PORTERVILLE, Calif.–(BUSINESS WIRE)–Sierra Bancorp (Nasdaq: BSRR), parent of Bank of the Sierra, today announced its unaudited financial results for the three- and six-month periods ended June 30, 2021. Sierra Bancorp reported consolidated net income of $11.7 million, or $0.76 per diluted share, for the second quarter of 2021, compared to $8.3 million, or $0.54 per diluted share, in the second quarter of 2020.
For the first six months of 2021, the Company recognized net income of $22.8 million as compared to $16.1 million for the same period in 2020. The Company’s financial performance metrics for the first half of 2021 include an annualized return on average equity of 13.11%, a return on average assets of 1.41%, and diluted earnings per share of $1.48.
“We are pleased to report another quarter of record earnings!” stated Kevin McPhaill, President and CEO. “Our strong results in the second quarter of 2021 are thanks to the continued hard work and persistence of our banking team. While we anticipate headwinds during the second half of this year due to historically low interest rates and competitive pressures, our core earnings engine remains strong, and our team is committed to meeting these challenges. We will continue to look for additional opportunities and we are excited about the future of Bank of the Sierra!” McPhaill concluded.
Quarterly Changes (comparisons to the second quarter of 2020)
- The change in quarterly net income was primarily due to a $2.1 million negative provision for loan and lease losses. This significant decrease is attributable to the impact of continued improvements in the overall economy, lower historical loss rates, net recoveries during the past two quarters, and a $272.7 million decrease in average balances of net loans and leases.
- Net interest income increased $3.0 million, or 13%, due primarily to increases in average loan balances and a lower cost of funds.
Year to-Date Changes (comparisons to the first six-months of 2020)
- Net income increased by $6.7 million due mostly to a $1.9 million negative provision for loan and lease losses, attributed to the same reasons as noted above in the quarterly comparison.
- Net interest income increased by $7.8 million, or 16%, as declines in loan yields were offset by higher balances and lower interest expense.
- The above year-to-date increases were partially offset by an increase in noninterest expense of $4.7 million, or 13%, due mostly to a $2.1 million increase in salaries and benefits, $1.4 million in professional services, and $0.8 million in data processing expenses.
Balance Sheet Changes (comparisons to December 31, 2020)
- Total assets increased to $3.3 billion, representing an increase of $51.3 million, or 2%, during the first half of the year.
- Cash and due from banks increased 424% to $373.9 million during the first six months of the year due mostly to higher deposit balances coupled with lower loan…