3 unchanged sentences
Consolidated Statements of Financial Condition
−Removed: March 31, 2022 and December 31, 2021
+Added: June 30, 2022 and December 31, 2021
(Amounts in thousands, except share and per share data)
4 unchanged sentences
Securities available for sale
−Removed: Securities held to maturity (fair values of $ 30,084 at March 31, 2022 and $ 33,673 at December 31, 2021)
−Removed: Loans receivable, net of allowance for loan and lease losses of $ 1,610 at March 31, 2022 and $ 1,592 at December 31, 2021
+Added: Securities held to maturity (fair values of $ 27,224 at June 30, 2022 and $ 33,673 at December 31, 2021)
+Added: Loans receivable, net of allowance for loan and lease losses of $ 1,639 at June 30, 2022 and $ 1,592 at December 31, 2021
Net investment in direct financing leases
Accrued interest receivable
−Removed: Premises and equipment
+Added: Premises and equipment, net
Bank-owned life insurance
17 unchanged sentences
Accumulated other comprehensive loss
−Removed: Unearned Employee Stock Ownership Program ("ESOP") shares, at cost
+Added: Unearned Employee Stock Ownership Program (ESOP) shares, at cost
Total shareholders' equity
3 unchanged sentences
Consolidated Statements of Operations (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
Three Months Ended
+Added: Six Months Ended
Interest Income
14 unchanged sentences
Other service charges and fees
+Added: Net loss on securities transactions
Net appreciation on bank-owned life insurance
18 unchanged sentences
Consolidated Statements of Comprehensive (Loss) Income (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
Three Months Ended
−Removed: Other items of comprehensive (loss) income
−Removed: Net changes in fair value of available for sale securities, before tax
−Removed: Total other items of comprehensive (loss) income
−Removed: Comprehensive (Loss) Income Before Tax
−Removed: Income tax benefit related to other items of comprehensive (loss) income
+Added: Six Months Ended
+Added: Other items of comprehensive loss, before tax
+Added: Net changes in fair value of available for sale securities
+Added: Reclassification adjustment for realized loss on sale of investment securities included in net income
+Added: Total other items of comprehensive loss, before tax
+Added: Income tax benefit related to other items of comprehensive loss
+Added: Total other items of comprehensive loss, after tax
Comprehensive (Loss) Income
3 unchanged sentences
Consolidated Statements of Shareholders’ and Members’ Equity (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
1 unchanged sentence
Comprehensive
−Removed: Three Months Ended March 31, 2022 and 2021
−Removed: Income (Loss)
−Removed: Balance at January 1, 2022
+Added: Three Months Ended June 30, 2022 and 2021
+Added: (Loss) Income
+Added: Balance at April 1, 2022
Net changes in fair value of available for sale securities, net of tax benefit of $ 612
ESOP shares committed to be released, 3,258 shares
−Removed: Balance at March 31, 2022
+Added: Balance at June 30, 2022
+Added: Balance at April 1, 2021
+Added: Change in additional paid in capital
+Added: Net changes in fair value of available for sale securities, net of tax benefit of $ 3
+Added: Balance at June 30, 2021
+Added: Shareholders'
+Added: Comprehensive
+Added: Six Months Ended June 30, 2022 and 2021
+Added: (Loss) Income
Balance at January 1, 2022
−Removed: Conversion costs
Net changes in fair value of available for sale securities, net of tax benefit of $ 1,276
−Removed: Balance at March 31, 2021
+Added: ESOP shares committed to be released, 6,516 shares
+Added: Balance at June 30, 2022
+Added: Balance at January 1, 2021
+Added: Change in additional paid in capital
+Added: Net changes in fair value of available for sale securities, net of tax expense of $ 9
+Added: Balance at June 30, 2021
See Notes to Consolidated Financial Statements
2 unchanged sentences
Consolidated Statements of Cash Flows (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: Three Months Ended
+Added: Six Months Ended
Operating Activities
3 unchanged sentences
Depreciation and amortization
+Added: Net realized loss on investment securities transactions
+Added: Loss on sale of fixed assets
Appreciation on bank-owned life insurance
15 unchanged sentences
Net decrease (increase) in net investment in direct financing leases
−Removed: Additions to premises and equipment
+Added: Purchases of premises and equipment
Net Cash used for Investing Activities
11 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
27 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
Interim Financial Statements
−Removed: The interim unaudited consolidated financial statements as of March 31, 2022, and for the three months ended March 31, 2022 and 2021, are unaudited and reflect all normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented.
+Added: The interim unaudited consolidated financial statements as of June 30, 2022, and for the three and six months ended June 30, 2022 and 2021, are unaudited and reflect all normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented.
Such adjustments are the only adjustments contained in these unaudited consolidated financial statements.
These unaudited consolidated financial statements have been prepared according to the rules and regulations of the Securities and Exchange Commission, and therefore certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been omitted.
−Removed: The results of operations for the three months ended March 31, 2022, are not necessarily indicative of the results to be achieved for the remainder of the year ending December 31, 2022, or any other period.
+Added: The results of operations for the six months ended June 30, 2022, are not necessarily indicative of the results to be achieved for the remainder of the year ending December 31, 2022, or any other period.
Certain prior period data presented in the consolidated financial statements have been reclassified to conform with the current period presentation.
12 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
2 unchanged sentences
Diluted earnings per share is computed using the weighted-average number of shares determined for the basic earnings per common share computation plus the dilutive effect of stock compensation using the treasury stock method.
−Removed: There were no dilutive shares as of March 31, 2022.
−Removed: There were no shares authorized or outstanding at March 31, 2021.
+Added: There were no dilutive shares as of June 30, 2022.
+Added: There were no shares issued or outstanding at June 30, 2021.
Three Months Ended
−Removed: March 31, 2022
+Added: Six Months Ended
+Added: June 30, 2022
+Added: June 30, 2022
Weighted average shares outstanding for basic earnings per share:
8 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
1 unchanged sentence
The amortized cost and fair value of securities, with gross unrealized gains and losses, follows:
−Removed: March 31, 2022
+Added: June 30, 2022
Available for Sale
25 unchanged sentences
Total securities held to maturity
−Removed: During the three months ended March 31, 2022 and 2021, the Company had no sales of available for sale securities or held to maturity securities.
−Removed: At March 31, 2022 and December 31, 2021, securities with a carrying value of $ 2,715 and $ 2,745 , respectively, were pledged to secure public deposits and for other purposes required or permitted by law.
+Added: During the six months ended June 30, 2022, the Company had sales of available for sale securities of $ 10,822 with a loss of $ 29 .
+Added: During the three and six months ended June 30, 2021, the Bank had no sales of available for sale securities or held to maturity securities.
+Added: At June 30, 2022 and December 31, 2021, securities with a carrying value of $ 2,599 and $ 2,745 , respectively, were pledged to secure public deposits and for other purposes required or permitted by law.
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: The amortized cost and fair value of debt securities by contractual maturity at March 31, 2022, follows:
+Added: The amortized cost and fair value of debt securities by contractual maturity at June 30, 2022, follows:
Available for Sale
7 unchanged sentences
The following table shows the gross unrealized losses and fair value of the Company’s investments with unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:
−Removed: March 31, 2022
+Added: June 30, 2022
Less than 12 months
21 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
1 unchanged sentence
Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company’s investments.
−Removed: Because the decline in fair value is attributable to changes in market interest rates and increases in prepayment speeds and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at March 31, 2022 or December 31, 2021.
+Added: Because the decline in fair value is attributable to changes in market interest rates and increases in prepayment speeds and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2022 or December 31, 2021.
Government and Agency
The unrealized losses on the Company’s investments in U.S.
−Removed: government and agency securities were caused by interest rate increases.
+Added: government and agency securities were caused by market interest rate increases.
The contractual cash flows of those investments are guaranteed by an agency of the U.S.
Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company’s investments.
−Removed: Because the decline in fair value is attributable to changes in market interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at March 31, 2022 or December 31, 2021.
+Added: Because the decline in fair value is attributable to changes in market interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2022 or December 31, 2021.
State and Municipal
−Removed: The unrealized losses on the Company’s investments in state and municipal securities were caused by interest rate increases.
+Added: The unrealized losses on the Company’s investments in state and municipal securities were caused by market interest rate increases.
Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company’s investments.
−Removed: Because the decline in fair value is attributable to changes in market interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at March 31, 2022 or December 31, 2021.
+Added: Because the decline in fair value is attributable to changes in market interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2022 or December 31, 2021.
Corporate Bonds
−Removed: The unrealized losses on the Company’s investments in corporate bond securities were caused by interest rate increases.
+Added: The unrealized losses on the Company’s investments in corporate bond securities were caused by market interest rate increases.
Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company’s investments.
−Removed: Because the decline in fair value is attributable to changes in market interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at March 31, 2022 or December 31, 2021.
+Added: Because the decline in fair value is attributable to changes in market interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2022 or December 31, 2021.
