Limestone Bancorp Earnings 2020-06-30

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

lmst20200630_10q.htm

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the Quarterly Period Ended June 30, 2020

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

For the transition period from to

Commission file number: 001-33033

LIMESTONE BANCORP, INC.

(Exact name of registrant as specified in its charter)

Kentucky		61-1142247
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2500 Eastpoint Parkway, Louisville, Kentucky		40223
(Address of principal executive offices)		(Zip Code)

(502) 499-4800

(Registrant’s telephone number, including area code)

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common shares	LMST	Nasdaq

Indicate by check mark whether the registrant (1) 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 shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. 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 (§232.405 of this chapter) 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, a 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.

6,499,249 Common Shares and 1,000,000 Non-Voting Common Shares were outstanding at July 31, 2020.

Table of Contents

INDEX

		Page
PART I –	FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS	3
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
	CONDITION AND RESULTS OF OPERATIONS	31
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	48
ITEM 4.	CONTROLS AND PROCEDURES	48

PART II –	OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	49
ITEM 1A.	RISK FACTORS	49
ITEM 2.	UNREGISTERED SALES ON EQUITY SECURITIES AND USE OF PROCEEDS	50
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	50
ITEM 4.	MINE SAFETY DISCLOSURES	50
ITEM 5.	OTHER INFORMATION	50
ITEM 6.	EXHIBITS	50

Table of Contents

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

The following consolidated financial statements of Limestone Bancorp, Inc. and subsidiary, Limestone Bank, Inc. are submitted:

Unaudited Consolidated Balance Sheets for June 30, 2020 and December 31, 2019

Unaudited Consolidated Statements of Income for the three and six months ended June 30, 2020 and 2019

Unaudited Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2020 and 2019

Unaudited Consolidated Statement of Changes in Stockholders’ Equity for the three and six months ended June 30, 2020 and 2019

Unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2020 and 2019

Notes to Unaudited Consolidated Financial Statements

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LIMESTONE BANCORP, INC.

Unaudited Consolidated Balance Sheets

(dollars in thousands except share data)

	June 30, 2020			December 31, 2019
Assets
Cash and due from banks	$	9,990		$	8,241
Interest bearing deposits in banks		39,027			21,962
Cash and cash equivalents		49,017			30,203
Securities available for sale		202,596			209,000
Loans, net of allowance of $10,228 and $8,376, respectively		965,531			917,895
Premises and equipment, net		19,000			19,658
Premises held for sale		1,149			900
Other real estate owned		1,625			3,225
Federal Home Loan Bank stock		6,142			6,237
Bank owned life insurance		16,238			16,037
Deferred taxes, net		27,054			27,765
Goodwill		6,252			6,252
Other intangible assets, net		2,372			2,500
Accrued interest receivable and other assets		7,532			6,107
Total assets	$	1,304,508		$	1,245,779

Liabilities and Stockholders’ Equity
Deposits
Non-interest bearing	$	224,901		$	187,551
Interest bearing		899,887			839,424
Total deposits		1,124,788			1,026,975
Federal Home Loan Bank advances		20,644			61,389
Accrued interest payable and other liabilities		7,020			8,665
Junior subordinated debentures		21,000			21,000
Subordinated capital notes		17,000			17,000
Senior debt		5,000			5,000
Total liabilities		1,195,452			1,140,029
Commitments and contingent liabilities (Note 15)		—			—
Stockholders’ equity
Common stock, no par, 39,000,000 shares authorized, 6,265,872 and 6,251,975 voting, and 1,220,000 and 1,220,000 non-voting issued and outstanding, respectively		140,639			140,639
Additional paid-in capital		24,643			24,508
Retained deficit		(51,861	)		(55,683	)
Accumulated other comprehensive loss		(4,365	)		(3,714	)
Total stockholders' equity		109,056			105,750
Total liabilities and stockholders’ equity	$	1,304,508		$	1,245,779

See accompanying notes to unaudited consolidated financial statements.

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LIMESTONE BANCORP, INC.

