Mid-Southern Bancorp, Inc. [MSVB] Filings

10-Q 1 tmb-20230630x10q.htm 10-Q

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, 2023

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

For the transition period from to

Commission File No. 001-38491

Mid-Southern Bancorp, Inc.

(Exact name of registrant as specified in its charter)


Indiana	82-4821705
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)

300 North Water Street, Salem, Indiana 47167 812-883-2639
(Address of principal executive offices, zip code, telephone number)

Not applicable
(Former name, former address and former fiscal year, if changed since last report)

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $.01 per share	MSVB	The NASDAQ Stock Market LLC

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 such 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: As of August 04, 2023, there were 2,885,039 shares of the registrant’s common stock outstanding.

Table of Contents

MID-SOUTHERN BANCORP, INC.

INDEX


		Page
Part I	Financial Information

	Item 1. Consolidated Financial Statements

	Consolidated Balance Sheets (unaudited)	3

	Consolidated Statements of Income (unaudited)	4

	Consolidated Statements of Comprehensive Income (Loss) (unaudited)	5

	Consolidated Statements of Changes in Stockholders’ Equity (unaudited)	6

	Consolidated Statements of Cash Flows (unaudited)	7

	Notes to Consolidated Financial Statements (unaudited)	8-34

	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	35-46

	Item 3. Quantitative and Qualitative Disclosures About Market Risk	47

	Item 4. Controls and Procedures	47

Part II	Other Information

	Item 1. Legal Proceedings	48

	Item 1A. Risk Factors	48

	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	49

	Item 3. Defaults Upon Senior Securities	49

	Item 4. Mine Safety Disclosures	49

	Item 5. Other Information	49

	Item 6. Exhibits	50

Signatures		51

-2-

Table of Contents

Item 1. Consolidated Financial Statements

MID-SOUTHERN BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share information) (Unaudited)


	June 30,		December 31,
	2023		2022
ASSETS
Cash and due from banks	$	1,224	$	979
Interest-bearing deposits with banks		4,644		4,705
Cash and cash equivalents		5,868		5,684

Securities available for sale, at fair value		99,141		105,351
Securities held to maturity		12		17

Loans, net of allowance for credit losses of $2,329 and $1,692, respectively		147,555		144,379

Federal Home Loan Bank stock, at cost		1,778		1,778
Premises and equipment		2,128		2,150
Accrued interest receivable:
Loans		444		437
Securities		771		886
Cash value of life insurance		3,854		3,826
Other assets		4,715		4,710

Total Assets	$	266,266	$	269,218

LIABILITIES
Deposits:
Noninterest-bearing	$	25,775	$	28,232
Interest-bearing		177,143		177,832
Total deposits		202,918		206,064

Borrowings		28,200		29,000

Accrued interest payable		497		12
Accrued expenses and other liabilities		572		820
Total Liabilities		232,187		235,896

COMMITMENTS AND CONTINGENCIES		—		—

STOCKHOLDERS’ EQUITY
Preferred stock, 1,000,000 shares authorized, $0.01 par value, no shares issued and outstanding		—		—
Common stock, 30,000,000 shares authorized, $0.01 par value, 3,565,430 shares issued and 2,885,039 shares outstanding (2,885,039 at December 31, 2022)		36		36
Additional paid-in-capital		30,818		30,777
Retained earnings, substantially restricted		24,847		24,916
Accumulated other comprehensive loss		(10,201)		(10,831)
Unearned ESOP shares		(1,470)		(1,524)
Unearned stock compensation plan		(357)		(458)
Treasury stock, at cost - 680,391 shares (680,391 at December 31, 2022)		(9,594)		(9,594)
Total Stockholders’ Equity		34,079		33,322

Total Liabilities and Stockholders’ Equity	$	266,266	$	269,218

See accompanying Notes to Consolidated Financial Statements.

-3-

Table of Contents

MID-SOUTHERN BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share information) (Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
INTEREST INCOME
Loans, including fees	$	1,870	$	1,455	$	3,591	$	2,770
Investment securities:
Mortgage-backed securities		189		143		379		247
Municipal tax exempt		393		424		806		805
Other debt securities		115		123		230		198
Federal Home Loan Bank dividends		21		5		48		9
Interest-bearing deposits with banks and time deposits		16		3		33		7
Total interest income		2,604		2,153		5,087		4,036

INTEREST EXPENSE
Deposits		398		107		744		214
Borrowings		289		66		566		109
Total interest expense		687		173		1,310		323

Net interest income		1,917		1,980		3,777		3,713

Provision for (recapture of) credit losses		(16)		50		36		50
Net interest income after provision for credit losses		1,933		1,930		3,741		3,663

NONINTEREST INCOME
Deposit account service charges		89		90		180		171
Brokered loan fees		19		58		34		101
Net loss on sales of securities available for sale		—		—		(27)		—
Increase in cash value of life insurance		14		15		28		29
Net gain on disposal of foreclosed real estate		7		—		7		—
ATM and debit card fee income		167		152		306		288
Gain on life insurance		—		36		—		36
Other income		12		13		24		24
Total noninterest income		308		364		552		649

NONINTEREST EXPENSE
Compensation and benefits		933		983		1,824		1,816
Occupancy and equipment		153		138		314		276
Data processing		221		118		432		236
Professional fees		129		158		298		302
Loss on disposal of premises and equipment		—		7		—		7
Directors' compensation		90		89		179		170
Stockholders' meeting expense		76		15		94		33
Supervisory examinations		8		17		23		35
Deposit insurance premiums		30		17		50		33
Marketing and business development		22		57		48		79
Other expenses		170		145		319		274
Total noninterest expense		1,832		1,744		3,581		3,261

Income before income taxes		409		550		712		1,051

Income tax expense (benefit)		9		24		(28)		58

Net Income	$	400	$	526	$	740	$	993

Earnings per common share:
Basic	$	0.14	$	0.19	$	0.27	$	0.36
Diluted	$	0.14	$	0.19	$	0.27	$	0.36

See accompanying Notes to Consolidated Financial Statements.