Other-Than-Temporary Impairment
1 unchanged sentence
Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) evaluation by the Company of (a) its intent to sell a debt security prior to recovery and (b) whether it is more likely than not the Company will have to sell the debt security prior to recovery.
−Removed: As of March 31, 2022 and December 31, no investment securities were other-than- temporarily impaired.
+Added: As of June 30, 2022 and December 31, no investment securities were other-than- temporarily impaired.
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
7 unchanged sentences
This legislation is called the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) which provides economy‐wide financial stimulus in the form of financial aid to individuals, businesses, nonprofit entities, states and municipalities.
−Removed: The CARES Act temporarily added a new product titled the “Paycheck Protection Program” (PPP) to the U.S.
+Added: The CARES Act temporarily added a new program titled the “Paycheck Protection Program” (PPP) to the U.S.
Small Business Administration’s loan program.
The CARES Act permits the SBA to guarantee 100 percent of these loans and also provides for forgiveness of up to the full principal amount of these loans.
−Removed: As of March 31, 2022, the Company originated $ 5,484 in PPP loans of which $ 5,475 had been forgiven.
−Removed: Additionally, the Company recognized $ 0 and $ 4 of PPP loan interest in interest income during the three months ended March 31, 2022 and 2021, respectively.
+Added: As of June 30, 2022, the Company originated $ 5,484 in PPP loans of which $ 5,477 had been forgiven.
+Added: Additionally, the Company recognized $ 0 and $ 5 of PPP loan interest in interest income during the six months ended June 30, 2022 and 2021, respectively, and $ 0 and $ 1 for the three months ended June 30, 2022 and 2021, respectively.
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: The following tables set forth information regarding the activity in the allowance for loan and lease losses for the three months ended March 31, 2022 and 2021 and the year ended December 31, 2021:
−Removed: March 31, 2022
+Added: The following tables set forth information regarding the activity in the allowance for loan and lease losses for the three and six months ended June 30, 2022 and 2021 and the year ended December 31, 2021:
+Added: June 30, 2022
Allowance for loan and lease losses:
+Added: Three-months ended
+Added: Balance, April 1, 2022
+Added: Balance, June 30, 2022
+Added: Six-months ended
Balance, January 1, 2022
−Removed: Balance, March 31, 2022
−Removed: Balance, March 31, 2022 allocated to loans and leases individually evaluated for impairment
−Removed: Balance, March 31, 2022 allocated to loans and leases collectively evaluated for impairment
+Added: Balance, June 30, 2022
+Added: Balance, June 30, 2022 allocated to loans and leases individually evaluated for impairment
+Added: Balance, June 30, 2022 allocated to loans and leases collectively evaluated for impairment
Loans and leases receivable:
−Removed: Balance, March 31, 2022 loans and leases individually evaluated for impairment
−Removed: Balance, March 31, 2022 loans and leases collectively evaluated for impairment
−Removed: Balance, March 31, 2022
+Added: Balance, June 30, 2022 loans and leases individually evaluated for impairment
+Added: Balance, June 30, 2022 loans and leases collectively evaluated for impairment
+Added: Balance, June 30, 2022
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: March 31, 2021
+Added: June 30, 2021
Allowance for loan and lease losses:
+Added: Three-months ended
+Added: Balance, April 1, 2021
+Added: Balance, June 30, 2021
+Added: Six-months ended
Balance, January 1, 2021
Provision (Credit)
−Removed: Balance, March 31, 2021
+Added: Balance, June 30, 2021
December 31, 2021
14 unchanged sentences
Ratings are adjusted to reflect the degree of risk and loss that is felt to be inherent in each credit as of each quarterly reporting period.
−Removed: The methodology is structured so that specific allocations are increased in accordance with deterioration in credit quality (and a corresponding increase in risk and loss) or decreased in accordance with improvement in credit quality (and a corresponding decrease in risk and loss).
−Removed: Credits rated special mention show clear signs of financial weaknesses or deterioration in credit worthiness;
−Removed: however, such concerns are not so pronounced that the Company generally expects to experience significant loss within the short-term.
−Removed: Such credits typically maintain the ability to perform within standard credit terms and credit exposure is not as prominent as credits rated more harshly.
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
+Added: The methodology is structured so that specific allocations are increased in accordance with deterioration in credit quality (and a corresponding increase in risk and loss) or decreased in accordance with improvement in credit quality (and a corresponding decrease in risk and loss).
+Added: Credits rated special mention show clear signs of financial weaknesses or deterioration in credit worthiness;
+Added: however, such concerns are not so pronounced that the Company generally expects to experience significant loss within the short-term.
+Added: Such credits typically maintain the ability to perform within standard credit terms and credit exposure is not as prominent as credits rated more harshly.
Credits rated substandard are those in which the normal repayment of principal and interest may be, or has been, jeopardized by reason of adverse trends or developments of a financial, managerial, economic or political nature, or important weaknesses exist in collateral.
11 unchanged sentences
The Company evaluates the loan risk grading system definitions and allowance for loan and lease loss methodology on an ongoing basis.
−Removed: No significant changes were made during the three months ended March 31, 2022 or during the year ended December 31, 2021.
+Added: No significant changes were made during the six months ended June 30, 2022 or during the year ended December 31, 2021.
+Added: Texas Community Bancshares, Inc.
+Added: and Subsidiaries
+Added: Notes to Consolidated Financial Statements (Unaudited)
+Added: Three and Six Months Ended June 30, 2022 and 2021
+Added: (Amounts in thousands, except share and per share data)
The following tables set forth information regarding the internal classification of the loan and lease portfolio:
−Removed: March 31, 2022
+Added: June 30, 2022
Construction and land
2 unchanged sentences
Consumer and other
−Removed: Texas Community Bancshares, Inc.
−Removed: and Subsidiaries
−Removed: Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
−Removed: (Amounts in thousands, except share and per share data)
December 31, 2021
4 unchanged sentences
The following table sets forth information regarding the credit risk profile based on payment activity of the loan and lease portfolio:
−Removed: March 31, 2022
+Added: June 30, 2022
December 31, 2021
3 unchanged sentences
Consumer and other
−Removed: The following table sets forth information regarding the delinquencies not on nonaccrual within the loan and lease portfolio:
−Removed: March 31, 2022
+Added: Texas Community Bancshares, Inc.
+Added: and Subsidiaries
+Added: Notes to Consolidated Financial Statements (Unaudited)
+Added: Three and Six Months Ended June 30, 2022 and 2021
+Added: (Amounts in thousands, except share and per share data)
+Added: The following tables set forth information regarding the delinquencies not on nonaccrual within the loan and lease portfolio:
+Added: June 30, 2022
> 90 Days and
4 unchanged sentences
Consumer and other
−Removed: Texas Community Bancshares, Inc.
−Removed: and Subsidiaries
−Removed: Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
−Removed: (Amounts in thousands, except share and per share data)
December 31, 2021
5 unchanged sentences
Consumer and other
−Removed: The following table sets forth information regarding the nonaccrual status within the loan and lease portfolio as of March 31, 2022 and December 31, 2021:
+Added: The following table sets forth information regarding the nonaccrual status within the loan and lease portfolio as of June 30, 2022 and December 31, 2021:
Construction and land
2 unchanged sentences
Consumer and other
+Added: Texas Community Bancshares, Inc.
+Added: and Subsidiaries
+Added: Notes to Consolidated Financial Statements (Unaudited)
+Added: Three and Six Months Ended June 30, 2022 and 2021
+Added: (Amounts in thousands, except share and per share data)
A loan is considered impaired when based on current information and events;
5 unchanged sentences
Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.
−Removed: No interest income was recognized for loans on nonaccrual status for the three months ended March 31, 2022 and 2021.
+Added: No interest income was recognized for loans on nonaccrual status for the three and six months ended June 30, 2022 and 2021.
+Added: The following table presents interest income recognized on impaired loans for the three and six months ended June 30, 2022 and 2021:
+Added: Three Months Ended
+Added: Six Months Ended
+Added: 1-4 residential & multi-family
+Added: Commercial real estate
+Added: Consumer and other
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: The following table presents interest income recognized on impaired loans for the three months ended March 31, 2022 and 2021:
−Removed: 1-4 residential & multi-family
−Removed: Commercial real estate
−Removed: The following table sets forth information regarding impaired loans as of March 31, 2022:
+Added: The following table sets forth information regarding impaired loans as of June 30, 2022:
With no related allowance
7 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
9 unchanged sentences
Consumer and other
−Removed: During the three months ended March 31, 2022, there were no modifications resulting in troubled debt restructurings.
−Removed: During the three months ended March 31, 2021, there were two modifications resulting in troubled debt restructurings totaling approximately $ 90 .
−Removed: The first loan is a single-family mortgage loan with an outstanding balance of approximately $ 72 as of March 31, 2022 and a second loan is a commercial and industrial loan with an outstanding balance of approximately $ 18 as of March 31, 2022.
