Form 8-K - Current report

0000898171falseNONE00008981712023-08-252023-08-25

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 25, 2023

 

 

Uwharrie Capital Corp

(Exact name of Registrant as Specified in Its Charter)

 

 

North Carolina			000-22062	56-1814206
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
132 North First Street
Albemarle, North Carolina				28001
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: 704 983-6181

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
None		N/A		N/A

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

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. ☐

 

 

 

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Item 2.02 Results of Operations and Financial Condition

On August 25, 2023, Uwharrie Capital Corp (the "Registrant") released a quarterly report to its shareholders that included a letter to the shareholders from President and CEO Roger L. Dick and unaudited financial information for the period ended June 30, 2023.

A copy of this report is attached hereto as Exhibit 99.1 and incorporated by reference herein.

This Current Report on Form 8-K (including information included or incorporated by reference herein) may contain, among other things, certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of the Registrant’s goals and expectations with respect to earnings, income per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (ii) statements preceded by, followed by or that include the words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “projects,” “outlook” or similar expressions. These statements are based upon the current belief and expectations of the Registrant’s management and are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond the Registrant’s control).

 

Item 9.01 Financial Statements and Exhibits

(c) Exhibits

 

Exhibit Number		Description
99.1		Quarterly report to shareholders for the period ended June 30, 2023
104		Cover page interactive data file (embedded within the Inline XBRL document)

 

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

		UWHARRIE CAPITAL CORP
Date: August 25, 2023		By:	/s/ Heather H. Almond
			Heather H. Almond
			Principal Financial Officer

 

 

 

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Exhibit 99.1

 

 

 

August 25, 2023

Dear Shareholder:

Your Company concluded the first half of 2023 showing continued improvement in core bank earnings with a strong liquidity position. Uwharrie Capital Corp and its subsidiaries reported total assets of $1.03 billion at June 30, 2023, an increase of 4.3% over the $991 million reported for June 30, 2022. We are not putting all of our assets in one category; we are fortunate that we have good deposit and loan growth in our local markets. In banking, that is typically referred to as “core” deposits and loans and considered much lower risk than purchased funding and assets. More importantly, we continue to grow our family of customers and shareholders who share our beliefs and values in building a community-focused institution that can help secure our future.

Although rates have risen sharply over the past 12-18 months, the economy in our region has remained resilient, leading to stronger demand for loans. The loan portfolio experienced growth of $63 million for the period ended June 30, 2023, as compared to the same period for 2022. Annualized, this represents a 13.3% growth rate in the loan portfolio. Our credit standards have not waivered, and we remain diligent in the management of credit risk of our loan portfolio.

Net income for the first six months of 2023 was $4.2 million, as compared to $2.5 million for the same six-month period in 2022. This equates to $3.9 million in net income available to common shareholders, or $0.55 per share, compared to $2.2 million in net income available to common shareholders, or $0.31 per share, that we reported in 2022 for the same period. The key driver of the improvement in earnings year-over-year is directly attributable to the increase in margins as a result of the rising interest rate environment, along with growth in the volume of loans.

When making important financial decisions, customers desire high-touch; therefore, we continue to invest in our people as well as technology that will provide conveniences and efficiencies in a purposeful manner. With this, we continue to build our brand and reputation that allows us to serve markets outside of our traditional geographic footprint.

We are grateful for a strong start to 2023. As we navigate the current economic environment and grow our technology platform to meet the ever-changing needs of the consumer, we continue to focus on our founding purpose: creation of a community-based institution. We remain committed to improving financial literacy and creating capital to build strong “Main Street” economies; thereby, improving the overall return to all of our stakeholders. Please remember to invite your friends and business associates to come join us in making a difference as we go about building great communities.

God bless you and your families.

Sincerely,

UWHARRIE CAPITAL CORP

/s/ Roger L. Dick

President and Chief Executive Officer

This Report may contain, among other things, certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of the Company's goals and expectations with respect to earnings, income per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (ii) statements preceded by, followed by or that include the words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “projects,” “outlook,” or similar expressions. These statements are based upon the current belief and expectations of the Company‘s management and are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond the Company’s control).

