Attached files
| file | filename |
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| EX-99.1 - EX-99.1 - Citizens Community Bancorp Inc. | exhibit991earningsrelczwi2.htm |
| 8-K - 8-K - Citizens Community Bancorp Inc. | czwi-20210426.htm |
EXHIBIT 99.2 Earnings Release Supplement First Quarter 2021
Citizens Community Bancorp, Inc. Table of Contents Segment Profiles COVID-19 Related Loan Deferrals Non-Owner Occupied CRE Owner Occupied CRE Multi-family Commercial & Industrial Loans Construction & Development Loans Agricultural Real Estate & Operating Loans Hotel Loans Restaurant Loans Credit Quality/Risk Rating Descriptions Loans by Risk Rating as of March 31, 2021 Loans by Risk Rating as of December 31, 2020 Loans by Risk Rating as of March 31, 2020 Allowance for Loan Losses Nonaccrual Loans Roll forward Other Real Estate Owned Roll forward Troubled Debt Restructurings in Accrual Status Acquired Loans – Non-accretable difference and accretable discount tables Selected Capital Composition Highlights – Bank and Company Page(s) 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 16 16 17 18 1
COVID-19 Related Loan Deferrals Source: Unless otherwise noted, internal Company documents. Dollars in Thousands At March 31, 2021 Balance Number of Loans Commercial Deferrals Hotel Loans 48,920$ 10 Other Commercial Loans 3,891 10 Total Commercial Deferrals 52,811 20 Residential Deferrals 3,865 98 Consumer Deferrals 599 40 Total Deferrals at March 31, 2021 57,275$ 158 Commercial Loan Deferral Expiration by Quarter Balance Number of Loans Hotel Loans Quarter Ending June 30, 2021 36,991$ 7 Quarter Ending September 30, 2021 11,929 3 Total Hotel Loans 48,920 10 Other Commercial Loans Quarter Ending June 30, 2021 2,107 5 Quarter Ending September 30, 2021 1,784 5 Total Other Commercial Loans 3,891 10 Total Commercial Deferral Expirations 52,811$ 20 2
Portfolio Fundamentals 57% 33% 10% Wisconsin Minnesota Other By Geography As of 03/31/21 • Typically well seasoned investors with multiple projects, track record of success and personal financial strength (net worth/Liquidity) • Maximum LTV =<80% with recourse to owners with >20% interest • Term of 5-10 years with 20 to 25-year amortizations depending on property type, markets and strength and liquidity of sponsors • Minimum DSC and/or Global DSC covenant required to monitor performance ranging from 1.15x-1.25x • Conservative underwriting approach emphasizing actual results or market data • Appropriate use of SBA 504/7a for lower cash injection or special use projects Non – Owner Occupied CRE As of 03/31/21 As of 12/31/2020 $311 $307 765 785 $406 $391 Approximate Weighted Average LTV 55% 56% 2.4x 2.4x Weighted Average Seasoning In Months 28 28 0.00% 0.00% Approximate Weighted Average DSCR Trailing 12 Month Net Charge-Offs Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands Portfolio Characteristics Non - Owner Occupied CRE 32% 26% 7% 7% 5% 5% 4% 3% 2% 9% Hotel Investor Residential CRE - Warehouse/Mini Storage CRE - Retail CRE - Industrial/Manufacturing CRE - Office CRE - Senior Living CRE - Mixed Use CRE - Bar/Restaurant Other Non – Owner Occupied CRE As of 3/31/21 3