−Removed: There have been no subsequently defaulted troubled debt restructurings.
−Removed: At March 31, 2022 and December 31, 2021, the Company had no commitments to loan additional funds to borrowers whose loans have been modified but may on occasion extend financing to these borrowers.
−Removed: At March 31, 2022 and December 31, 2021, the Company had a recorded investment of $ 482 and $ 493 , respectively, of troubled debt restructured loans.
+Added: During the six months ended June 30, 2022, there were no modifications resulting in troubled debt restructurings.
+Added: During the six months ended June 30, 2022, there were no subsequently defaulted troubled debt restructurings.
+Added: At June 30, 2022 and December 31, 2021, the Company had no commitments to loan additional funds to borrowers whose loans have been modified but may on occasion extend financing to these borrowers.
+Added: At June 30, 2022 and December 31, 2021, the Company had a recorded investment of $ 386 and $ 493 , respectively, of troubled debt restructured loans.
The Company has no current commitments to loan additional funds to the borrowers whose loans have been modified.
3 unchanged sentences
Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated statements of financial condition.
−Removed: The Company’s
+Added: The Company’s exposure to credit loss is represented by the contractual amount of these commitments.
+Added: The Company follows the same credit policies in making commitments as it does for on-balance-sheet instruments.
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: exposure to credit loss is represented by the contractual amount of these commitments.
−Removed: The Company follows the same credit policies in making commitments as it does for on-balance-sheet instruments.
−Removed: At March 31, 2022 and December 31, 2021, the following financial instruments were outstanding whose contract amounts represent credit risk:
+Added: At June 30, 2022 and December 31, 2021, the following financial instruments were outstanding whose contract amounts represent credit risk:
Contract Amount
10 unchanged sentences
The lines renew annually.
−Removed: At March 31, 2022, the Company had unused borrowing capacity of $ 106.3 million with the Federal Home Loan Bank of Dallas.
−Removed: At March 31, 2022, the Company had no commitments to purchase securities.
+Added: At June 30, 2022, the Company had unused borrowing capacity of $ 107,800 with the Federal Home Loan Bank of Dallas.
+Added: At June 30, 2022, the Company had no commitments to purchase securities.
The Company has no other off-balance-sheet arrangements or transactions with unconsolidated, special purpose entities that would expose the Company to liability that is not reflected on the face of the consolidated statements of financial condition.
1 unchanged sentence
Supplemental disclosure of cash flow information is as follows:
+Added: Six Months Ended
Supplemental cash flow information:
6 unchanged sentences
Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the consolidated financial statements.
+Added: Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items as
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices.
+Added: calculated under regulatory accounting practices.
The capital amounts and classification are also subject to qualitative judgements by the regulators about components, risk weightings, and other factors.
The Bank has opted into the Community Bank Leverage Ratio (CBLR) framework, beginning with the Call Report filed for the first quarter of 2020.
−Removed: At March 31, 2022 and December 31, 2021, the Bank’s CBLR ratio was 12.84 % and 12.89 %, respectively, which exceeded all regulatory capital requirements under the CBLR framework and the Bank was considered to be “well-capitalized.”
+Added: At June 30, 2022 and December 31, 2021, the Bank’s CBLR ratio was 12.76 % and 12.89 %, respectively, which exceeded all regulatory capital requirements under the CBLR framework and the Bank was considered to be “well-capitalized.”
Under the CLBR framework, banks and their bank holding companies that have less than $10 billion in total consolidated assets and meet other qualifying criteria, including a leverage ratio (equal to tier 1 capital divided by average total consolidated assets) of greater than 9%, are eligible to opt into the CBLR framework.
Qualifying community banking organizations that elect to use the CBLR framework and that maintain a leverage ratio of greater than 9% will be considered to have satisfied the generally applicable risk-based and leverage capital requirements in the agencies’ capital rules (generally applicable capital rules) and, if applicable, will be considered to have met the well-capitalized ratio requirements for purposes of section 38 of the Federal Deposit Insurance Act.
−Removed: Accordingly, beginning January 1, 2022, qualifying community banking organizations that exceed the 9% CBLR will be considered to have met:
+Added: Accordingly, beginning January 1, 2022, qualifying community banking organizations that exceed the 9% CBLR are considered to have met:
(i) the generally applicable risk-based and leverage capital requirements of the generally applicable capital rules;
16 unchanged sentences
The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities.
−Removed: The income approach uses
+Added: The income approach uses valuation techniques to convert future amounts, such as cash flows or earnings, to a single present amount on a discounted basis.
+Added: The cost approach is based on the amount that currently would be required to replace the service
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: valuation techniques to convert future amounts, such as cash flows or earnings, to a single present amount on a discounted basis.
−Removed: The cost approach is based on the amount that currently would be required to replace the service capacity of an asset (replacement costs).
+Added: capacity of an asset (replacement costs).
Valuation techniques should be consistently applied.
7 unchanged sentences
● Level 3 Inputs – Significant unobservable inputs that reflect an entity ’ s own assumptions that market participants would use in pricing the assets or liabilities.
−Removed: A description of the valuation methodologies used for assets and liabilities measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below.
−Removed: There have been no changes in valuation techniques during either the three months ended March 31, 2022 or the year ended December 31, 2021.
+Added: A description of the valuation methodologies used for assets measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below.
+Added: There were no changes in valuation techniques during either the six months ended June 30, 2022 or the year ended December 31, 2021.
In general, fair value is based upon quoted market prices, where available.
8 unchanged sentences
Collateral values are estimated using Level 3 inputs based on internally customized discounting criteria.
+Added: Foreclosed Assets – Fair values are valued at the time the loan is foreclosed upon and the asset is transferred from loans.
+Added: The value is based upon primarily third-party appraisals, less estimated costs to sell.
+Added: The appraisals are
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: Foreclosed Assets – Fair values are valued at the time the loan is foreclosed upon and the asset is transferred from loans.
−Removed: The value is based upon primarily third-party appraisals, less estimated costs to sell.
−Removed: The appraisals are generally discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and the client’s business.
+Added: generally discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and the client’s business.
Such discounts are typically significant and result in Level 3 classification of the inputs for determining fair value.
Foreclosed assets are reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the same or similar factors above.
−Removed: The following table summarizes financial assets measured at fair value on a recurring basis as of March 31, 2022 and December 31, 2021, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:
−Removed: March 31, 2022
+Added: The following table summarizes financial assets measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:
+Added: June 30, 2022
Financial assets
20 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: The following table summarizes financial and non-financial assets measured at fair value on a nonrecurring basis as of March 31, 2022 and December 31, 2021, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:
−Removed: March 31, 2022
+Added: The following table summarizes financial and non-financial assets measured at fair value on a nonrecurring basis as of June 30, 2022 and December 31, 2021, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:
+Added: June 30, 2022
Financial assets
7 unchanged sentences
Foreclosed assets
−Removed: During the three months ended March 31, 2022 and 2021, certain impaired loans were remeasured and reported at fair value through a specific allocation of the allowance for loan and lease losses based upon the fair value of the underlying collateral.
−Removed: At March 31, 2022, impaired loans with a carrying value of $ 301 were reduced by specific valuation allowance allocations totaling $ 300 to a reported fair value of $ 1 .
+Added: During the six months ended June 30, 2022 and the year ended December 31, 2021, certain impaired loans were remeasured and reported at fair value through a specific allocation of the allowance for loan and lease losses based upon the fair value of the underlying collateral.
+Added: At June 30, 2022, impaired loans with a carrying value of $ 426 were reduced by specific valuation allowance allocations totaling $ 300 to a reported fair value of $ 126 .
At December 31, 2021, impaired loans with a carrying value of $ 1,582 were reduced by specific valuation allowance allocations totaling $ 308 to a reported fair value of $ 1,274 .
The fair value of impaired loans is determined based on collateral valuations utilizing Level 3 valuation inputs.
−Removed: There was no charge to the provision for loan and lease losses as a result of the valuation allowances for the three months ended March 31, 2022 and 2021.
+Added: There was no charge to the provision for loan and lease losses as a result of the valuation allowances for the three and six months ended June 30, 2022 and 2021.
Quantitative Information About Significant Unobservable Inputs Used in Level 3 Fair Value Measurements – The following table represents the Company’s Level 3 financial assets, the valuation techniques used to measure the fair value of those financial assets, the significant unobservable inputs and the ranges of values for those inputs:
2 unchanged sentences
Significant Input
−Removed: March 31, 2022
+Added: June 30, 2022
Impaired loans
7 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
11 unchanged sentences
The estimated fair values, and related carrying amounts, of the Company’s financial instruments are as follows:
−Removed: March 31, 2022
+Added: June 30, 2022
Carrying Value
26 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
14 unchanged sentences
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
Note 8 - Employee Stock Ownership Plan
−Removed: In connection with the conversion to an entity owned by shareholders, the Company established an Employee Stock Ownership Plan for the exclusive benefit of eligible employees.