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Uwharrie Capital Corp and Subsidiaries
Consolidated Balance Sheets (Unaudited)
		June 30,				June 30,
(Amounts in thousands except share and per share data)		2023				2022
Assets
Cash and due from banks		$	10,608			$	5,244
Interest-earning deposits with banks			83,245				117,112
Securities available for sale			324,484				315,101
Securities held to maturity (fair value $25,812 and $28,396, respectively)			29,191				30,381
Less: allowance for credit losses on securities held to maturity			(65	)			-
Equity securities, at fair value			303				327
Loans held for sale			3,297				13,261
Loans held for investment			534,364				461,091
Less: allowance for credit losses on loans			(4,713	)			(4,194	)
Net loans held for investment			529,651				456,897
Premises and equipment, net			15,206				15,728
Interest receivable			3,712				2,656
Restricted stock			1,468				1,428
Bank-owned life insurance			7,721				9,125
Deferred income tax benefit			10,593				-
Loan servicing assets			4,615				5,137
Other assets			9,934				18,601
Total assets		$	1,033,963			$	990,998
Liabilities
Deposits:
Demand, noninterest-bearing		$	277,685			$	288,887
Interest checking and money market accounts			426,997				444,529
Savings accounts			98,118				112,846
Time deposits, $250,000 and over			55,873				16,900
Other time deposits			91,597				46,968
Total deposits			950,270				910,130
Short-term borrowed funds			932				1,132
Long-term debt			29,066				29,569
Other liabilities			12,135				10,982
Total liabilities			992,403				951,813
Shareholders' Equity
Common stock, $1.25 par value: 20,000,000 shares authorized;
issued and outstanding or in process of issuance
7,057,847 and 6,930,717, respectively.
Book value per share $4.38 in 2023 and $4.02 in 2022 (1)			8,823				8,664
Additional paid-in capital			12,521				11,814
Undivided profits			39,012				32,754
Accumulated other comprehensive loss			(29,451	)			(24,702	)
Total Uwharrie Capital Corp shareholders' equity			30,905				28,530
Noncontrolling interest			10,655				10,655
Total shareholders' equity			41,560				39,185
Total liabilities and shareholders' equity		$	1,033,963			$	990,998
(1) Net income per share, book value per share and weighted average shares  outstanding have been adjusted to reflect the 2.5% stock dividend in 2022.

 

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Uwharrie Capital Corp and Subsidiaries
Consolidated Statements of Income (Unaudited)
		Three Months Ended								Six Months Ended
		June 30,								June 30,
(Amounts in thousands except share and per share data)		2023				2022				2023				2022
Interest Income
Interest and fees on loans		$	6,989			$	5,297			$	13,356			$	10,404
Interest on investment securities			2,951				1,603				5,818				2,981
Interest-earning deposits with banks and federal funds sold			1,181				247				2,251				287
Total interest income			11,121				7,147				21,425				13,672
Interest Expense
Interest paid on deposits			2,712				213				4,828				390
Interest paid on borrowed funds			342				337				685				674
Total interest expense			3,054				550				5,513				1,064
Net Interest Income			8,067				6,597				15,912				12,608
Provision for (recovery of) credit losses			102				(13	)			386				105
Net interest income after provision for (recovery of) credit losses			7,965				6,610				15,526				12,503
Noninterest Income
Service charges on deposit accounts			264				261				513				504
Interchange and card transaction fees			315				303				619				541
Other service fees and commissions			822				801				1,711				1,702
Gain (loss) on sale of securities			9				-				(42	)			(91	)
Realized/unrealized gain (loss) on equity securities			(23	)			(56	)			11				(65	)
Income from mortgage banking			891				1,172				1,585				2,439
Other income (loss)			408				(229	)			271				(149	)
Total noninterest income			2,686				2,252				4,668				4,881
Noninterest Expense
Salaries and employee benefits			4,932				4,912				9,676				9,928
Occupancy expense			432				427				885				852
Equipment expense			195				193				383				381
Data processing			204				194				408				406
Loan costs			105				95				198				264
Professional fees and services			179				204				437				416
Marketing and donations			342				205				724				539
Software amortization and maintenance			296				308				603				619
Other operating expenses			1,164				332				1,653				1,018
Total noninterest expense			7,849				6,870				14,967				14,423
Income before income taxes			2,802				1,992				5,227				2,961
Provision for income taxes			579				310				1,050				478
Net Income		$	2,223			$	1,682			$	4,177			$	2,483
Consolidated net income		$	2,223			$	1,682			$	4,177			$	2,483
Less: net income attributable to noncontrolling interest			(141	)			(141	)			(280	)			(280	)
Net income attributable to Uwharrie Capital Corp and common shareholders		$	2,082			$	1,541			$	3,897			$	2,203
Net Income Per Common Share (1)
Basic		$	0.29			$	0.22			$	0.55			$	0.31
Assuming dilution		$	0.29			$	0.22			$	0.55			$	0.31
Weighted Average Common Shares Outstanding (1)
Basic			7,073,689				7,103,985				7,074,403				7,114,812
Assuming dilution			7,073,689				7,103,985				7,074,403				7,114,812

 

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Document And Entity Information	Aug. 25, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Aug. 25, 2023
Entity Registrant Name	Uwharrie Capital Corp
Entity Central Index Key	0000898171
Entity Emerging Growth Company	false
Securities Act File Number	000-22062
Entity Incorporation, State or Country Code	NC
Entity Tax Identification Number	56-1814206
Entity Address, Address Line One	132 North First Street
Entity Address, City or Town	Albemarle
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	28001
City Area Code	704
Local Phone Number	983-6181
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	None
No Trading Symbol Flag	true
Security Exchange Name	NONE

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