15% 13% 11% 9%9% 8% 7% 5% 23% CRE Campground CRE Restaurant CRE Retail CRE Industrial/Manufacturing CRE Warehouse/Mini Storage CRE Senior Living CRE Mixed Use CRE Office Other Owner Occupied CRE As of 03/31/2021 Portfolio Fundamentals 75% 15% 10% Wisconsin Minnesota Other By Geography As of 03/31/2021 • Underwritten to <80% LTV based on appraised value (<75% for Restaurant) • Term of 5-10 years with 20-year amortization • Recourse to owners with greater than 20% interest • DSC covenant of 1.25x on project and/or Global DSC of 1.15x • Appropriate use of SBA 504/7a for lower cash injection or special use projects • By Geography “Other” segment includes borrowers with warm climates, no state income tax sales Owner Occupied CRE As of 03/31/21 As of 12/31/2020 $205 $201 420 420 $487 $478 Approximate Weighted Average LTV 50% 50% 2.1x 2.1x Weighted Average Seasoning In Months 31 32 0.00% 0.00% Approximate Weighted Average DSCR Trailing 12 Month Net Charge-Offs Portfolio Characteristics Owner Occupied CRE Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands 4
Portfolio Fundamentals 60% 38% 2% Wisconsin Minnesota Other By Geography As of 03/31/21 100% Multi-family Multi-family As of 03/31/21 • Robust housing markets in Eau Claire and Mankato markets supported by student populations at state universities, technical colleges, and growing population and job markets • Multi-family sponsors experienced owners with multi-project portfolios • Typically underwritten to 75% LTV based on appraised value with recourse; metro markets and/or strong sponsors may warrant up to 80% LTV • Term of 5-10 years with 20 to 25-year amortization (varies by new versus existing, size of market and sponsor strength) • Covenant for minimum DSC/Global DSC Multi-family As of 03/31/21 As of 12/31/2020 $119 $122 102 111 $1.17 $1.10 67% 67% Approximate Weighted Average DSCR 1.9x 1.9x 18 18 0.00% 0.00% Approximate Weighted Average LTV Weighted Average Seasoning In Months Trailing 12 Month Net Charge-Offs Portfolio Characteristics - Multi-family Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Millions 5
84% 15% 1% Wisconsin Minnesota Other By Geography As of 03/31/2021 14% 11% 11% 10% 8% 7% 7% 6% 5% 4% 4% 3% 3% 3% 4% Manufacturing Transportation and Warehousing Public Administration Wholesale Trade Real Estate, Rental and Leasing Construction Retail Trade Agriculture Administrative and Support Educational Services Health Care Professional Services Other Services Finance and Insurance Other Commercial & Industrial As of 03/31/2021 Portfolio Fundamentals • Highly diversified, secured loan portfolio underwritten with recourse • Lines of credit reviewed annually and may have borrowing base certificates governing line usage • Fixed asset LTV’s based on age and type of equipment; <5-year amortization • Use of SBA Guaranty Program (Preferred Lender or General Processing) as appropriate • “Retail Trade” segment consists of Farm Supply, Franchised Hardware, Franchised Auto Parts, Franchised and Non-franchised Auto Dealers and Repair Shops, Convenience Stores/Gas Stations Commercial & Industrial Loans As of 03/31/21 As of 12/31/2020 $96 $117 756 764 $127 $153 2.7x 2.4x 25 28 0.42% 0.78% Committed Line, if collateral 58 52 Approximate Weighted Average DSCR Weighted Average Seasoning In Months Trailing 12 Month Net Charge-Offs Portfolio Characteristics - Commercial & Industrial Loan Balance In Millions Number of Loans Average Loan Size In Thousands 6
Portfolio Fundamentals 18% 16% 14% 10% 10% 8% 7% 6% 4% 7% CRE Senior Living Commercial 1-4 Family Construction CRE Multi-family CRE Campground CRE Retail CRE Hospitality Other Land CRE Warehouse/Mini Storage Industrial/Manufacturing Other Commercial & Development As of 03/31/21 51% 32% 17% Wisconsin Minnesota Other By Geography As of 03/31/21 • Underwritten to 75-80% LTV based on lesser of cost or appraised value with full recourse • Interest only typically up to 18 months (depending on project complexity and seasonal timing) followed by amortization of 15-25 years (terms vary by property type) • Borrower equity contribution of cash/land value =>15% injected at