+Added: In connection with the Conversion, the Company established an Employee Stock Ownership Plan for the exclusive benefit of eligible employees.
The ESOP borrowed funds from the Company in an amount sufficient to purchase 260,621 shares (approximately 8.0 % of the common stock issued in connection with the Conversion).
12 unchanged sentences
Dividends on unallocated ESOP shares, if any, are recorded as a reduction of debt and accrued interest.
−Removed: ESOP compensation was $ 51 for the three months ended March 31, 2022.
+Added: ESOP compensation was $ 60 and $ 111 for the three months and six months ended June 30, 2022, respectively.
A summary of the ESOP shares are as follows:
7 unchanged sentences
ASU 2016‐ 13 is effective for the Company on January 1, 2023.
−Removed: The Company has approved a third-party vendor recommended by the Current Expected Credit Losses (“CECL”) team.
−Removed: Management will begin working with them to provide, review and update loan data for use in the model during the quarter ending June 30, 2022, as well as re-evaluating the Company’s internal and external factors, including economic and peer data, with the goal of beginning parallel runs using the new CECL model and the current allowance for loan and lease losses model
+Added: The Company has contracted with a third-party vendor recommended by the Current Expected Credit Losses (“CECL”) team.
+Added: Management is working to upload needed loan data used in the CECL model for the quarter ending June 30, 2022, as well as re-evaluating the Company’s internal and external factors, including economic and peer data for use in the second quarter calculation.
+Added: A parallel run using the new CECL model and the current allowance for loan and lease losses model will be run for the June 30, 2022 data.
+Added: At this time however, the CECL model data inputs are still in process.
Texas Community Bancshares, Inc.
1 unchanged sentence
Notes to Consolidated Financial Statements (Unaudited)
−Removed: Three Months Ended March 31, 2022 and 2021
+Added: Three and Six Months Ended June 30, 2022 and 2021
(Amounts in thousands, except share and per share data)
−Removed: simultaneously as soon as all systems are in place.
−Removed: Once parallel runs are in place management can evaluate how this methodology change will impact the Company’s consolidated financial statements.
In March 2020, the FASB issued ASU No.
7 unchanged sentences
Management’s Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Management’s discussion and analysis of financial condition and results of operations is intended to assist in understanding Texas Community Bancshares, Inc.’s (“the Company”) consolidated financial condition at March 31, 2022 and consolidated results of operations for the three months ended March 31, 2022 and 2021.
+Added: Management’s discussion and analysis of financial condition and results of operations is intended to assist in understanding Texas Community Bancshares, Inc.’s (“the Company”) consolidated financial condition at June 30, 2022 and consolidated results of operations for the three and six months ended June 30, 2022 and 2021.
It should be read in conjunction with the unaudited consolidated financial statements and the related notes appearing in Part I, Item 1, of this Quarterly Report on Form 10-Q.
24 unchanged sentences
● competition among depository and other financial institutions;
−Removed: ● inflation and changes in the interest rate environment that reduce our margins and yields, our mortgage banking revenues, the fair value of financial instruments, including our mortgage servicing rights asset, or our level of loan originations, or increase the level of defaults, losses and prepayments on loans we have made and make;
+Added: ● inflation and changes in the interest rate environment that reduce our margins and yields, our mortgage banking revenues, the fair value of our investment securities and other financial instruments, including our mortgage servicing rights asset, or our level of loan originations, or increase the level of defaults, losses and prepayments on loans we have made and make;
● adverse changes in the securities or secondary mortgage markets;
20 unchanged sentences
The Jumpstart Our Business Startups Act of 2012 (JOBS Act) contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies.
−Removed: As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies.
+Added: As an “emerging growth company” we had the option to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies.
However, we have determined not to take advantage of the benefits of this extended transition period.
14 unchanged sentences
The total allowance is available to absorb losses from any segment of the loan portfolio.
−Removed: Management believes the allowance for loan and lease losses was adequate at March 31, 2022 and December 31, 2021.
+Added: Management believes the allowance for loan and lease losses was adequate at June 30, 2022 and December 31, 2021.
The allowance analysis is reviewed by the board of directors on a quarterly basis in compliance with regulatory requirements.
14 unchanged sentences
Penalties related to unrecognized tax benefits are classified as income tax expense.
−Removed: Comparison of Financial Condition at March 31, 2022 and December 31, 2021
+Added: Comparison of Financial Condition at June 30, 2022 and December 31, 2021
Total Assets.
−Removed: Total assets were $369.0 million at March 31, 2022, an increase of $4.2 million, or 1.2%, from $364.8 million at December 31, 2021.
−Removed: The increase was due primarily to increases in net loans of $4.3 million, or 2.0%, from $220.3 million at December 31, 2021 to $224.6 million at March 31, 2022.
+Added: Total assets were $373.7 million at June 30, 2022, an increase of $8.9 million, or 2.4%, from $364.8 million at December 31, 2021.
+Added: The increase was due primarily to increases in net loans and leases of $10.1 million, or 4.6%, from $220.3 million at December 31, 2021 to $230.4 million at June 30, 2022.
Cash and Cash Equivalents.
−Removed: Cash and cash equivalents increased $3.7 million, or 16.9%, to $25.6 million (which includes fed funds sold of $19.7 million) at March 31, 2022 from $21.9 million (which includes fed funds sold of $16.3 million) at December 31, 2021.
−Removed: This increase is primarily due to an increase in deposits of $6.8 million, partially offset by loan funding.
+Added: Cash and cash equivalents decreased $3.5 million, or 15.9%, to $18.4 million (which includes fed funds sold of $12.2 million) at June 30, 2022 from $21.9 million (which includes fed funds sold of $16.3 million) at December 31, 2021.
+Added: This decrease is primarily due to an increase in deposits of $13.7 million, being offset by increased net loan funding and an increase in securities purchases.
Interest Bearing Deposits in Banks.
−Removed: Interest bearing deposits in banks were $5.3 million at March 31, 2022 compared to $15.0 million at December 31, 2021, a decrease of $9.7 million, or 64.7%.
−Removed: The decrease was due primarily to an increase in securities of $5.1 million and loans of $4.3 million.
+Added: Interest bearing deposits in banks were $7.4 million at June 30, 2022 compared to $15.0 million at December 31, 2021, a decrease of $7.5 million, or 50.4%.
+Added: The decrease was due primarily to an increase in securities of $8.4 million.
Securities Available for Sale.
−Removed: Securities available for sale increased by $7.2 million, or 12.7%, to $64.0 million at March 31, 2022 from $56.8 million at December 31, 2021.
−Removed: The increase in securities for the quarter included the investment of $11.5 million in available for sale securities, including purchases of $6.0 million in U.S.
−Removed: Government debt securities, $3.3 million in municipals, and $2.2 million in corporate bonds, partially reduced by paydowns of $1.1 million, and unrealized losses on the available for sale portfolio of $3.2 million due primarily to the increase in market interest rates during the period.
+Added: Securities available for sale increased by $12.1 million, or 21.3%, to $68.9 million at June 30, 2022 from $56.8 million at December 31, 2021.
+Added: The increase in securities resulted primarily from purchases of $31.4 million, sales of $10.9 million, paydowns of $2.2 million, and unrealized losses on the available for sale portfolio of $6.1 million due primarily to the increase in market interest rates during the period.
Securities Held to Maturity.
−Removed: Securities held to maturity decreased by $2.1 million, or 6.2%, to $31.6 million at March 31, 2022 from $33.7 million at December 31, 2021.
+Added: Securities held to maturity decreased by $3.6 million, or 10.8%, to $30.0 million at June 30, 2022 from $33.7 million at December 31, 2021.
This decrease is due primarily to principal repayments of $3.2 million and one municipal security totaling $365,000 being called.
Loans and Leases Receivable, Net.
−Removed: Loans and leases receivable, net, increased $4.3 million, or 2.0%, to $224.6 million at March 31, 2022 from $220.3 million at December 31, 2021.
−Removed: Loans secured by residential real estate and farmland comprise $161.7, or 71.5% of the net loans at March 31, 2022.
−Removed: During the three months ended March 31, 2022, loan originations totaled $31.0 million of which $3.9 million were renewals or refinancings of existing loans with Mineola Community Bank, resulting in originations of new loans of $27.1 million.
−Removed: Originations consisted primarily of $11.4 million in one- to-four family residential mortgage loans, $11.8 million of residential construction loans (upon completion), including speculative construction loans of $4.9 million, $4.2 million in commercial real estate loans, $964,000 in consumer loans, $1.6 million in commercial and industrial loans, $676,000 in land & development loans,
−Removed: and $406,000 in farmland loans.
−Removed: During the three months ended March 31, 2022, there were $3.4 million in loan principal paydowns and $16.4 million in loan payoffs.
−Removed: PPP loans have paid down to 3 loans totaling $9,000 at March 31, 2022.
