Cullman Bancorp, Inc. /MD/ [CULL] Filings

10-Q 1 cull-20230930.htm 10-Q 10-Q

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period ended September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For transition period from to

Commission File Number 001-40607

CULLMAN BANCORP, INC.

(Exact Name of Registrant as Specified in Charter)


Maryland		61-1990996
(State or Other Jurisdiction of Incorporation)		(I.R.S. Employer Identification No.)


316 Second Avenue, SW, Cullman, Alabama		35055
(Address of Principal Executive Offices)		(Zip Code)

(256) 734-1740

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and formal fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, per value $0.01 per share	CULL	The Nasdaq Stock Market, LLC

Indicate by check mark whether the registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), Yes ☒ No ☐ .

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☐		Accelerated filer ☐
Non-accelerated filer ☒		Smaller reporting company ☒
		Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒.

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: 7,256,661 shares of Common Stock, par value $0.01 per share, were issued and outstanding as of November 14, 2023.

Table of Contents

CULLMAN BANCORP, INC.

Form 10-Q Quarterly Report

Table of Contents


PART I

ITEM 1.	FINANCIAL STATEMENTS	2
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	39
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	48
ITEM 4.	CONTROLS AND PROCEDURES	49

PART II

ITEM 1.	LEGAL PROCEEDINGS	50
ITEM 1A.	RISK FACTORS	50
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES	50
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	50
ITEM 4.	MINE SAFETY DISCLOSURES	50
ITEM 5.	OTHER INFORMATION	50
ITEM 6.	EXHIBITS	51

SIGNATURES		52

Table of Contents

PART I

ITEM 1. FINANCIAL STATEMENTS

CULLMAN BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

September 30, 2023 and December 31, 2022

(All amounts in thousands, except share and per share data)


	September 30, 2023 (Unaudited)			December 31, 2022
ASSETS
Interest bearing cash and cash equivalents	$	123		$	434
Non-interest bearing cash and cash equivalents		3,578			5,986
Federal funds sold		19,100			30,225
Total cash and cash equivalents		22,801			36,645
Securities available for sale		27,325			29,796
Equity securities		—			479
Loans, net of allowance of $3,004 and $2,841 respectively		338,111			329,943
Premises and equipment, net		11,998			10,851
Foreclosed real estate		—			50
Accrued interest receivable		1,133			1,162
Restricted equity securities		2,770			2,033
Bank owned life insurance		9,168			8,964
Deferred tax asset, net		2,677			2,194
Other assets		1,332			1,112
Total assets	$	417,315		$	423,229

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits
Non-interest bearing	$	13,123		$	16,281
Interest bearing		261,078			276,668
Total deposits		274,201			292,949

Federal Home Loan Bank advances		35,000			25,000
Accrued interest payable		235			155
Other liabilities		6,669			4,943
Total liabilities		316,105			323,047

Shareholders' equity
Common stock, $0.01 par value; 50,000,000 shares authorized; 7,286,651 shares and 7,394,615 shares outstanding at September 30, 2023 and December 31, 2022 respectively		73			74
Additional paid-in capital		49,492			50,161
Retained earnings		58,514			56,561
Accumulated other comprehensive loss		(3,924	)		(3,558	)
Unearned ESOP shares, at cost		(2,945	)		(3,056	)
Total shareholders' equity		101,210			100,182
Total liabilities and shareholders' equity	$	417,315		$	423,229

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CULLMAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF NET INCOME (Unaudited)

Three and nine months ended September 30, 2023 and 2022

(All amounts in thousands, except share and per share data)