the beginning of project (cash/land contribution) • Construction loans require 3rd Party inspections and Title Company draws after balancing to sworn construction statement • 1-4 Residential construction centered in eastern Twin Cities and Northwest Wisconsin. Generally 80% LTC /60%-80% of AV. Spec building capped. Progress reporting monthly by individual home Construction & Development Loans As of 03/31/2021 As of 12/31/2020 Loan Balance Outstanding In Millions $90 $99 Number of Loans 109 125 Average Loan Size In Thousands $832 $788 Approximate Weighted Average LTV 56% 51% Trailing 12 Month Net Charge-Offs 0.00% 0.00% Percent Utilized of Commitments 63% 62% Portfolio Characteristics - Construction & Development 7
41% 26% 17% 13% Crop Dairy Other Farming Other Agricultural As of 03/31/21 Portfolio Fundamentals 70% 26% 4% Wisconsin Minnesota Other By Geography As of 03/31/21 • Producers required to have marketing plans to mitigate volatility of commodities • Appropriate crop/revenue insurance and/or dairy margin protection required • Maximum Ag RE LTV of less than 65%; Equipment LTV of less than 75% • Appropriate structuring to separate crop production cycles and to match length of loan with asset financed • Use of Farmer Mac, FSA, SBA or USDA programs to address DSC, collateral margins or working capital Agricultural Real Estate & Operating Loans As of 03/31/21 As of 12/31/2020 $98 $102 611 645 $162 $157 1.8x 1.7x 34 35 0.16% -0.01% Approximate Weighted Average DSCR Weighted Average Seasoning In Months Trailing 12 Month Net Charge-Offs Portfolio Characteristics - Agricultural Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands 8
68% 20% 12% Flagged Historic Boutique Other Hotels As of 03/31/21 Portfolio Fundamentals 51% 32% 17% Minnesota Wisconsin Illinois By Geography As of 03/31/21 • Mainly experienced multi project hoteliers and guarantors with strong personal financial statements (net worth and liquidity) • Mainly flagged properties, Historic hotels, including two hotels in Minneapolis • Wisconsin Dells Area projects were acquired from F&M • One flagged project approved with the SBA 504 structure; nearing completion of construction • Underwriting consistent with management's conservative approach to Investor CRE, emphasizing actual results in underwriting Hotel Loans As of 03/31/21 As of 12/31/2020 $93 $94 32 32 $2.9 $2.8 56% 56% 2.3x 2.3x 0.00% 0.00%Trailing 12 Month Net Charge Offs Number of Loans Approximate DSCR - Non-Construction Portfolio Characteristics - Hotels Loan Balance Outstanding In Millions Average Loan Size In Millions Approximate Weighted Average LTV 9
53% 16% 10% 8% 6% 7% Culver's - Limited Service Restaurants Micro Breweries Other National Limited Services Drinking Establishments Other Restaurants As of 03/31/21 Portfolio Fundamentals 79% 20% 1% Wisconsin Minnesota Other By Geography As of 03/31/21 • Experienced developers/operators of national Limited /Quick Service brands (Culver’s, Subway, Dairy Queen, McDonalds, Jimmy John’s, A&W) • Underwritten to =<80% LTV with full recourse (depending on sponsor history); 20-year amortization with 5 to 10-year terms • Use of SBA Guaranty Program (Preferred Lender or General Processing) as appropriate • Drinking establishments may have other collateral pledged and tend to be in smaller communities in our footprint • Micro Breweries concentrated in Eau Claire area • Lessors of RE include investor and owner-occupied structure Restaurant Loans As of 03/31/2021 As of 12/31/2020 $39 $37 87 90 $444 $412 57% 57% 3.5x 3.3x 0.00% 0.00% Portfolio Characteristics - Restaurants Approximate Weighted Average DSCR Trailing 12 Month Net Charge-Offs Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands Approximate Weighted Average LTV 10
