Stock Listing – DIMC
Dividend Reinvestment Plan
The Company offers a plan for stockholders to automatically reinvest their dividends in shares of common stock along with the opportunity to purchase additional stock. There are no brokerage commissions or fees imposed. For more information, contact the Transfer Agent listed above.
Dimeco, Inc. Stock Market Makers
Boenning & Scattergood, Inc.
FIG Partners, LLC
Raymond James & Associates
Stifel, Nicolaus & Company, Inc.
John S. Kiesendahl, Chairman
Todd J. Stephens, Vice Chairman
Gary C. Beilman, President
John F. Spall, Secretary
Gregory J. Frigolettop
Barbara J. Genzlinger
Brian T. Kelly
Thomas A. Peifer
David D. Reynolds, M.D.
Henry M. Skier
It is my pleasure to present this report of Dimeco Inc., as of the second quarter of 2019. Enthusiastically, I have great news.
When compared to the same period one year ago, Dimeco’s financial position as of June 30, 2019 shows several positive results. Deposits stand at $565 million, an increase of almost 15% over 2018. Deposit growth this year was spread across checking and savings accounts as well as certificates of deposits. This growth includes the repositioning of commercial funds from repurchase agreement sweep accounts into deposit accounts. This transition provides our commercial clients with FDIC insurance for their deposits, while eliminating the need for us to pledge investment securities. Loans as of June 30, 2019 are $523 million or 3.7% higher than in 2018. The pace of both consumer and commercial loan originations are handsomely ahead of those last year. In 2019, we continue to experience unexpected loan payoffs. Despite these payoffs, our lenders are busy originating new loans, and our loan pipeline remains healthy.
As we end the second quarter of 2019, our assets are $710 million, an increase of 7.7% over the previous year. We are proud to note that this is the first quarter that total assets are over $700 million.
The second quarter indicates continued positive results from an income performance perspective. Interest income for the first half of 2019 is $16 million, a 15% expansion over 2018. Interest expense year to date is $2.7 million, or 58% over one year earlier. Interest expense related to certificates of deposit represents the greatest increase, mostly due to special rate offerings to reward customer relationships and to remain competitive in our market. Of particular note, net interest income is $13.3 million, up 9% over that of a year ago. Net income of $4.4 million is a solid 23% increase over 2018! These positive results are mainly attributable to the increase in all types of interest income along with reduced expenses related to other real estate owned with continued improvement in asset quality.
This strong performance equates to very positive results for shareholders. On a per share basis, the book value and market value of your Dimeco investment grew by 10.7% and 9%, respectively when comparing 2019 to 2018. Moreover, dividends approved by your Board of Directors increased by 7.1% over the same period. Finally, the year to date return on average assets ratio is 1.27% and the return on average equity is 10.79%, increases of 15.5% and 13.2% respectively, over the first half of 2018.
As we move into the next half of 2019, we do so vigilantly, watching several factors including: the overall sentiment of our economy, concern over possible turmoil with foreign trade, and the uncertainty of potential interest rate moves by the Federal Reserve. Rest assured that all our actions in the coming months will continue to be directed toward providing you with the best results possible.
We extend sincere thanks to you for your investment and loyalty. I encourage you to recommend us to others for investment in our stock and to use our full array of banking and wealth management services. As always, your comments and questions are welcome.
Gary C. Beilman
President and Chief Executive Officer
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited)
|2019||2018|| % Increase
|Performance for the six months ended June 30,|
|Net interest income||$||13,310||$||12,195||9.1%|
|Shareholders' Value (per share)|
|Net income - basic||$||1.77||$||1.45||22.1%|
|Net income - diluted||$||1.75||$||1.43||22.4%|
|Market value/book value ratio||120.8%||122.7%||(1.5%)|
|Return on average assets*||1.27%||1.10%||15.5%|
|Return on average equity*||10.79%||9.53%|
|Net interest margin||4.24%||4.13%||2.7%|
|Shareholders' equity/asset ratio||11.89%||11.49%||3.5%|
|Dividend payout ratio||33.90%||38.62%||(12.2%)|
|Nonperforming assets/total assets||1.66%||1.75%||(5.1%)|
|Allowance for loan losses as a % of loans||1.61%||1.55%||3.9%|
|Net charge-offs/average loans||.01%||-||-|
|Allowance for loan losses/nonaccrual loans||127.07%||173.46%||(26.7%)|
|Allowance for loan losses/non-performing loans||115.47%||155.60%||(25.8%)|
|Financial Position at June 30,|
|CONSOLIDATED BALANCE SHEET (unaudited)|
|Cash and cash equivalents||$||21,789||$||15,172||$||12,685|
|Mortgage loans held for sale||-||458||-|
|Investment securities available for sale||122,965||114,883||99,319|
|Loans, net of allowance for loan losses||514,741||505,125||496,706|
|Premises and equipment||9,374||9,417||9,861|
|Accrued interest receivable||2,282||2,158||1,998|
|Other real estate owned||4,487||4,749||6,483|
|Other borrowed funds||49,629||50,820||45,568|
|Accrued interest payable||284||553||186|
|TOTAL STOCKHOLDERS' EQUITY||84,398||81,450||75,678|
|TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY||$||709,738||$||686,417||$||658,812|
|CONSOLIDATED STATEMENT OF INCOME (unaudited)|
|(in thousands, except per share data)||Three months ended||Six months ended|
|Loans, including fees||$||7,049||$||6,887||$||6,405||$||13,936||$||12,655|
|Total interest income||8,151||7,849||7,088||16,000||13,893|
|Other borrowed funds||331||343||281||674||533|
|Total interest expense||1,338||1,352||865||2,690||1,698|
|Net Interest Income||6,813||6,497||6,223||13,310||12,195|
|Provision for loan losses||102||248||-||350||248|
|Net Interest Income, After Provision for Loan Losses||6,711||6,249||6,223||12,960||11,947|
|Income before income taxes||2,549||2,400||1,847||4,949||3,901|
|Earnings per share-basic||$||.90||$||.87||$||.69||$||1.77||$||1.45|
|Earnings per share-diluted||$||.89||$||.86||$||.68||$||1.75||$||1.43|
|Average shares outstanding-basic||2,490,179||2,488,467||2,475,503||2,489,969||2,475,285|
|Average shares outstanding-diluted||2,518,289||2,517,538||2,502,530||2,518,518||2,501,735|