−Removed: During the three months ended March 31, 2022, construction loans in process increased by $6.1 million to $29.4 million at March 31, 2022 from $23.3 million at December 31, 2021.
+Added: Loans and leases receivable, net, increased $10.1 million, or 4.6%, to $230.4 million at June 30, 2022 from $220.3 million at December 31, 2021.
+Added: Loans secured by residential real estate and farmland comprise $162.7, or 70.1% of the net loans at June 30, 2022.
+Added: During the six months ended June 30, 2022, loan originations totaled $53.2 million of which $6.9 million were renewals or refinancings of existing loans with Mineola Community Bank, resulting in originations of new loans of $46.3 million.
+Added: Originations consisted primarily of $17.9 million in one- to-four family residential mortgage loans, $22.6 million of residential construction loans (upon completion), including speculative construction loans of $8.0 million, $5.0 million in commercial real estate loans, $2.2 million in consumer loans, $2.6 million in commercial and industrial loans, $1.4 million in land & development loans, and $1.4 million in farmland loans.
+Added: During the six months ended June 30, 2022, there were $6.4 million in loan principal paydowns and $27.4 million in loan payoffs.
+Added: PPP loans have paid down to 2 loans totaling $7,000 at June 30, 2022.
+Added: During the six months ended June 30, 2022, construction loans (when fully funded upon completion) increased by $11.7 million to $35.0 million at June 30, 2022 from $23.3 million at December 31, 2021 and the construction loan balance increased $6.1 million to $17.3 million at June 30, 2022.
Construction loans continue to be a large segment of our portfolio which is a reflection of the strong housing demand in our primary market area.
−Removed: Deposits increased $6.8 million, or 2.5%, to $281.7 million at March 31, 2022 from $274.9 million at December 31, 2021.
−Removed: Core deposits (defined as all deposits other than certificates of deposit) increased $8.5 million, or 4.2%, to $210.9 million at March 31, 2022 from $202.4 million at December 31, 2021.
−Removed: Certificates of deposit decreased $1.9 million, or 2.6%, to $70.7 million at March 31, 2022 from $72.6 million at December 31, 2021.
−Removed: At March 31, 2022, there were no brokered deposits.
+Added: Deposits increased $13.7 million, or 5.0%, to $288.6 million at June 30, 2022 from $274.9 million at December 31, 2021.
+Added: Core deposits (defined as all deposits other than certificates of deposit) increased $17.7 million, or 8.7%, to $220.1 million at June 30, 2022 from $202.4 million at December 31, 2021.
+Added: Certificates of deposit decreased $4.0 million, or 5.6%, to $68.5 million at June 30, 2022 from $72.6 million at December 31, 2021.
+Added: At June 30, 2022, there were no brokered deposits.
Advances from Federal Home Loan Bank.
−Removed: Advances from Federal Home Loan Bank decreased by $518,000 or 1.9%, to $27.1 million at March 31, 2022 from $27.6 million at December 31, 2021 due to scheduled monthly payments of principal on amortizing advances.
+Added: Advances from Federal Home Loan Bank decreased by $1.0 million, or 3.8%, to $26.5 million at June 30, 2022 from $27.6 million at December 31, 2021 due to scheduled monthly payments of principal on amortizing advances.
Total Shareholders’ Equity.
−Removed: Total shareholders’ equity decreased $2.0 million, or 3.3%, to $58.1 million at March 31, 2022 from $60.1 million at December 31, 2021.
+Added: Total shareholders’ equity decreased $3.9 million, or 6.5%, to $56.2 million at June 30, 2022 from $60.1 million at December 31, 2021.
This decrease was primarily due to a $4.8 million, or 699.9%, change in accumulated other comprehensive loss representing decreases in the fair value of available for sale securities resulting primarily from rising market interest rates.
−Removed: At March 31, 2022, this unrealized loss was $3.2 million, compared to $686,000 at December 31, 2021, partially offset by net income of $391,000 for the three months ended March 31, 2022.
−Removed: An additional $51,000 was added to shareholders’ equity with the commitment to release 3,258 additional ESOP shares to participants.
−Removed: At March 31, 2022, Mineola Community Bank opted to use the community bank leverage ratio framework (Tier 1 capital to average assets) for regulatory capital purposes, as permitted by the CARES Act.
−Removed: At March 31, 2022, a community bank leverage ratio of at least 9.0% is required to be considered “well capitalized” under regulatory requirements.
−Removed: At March 31, 2022, Mineola Community Bank was well capitalized and had a ratio of 12.84%
+Added: At June 30, 2022, the accumulated other comprehensive loss was $5.5 million, compared to $686,000 at December 31, 2021, partially offset by net income of $807,000 and an additional $111,000 added to shareholders’ equity with the commitment to release 6,516 additional ESOP shares to participants during the six months ended June 30, 2022.
+Added: At June 30, 2022, Mineola Community Bank opted to use the community bank leverage ratio framework (Tier 1 capital to average assets) for regulatory capital purposes, as permitted by the CARES Act.
+Added: At June 30, 2022, a community bank leverage ratio of at least 9.0% is required to be considered “well capitalized” under regulatory requirements.
+Added: At June 30, 2022, Mineola Community Bank was well capitalized and had a ratio of 12.76%.
Average Balance Sheets
−Removed: The following table sets forth average consolidated statements of financial condition, average yields and costs, and certain other information at and for the periods indicated.
+Added: The following table sets forth average balances, average yields and costs, and certain other information at and for the periods indicated.
No tax-equivalent yield adjustments have been made, as the effects would be immaterial.
1 unchanged sentence
Non-accrual loans are included in the computation of average balances.
−Removed: Average yields for loans (excluding PPP loans) include loan fees of $112,000 and $134,000 for the three months ended March 31, 2022 and 2021, respectively.
−Removed: No PPP loans were originated during the three months ended March 31, 2022 or 2021.
+Added: Average yields for loans (excluding PPP loans) include loan fees of $103,000 and $162,000 for the three months ended June 30, 2022 and 2021, respectively.
+Added: No PPP loans were originated during the three months ended June 30, 2022 or 2021.
We have not recorded deferred loan fees, as we have determined them to be immaterial.
−Removed: For the Three Months Ended March 31,
+Added: For the Three Months Ended June 30,
(Dollars in thousands)
29 unchanged sentences
(3) Net interest margin represents net interest income divided by average total interest-earning assets.
−Removed: Comparison of the Operating Results for the Three Months Ended March 31, 2022 and March 31, 2021
−Removed: Net income was $391,000 for the three months ended March 31, 2022, compared to net income of $242,000 for the three months ended March 31, 2021, an increase of $149,000, or 61.6%.
−Removed: The increase was primarily due to a $270,000 increase in net interest income and a $70,000 increase in noninterest income, partially offset by a $115,000 increase in noninterest expense, a $38,000 increase in the provision for loan and lease losses and an increase in income tax expense of $38,000.
+Added: Comparison of the Operating Results for the Three Months Ended June 30, 2022 and June 30, 2021
+Added: Net income was $416,000 for the three months ended June 30, 2022, compared to net income of $188,000 for the three months ended June 30, 2021, an increase of $228,000, or 121.3%.
+Added: The increase was primarily due to a $400,000, or 19.0%, increase in net interest income, partially offset by a $101,000, or 5.6%, decrease in net noninterest income, a $9,000 increase in the provision for loan and lease losses and a $79,000 increase in income tax expense.
Interest Income.
−Removed: Interest income increased at $164,000, or 6.3%, for the three months ended March 31, 2022.
−Removed: This was primarily the result of increased interest income on securities and fed funds due primarily to the investment of proceeds from the Conversion, but was offset by a decrease in loan interest income of $23,000 due to decreased loan yield.
−Removed: Interest income on loans was $2.4 million for the three months ended March 31, 2022 and 2021.
−Removed: Loan interest income remained flat with an $11.8 million, or 5.6%, increase in average loans from $212.1 million at March 31, 2021 to $223.9 million at March 31, 2022 being offset by a 28 basis point, or 6.2%, decrease in loan yield to 4.24% for the three months ended March 31, 2022 from 4.52% for the three months ended March 31, 2021.
−Removed: Interest income on securities increased $195,000, or 109.6%, from $178,000 for the three months ended March 31, 2021 to $373,000 for the three months ended March 31, 2022.
−Removed: This increase resulted from an increase of 10 basis points, or 6.8%, in yield from 1.48% for the three months ended March 31, 2021 to 1.58% for the three months ended March 31, 2022 and an increase in average securities of $46.4 million, or 97.1 %, from $47.8 million for the three months ended March 31, 2021 to $94.2 million for the three months ended March 31, 2022.
−Removed: The rate increase is reflective of the beginning of market rate increases and the diversification of our securities portfolio as we continue to invest Conversion proceeds into higher yielding investments.
