Generations Bancorp NY (GBNY) investor relations material

Executive summary

• Net loss of $841,000 for Q2 2024, up from $166,000 loss in Q2 2023, driven by lower net interest income, reduced noninterest income, and higher credit loss provisions.

• Total assets declined 5.4% to $401.8 million at June 30, 2024, mainly due to decreases in loans, cash, and investment securities.

• Deposits fell 5.3% to $338.8 million, with notable declines in certificates of deposit and brokered deposits.

• The company entered into a written agreement with the OCC, requiring enhanced compliance, governance, and risk management programs.

Financial highlights

• Net interest income dropped 16.5% year-over-year to $1.9 million for Q2 2024; net interest margin fell to 2.05%.

• Provision for credit losses increased to $377,000 from $165,000 year-over-year, mainly due to higher loss rates in auto and RV portfolios.

• Noninterest income decreased 41.4% to $462,000, primarily due to the sale of the insurance agency business.

• Noninterest expense decreased slightly to $3.1 million, with lower compensation and benefits offset by higher professional services and other costs.

• Net loss per share was $0.39 for Q2 2024, compared to $0.07 in Q2 2023.

Outlook and guidance

• Management expects noninterest expenses to rise due to remediation actions required by the OCC agreement, potentially impacting future financial performance.

• The company plans to continue purchasing residential mortgage and auto loans as part of its business strategy.