-4-

Table of Contents

MID-SOUTHERN BANCORP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands) (Unaudited)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Net Income	$	400	$	526	$	740	$	993

Other Comprehensive Income (Loss), net of tax
Unrealized gains (losses) on securities available for sale:
Net unrealized holding gains (losses) arising during the period		(1,591)		(6,819)		812		(14,656)
Income tax (expense) benefit		396		1,696		(202)		3,645
Net of tax amount		(1,195)		(5,123)		610		(11,011)

Reclassification adjustment for realized losses included in net income during the period		—		—		(27)		—
Income tax benefit		—		—		7		—
Net of tax amount		—		—		(20)		—

Other Comprehensive Income (Loss), net of tax		(1,195)		(5,123)		630		(11,011)

Total Comprehensive Income (Loss)	$	(795)	$	(4,597)	$	1,370	$	(10,018)

See accompanying Notes to Consolidated Financial Statements.

-5-

Table of Contents

MID-SOUTHERN BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(In thousands, except share information) (Unaudited)


							Accumulated				Unearned
			Additional				Other		Unearned		Stock
	Common		Paid-in		Retained		Comprehensive		ESOP		Compensation		Treasury
	Stock		Capital		Earnings		Income (Loss)		Shares		Plan		Stock		Total
Balances at January 1, 2022	$	36	$	30,694	$	23,527	$	2,096	$	(1,649)	$	(473)	$	(7,702)	$	46,529

Net income		—		—		467		—		—		—		—		467
Other comprehensive loss		—		—		—		(5,888)		—		—		—		(5,888)
Cash dividends ($0.04 per share)		—		—		(113)		—		—		—		—		(113)
ESOP shares committed to be released		—		13		—		—		26		—		—		39
Purchase of 16,117 treasury shares		—		—		—		—		—		—		(241)		(241)
Forfeiture of unearned stock awards		—		—		—		—		—		2		(2)		—
Exercise of stock options		—		(8)		—		—		—		—		111		103
Stock compensation expense		—		13		—		—		—		41		—		54

Balances at March 31, 2022	$	36	$	30,712	$	23,881	$	(3,792)	$	(1,623)	$	(430)	$	(7,834)	$	40,950

Net income		—		—		526		—		—		—		—		526
Other comprehensive loss		—		—		—		(5,123)		—		—		—		(5,123)
Cash dividends ($0.04 per share)		—		—		(108)		—		—		—		—		(108)
ESOP shares committed to be released		—		11		—		—		26		—		—		37
Purchase of 136,780 treasury shares		—		—		—		—		—		—		(1,952)		(1,952)
Forfeiture of unearned stock awards		—		—		—		—		—		2		(2)		—
Stock compensation expense		—		11		—		—		—		41		—		52

Balances at June 30, 2022	$	36	$	30,734	$	24,299	$	(8,915)	$	(1,597)	$	(387)	$	(9,788)	$	34,382

Balances at January 1, 2023	$	36	$	30,777	$	24,916	$	(10,831)	$	(1,524)	$	(458)	$	(9,594)	$	33,322

Impact of adoption of ASC 326		—		—		(481)		—		—		—		—		(481)
Net income		—		—		340		—		—		—		—		340
Other comprehensive income		—		—		—		1,825		—		—		—		1,825
Cash dividends ($0.06 per share)		—		—		(164)		—		—		—		—		(164)
ESOP shares committed to be released		—		7		—		—		27		—		—		34
Stock compensation expense		—		16		—		—		—		51		—		67

Balances at March 31, 2023	$	36	$	30,800	$	24,611	$	(9,006)	$	(1,497)	$	(407)	$	(9,594)	$	34,943

Net income		—		—		400		—		—		—		—		400
Other comprehensive loss		—		—		—		(1,195)		—		—		—		(1,195)
Cash dividends ($0.06 per share)		—		—		(164)		—		—		—		—		(164)
ESOP shares committed to be released		—		3		—		—		27		—		—

Mid-Southern Bancorp, Inc. [MSVB] Filings
10-Q	[2023-08-11]
10-Q	[2023-05-12]
10-K	[2023-03-24]
10-Q	[2022-11-10]
10-Q	[2022-08-12]
10-Q	[2022-05-13]
10-K	[2022-03-25]
10-Q	[2021-11-12]
10-Q	[2021-08-13]
10-Q	[2021-05-14]
10-K	[2021-03-26]
10-Q	[2020-11-13]
10-Q	[2020-08-13]
10-Q	[2020-05-12]
10-K	[2020-03-26]
10-Q	[2019-11-14]
10-Q	[2019-08-13]
10-Q	[2019-05-13]
10-K	[2019-03-22]
10-Q	[2018-11-14]
10-Q	[2018-08-14]
10-Q	[2018-06-28]
S-1	[2018-03-23]