Credit Quality/Risk Ratings: Management utilizes a numeric risk rating system to identify and quantify the Bank’s risk of loss within its loan portfolio. Ratings are initially assigned prior to funding the loan, and may be changed at any time as circumstances warrant. Ratings range from the highest to lowest quality based on factors that include measurements of ability to pay, collateral type and value, borrower stability and management experience. The Bank’s loan portfolio is presented below in accordance with the risk rating framework that has been commonly adopted by the federal banking agencies. The definitions of the various risk rating categories are as follows: 1 through 4 - Pass. A “Pass” loan means that the condition of the borrower and the performance of the loan is satisfactory or better. 5 - Watch. A “Watch” loan has clearly identifiable developing weaknesses that deserve additional attention from management. Weaknesses that are not corrected or mitigated, may jeopardize the ability of the borrower to repay the loan in the future. 6 - Special Mention. A “Special Mention” loan has one or more potential weakness that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution’s credit position in the future. 7 - Substandard. A “Substandard” loan is inadequately protected by the current net worth and paying capacity of the obligor or the collateral pledged, if any. Assets classified as substandard must have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. 8 - Doubtful. A “Doubtful” loan has all the weaknesses inherent in a Substandard loan with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. 9 - Loss. Loans classified as “Loss” are considered uncollectible, and their continuance as bankable assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, and a partial recovery may occur in the future. 11
Below is a breakdown of loans by risk rating as of March 31, 2021: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 363,758 $ 764 $ 1,081 $ — $ — $ 365,603 Agricultural real estate 36,439 522 1,179 — — 38,140 Multi-family real estate 111,199 304 — — — 111,503 Construction and land development 80,458 — 3,478 — — 83,936 C&I/Agricultural operating: Commercial and industrial 72,355 317 4,021 — — 76,693 SBA PPP loans 118,931 — — — — 118,931 Agricultural operating 20,003 1,045 101 — — 21,149 Residential mortgage: Residential mortgage 78,764 — 3,521 — — 82,285 Purchased HELOC loans 5,057 — 234 — — 5,291 Consumer installment: Originated indirect paper 23,024 — 162 — — 23,186 Other consumer 10,906 — 45 — — 10,951 Total originated loans $ 920,894 $ 2,952 $ 13,822 $ — $ — $ 937,668 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 135,059 $ 10,494 $ 4,033 $ — $ — $ 149,586 Agricultural real estate 27,041 — 5,386 — — 32,427 Multi-family real estate 7,485 — — — — 7,485 Construction and land development 6,553 204 39 — — 6,796 C&I/Agricultural operating: Commercial and industrial 18,865 9 366 — — 19,240 Agricultural operating 6,754 — 347 — — 7,101 Residential mortgage: Residential mortgage 37,982 — 2,064 — — 40,046 Consumer installment: Other consumer 906 — 7 — — 913 Total acquired loans $ 240,645 $ 10,707 $ 12,242 $ — $ — $ 263,594 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 498,817 $ 11,258 $ 5,114 $ — $ — $ 515,189 Agricultural real estate 63,480 522 6,565 — — 70,567 Multi-family real estate 118,684 304 — — — 118,988 Construction and land development 87,011 204 3,517 — — 90,732 C&I/Agricultural operating: Commercial and industrial 91,220 326 4,387 — — 95,933 