in employee benefits between periods.