Unaudited Consolidated Statements of Income

(dollars in thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
Interest income
Loans, including fees	$	11,356		$	10,465		$	22,967		$	20,719
Taxable securities		1,307			1,608			2,774			3,181
Tax exempt securities		77			88			147			181
Federal funds sold and other		46			215			165			481
		12,786			12,376			26,053			24,562
Interest expense
Deposits		2,127			2,965			4,899			5,552
Federal Home Loan Bank advances		73			255			293			536
Senior debt		51			98			107			194
Junior subordinated debentures		172			258			387			521
Subordinated capital notes		253			—			495			—
		2,676			3,576			6,181			6,803
Net interest income		10,110			8,800			19,872			17,759
Provision for loan losses		1,100			—			2,150			—
Net interest income after provision for loan losses		9,010			8,800			17,722			17,759

Non-interest income
Service charges on deposit accounts		441			571			1,109			1,067
Bank card interchange fees		863			596			1,613			1,104
Income from bank owned life insurance		116			118			212			217
Net loss on sales and calls of investment securities		(5	)		(5	)		(5	)		(5	)
Other		186			166			396			347
		1,601			1,446			3,325			2,730
Non-interest expense
Salaries and employee benefits		4,633			3,915			9,171			7,830
Occupancy and equipment		983			854			1,982			1,752
Professional fees		235			179			443			344
Marketing expense		104			212			318			439
FDIC Insurance		67			103			67			211
Data processing expense		380			315			739			628
State franchise and deposit tax		360			315			720			630
Deposit account related expense		460			310			911			591
Other real estate owned expense		22			142			38			308
Litigation and loan collection expense		59			34			124			80
Communications expense		247			189			465			379
Insurance expense		111			112			214			226
Postage and delivery		152			134			320			275
Other		423			410			959			812
		8,236			7,224			16,471			14,505
Income before income taxes		2,375			3,022			4,576			5,984
Income tax expense (benefit)		393			(611	)		754			(488	)
Net income		1,982			3,633			3,822			6,472
Basic and diluted income per common share	$	0.26		$	0.49		$	0.51		$	0.87

See accompanying notes to unaudited consolidated financial statements.

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LIMESTONE BANCORP, INC.

Unaudited Consolidated Statements of Comprehensive Income

(in thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
Net income	$	1,982		$	3,633		$	3,822		$	6,472
Other comprehensive income (loss):
Unrealized gain (loss) on securities:
Unrealized gain (loss) arising during the period		3,254			1,882			(872	)		3,877
Less reclassification adjustment for gains (losses) included in net income		(5	)		(5	)		(5	)		(5	)
Net unrealized gain (loss) recognized in comprehensive income (loss)		3,259			1,887			(867	)		3,882
Tax effect		(762	)		(471	)		216			(889	)
Other comprehensive income (loss)		2,497			1,416			(651	)		2,993

Comprehensive income	$	4,479		$	5,049		$	3,171		$	9,465

See accompanying notes to unaudited consolidated financial statements.

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LIMESTONE BANCORP, INC.

Unaudited Consolidated Statements of Changes in Stockholders’ Equity

For Three and Six Months Ended June 30, 2020 and 2019

(Dollar amounts in thousands except share and per share data)

	Shares						Amount
	Common						Common
	Common		Non-Voting Common		Total Common		Common and Non-Voting Common		Additional Paid-In Capital			Retained Deficit			Accumulated Other Comprehensive Loss			Total

Balances, January 1, 2020		6,251,975		1,220,000		7,471,975	$	140,639	$	24,508		$	(55,683	)	$	(3,714	)	$	105,750
Stock issued for share-based awards, net of withholdings to satisfy employee tax obligations upon award		17,330		—		17,330		—		(37	)		—			—			(37	)
Forfeited unvested stock		—		—		—		—		—			—			—			—
Stock-based compensation expense		—		—		—		—		106			—			—			106
Net income		—		—		—		—		—			1,840			—			1,840
Net change in accumulated other comprehensive loss, net of taxes		—		—		—		—		—			—			(3,148	)		(3,148	)
Balances, March 31, 2020		6,269,305