SBA PPP loans 118,931 — — — — 118,931 Agricultural operating 26,757 1,045 448 — — 28,250 Residential mortgage: Residential mortgage 116,746 — 5,585 — — 122,331 Purchased HELOC loans 5,057 — 234 — — 5,291 Consumer installment: Originated indirect paper 23,024 — 162 — — 23,186 Other consumer 11,812 — 52 — — 11,864 Gross loans $ 1,161,539 $ 13,659 $ 26,064 $ — $ — $ 1,201,262 Less: Unearned net deferred fees and costs and loans in process (4,487) Unamortized discount on acquired loans (4,649) Allowance for loan losses (16,860) Loans receivable, net $ 1,175,266 12
Below is a breakdown of loans by risk rating as of December 31, 2020: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 349,482 $ 543 $ 1,088 $ — $ — $ 351,113 Agricultural real estate 30,041 446 1,254 — — 31,741 Multi-family real estate 112,423 308 — — — 112,731 Construction and land development 87,763 — 3,478 — — 91,241 C&I/Agricultural operating: Commercial and industrial 91,474 20 3,796 — — 95,290 SBA PPP loans 123,702 — — — — 123,702 Agricultural operating 22,462 934 1,061 — — 24,457 Residential mortgage: Residential mortgage 82,097 7 4,179 — — 86,283 Purchased HELOC loans 5,959 — 301 — — 6,260 Consumer installment: Originated indirect paper 25,616 — 235 — — 25,851 Other consumer 11,986 — 70 — — 12,056 Total originated loans $ 943,005 $ 2,258 $ 15,462 $ — $ — $ 960,725 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 148,303 $ 4,274 $ 3,985 $ — $ — $ 156,562 Agricultural real estate 31,147 — 5,907 — — 37,054 Multi-family real estate 9,273 — 148 — — 9,421 Construction and land development 7,237 — 39 — — 7,276 C&I/Agricultural operating: Commercial and industrial 20,918 9 336 — — 21,263 Agricultural operating 7,838 — 490 — — 8,328 Residential mortgage: Residential mortgage 42,805 131 2,167 — — 45,103 Consumer installment: Other consumer 1,150 — 7 — — 1,157 Total acquired loans $ 268,671 $ 4,414 $ 13,079 $ — $ — $ 286,164 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 497,785 $ 4,817 $ 5,073 $ — $ — $ 507,675 Agricultural real estate 61,188 446 7,161 — — 68,795 Multi-family real estate 121,696 308 148 — — 122,152 Construction and land development 95,000 — 3,517 — — 98,517 C&I/Agricultural operating: Commercial and industrial 112,392 29 4,132 — — 116,553 SBA PPP loans 123,702 — — — — 123,702 Agricultural operating 30,300 934 1,551 — — 32,785 Residential mortgage: Residential mortgage 124,902 138 6,346 — — 131,386 Purchased HELOC loans 5,959 — 301 — — 6,260 Consumer installment: Originated indirect paper 25,616 — 235 — — 25,851 Other consumer 13,136 — 77 — — 13,213 Gross loans $ 1,211,676 $ 6,672 $ 28,541 $ — $ — $ 1,246,889 Less: Unearned net deferred fees and costs and loans in process (4,245) Unamortized discount on acquired loans (5,063) Allowance for loan losses (17,043) Loans receivable, net $ 1,220,538 13
Below is a breakdown of loans by risk rating as of March 31, 2020: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 307,313 $ 4,978 $ 856 $ — $ — $ 313,147 Agricultural real estate 33,069 469 2,114 — — 35,652 Multi-family real estate 89,474 — — — — 89,474 Construction and land development 72,427 5,780 3,478 — — 81,685 C&I/Agricultural operating: Commercial and industrial 80,746 1,115 3,388 — — 85,249 Agricultural operating 21,552 428 720 — — 22,700 Residential mortgage: Residential mortgage 98,138 35 4,681 — — 102,854 Purchased HELOC loans 7,367 — 234 — — 7,601 Consumer installment: — Originated indirect paper 36,153 — 261 — — 36,414 Other consumer 14,923 — 157 — — 15,080 Total originated loans $ 761,162 $ 12,805 $ 15,889 $ — $ — $ 789,856 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 192,367 $ 5,513 $ 9,123 $ — $ — $ 207,003 Agricultural real estate 39,729 — 8,037 — — 47,766 Multi-family real estate 13,361 — 148 — — 13,509 Construction and land development 13,982 — 251 — — 14,233 C&I/Agricultural operating: Commercial and industrial 34,914 563 1,280 — — 36,757 Agricultural operating 13,700 82 1,458 — — 15,240 Residential mortgage: Residential mortgage 60,335 424 2,198 — — 62,957 Consumer installment: Other consumer 2,095 — 9 — — 2,104 Total acquired loans $ 370,483 $ 6,582 $ 22,504 $ — $ — $ 399,569 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 499,680 $ 10,491 $ 9,979 $ — $ — $ 520,150 Agricultural real estate 72,798 469 10,151 — — 83,418 Multi-family real estate 102,835 — 148 — — 102,983 Construction and land development 86,409 5,780 3,729 — — 95,918 C&I/Agricultural operating: Commercial and industrial 115,660 1,678 4,668 — — 122,006 Agricultural operating 35,252 510 2,178 — — 37,940 Residential mortgage: Residential mortgage 158,473 459 6,879 — — 165,811 Purchased HELOC loans 7,367 — 234 — — 7,601 Consumer installment: Originated indirect paper 36,153 — 261 — — 36,414 Other consumer 17,018 — 166 — — 17,184 Gross loans $ 1,131,645 $ 19,387 $ 38,393 $ — $ — $ 1,189,425 Less: Unearned net deferred fees and costs and loans in process (510) Unamortized discount on acquired loans (7,964) Allowance for loan losses (11,835) Loans receivable, net $ 1,169,116 14
Allowance for Loan Losses (in thousand, except ratios) March 31, 2021 and Three Months Ended December 31, 2020 and Three Months Ended March 31, 2020 and Three Months Ended Allowance for loan losses (“ALL”), at beginning of period $ 17,043 $ 14,836 $ 10,320 Loans charged off: Commercial/Agricultural real estate (200) — — C&I/Agricultural operating — (300) (442) Residential mortgage — — (27) Consumer installment (25) (23) (51) Total loans charged off (225) (323) (520) Recoveries of loans previously charged off: Commercial/Agricultural real estate 5 1 — C&I/Agricultural operating 15 11 — Residential mortgage 8 — 13 Consumer installment 14 18 22 Total recoveries of loans previously charged off: 42 30 35 Net loans charged off (“NCOs”) (183) (293) (485) Additions to ALL via provision for loan losses charged to operations — 2,500 2,000 ALL, at end of period $ 16,860 $ 17,043 $ 11,835 Average outstanding loan balance $ 1,213,562 $ 1,240,895 $ 1,172,246 Ratios: NCOs (annualized) to average loans 0.06 % 0.09 % 0.17 % 15
Nonaccrual Loans Roll forward (in thousands) Quarter Ended March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 March 31, 2020 Balance, beginning of period $ 10,747 $ 13,154 $ 14,787 $ 16,090 $ 19,056 Additions 430 912 716 1,907 1,811 Acquired nonaccrual loans — — — — — Charge offs (205) (2) (141) (175) (452) Transfers to OREO (45) — (172) — (1,100) Return to accrual status (291) — (165) (1,702) (120) Payments received (1,935) (3,317) (1,744) (1,292) (2,887) Other, net (23) — (127) (41) (218) Balance, end of period $ 8,678 $ 10,747 $ 13,154 $ 14,787 $ 16,090 Other Real Estate Owned Roll forward (in thousands) Quarter Ended March, 31 2021 December 31, 2020 September 30, 2020 June 30, 2020 March 31, 2020 Balance, beginning of period $ 156 $ 756 $ 692 $ 1,412 $ 1,429 Loans transferred in 45 — 172 — 988 Sales (142) (529) (86) (681) (965) Write-downs — (68) (26) (151) (49) Other, net (2) (3) 4 112 9 Balance, end of period $ 57 $ 156 $ 756 $ 692 $ 1,412 Troubled Debt Restructurings in Accrual Status (in thousands, except number of modifications) March, 31 2021 December 31, 2020 September 30, 2020 March 31, 2020 Number of Modifications Recorded Investment Number of Modifications Recorded Investment Number of Modifications Recorded Investment Number of Modifications Recorded Investment Troubled debt restructurings: Accrual Status Commercial/Agricultural real estate 14 $ 4,472 16 $ 4,695 19 $ 5,480 13 $ 1,125 C&I/Agricultural Operating 5 4,042 4 3,836 5 3,868 1 9 Residential mortgage 44 3,195 43 3,162 42 3,178 38 3,174 Consumer installment 8 43 8 49 7 53 8 69 Total loans 71 $ 11,752 71 $ 11,742 73 $ 12,579 60 $ 4,377 16
