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White River Bancshares Passes $1B in Assets; Q1 Profit Falls on Rising Costs

2 min read

White River Bancshares Co. (OTCQX: WRIVof Fayetteville, the holding company for Signature Bank of Arkansas, announced that it surpassed $1 billion in assets in the first quarter as profit fell on higher costs.

The bank reported net income of $340,000, or 34 cents per diluted share, compared to $1.07 million, or $1.08 per diluted share, in the same period a year ago.

Gary Head, company chair and CEO, said net income continues to be affected by the costs of the bank’s expansion to Harrison and Jonesboro in the first half of 2022, and the addition of Banco Sí in downtown Rogers in the second half of last year.

Still, the bank plans to continue expanding. It announced in February that it’s opening a second Banco Sí branch in Springdale by the end of 2023.

Funding costs increased during the quarter due to rising interest rates, the bank said in a news release, resulting in net interest margin dropping to 3.16% from 3.58% a year ago. Brant Ward, president of the bank, said he expects net interest margins to stabilize as loan yields catch up to funding costs.

The company recorded a $150,000 provision for credit losses in the first quarter of 2023, compared to no provision in the first quarter of 2022. Jeff Maland, the bank’s chief risk officer, said the bank is “being proactive by working with our customers to solve credit issues in advance of a credit becoming a problem.” He said asset quality “remains pristine.”

Total assets increased to a record $1.08 billion during the first quarter, up 20.5% compared the same quarter in 2022. On a quarterly basis, assets grew 9.9%.

Deposits totaled $890.8 million, up 14.7% from $776.7 million a year ago. Compared to the fourth quarter of 2022, deposits increased 9.9%. The bank said time deposits account for a majority of the deposit growth year-over-year.

“We have a diverse deposit and loan portfolio and have stayed clear of the issues affecting the banks that were closed by federal regulators in March,” Head said.

White River Bancshares ended the first quarter with cash and cash equivalents of  $87.2 million, down from $90.3 million a year ago but much higher than the $11.8 million it reported at the end of 2022.

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