Infinity Bancorp Announces First Quarter 2023 Financial Results - Seite 2

Due to the current trajectory of the national and local economies, management has proactively increased the Bank's Allowance for Loan and Lease Losses ("ALLL") during 2022. With the adoption of CECL in 2023, the Bank's ALLL decreased slightly to 1.68% of total loans as of March 31, 2023 from 1.70% as compared with the prior quarter and an increase from 1.54% for the first quarter of 2022.

Yield on total loans increased to 9.38% during the first quarter of 2023, compared to 8.48% from fourth quarter of 2022 and 6.61% in the first quarter a year ago.

Deposits

Total deposits equaled to $270.5 million at March 31, 2023, a decrease of $5.8 million, or -2.1% from the fourth quarter of 2022 and a decrease of $5.2 million, or -1.9% from March 31, 2022. Interest-bearing deposits increased by $8.6 million, or 6.5% when compared to fourth quarter of 2022 and increased $37.2 million, or 36% when compared to March 31, 2022. Noninterest-bearing demand accounts decreased $14.5 million, or -10% during the first quarter to $129.8 million as of March 31, 2023, and comprises 48% of total deposits. Noninterest-bearing demand accounts decreased $33 million, or -20.3% when compared to same quarter in 2022. This shift to interest-bearing accounts was expected due to increased market rates over the past year.

Cost of funds for the quarter ended March 31, 2023, increased due to two federal funds rate increases during the first quarter of 2023 that were approved by the Federal Open Market Committee. In response to the increases in federal funds rates in 2022 and 2023, the Bank increased the rates paid on interest-bearing-deposit accounts in 2022 and first quarter of 2023 resulting in an increase in cost of funds of 48 basis points to 1.06% when compared to year end and 77 basis points from March 2022.

Net-interest Income

Net-interest income for the first quarter of 2023 was $4.1 million, a slight decrease of $24 thousand, or -0.6% from the fourth quarter of 2022 and an increase of $1.7 million, or 68.7% over the first quarter of 2022.

The Bank's net interest margin was up 58 basis points to 5.72% when compared to fourth quarter ended December 31, 2022, and 237 basis points from 3.35% for the comparable period ended March 31, 2022. The Bank's primary source of net-interest income continues to be driven by interest on loans followed by other short-term investments.

Non-interest Income

For the quarter ended March 31, 2023, the Bank's non-interest income totaled $79 thousand, a decrease of $1 thousand, or -1.3% from the fourth quarter of 2022, and up $2 thousand, or 2.6% from same period in 2022. The increase in non-interest income for the quarter was mainly driven by an increase in account analysis fees.