SB Financial Group, Inc. (NASDAQ:SBFG) Q1 2023 Earnings Conference Call April 21, 2023 11:00 AM ET

Company Participants

Sarah Mekus - Executive Assistant, Corporate Secretary

Mark Klein - Chairman, President & Chief Executive Officer

Tony Cosentino - Executive Vice President, Chief Financial Officer

Steve Walz - Executive Vice President and Chief Lending Officer

Conference Call Participants

Nina Burns - Janney

Operator

Good morning, and welcome to the SB Financial First Quarter 2023 Conference Call and Webcast. I would like to inform you that this conference call is being recorded and that all participants are in listen-only mode. We will begin with remarks by management and then open the conference up to the investment community for questions and answers.

I will now turn the conference over to Sarah Mekus with SB Financial. Please go ahead, Sarah.

Sarah Mekus

Thank you, and good morning, everyone. I would like to remind you that this conference call is being broadcast live over the Internet, and will be archived and available on our website at ir.yourstatebank.com. Joining me today are Mark Klein, Chairman, President and CEO; and Tony Cosentino, Chief Financial Officer; and Steve Walz, Chief Lending Officer. Today's presentation may contain forward-looking information. Cautionary statements about this information as well as reconciliations of non-GAAP financial measures are included in today's earnings release materials as well as our SEC filings and other investor materials. These materials are available on our website and we encourage participants to refer to them for a complete discussion of risk factors and forward-looking statements. These statements speak only as of the date made and SB Financial undertakes no obligation to update them.

I will now turn the call over to Mr. Klein.

Mark Klein

Thank you, Sarah, and good morning, everyone. Welcome to our conference call and webcast highlights for the quarter and recapping our recent earnings release with net income of $2.5 million, up $363,000 or nearly 13% from the prior year quarter, but would have been up just $296,000 or 14% when you exclude the effect of the OMSR recapture that Tony will speak of shortly.

Return on average assets 0.73, return on tangible common equity 10.5. Net interest income of $10.3 million was up $1.8 million or 22% from the prior quarter as loan growth, better asset mix and increasing earning asset yields have offset the increase in deposit and other funding costs.

Loan balances from the linked quarter rose $14 million, with loans raising now $126 million or 15% compared to the prior year quarter. Deposits grew from the linked quarter by $24 million, but were down $28 million year-over-year.