Premier Bank Reports 2Q Income of $29.1M

DEFIANCE, Ohio – Premier Financial Corp., the institution formed by the merger of Home Savings Bank’s parent company and First Defiance Financial Corp., reports net income of $29.1 million in the second quarter, or 78 cents per share.

If expenses related to the merger are excluded, Premier posted income of $30.7 million, or 82 cents per share. That compares to $12.2 million in the second quarter of 2019, or 61 cents per share.

“Strong non-interest income performance and operating efficiency led to record quarterly results for the second quarter,” said Donald P. Hileman, CEO of Premier, in a statement. “We are very pleased by our ability to generate solid profitability for our shareholders while supporting the communities we serve. We happily participated in the [Paycheck Protection Program] while also conducting loan deferrals for both commercial and retail customers to help them during this difficult and uncertain time.”

The merger of the two financial institutions was completed Jan. 31 and the combined brand – Premier Bank – was introduced in June. The financial results are significantly affected by the merger, with year-to-date and second quarter figures including assets from the former United Community Financial Corp., the parent of Home Savings, that were not counted in the same periods for 2019.

“We achieved a significant milestone with the successful completion of our core systems conversion on July 13,” said President Gary M. Small. “We are very proud of the hard work and dedication exhibited by the Premier team to help us accomplish our integration goals especially during a pandemic.”

As part of the Paycheck Protection Program, Premier made 2,758 loans for a total of $434 million. Total gross fees totaled $14.5 million.

Key performance ratios for the quarters ended June 30 and June 30, 2019, include:

  • Return on average assets: 1.67% and 1.52%.
  • Return on average equity 12.53% and 12.28%.
  • Net interest margin: 3.51% and 4.03%.
  • Efficiency: 48.96% and 61.01%.

Net interest income rose to $54.3 million, up from $29 million in the second quarter last year

Noninterest income was $23 million, up from $10.5 in the same period a year ago. Mortgage banking increased to $9.9 million from $2.1 million.

Noninterest expenses totaled $38 million in the second quarter – $35.9 million if costs from the merger are excluded – compared to $24.2 million in 2019.

Total assets were $7.01 billion, up from $6.54 at the end of the first quarter and $3.28 billion in the second quarter of 2019.

Other second-quarter highlights include:

  • Allowance to loans ratio of 1.62%, or 1.76% excluding PPP loans
  • Loan growth of $343 million, or 6.7% quarterly growth
  • Deposit growth of $766 million, or 15.3% quarterly growth
  • Pretax preprovision ROAA of 2.26%, or 2.38% excluding merger-related expenses, compared to 1.89% for 2019 second quarter
  • Quarterly dividend of 22 cents per share, up 15.8% from 2019 second quarter

Copyright 2020 The Business Journal, Youngstown, Ohio.