Peoples Financial Services, the bank holding company for Peoples Security Bank and Trust Company, reported unaudited financial results at and for the fourth quarter ended December 31, 2019.
Peoples Financial Services reported net income of $6.8 million, or $0.92 per share for the three months ended December 31, 2019, a 7.0% increase when compared to $6.4 million, or $0.86 per share for the comparable period of 2018.
The increase in earnings for the three months ended December 31, 2019 was the product of higher net interest income of $0.7 million due to growth of $137.7 million in our average earning assets from the year ago period and higher noninterest income of $0.7 million when comparing the three months ended December 31, 2019 to the same period in 2018, partially offset by higher noninterest expense of $0.6 million and an increase of $0.3 million in the provision for loan losses in the 2019 period.
Peoples Financial Services net income for the twelve months ended December 31, 2019, totaled $27.5 million or $3.72 per share, a 10.5% increase when compared to $24.9 million or $3.37 per share for 2018.
The increase in earnings in 2019 was the result of higher net interest income of $4.2 million due to our earning asset growth and higher noninterest income of $1.5 million combined with a $0.7 million decrease in the provision for loan losses when comparing the twelve months ended December 31, 2019 to the same period in 2018.
These positives were partially offset by an increase of $3.3 million in salaries and employee benefit expenses and $1.0 million in occupancy and equipment expenses in support of our growth initiative.
In addition to evaluating its results of operations in accordance with GAAP, Peoples routinely supplements its evaluation with an analysis of certain non-GAAP financial measures, such as tangible stockholders' equity and core net income ratios.
The reported results included in this release contain items, which Peoples considers non-core, namely gains and losses incurred within the investment securities portfolio and gains on the sale of other business lines.
Peoples believes the reported non-GAAP financial measures provide information useful to investors in understanding its operating performance and trends.
Where non-GAAP disclosures are used in this press release, a reconciliation to the comparable GAAP measure is provided in the accompanying tables.
The non-GAAP financial measures Peoples uses may differ from the non-GAAP financial measures of other financial institutions.
Core net income, which we have defined to exclude losses or gains on investment securities and gains from other nonrecurring sources, for the three months ended December 31, totaled $6.7 million and $6.4 million in 2019 and 2018, respectively.
Core net income per share for the three months ended December 31, 2019 was $0.91, an increase from $0.86 for the same period in 2018.
The results in 2019 exclude a pre-tax $126 thousand gain in the value of our equity investment securities portfolio.
The 2018 results for the three months ended December 31 do not include any income items considered to be non-core.
Core net income for the twelve months ended December 31, 2019 was $27.4 million or $3.71 per share, an increase of 11.0% compared to $24.7 million or $3.34 per share for the same period of 2018.
Results for the twelve months ended December 31, 2019 exclude a pre-tax $132 thousand gain in the value of our equity investment securities portfolio as well as a pre-tax $23 thousand gain from the sale of investment securities.
The 2018 results were impacted by a pre-tax $14 thousand gain in the value of our equity investment securities portfolio and a pre-tax gain of $291 thousand from the sale of our credit card portfolio. ■