Rhinebeck Bancorp (RBKB) Q3 2024 earnings summary

Executive summary

• Reported a net loss of $8.1 million for Q3 2024 and $6.0 million for the nine months ended September 30, 2024, compared to net income in the prior year periods, primarily due to a $12.0 million pre-tax loss from a balance sheet restructuring involving the sale of lower-yielding securities.

• Loss per share was $0.75 for Q3 2024 and $0.55 for the nine months, compared to diluted EPS of $0.11 and $0.32 in the prior year.

• The restructuring is expected to improve earnings beginning in Q4 2024, as proceeds were reinvested into higher-yielding assets.

• Stockholders' equity increased 7.9% to $122.7 million, driven by a reduction in accumulated other comprehensive loss.

Financial highlights

• Net interest income for Q3 2024 was $9.7 million, up 0.4% year-over-year; for the nine months, it was $27.7 million, down 3.8%.

• Interest and dividend income rose 3.3% for the quarter and 5.3% for the nine months, while interest expense increased 7.9% and 21.3%, respectively.

• Non-interest income for Q3 2024 was a loss of $10.0 million, mainly due to the securities sale; excluding this, non-interest income would have been $2.0 million, up from $1.6 million in Q3 2023.

• Non-interest expense for Q3 2024 increased 3.0% to $9.1 million, driven by higher salaries and benefits.

• Net charge-offs for Q3 2024 decreased to $344,000 from $385,000 in Q3 2023.

Outlook and guidance

• The restructuring of the securities portfolio is expected to enhance profitability and flexibility in managing growth, with improved earnings stream beginning in Q4 2024.

• Management continues to monitor interest rate risk and liquidity, focusing on maintaining adequate capital and funding sources.