Price	15.31	EPS	2
Shares	7	P/E	10
MCap	113	P/FCF	12
Net Debt	-58	EBIT	22
TEV	55	TEV/EBIT	3
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-06-30	Filed 2020-07-31
10-Q	2020-03-31	Filed 2020-05-01
10-K	2019-12-31	Filed 2020-02-28
10-Q	2019-09-30	Filed 2019-11-01
10-Q	2019-06-30	Filed 2019-08-02
10-Q	2019-03-31	Filed 2019-05-02
10-K	2018-12-31	Filed 2019-03-08
10-Q	2018-09-30	Filed 2018-11-02
10-Q	2018-06-30	Filed 2018-08-02
10-Q	2018-03-31	Filed 2018-05-03
10-K	2017-12-31	Filed 2018-02-28
10-Q	2017-09-30	Filed 2017-11-02
10-Q	2017-06-30	Filed 2017-08-04
10-Q	2017-03-31	Filed 2017-05-04
10-K	2016-12-31	Filed 2017-02-28
10-Q	2016-09-30	Filed 2016-11-03
10-Q	2016-06-30	Filed 2016-08-04
10-Q	2016-03-31	Filed 2016-05-05
10-K	2015-12-31	Filed 2016-03-25
10-Q	2015-09-30	Filed 2015-11-12
10-Q	2015-06-30	Filed 2015-08-05
10-Q	2015-03-31	Filed 2015-05-11
10-K	2014-12-31	Filed 2015-03-30
10-Q	2014-06-30	Filed 2014-08-08
10-Q	2014-06-30	Filed 2014-11-14
10-Q	2014-03-31	Filed 2014-05-09
10-K	2013-12-31	Filed 2014-03-14
10-Q	2013-09-30	Filed 2013-11-13
10-Q	2013-06-30	Filed 2013-08-08
10-Q	2013-03-31	Filed 2013-05-15
10-K	2012-12-31	Filed 2013-02-28
10-Q	2012-09-30	Filed 2012-11-13
10-Q	2012-06-30	Filed 2012-08-01
10-Q	2012-03-31	Filed 2012-04-30
10-K	2011-12-31	Filed 2012-03-30
10-Q	2011-09-30	Filed 2011-11-10
10-Q	2011-06-30	Filed 2011-08-15
10-Q	2011-03-31	Filed 2011-05-16
10-K	2010-12-31	Filed 2011-03-31
10-Q	2010-09-30	Filed 2010-11-12
10-Q	2010-06-30	Filed 2010-08-16
10-Q	2010-03-31	Filed 2010-05-11
10-K	2009-12-31	Filed 2010-03-16

8-K	2020-09-08	Regulation FD
8-K	2020-07-22	Earnings, Regulation FD, Exhibits
8-K	2020-07-22	Earnings, Exhibits
8-K	2020-07-21	Enter Agreement, Off-BS Arrangement, Sale of Shares, Exhibits
8-K	2020-06-17
8-K	2020-05-04
8-K	2020-04-16
8-K	2020-01-22
8-K	2019-11-25
8-K	2019-11-15
8-K	2019-11-12
8-K	2019-10-23
8-K	2019-08-30
8-K	2019-07-24
8-K	2019-07-23
8-K	2019-06-19
8-K	2019-04-24
8-K	2019-04-24
8-K	2019-01-25
8-K	2019-01-23
8-K	2018-11-07
8-K	2018-10-23
8-K	2018-09-26
8-K	2018-07-18
8-K	2018-07-18
8-K	2018-06-25
8-K	2018-06-18
8-K	2018-05-23
8-K	2018-05-21
8-K	2018-04-18
8-K	2018-04-10
8-K	2018-03-30
8-K	2018-01-24

EX-4.7	ex_196196.htm
EX-31.1	ex_195114.htm
EX-31.2	ex_195115.htm
EX-32.1	ex_195116.htm
EX-32.2	ex_195117.htm

LMST 10Q Quarterly Report

Limestone Bancorp Earnings 2020-06-30