−Removed: Interest income from interest bearing deposits in banks declined $14,000, or 70.0%, from $20,000 for the three months ended March 31, 2021 to $6,000 for the three months ended March 31, 2022.
−Removed: This decline resulted from a decrease of nine basis points, or 24.9%, in average yield from 0.37% for the three months ended March 31, 2021 to 0.28% for the three months ended March 31, 2022, combined with a $13.0 million, or 60%, decrease in average deposits in banks from $21.6 million for the three months ended March 31, 2021 to $8.6 million for the three months ended March 31, 2022.
−Removed: There was also an increase of $9,000 in fed funds interest for the three months ended March 31, 2022 primarily from an increase of seven basis points, or 57.5%, in average yield on fed funds from 0.12% for the three months ended March 31, 2021 to 0.19% for the three months ended March 31, 2022, and a $15.3 million, or 463.6%, increase in average fed funds from $3.3 million for the three months ended March 31, 2021 to $18.6 million for the three months ended March 31, 2022.
−Removed: This increase is reflective of the increase in the fed funds market rate.
−Removed: Average interest earning assets increased by $59.2 million, or 20.7%, from $286.6 million at March 31, 2021 to $345.8 million at March 31, 2022, which was offset by a decrease in the yield on interest earning assets of 43 basis points, or 11.9%, from 3.63% on March 31, 2021 to 3.20% on March 31, 2022.
+Added: Interest income increased by $300,000, or 11.5%, to $2.9 million for the three months ended June 30, 2022 from $2.6 million for the three months ended June 30, 2021.
+Added: This was primarily the result of increased interest income on securities and cash and cash equivalents resulting from increased yields and a 102.2% increase in the average balance of the securities portfolio.
+Added: Average interest earning assets overall increased by $43.5 million, or 14.1%, from $307.5 million at June 30, 2021 to $351.0 million at June 30, 2022, which was partially offset by a decrease in the yield on interest earning assets of six basis points, or 1.8%, from 3.40% for the three months ended June 30, 2021 to 3.34% for the three months ended June 30, 2022.
+Added: Interest income on loans (excluding PPP loans) was flat at $2.4 million for the three months ended June 30, 2022 and the three months ended June 30, 2021.
+Added: This was primarily due to an increase of $15.6 million, or 7.3%, in the average balance of the loan portfolio to $229.9 million for the three months ended June 30, 2022 from $214.3 million for the three months ended June 30, 2021 being offset by a decrease of 25 basis points, or 5.6%, in the average yield on loans from 4.48% for the three months ended June 30, 2021 to 4.23% for the three months ended June 30, 2022.
+Added: Interest income on securities increased $257,000, or 135.3%, from $190,000 for the three months ended June 30, 2021 to $447,000 for the three months ended June 30, 2022.
+Added: This increase resulted from an increase of 25 basis points, or 16.3%, in yield from 1.53% for the three months ended June 30, 2021 to 1.78% for the three months ended June 30, 2022 and an increase in average securities of $50.7 million, or 102.2%, from $49.6 million for the three months ended June 30, 2021 to $100.3 million for the three months ended June 30, 2022.
+Added: The rate increase is reflective of the rising rates in the overall market and diversification of the securities portfolio as the Bank continued to invest conversion proceeds over the periods compared.
+Added: Interest income from interest bearing deposits in banks declined $1,000, or 7.1%, from $14,000 for the three months ended June 30, 2021 to $13,000 for the three months ended June 30, 2022.
+Added: This decline resulted primarily from a $14.2 million, or 72.1%, decrease in average deposits in banks from $19.7 million for the three months ended June 30, 2021 to $5.5 million for the three months ended June 30, 2022 partially offset by an increase of 66 basis points, or 235.7%, in average yield from 0.28% for the three months ended June 30, 2021 to 0.94% for the three months ended June 30, 2022.
+Added: There was also an increase in fed funds interest income of $25,000, or 500.0%, resulting from a 72 basis points, or 800.0%, increase in average yield on fed funds from 0.09% for the three months ended June 30, 2021 to 0.81% for the three months ended June 30, 2022, partially offset by a $7.9 million, or 34.6%, decrease in average fed funds balances from $22.8 million for the three months ended June 30, 2021 to $14.9 million for the three months ended June 30, 2022.
Interest Expense.
−Removed: Total interest expense decreased $106,000, or 18.8%, to $458,000 for the three months ended March 31, 2022 from $564,000 for the three months ended March 31, 2021 due to a decrease in the average cost of interest-bearing liabilities of 24 basis points, or 25.6 %, from 0.93% for the three months ended March 31, 2021 to 0.69% for the three months ended March 31, 2022, primarily due to a decrease in deposit costs.
−Removed: Interest expense on deposit accounts decreased $90,000, or 22.4%, to $311,000 for three months ended March 31, 2022 from $401,000 for the three months ended March 31, 2021, due to a decrease in the average deposit cost of 23 basis points, or 30.7%, from 0.76% for the three months ended March 31, 2021 to 0.53% for the three months ended March 31, 2022, primarily the result of an overall decrease in market interest rates.
−Removed: This was partially offset by an increase of $25.3 million, or 12.0%, in the average deposit account balances from $211.1 million for the three months ended March 31, 2021 to $236.4 million for the three months ended March 31, 2022, with the increase being in lower cost interest-bearing transaction accounts.
−Removed: Interest expense on Federal Home Loan Bank advances decreased $16,000, or 10.0%, to $144,000 for the three months ended March 31, 2022 from $160,000 for the three months ended March 31, 2021.
+Added: Total interest expense decreased $107,000, or 19.5%, to $441,000 for the three months ended June 30, 2022 from $548,000 for the three months ended June 30, 2021 due to a decrease in the average cost of interest-bearing liabilities of 19 basis points, or 22.4%, from 0.85% for the three months ended June 30, 2021 to 0.66% for the three months ended June 30, 2022, primarily due to a decrease in deposit costs.
+Added: Interest expense on deposit accounts decreased $91,000, or 23.4%, to $298,000 for three months ended June 30, 2022 from $389,000 for the three months ended June 30, 2021, due to a decrease in the average deposit cost of 18 basis points, or 26.5%, from 0.68% for the three months ended June 30, 2021 to 0.50% for the three months ended June 30, 2022, primarily the result of an overall decrease in market interest rates.
+Added: This was partially offset by an increase of $11.7 million, or 5.1%, in the average deposit account balances from $228.4 million for the three months ended June 30, 2021 to $240.1 million for the three months ended June 30, 2022, with the increase being in lower cost interest bearing transaction accounts.
+Added: Interest expense on Federal Home Loan Bank advances decreased $16,000, or 10.2%, to $141,000 for the three months ended June 30, 2022 from $157,000 for the three months ended June 30, 2021.
This decrease was due
−Removed: primarily to the decrease in the average balance of Federal Home Loan Bank advances of $3.2 million, or 10.4%, to $27.2 million for the three months ended March 31, 2022 from $30.4 million for the three months ended March 31, 2021.
−Removed: The average rate was flat at 2.11% for the three months ended March 31, 2022 and 2.10% for the three months ended March 31, 2021.
+Added: primarily to the decrease in the average balance of Federal Home Loan Bank advances of $3.1 million, or 10.5%, to $26.7 million for the three months ended June 30, 2022 from $29.8 million for the three months ended June 30, 2021.
Net Interest Income.
−Removed: Net interest income increased $270,000, or 13.2%, to $2.3 million for the three months ended March 31, 2022 from $2.0 million for the three months ended March 31, 2021 primarily due to a decrease in the average cost of funds of 24 basis points, or 25.6%, from 0.93% for the three months ended March 31, 2021 to 0.69% for the three months ended March 31, 2022 combined with an increase in the average balance of net interest-earning assets from $44.7 million for the three months ended March 31, 2021 to $81.7 million for the three months ended March 31, 2022, which offset a 19 basis point, or 7.2%, decrease in the net interest rate spread from 2.70% for the three months ended March 31, 2021 to 2.51% for the three months ended March 31, 2022.
−Removed: Net interest margin decreased 18 basis points, or 6.2%, to 2.67% for the three months ended March 31, 2022 from 2.85% for the three months ended March 31, 2021.
+Added: Net interest income increased $400,000, or 19.0%, to $2.5 million for the three months ended June 30, 2022 from $2.1 million for the three months ended June 30, 2021 primarily due to an increase in the average balance of net interest-earning assets of $34.8 million, or 71.2%, from $48.9 million for the three months ended June 30, 2021 to $83.7 million for the three months ended June 30, 2022, with a 12 basis point, or 4.7%, increase in the net interest rate spread from 2.56% for the three months ended June 30, 2021 to 2.68% for the three months ended June 30, 2022 and an increase in interest margin of 14 basis points, or 5.2%, to 2.83% for the three months ended June 30, 2022 from 2.69% for the three months ended June 30, 2021.
Provision for Loan and Lease Losses.