Acquired loans represent much of the reduction in non-performing loans and classified loans. The table below shows the changes in the Bank’s non-accretable difference on purchased credit impaired loans. The second table below shows the changes in the Bank’s accretable loan discount which was established at each acquisition. The Bank has transferred the non-accretable difference on purchased credit impaired loans to accretable discount as collateral coverage improved sufficiently, due to a combination of principal paydowns and/or improving collateral positions. This transferred non-accretable difference to accretable discount is accreted over the remaining maturity of the loan or until payoff, whichever is shorter. Non-accretable difference: (in thousands) March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 March 31, 2020 Non-accretable difference, beginning of period $ 1,087 $ 1,661 $ 3,355 $ 4,327 $ 6,290 Additions to non-accretable difference for acquired purchased credit impaired loans — — — — — Non-accretable difference realized as interest from payoffs of purchased credit impaired loans (58) (324) (130) (196) (1,043) Transfers from non-accretable difference to accretable discount (63) (50) (1,294) (741) (669) Non-accretable difference used to reduce loan principal balance — (200) (270) (35) — Non-accretable difference transferred to OREO due to loan foreclosure — — — — (251) Non-accretable difference, end of period $ 966 $ 1,087 $ 1,661 $ 3,355 $ 4,327 The table below provides the changes in accretable discount for acquired loans. Accretable discount: (in thousands) March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 March 31, 2020 Accretable discount, beginning of period $ 3,976 $ 5,050 $ 4,032 $ 3,637 $ 3,201 Additions to accretable discount for acquired performing loans — — — — — Accelerated accretion from payoff of certain PCI loans with transferred non-accretable difference (90) (872) — (99) — Transfers from non-accretable difference to accretable discount 63 50 1,294 741 669 Scheduled accretion (266) (252) (276) (247) (233) Accretable discount, end of period $ 3,683 $ 3,976 $ 5,050 $ 4,032 $ 3,637 17
CITIZENS COMMUNITY FEDERAL N.A. Selected Capital Composition Highlights March 31, 2021 (unaudited) December 31, 2020 (audited) September 30, 2020 (unaudited) March, 31, 2020 (unaudited) To Be Well Capitalized Under Prompt Corrective Action Provisions Tier 1 leverage ratio (to adjusted total assets) 9.8% 9.9% 9.9% 10.3% 5.0% Tier 1 capital (to risk weighted assets) 14.3% 13.5% 13.7% 12.6% 8.0% Common equity tier 1 capital (to risk weighted assets) 14.3% 13.5% 13.7% 12.6% 6.5% Total capital (to risk weighted assets) 15.5% 14.7% 15.0% 13.6% 10.0% CITIZENS COMMUNITY BANCORP, INC. Selected Capital Composition Highlights March 31, 2021 (unaudited) December 31, 2020 (audited) September 30, 2020 (unaudited) March, 31, 2020 (unaudited) For Capital Adequacy Purposes Tier 1 leverage ratio (to adjusted total assets) 7.5% 7.7% 7.5% 7.7% 4.0% Tier 1 capital (to risk weighted assets) 11.0% 10.5% 10.5% 9.2% 6.0% Common equity tier 1 capital (to risk weighted assets) 11.0% 10.5% 10.5% 9.2% 4.5% Total capital (to risk weighted assets) 14.9% 14.3% 14.3% 11.5% 8.0% 18