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Parent Company Condensed Financial Statements

12 Months Ended

Dec. 31, 2022

Condensed Financial Information Disclosure [Abstract]

Parent Company Condensed Financial Statements

(22) Parent Company Condensed Financial Statements

The following is condensed financial information of the parent company as of December 31, 2022 and 2021 and for the years ended December 31, 2022, 2021 and 2020:

Condensed Balance Sheets


(Dollars in thousands)		As of December 31,
		2022				2021
Assets:
Cash and cash equivalents		$	166			$	1,121
Interest-bearing deposits at other banks			214				214
Investment in subsidiaries			140,802				154,978
Other			959				1,074
Total assets		$	142,141			$	157,387
Liabilities and stockholders’ equity:
Subordinated debentures		$	21,651			$	21,651
Other borrowings			9,000				-
Other			57				93
Stockholders’ equity			111,433				135,643
Total liabilities and stockholders’ equity		$	142,141			$	157,387

Condensed Statements of Earnings


(Dollars in thousands)		Years ended December 31,
		2022				2021				2020
Dividends from Bank		$	29,350			$	4,600			$	6,900
Dividends from nonbank subsidiary			490				1,000				-
Interest income			26				16				21
Other non-interest income			8				7				7
Interest expense			(998	)			(472	)			(614	)
Other expense, net			(412	)			(532	)			(352	)
Earnings before equity in undistributed earnings			28,464				4,619				5,962
(Decrease) increase in undistributed equity of Bank			(19,030	)			13,599				13,087
Increase (decrease) in undistributed equity of nonbank subsidiary			155				(272	)			248
Earnings before income taxes			9,589				17,946				19,297
Income tax benefit			(289	)			(65	)			(196	)
Net earnings			9,878				18,011				19,493
Other comprehensive (loss) income			(28,946	)			(5,567	)			4,208
Total comprehensive income		$	(19,068	)		$	12,444			$	23,701

Condensed Statements of Cash Flows


(Dollars in thousands)		Years ended December 31,
		2022				2021				2020
Cash flows from operating activities:
Net earnings		$	9,878			$	18,011			$	19,493
Decrease (increase) in undistributed equity of subsidiaries			18,875				(13,327	)			(13,335	)
Other			79				130				(312	)
Net cash provided by operating activities			28,832				4,814				5,846

Cash flows from investing activities:
Net change in interest-bearing deposits at banks			-				(2	)			26
Acquisition of Freedom Bancshares, Inc.			(33,350	)			-				-
Net cash (used in) provided by investing activities			(33,350	)			(2	)			26

Cash flows from financing activities:
Proceeds from exercise of stock options			-				22				42
Payment of dividends			(4,198	)			(3,818	)			(3,633	)
Purchase of treasury stock			(1,239	)			-				(2,349	)
Issuances of outstanding debt			10,065				-				-
Payment on outstanding debt			(1,065	)			-				-
Net cash used in financing activities			3,563				(3,796	)			(5,940	)
Net (decrease) increase in cash			(955	)			1,016				(68	)
Cash at beginning of year			1,121				105				173
Cash at end of year		$	166			$	1,121			$	105

Dividends paid by the Company are provided through dividends from the Bank and dividends from nonbank subsidiaries. At December 31, 2022, the Bank could distribute dividends of up to $7.7 million without regulatory approvals. The primary source of funds for the Company is dividends from the Bank. Under the National Bank Act, a national bank may pay dividends out of its undivided profits in such amounts and at such times as the bank’s board of directors deems prudent. Without prior OCC approval, however, a national bank may not pay dividends in any calendar year that, in the aggregate, exceed the bank’s year-to-date net income plus the bank’s retained net income for the two preceding years. The payment of dividends by any financial institution is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations, and a financial institution generally is prohibited from paying any dividends if, following payment thereof, the institution would be undercapitalized.