−Removed: Based on management’s analysis of the adequacy of the allowance for loan and lease losses, the provision for loan and lease losses was $40,000 for the three months ended March 31, 2022, compared to $2,000 for the three months ended March 31, 2021, an increase of $38,000, primarily due to an increase in loan volume.
+Added: Based on management’s analysis of the adequacy of allowance for loan and lease losses, the provision for loan and lease losses was $37,000, for the three months ended June 30, 2022, compared to $28,000 for the three months ended June 30, 2021, an increase of $9,000, or 32.1%, due primarily to increased loan volume.
Noninterest Income.
−Removed: Noninterest income decreased $70,000, or 18.3%, to $453,000 for the three months ended March 31, 2022 from $383,000 for the three months ended March 31, 2021, due primarily to an increase of $68,000, or 19.3%, in service charges and fees from $353,000 for the three months ended March 31, 2021 to $421,000 for the three months ended March 31, 2022.
−Removed: The increase is partially due to an increase in the number of deposit accounts combined with increased ATM use.
+Added: Noninterest income increased $23,000, or 5.4%, to $449,000 for the three months ended June 30, 2022 from $426,000 for the three months ended June 30, 2021, due primarily to an increase in service charges on deposit accounts of $40,000, or 32%, and an increase in other service charges and fees of $10,000, or 3.7%, for the three months ended June 30, 2022 partially offset by a $29,000 loss on the sale of securities for the three months ended June 30, 2022.
Noninterest Expense.
−Removed: Noninterest expense increased $115,000, or 5.4%, to $2.2 million for the three months ended March 31, 2022 from $2.1 million for the three months ended March 31, 2021 primarily due to increases in salaries and employee benefits, director fees and other expenses partially offset by decreases in contract services and data processing.
−Removed: Salary and employee benefit expenses increased by $132,000, or 10.7%, to $1.4 million for the three months ended March 31, 2022 from $1.2 million for the three months ended March 31, 2021, due to normal salary increases and an increase in health insurance cost, as well as the additional $51,000 expense for the quarter for the ESOP plan that was not in existence in 2021.
−Removed: Directors’ fees also increased $21,000, or 28.0%, to $96,000 for the three months ended March 31, 2022 from $75,000 for the three months ended March 31, 2021 due to the addition of four new directors and two new advisory directors.
−Removed: These increases were partially offset by decreases in data processing, contract services and other expenses.
−Removed: These expenses were higher in the three months ended March 31, 2021 due partially to additional expenses related to the Conversion.
+Added: Noninterest expense increased $124,000, or 5.5%, to $2.4 million for the three months ended June 30, 2022 primarily due to increases in salaries, employee benefits and director fees.
+Added: Salary and employee benefit expenses increased by $145,000, or 11.5%, to $1.4 million for the three months ended June 30, 2022 from $1.3 million for the three months ended June 30, 2021, due to normal salary increases and a $51,000 contribution to the ESOP plan for the three months ended June 30, 2022 which did not exist in the three months June 30, 2021.
+Added: Directors’ fees also increased $14,000, or 17.3%, to $95,000 for the three months ended June 30, 2022 from $81,000 for the three months ended June 30, 2021 due to the addition of new directors.
+Added: Data processing, contract services and other fees combined decreased by $34,000, or 4.7%, primarily due to higher expenses related to the conversion during the three months ended June 30, 2021 partially offsetting those increases.
Income Tax Expense.
−Removed: Income tax expense increased by $38,000, or 76.0%, to $88,000 for the three months ended March 31, 2022 from $50,000 for the three months ended March 31, 2021, primarily due to higher income before taxes.
−Removed: The effective tax rate was 18.4% and 17.1% for the three months ended March 31, 2022 and 2021, respectively.
+Added: Income tax expense increased by $79,000, or 225.7%, to $114,000 for the three months ended June 30, 2022 from $35,000 for the three months ended June 30, 2021 primarily due to higher income before taxes.
+Added: The effective tax rate was 21.5% and 15.7% for the three months ended June 30, 2022 and 2021, respectively.
+Added: The effective tax rate was higher for the three months ended June 30, 2022 due to taxable income increasing at a faster rate than tax exempt income
+Added: Average Balance Sheets
+Added: The following table sets forth average balances, average yields and costs, and certain other information at and for the periods indicated.
+Added: No tax-equivalent yield adjustments have been made, as the effects would be immaterial.
+Added: All average balances are daily average balances.
+Added: Non-accrual loans are included in the computation of average balances.
+Added: Average yields for loans (excluding PPP loans) include loan fees of $215,000 and $295,000 for the six months ended June 30, 2022 and 2021, respectively.
+Added: No PPP loans were originated during the six months ended June 30, 2022 or 2021.
+Added: We have not recorded deferred loan fees, as we have determined them to be immaterial.
+Added: For the Six Months Ended June 30,
+Added: (Dollars in thousands)
+Added: Interest-earning assets:
+Added: Loans (excluding PPP loans)
+Added: Allowance for loan and lease losses
+Added: Restricted stock
+Added: Interest-bearing deposits in banks
+Added: Federal funds sold
+Added: Total interest-earning assets
+Added: Noninterest-earning assets
+Added: Interest-bearing liabilities:
+Added: Interest-bearing demand deposits
+Added: Regular savings and other deposits
+Added: Money market deposits
+Added: Certificates of deposit
+Added: Total interest-bearing deposits
+Added: Advances from the Federal Home Loan Bank
+Added: Other liabilities
+Added: Total interest-bearing liabilities
+Added: Noninterest-bearing demand deposits
+Added: Other noninterest-bearing liabilities
+Added: Total liabilities
+Added: Total shareholders' and members’ equity
+Added: Total liabilities and shareholders' and members’ equity
+Added: Net interest income
+Added: Net interest rate spread (1)
+Added: Net interest-earning assets (2)
+Added: Net interest margin (3)
+Added: Average interest-earning assets to interest-bearing liabilities
+Added: (1) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
+Added: (2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
+Added: (3) Net interest margin represents net interest income divided by average total interest-earning assets.
+Added: Comparison of the Operating Results for the Six Months Ended June 30, 2022 and June 30, 2021
+Added: Net income was $807,000 for the six months ended June 30, 2022, compared to net income of $430,000 for the six months ended June 30, 2021, an increase of $377,000, or 87.7%.
+Added: The increase was primarily due to a $700,000 increase in net interest income and a $93,000 increase in noninterest income, offset by a $238,000 increase in noninterest expense, a $47,000 increase in the provision for loan and lease losses and an increase in income tax expense of $119,000.
+Added: Interest Income.
+Added: Interest income increased at $500,000, or 9.6%, for the six months ended June 30, 2022 from $5.2 million at June 30, 2021 to $5.7 million at June 30, 2022.
+Added: This was primarily the result of increased interest income on securities and fed funds due primarily to the continued investment of proceeds from the Conversion and increased yields on those investments resulting primarily from rising market interest rates.
+Added: Average interest earning assets increased by $51.3 million, or 17.3%, from $297.1 million at June 30, 2021 to $348.4 million at June 30, 2022, which was partially offset by a decrease in the yield on interest earning assets of 24 basis points, or 6.8%, from 3.51% on June 30, 2021 to 3.27% on June 30, 2022.
+Added: Interest income on loans was $4.8 million for the six months ended June 30, 2022 and 2021.
+Added: Loan interest income remained flat with a $13.7 million, or 6.4%, increase in average loans from $213.2 million at June 30, 2021 to $226.9 million at June 30, 2022 being offset by a 26 basis point, or 5.8%, decrease in loan yield to 4.24% for the six months ended June 30, 2022 from 4.50% for the six months ended June 30, 2021.
+Added: Interest income on securities increased $452,000, or 122.8%, from $368,000 for the six months ended June 30, 2021 to $820,000 for the six months ended June 30, 2022.
+Added: This increase resulted from an increase of 18 basis points, or 11.9%, in yield from 1.51% for the six months ended June 30, 2021 to 1.69% for the six months ended June 30, 2022 and an increase in average securities of $48.5 million, or 99.6 %, from $48.7 million for the six months ended June 30, 2021 to $97.2 million for the six months ended June 30, 2022.
+Added: The rate increase is reflective of market rate increases and the diversification of our securities portfolio as we continue to invest Conversion proceeds into higher yielding investments.
+Added: Interest income from interest bearing deposits in banks declined $16,000, or 45.7%, from $35,000 for the six months ended June 30, 2021 to $19,000 for the six months ended June 30, 2022.
+Added: This decline resulted from a decrease in average deposits in banks of $13.6 million, or 65.7%, from $20.7 million for the six months ended June 30, 2021 to $7.1 million for the six months ended June 30, 2022 partially offset by a 20 basis points, or 58.8%, increase in average yield from 0.34% for the six months ended June 30, 2021 to 0.54% for the six months ended June 30, 2022.
