Lyons Bancorp Earnings Continue at Record Pace
For the 23rd consecutive year, Lyons Bancorp, Inc., the financial holding company for The Lyons National Bank, reported record earnings. The Company’s 2019 operating earnings per common share were $3.22, a 6.3% increase over the $3.03 per share it earned in 2018. The Company sadly recognized one-time income from Bank Owned Life Insurance due to the untimely passing of its Chief Risk Officer during the year. This insurance income increased the Company’s reported EPS to $3.33 per common share. In dollars, including the insurance, the Company’s after-tax net income earned was $11.005 million in 2019 versus $10 million in 2018.
Assets at the Company’s main subsidiary, The Lyons National Bank, grew by 7.6% and ended 2019 at $1.16 billion. Loans at the Bank, the largest component of Company assets, grew $52 million, a gain of 6.5%. On the other side of the Bank’s balance sheet, deposits grew $84 million, an 8.8% increase. Shareholder equity grew $8.8 million or 11.3%.
In addition to its balance sheet growth, the Bank’s “off-balance” residential mortgage portfolio, which consists of mortgages it originates and continues to service but sells into the secondary market, grew by $44 million and totaled $383 million at 12/31/19. The Bank collects fees to service the loans, and the money it receives from the sale of the mortgages is leveraged into originating additional residential mortgages.
Loan quality remains very strong. Net loans charged-off in 2019 equaled 0.10% of outstanding loans, the same percentage as 2018. While the amount of charged off loans remained constant, the Bank increased its Allowance for Loan Losses by $1.5 million. This increase followed its conservative practices, boosting the Allowance to $11.6 million or 1.34% of gross loans at December 31, 2019, a level well above current industry standards.
The Company’s Return on Average Assets (ROAA) grew to 0.98% from the prior year’s 0.95%. Because the Company’s capital grew faster than the growth in the balance sheet, its Return on Average Equity (ROAE) slipped slightly to 12.99% from 13.37% in 2018.
For the 22nd consecutive year, the Board of Directors approved an increase in the Company’s common stock dividend. The 2019 annualized dividend of $1.24 per share reflects a 3% increase over 2018. Based on the closing price of the Company’s common stock on the date of this release, the annualized dividend yield is 3.20%.
In the fourth quarter of 2019, the Bank received regulatory approval to open its 16th branch office in the Town of Farmington in Ontario County. The office is scheduled to open in the second quarter of 2020.
“We are again clearly pleased with our annual financial results,” said Robert A. Schick, Chief Executive Officer and Board Chairman. “With the obvious exception of the loss of our beloved colleague, any way you look at our growth and performance, our employees had the company running on all cylinders in 2019. They are an amazing team.”