	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
	2023			2022		2023			2022
Interest and dividend income:
Loans, including fees	$	4,460		$	3,892	$	12,814		$	11,110
Non taxable securities		6			8		22			24
Securities		226			246		699			564
FHLB dividends		30			2		68			17
Federal funds sold and other		329			95		864			187
Total interest income		5,051			4,243		14,467			11,902
Interest expense:
Deposits		799			254		1,931			688
Federal Home Loan Bank advances and other borrowings		381			27		1,041			48
Total interest expense		1,180			281		2,972			736
Net interest income		3,871			3,962		11,495			11,166
Provision for credit losses on loans		(108	)		120		(85	)		275
Provision for unfunded commitments		108			—		132			—
Net interest income after provision for loan losses		3,871			3,842		11,448			10,891
Noninterest income:
Service charges on deposit accounts		285			272		825			753
Income on bank owned life insurance		71			67		204			160
Gain on sales of mortgage loans		—			24		15			86
Net gain on sale of foreclosed real estate		—			—		—			46
Gain on prepayment of Federal Home Loan Bank advances		—			—		127			91
Other		34			39		113			120
Total noninterest income		390			402		1,284			1,256
Noninterest expense:
Salaries and employee benefits		1,955			2,007		5,926			5,377
Occupancy and equipment		242			242		742			668
Data processing		261			221		730			632
Professional and supervisory fees		196			206		616			558
Office expense		46			52		123			150
Advertising		35			79		84			143
FDIC deposit insurance		40			21		122			55
Loss on prepayment of Federal Home Loan Bank advances		—			—		—			4
Other		109			132		336			339
Total noninterest expense		2,884			2,960		8,679			7,926
Income before income taxes		1,377			1,284		4,053			4,221
Income tax expense		297			358		930			973
Net income	$	1,080		$	926	$	3,123		$	3,248
Earnings per share:
Basic	$	0.15		$	0.13	$	0.44		$	0.46
Dilutive	$	0.15		$	0.13	$	0.44		$	0.45

Table of Contents

CULLMAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Loss) (Unaudited)

Three and nine months ended September 30, 2023 and 2022

(All amounts in thousands, except share and per share data)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Net Income	$	1,080		$	926		$	3,123		$	3,248

Other comprehensive income, net of tax
Unrealized loss on securities available for sale		(1,120	)		(1,617	)		(737	)		(5,190	)
Less income tax effect		281			340			371			1,090
Other comprehensive loss		(839	)		(1,277	)		(366	)		(4,100	)

Comprehensive income (loss)	$	241		$	(351	)	$	2,757		$	(852	)

Table of Contents

CULLMAN BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

Three and nine months ended September 30, 2023 and 2022

(All amounts in thousands, except share and per share data)


	Shares			Common Stock			Additional Paid-In Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Unearned ESOP Shares			Total
Balance at July 1, 2023		7,382,539		$	74		$	50,302		$	57,434		$	(3,085	)	$	(2,982	)	$	101,743
Net income		—			—			—			1,080			—			—			1,080
Other comprehensive loss		—			—			—			—			(839	)		—			(839	)
Share repurchases		(95,888	)		(1	)		(1,042	)		—			—			—			(1,043	)
ESOP shares earned		—			—			—			—			—			37			37
Stock-based compensation expense		—			—			232			—			—			—			232
Balance at September 30, 2023		7,286,651		$	73		$	49,492		$	58,514		$	(3,924	)	$	(2,945	)	$	101,210


Balance at January 1, 2023		7,394,615		$	74		$	50,161		$	56,561		$	(3,558	)	$	(3,056	)	$	100,182
Net income		—			—			—			3,123			—			—			3,123
CECL implementations		—			—			—			(284	)		—			—			(284	)
Other comprehensive loss		—			—			—			—			(366	)		—			(366	)
Share repurchases		(107,964	)		(1	)		(1,179	)		—			—			—			(1,180	)
ESOP shares earned		—			—			—			—			—			111			111
Dividend paid		—			—			—			(886	)		—			—			(886	)
Stock-based compensation expense		—			—			510			—			—			—			510
Balance at September 30, 2023		7,286,651		$	73		$	49,492		$

Cullman Bancorp, Inc. /MD/ [CULL] Filings
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S-1	[2021-03-12]