+Added: There was also an increase of $34,000 in fed funds interest income for the six months ended June 30, 2022 primarily from an increase of 39 basis points, or 487.5%, in average yield on fed funds from 0.08% for the six months ended June 30, 2021 to 0.47% for the six months ended June 30, 2022, and a $3.6 million, or 27.5%, increase in average fed funds from $13.1 million for the six months ended June 30, 2021 to $16.7 million for the six months ended June 30, 2022.
+Added: This increase is reflective of the increase in the fed funds market rate.
+Added: Interest Expense.
+Added: Total interest expense decreased $214,000, or 19.2%, to $898,000 for the six months ended June 30, 2022 from $1.1 million for the six months ended June 30, 2021 due to a decrease in the average cost of interest-bearing liabilities of 21 basis points, or 23.6%, from 0.89% for the six months ended June 30, 2021 to 0.68% for the six months ended June 30, 2022, primarily due to a decrease in deposit costs.
+Added: Interest expense on deposit accounts decreased $182,000, or 23.0%, to $609,000 for six months ended June 30, 2022 from $791,000 for the six months ended June 30, 2021, due to a decrease in the average deposit cost of 21 basis points, or 29.2%, from 0.72% for the six months ended June 30, 2021 to 0.51% for the six months ended June 30, 2022.
+Added: This was partially offset by an increase of $18.4 million, or 8.4%, in the average deposit account balances from $219.9 million for the six months ended June 30, 2021 to $238.2 million for the six months ended June 30, 2022, with the increase being in lower cost interest-bearing transaction accounts.
+Added: Interest expense on Federal Home Loan Bank advances decreased $32,000, or 10.1%, to $285,000 for the six months ended June 30, 2022 from $317,000 for the six months ended June 30, 2021.
+Added: This decrease was due primarily to the decrease in the average balance of Federal Home Loan Bank advances of $3.1 million, or 10.5%, to $27.0 million
+Added: for the six months ended June 30, 2022 from $30.1 million for the six months ended June 30, 2021.
+Added: The average yield was 2.11% for the six months ended June 30, 2022 and 2.10% for the six months ended June 30, 2021.
+Added: Net Interest Income.
+Added: Net interest income increased $700,000, or 17.1%, to $4.8 million for the six months ended June 30, 2022 from $4.1 million for the six months ended June 30, 2021 primarily due to an increase of $35.9 million in the average balance of net interest-earning assets from $46.8 million for the six months ended June 30, 2021 to $82.7 million for the six months ended June 30, 2022, which offset a three basis point, or 1.1%, decrease in the net interest rate spread from 2.62% for the six months ended June 30, 2021 to 2.59% for the six months ended June 30, 2022.
+Added: Net interest margin decreased one basis point, or 0.4%, to 2.75% for the six months ended June 30, 2022 from 2.76% for the six months ended June 30, 2021.
+Added: Provision for Loan and Lease Losses.
+Added: Based on management’s analysis of the adequacy of the allowance for loan and lease losses, the provision for loan and lease losses was $77,000 for the six months ended June 30, 2022, compared to $30,000 for the six months ended June 30, 2021, an increase of $47,000, primarily due to an increase in loan volume.
+Added: Noninterest Income.
+Added: Noninterest income increased $93,000, or 11.5%, to $902,000 for the six months ended June 30, 2022 from $809,000 for the six months ended June 30, 2021, due primarily to an increase of $118,000, or 15.8%, in service charges and fees from $746,000 for the six months ended June 30, 2021 to $864,000 for the six months ended June 30, 2022.
+Added: The increase is primarily due to an increase in the number of deposit accounts combined with increased ATM use.
+Added: This was partially offset by a $29,000 loss on the sale of securities during the six months ended June 30, 2022.
+Added: Noninterest Expense.
+Added: Noninterest expense increased $238,000, or 5.4%, to $4.6 million for the six months ended June 30, 2022 primarily due to increases in salaries and employee benefits, director fees and other expenses partially offset by decreases in contract services and data processing.
+Added: Salary and employee benefit expenses increased by $277,000, or 11.1%, to $2.8 million for the six months ended June 30, 2022 from $2.5 million for the six months ended June 30, 2021, due to normal salary increases and an increase in health insurance cost, as well as the additional $111,000 expense for the quarter for the ESOP plan that was not in existence in 2021.
+Added: Directors’ fees also increased $35,000, or 22.4%, to $191,000 for the six months ended June 30, 2022 from $156,000 for the six months ended June 30, 2021 due to the addition of four new directors and two new advisory directors.
+Added: These increases were partially offset by a combined decrease in data processing, contract services and other expenses of $82,000.
+Added: These expenses were higher in the six months ended June 30, 2021 due partially to additional expenses related to the Conversion.
+Added: Income Tax Expense.
+Added: Income tax expense increased by $119,000, or 143.4%, to $202,000 for the six months ended June 30, 2022 from $83,000 for the six months ended June 30, 2021, primarily due to higher income before taxes.
+Added: The effective tax rate was 20.02% and 16.18% for the six months ended June 30, 2022 and 2021, respectively.
+Added: The effective tax rate was higher for the six months ended June 30, 2022 due to taxable income increasing at a faster rate than tax exempt income
Liquidity and Capital Resources
4 unchanged sentences
We are also able to borrow from the Federal Home Loan Bank of Dallas.
−Removed: At March 31, 2022, we had outstanding advances of $27.1 million from the Federal Home Loan Bank of Dallas.
−Removed: At March 31, 2022, we had unused borrowing capacity of $106.3 million with the Federal Home Loan Bank of Dallas.
−Removed: at March 31, 2022, we had a $10.0 million line of credit with Texas Independent Bankers Bank and a $5.0 million line of credit with First Horizon Bank.
−Removed: At March 31, 2022, there was no outstanding balance under either of these facilities.
+Added: At June 30, 2022, we had outstanding advances of $26.5 million from the Federal Home Loan Bank of Dallas.
+Added: At June 30, 2022, we had unused borrowing capacity of $107.8 million with the Federal Home Loan Bank of Dallas.
+Added: In addition, at June 30, 2022, we had a $10.0 million line of credit with Texas Independent Bankers Bank and a $5.0 million line of credit with First Horizon Bank.
+Added: At June 30, 2022, there was no outstanding balance under either of these facilities.
While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions, and competition.
1 unchanged sentence
The levels of these assets are dependent on our operating, financing, lending, and investing activities during any given period.
−Removed: Our cash flows are comprised of three primary classifications:
+Added: Our cash flows are comprised of six primary classifications:
cash flows from operating activities, investing activities, and financing activities.
−Removed: For additional information, see the consolidated statements of cash flows for the three months ended March 31, 2022 and 2021 included as part of the consolidated financial statements included in this report.
+Added: For additional information, see the consolidated statements of cash flows for the six months ended June 30, 2022 and 2021 included as part of the consolidated financial statements included in this report.
We are committed to maintaining a strong liquidity position.
7 unchanged sentences
is governed by applicable banking laws and regulations.
−Removed: At March 31, 2022, Texas Community Bancshares, Inc.
+Added: At June 30, 2022, Texas Community Bancshares, Inc.
(on a stand-alone, unconsolidated basis) had liquid assets of $13.4 million.
−Removed: At March 31, 2022, Mineola Community Bank exceeded all of its regulatory capital requirements, and was categorized as well-capitalized at that date.
+Added: At June 30, 2022, Mineola Community Bank exceeded all of its regulatory capital requirements, and was categorized as well-capitalized at that date.
Management is not aware of any conditions or events since the most recent notification of well-capitalized status that would change our category.
23 unchanged sentences
The tables below set forth the calculation of the estimated changes in our monthly net interest income that would result from the designated immediate changes in the United States Treasury yield curve.
−Removed: At March 31, 2022
+Added: At June 30, 2022
Change in Interest Rates
4 unchanged sentences
(1) Assumes an immediate uniform change in interest rates at all maturities.
−Removed: The table above indicates that at March 31, 2022, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience a 4.72% decrease in net interest income, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 1.39% increase in net interest income.
+Added: The table above indicates that at June 30, 2022, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience a 2.47% decrease in net interest income, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 2.30% decrease in net interest income.
+Added: The net interest income decreases in both interest rate scenarios due to the assets and liabilities repricing at different speeds in a rates up and rates down environment.
Net Economic Value .
3 unchanged sentences
The table below sets forth the calculation of the estimated changes in our EVE that would result from the designated immediate changes in the United States Treasury yield curve.
−Removed: At March 31, 2022
+Added: At June 30, 2022
EVE as a Percentage of
11 unchanged sentences
(4) EVE Ratio represents EVE divided by the present value of assets.
−Removed: The table above indicates that at March 31, 2022, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience a 6.04% decrease in EVE, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 0.09% increase in EVE.
+Added: The table above indicates that at June 30, 2022, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience a 8.53% decrease in EVE, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 1.02% increase in EVE.
Certain shortcomings are inherent in the methodologies used in the above interest rate risk measurements.
7 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.