Jefferson Security Bank Reports First Quarter 2021 Results

Jefferson Security Bank (OTC Pink: JFWV) reported net income of $782 thousand for the quarter ended March 31, 2021, representing an increase of $162 thousand, or 26.1% when compared to net income of $620 thousand for the quarter ended March 31, 2020. Diluted earnings per share was $2.81 for the first quarter of 2021, compared to $2.22 for the first quarter of 2020. Annualized return on average assets and average equity for March 31, 2021 increased to 0.81% and 10.16%, respectively, compared to 0.77% and 8.74%, respectively, for March 31, 2020.

“We are pleased to deliver another strong quarter of earnings to our shareholders,” said President and Chief Executive Officer, Cindy Kitner. “Net income was positively impacted by growth in net interest income, a reduction in provision for loan losses and proactive expense management. As the pandemic begins to ease and our communities reopen, we are well-positioned to assist our customers with opportunities presented by the economic activity in our markets,” said President and Chief Executive Officer, Cindy Kitner.

As of March 31, 2021, total assets increased $71.1 million, or 21.7%, to $398.5 million compared to total assets of $327.4 million as of March 31, 2020. Loans, net of the allowance for loan losses, increased $28.0 million to $245.1 million as of March 31, 2021, compared to $217.1 million as of March 31, 2020. As of March 31, 2021, loan growth excluding Paycheck Protection Program (“PPP”) loans was $11.1 million when compared to March 31, 2020. Deposits totaled $363.8 million at March 31, 2021, representing an increase of $72.1 million or 24.7%, when compared to $291.7 million at March 31, 2020. Since December 31, 2020, total assets increased $17.8 million; loans, net of the allowance for loans losses, increased $5.3 million; excluding PPP loans, loan growth was $2.2 million and total deposits increased $17.4 million.

The allowance for loan losses as of March 31, 2021 was $2.8 million, or 1.14% of total loans compared to $2.8 million, or 1.15% as of December 31, 2020 and $2.2 million, or 1.00% as of March 31, 2020. Excluding PPP loans, the ratio of the allowance for loans losses to total loans was 1.22% at March 31, 2021 and December 31, 2020. For the first quarter of 2021, the provision for loan losses totaled $80 thousand compared to $160 thousand for the same period in 2020 primarily resulting from stable credit trends and improved economic conditions compared to the start of the pandemic a year ago.

The Bank has continued to provide financial assistance to existing and new small business customers through participation in PPP lending. With the passage of the Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act (“Economic Aid Act”), the third round of PPP funding opened for applications on January 19, 2021, which modified existing PPP requirements and allowed certain eligible borrowers to receive a second draw PPP loan. Since the second quarter of 2020, the Bank has actively participated in all rounds of PPP funding. As of March 31, 2021, PPP loans outstanding totaled $17.5 million and deferred loan fees totaled $562 thousand.

During the second quarter of 2020, the Bank implemented payment relief options to support customers including the deferral of loan principal and interest payments. Following the onset of the pandemic, the balance of loans on payment deferral or extension reached 11.8% of the total loans, excluding PPP loans. As of March 31, 2021, loans on payment deferral or extension totaled $193 thousand, or less than 0.1% of the total loans, excluding PPP loans. This represents a continued improvement from 3.6% of totals loans, excluding PPP loans, at December 31, 2020.

“During the pandemic, we were focused on keeping our customers and employees safe while maintaining a high level of customer service. While we continue to closely monitor information provided by our local health departments on COVID-19, management made the strategic decision to reopen our lobbies. To ensure the safety of our employees and customers, we are adhering to social distancing measures and the state-wide mask mandate. We will continue to provide our customers with various options to conduct their banking needs including online and mobile, by appointment, curbside banking and walk-up facilities,” said President and Chief Executive Officer, Cindy Kitner.

About Jefferson Security Bank

Jefferson Security Bank is an independent community bank evolving with the needs of the customers and the communities it serves. Serving individuals, businesses and community organizations, Jefferson Security Bank strives to support entrepreneurial efforts within its target markets. Delivering long-term value to its shareholders is at the core of the organization’s culture. Jefferson Security Bank is a West Virginia state-chartered bank that was formed and opened for business on May 19, 1869, making it the oldest bank in Jefferson County, West Virginia. The bank provides general banking services in Berkeley County and Jefferson County, West Virginia, and Washington County, Maryland. Visit www.JSB.bank for more information.

This press release may contain forward-looking statements, as defined by federal securities laws, which may involve significant risks and uncertainties. The statements are based on estimates and assumptions made by management in conjunction with other factors deemed appropriate under the circumstances. Actual results could differ materially from current projections.

Offices:

105 East Washington Street, Shepherdstown, WV (304-876-9000)

7994 Martinsburg Pike, Shepherdstown, WV (304-876-2800)

873 East Washington Street, Suite 100, Charles Town, WV (304-725-9752)

277 Mineral Drive, Suite 1, Inwood, WV (304-229-6000)

1861 Edwin Miller Boulevard, Martinsburg, WV (304-264-0900)

103 West Main Street, Sharpsburg, MD (301-432-3900)

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