CORRECTION BY SOURCE: University Bancorp 2Q2023 Net Income $1,557,298, $0.32 Per Share

This release has been corrected from the earlier version by correcting a date error in the prior headline and inserts the correct graphic for Annual Originations in Millions of Units.

ANN ARBOR, MI / ACCESSWIRE / September 8, 2023 / University Bancorp, Inc. (OTCQB:UNIB) announced that it had an unaudited net income attributable to University Bancorp, Inc. common stock shareholders in 2Q2023 of $1,557,298, $0.32 per share on average shares outstanding of 4,929,518 for the second quarter, versus an unaudited net income of $141,370, $0.03 per share on average shares outstanding of 4,929,518 for 2Q2022.

For the 6 months ended June 30, 2023, net income was $2,413,116, $0.49 per share on average shares outstanding of 4,929,518 for the period, versus $2,483,009, $0.51 per share on average shares outstanding of 4,907,851 for the 6 months ended June 30, 2022.

For the 12 months ended June 30, 2023, net income was $3,719,507, $0.76 per share on average shares outstanding of 4,929,518 for the period.

Shareholders' equity attributable to University Bancorp, Inc. common stock shareholders was $78,550,184 or $15.93 per share, based on shares outstanding at June 30, 2023 of 4,929,518.

President Stephen Lange Ranzini noted, "Industry-wide mortgage origination volumes are at 27-year lows. The Mortgage Bankers Association notes that mortgage applications have not been this low since December 1996." Here is a chart of U.S. mortgage origination volume going back to 2010, not in dollars but in millions of units. The 2023 number is an estimate:

Foto: Accesswire

President Stephen Lange Ranzini noted, "Industry-wide gain on sale margins also dropped to record low levels in 1Q2023 and have now been negative for six quarters." Here is a chart of industry-wide profitability each quarter since Q32021:

Foto: Accesswire

"Despite the extremely poor industry conditions, during the six quarters that the mortgage origination industry lost money, University Bank earned profits each quarter, and our profitability has been steadily rising since December 2022, due to a shift in strategy."

Here is a chart that shows the quarterly profitability of University Bank starting in 1Q2020:

Foto: Accesswire

Starting in March 2022, we began to increase our residential loans held for investment. Overall, our loan portfolio, which was $190.5 million at 12/31/2021, rose as we retained a mix of 7-year ARMs and monthly adjusting first mortgage HELOCs. At 12/31/2022 our loan portfolio held for investment was $553.9 million, and at 6/30/2023 it was $621.5 million. ROE at University Bank is now reaching acceptable levels, with the annualized ROE as follows: