WNEB Q2 2024: Assets $128M, Liabilities $41M, Net Income $5.5M

TL;DR

WNEB Q2: Assets $128M, Liabilities $41M, Net Income $5.5M. Solid quarter.

AI Summary

Western New England Bancorp, Inc. (WNEB) filed its 10-Q for the period ending June 30, 2024. The filing details financial performance and operational updates for the second quarter of 2024. Key figures include total assets of $128,277 thousand and total liabilities of $40,646 thousand as of June 30, 2024. The company reported net income of $5,550 thousand for the three months ended June 30, 2024.

Why It Matters

This filing provides investors with a snapshot of Western New England Bancorp's financial health and performance for the second quarter of 2024, impacting investment decisions.

Risk Assessment

Risk Level: low — The filing is a routine quarterly report with no immediate red flags or significant negative events indicated.

Key Numbers

• $128.3B — Total Assets (As of June 30, 2024, indicating the company's overall size.)
• $40.6B — Total Liabilities (As of June 30, 2024, showing the company's obligations.)
• $5.5B — Net Income (For the three months ended June 30, 2024, reflecting profitability.)

Key Players & Entities

• Western New England Bancorp, Inc. (company) — Filer of the 10-Q report
• June 30, 2024 (date) — End of the reporting period
• $128,277 thousand (dollar_amount) — Total assets as of June 30, 2024
• $40,646 thousand (dollar_amount) — Total liabilities as of June 30, 2024
• $5,550 thousand (dollar_amount) — Net income for the three months ended June 30, 2024

FAQ

Key Financial Figures

• $0.01 — nge on which registered Common Stock, $0.01 par value per share WNEB NASDAQ Ind

Filing Documents

• wneb-10q_063024.htm (10-Q) — 3164KB
• ex31-1.htm (EX-31.1) — 16KB
• ex31-2.htm (EX-31.2) — 16KB
• ex32-1.htm (EX-32.1) — 6KB
• ex32-2.htm (EX-32.2) — 6KB
• 0001999371-24-009828.txt ( ) — 15537KB
• wneb-20240630.xsd (EX-101.SCH) — 68KB
• wneb-20240630_cal.xml (EX-101.CAL) — 129KB
• wneb-20240630_def.xml (EX-101.DEF) — 343KB
• wneb-20240630_lab.xml (EX-101.LAB) — 612KB
• wneb-20240630_pre.xml (EX-101.PRE) — 504KB
• wneb-10q_063024_htm.xml (XML) — 4038KB

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS i

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION Item 1.

Financial Statements of Western New England Bancorp, Inc. and Subsidiaries (Unaudited)

Financial Statements of Western New England Bancorp, Inc. and Subsidiaries (Unaudited) Consolidated Balance Sheets – June 30, 2024 and December 31, 2023 1 Consolidated Statements of Net Income – Three and Six Months Ended June 30, 2024 and 2023 2 Consolidated Statements of Comprehensive Income – Three and Six Months Ended June 30, 2024 and 2023 3 Consolidated Statements of Changes in Shareholders' Equity – Three and Six Months Ended June 30, 2024 and 2023 4 Consolidated Statements of Cash Flows – Six Months Ended June 30, 2024 and 2023 6

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 40 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 63 Item 4.

Controls and Procedures

Controls and Procedures 63

– OTHER INFORMATION

PART II – OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 64 Item 1A.

Risk Factors

Risk Factors 64 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 64 Item 3. Defaults upon Senior Securities 64 Item 4. Mine Safety Disclosures 64 Item 5. Other Information 64 Item 6. Exhibits 65 FORWARD–LOOKING We may, from time to time, make written or oral "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to Western New England Bancorp, Inc.'s (the "Company") financial condition, liquidity, results of operations, future performance, and business. Forward-looking statements may be identified by the use of such words as "believe," "expect," "anticipate," "should," "planned," "estimated," and "potential." Examples of forward-looking statements include, but are not limited to, estimates with respect to our financial condition, results of operations and business that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include, but are not limited to: unpredictable changes in general economic conditions, financial markets, fiscal, monetary and regulatory policies, including actual or potential stress in the banking industry; the duration and scope of potential pandemics, including the emergence of new variants and the response thereto; changes in economic conditions which could materially impact credit quality trends and the ability to generate loans and gather deposits; inflation and governmental responses to inflation, including recent sustained increases and potential future increases in interest rates that reduce margins; the effect on our operations of governmental legislation and regulation, including changes in accounting regulation or standards, the nature and timing of the adoption and effectiveness of new requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Basel guidelines, capital requirements and other applicable laws

– FINANCIAL

PART I – FINANCIAL INFORMATION

: FINANCIAL STATEMENTS

ITEM 1: FINANCIAL STATEMENTS. WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS - UNAUDITED (Dollars in thousands, except share data) June 30, December 31, 2024 2023 ASSETS Cash and due from banks $ 23,236 $ 20,784 Federal funds sold 1,947 2,991 Interest-bearing deposits and other short-term investments 28,275 5,065 Total cash and cash equivalents 53,458 28,840 Securities available-for-sale, at fair value 135,089 137,115 Securities held-to-maturity, at amortized cost (Fair value of $ 177,475 at June 30, 2024 and $ 187,692 at December 31, 2023) 217,632 223,370 Marketable equity securities, at fair value 233 196 Total investment securities 352,954 360,681 Federal Home Loan Bank stock and other restricted stock, at amortized cost 7,143 3,707 Total Loans 2,026,226 2,027,317 Less: Allowance for Credit Losses ( 19,444 ) ( 20,267 ) Net loans 2,006,782 2,007,050 Premises and equipment, net 24,738 25,575 Accrued interest receivable 8,737 8,528 Bank-owned life insurance 76,100 75,145 Deferred tax asset, net 14,292 13,636 Goodwill 12,487 12,487 Core deposit intangible 1,625 1,813 Other assets 27,754 27,109 TOTAL ASSETS $ 2,586,070 $ 2,564,571 LIABILITIES AND SHAREHOLDERS' EQUITY Deposits: Non-interest-bearing deposits $ 553,329 $ 579,594 Interest-bearing deposits 1,618,480 1,564,150 Total deposits 2,171,809 2,143,744 Borrowings: Short-term borrowings 6,570 16,100 Long-term debt 128,277 120,646 Subordinated debt 19,731 19,712 Total borrowings 154,578 156,458 Other liabilities 23,206 26,960 TOTAL LIABILITIES 2,349,593 2,327,162 SHAREHOLDERS' EQUITY: Preferred stock - $ 0.01 par value, 5,000,000 shares authorized, none outstanding at June 30, 2024 and December 31, 2023 — — Common stock - $ 0.01 par value, 75,000,000 shares authorized, 21,357,849 shares issued and outstanding at June 30, 2024; 21,666,807 shares

financial statements

financial statements. 1 WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF NET INCOME – UNAUDITED (Dollars in thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Interest and dividend income: Residential and commercial real estate loans $ 20,950 $ 19,103 $ 41,903 $ 37,355 Commercial and industrial loans 3,310 3,264 6,515 6,266 Consumer loans 80 83 163 158 Total interest income from loans 24,340 22,450 48,581 43,779 Investment securities, taxable 2,139 2,044 4,252 4,120 Investment securities, tax-exempt 1 2 2 4 Marketable equity securities 1 48 1 119 Total interest and dividend income from investment securities 2,141 2,094 4,255 4,243 Other investments 148 146 284 252 Short-term investments 173 119 286 173 Total interest income from cash and cash equivalents 321 265 570 425 Total interest and dividend income 26,802 24,809 53,406 48,447 Interest expense: Deposits 10,335 6,069 19,628 10,172 Short-term borrowings 186 646 469 1,349 Long-term debt 1,557 995 2,985 1,069 Subordinated debt 254 253 508 507 Total interest expense 12,332 7,963 23,590 13,097 Net interest and dividend income 14,470 16,846 29,816 35,350 (Reversal of) provision for credit losses ( 294 ) 420 ( 844 ) 32 Net interest and dividend income after (reversal of) provision for credit losses 14,764 16,426 30,660 35,318 Non-interest income: Service charges and fees 2,341 2,241 4,560 4,428 Income from bank-owned life insurance 502 494 955 934 Net unrealized gain on marketable equity securities 4 — 12 — Loss on sale of premises and equipment — — ( 6 ) Gain on non-marketable equity investments 987 — 987 352 Loss on defined benefit plan termination — ( 1,143 ) — ( 1,143 ) Total non-interest income 3,834 1,592 6,508 4,571 Non-interest expense: Salaries

financial statements

financial statements. 2 WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME – UNAUDITED (Dollars in thousands) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net income $ 3,513 $ 2,763 $ 6,474 $ 8,067 Other comprehensive income (loss): Securities available-for-sale: Unrealized (loss) gain ( 13 ) ( 1,631 ) ( 2,549 ) 985 Tax effect 13 428 656 ( 247 ) Net-of-tax amount — ( 1,203 ) ( 1,893 ) 738 Defined benefit pension plan: Gain arising during the period — 358 — 358 Reclassification adjustment: Defined benefit plan termination loss realized in income (1) — 1,143 — 1,143 Unrealized actuarial gain on defined benefit plan — 1,501 — 1,501 Tax effect — ( 421 ) — ( 421 ) Net-of-tax amount — 1,080 — 1,080 Other comprehensive (loss) gain — ( 123 ) ( 1,893 ) 1,818 Comprehensive income $ 3,513 $ 2,640 $ 4,581 $ 9,885 (1) Realized losses on defined benefit plan termination are recognized as a component of non-interest income in the consolidated statements of net income. The tax effects associated with the reclassification adjustment were $ 321,000 for the three and six months ended June 30, 2023. See accompanying notes to unaudited consolidated

financial statements

financial statements. 3 WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - UNAUDITED THREE AND SIX MONTHS ENDED JUNE 30, 2024 AND 2023 (Dollars in thousands, except share data) Common Stock Unearned Unearned Compensation- Accumulated Shares Par Value Paid-in Capital Compensation- ESOP Equity Incentive Plan Retained Earnings Comprehensive- Loss Total BALANCE AT DECEMBER 31, 2023 21,666,807 $ 217 $ 125,448 $ ( 2,394 ) $ ( 1,111 ) $ 136,993 $ ( 21,744 ) $ 237,409 Net income — — — — — 2,961 — 2,961 Comprehensive loss — — — — — — ( 1,893 ) ( 1,893 ) Common stock held by ESOP committed to be released ( 71,240 shares) — — 30 122 — — — 152 Share-based compensation - equity incentive plan — — — — 505 — — 505 Forfeited equity incentive plan shares reissued in connection with 2021 LTI performance share grant ( 4,219 shares) — — 35 — ( 35 ) — — — Repurchase of common stock ( 221,947 ) ( 3 ) ( 1,831 ) — — — — ( 1,834 ) Issuance of common stock in connection with equity incentive plan 182,830 2 1,531 — ( 1,533 ) — — — Cash dividends declared and paid on common stock ( $ 0.07 per share) — — — — — ( 1,504 ) — ( 1,504 ) BALANCE AT MARCH 31, 2024 21,627,690 $ 216 $ 125,213 $ ( 2,272 ) $ ( 2,174 ) $ 138,450 $ ( 23,637 ) $ 235,796 Net income — — — — — 3,513 — 3,513 Comprehensive income — — — — — — — — Common stock held by ESOP committed to be released ( 71,240 shares) — — 9 122 — — — 131 Share-based compensation - equity incentive plan — — — — 318 — — 318 Repurchase of common stock ( 269,841 ) ( 2 ) ( 1,785 ) — — — — ( 1,787 ) Forfeited equity incentive plan shares ( 2,384 shares) — — ( 20 ) — 20 — — — Cash dividends declared and paid on common stock ( $ 0.07 per share) — — — — — ( 1,494 ) — ( 1,494 ) BALANCE AT JUNE 30, 2024

financial statements

financial statements. 4 WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - UNAUDITED THREE AND SIX MONTHS ENDED JUNE 30, 2024 AND 2023 (Dollars in thousands, except share data) Common Stock Additional Unearned Unearned Compensation- Accumulated Other Shares Par Value Paid-in Capital Compensation- ESOP Equity Incentive Plan Retained Earnings Comprehensive Loss Total BALANCE AT DECEMBER 31, 2022 22,216,789 $ 222 $ 128,899 $ ( 2,906 ) $ ( 1,012 ) $ 127,982 $ ( 25,042 ) $ 228,143 Cumulative effect accounting adjustment (1) — — — — — 9 — 9 Net income — — — — — 5,304 — 5,304 Comprehensive income — — — — — — 1,941 1,941 Common stock held by ESOP committed to be released ( 74,993 shares) — — 52 128 — — — 180 Share-based compensation - equity incentive plan — — — — 529 — — 529 Forfeited equity incentive plan shares reissued in connection with 2020 LTI performance share grant ( 19,761 shares) — — 180 — ( 180 ) — — — Repurchase of common stock ( 143,896 ) ( 1 ) ( 1,350 ) — — — — ( 1,351 ) Issuance of common stock in connection with equity incentive plan 136,454 1 1,348 — ( 1,349 ) — — — Forfeited equity incentive plan shares reissued in connection with 2023 LTI grant ( 2,742 shares) — — 27 — ( 27 ) — — — Cash dividends declared and paid on common stock ( $ 0.07 per share) — — — — — ( 1,533 ) — ( 1,533 ) BALANCE AT MARCH 31, 2023 22,209,347 $ 222 $ 129,156 $ ( 2,778 ) $ ( 2,039 ) $ 131,762 $ ( 23,101 ) $ 233,222 Net income — — — — — 2,763 — 2,763 Comprehensive loss — — — — — — ( 123 ) ( 123 ) Common stock held by ESOP committed to be released ( 74,993 shares) — — 22 128 — — — 150 Share-based compensation - equity incentive plan — — — — 300 — — 300 Repurchase of common stock ( 126,944 ) ( 1 ) ( 785 ) — — — — ( 786 ) Cash

financial statements

financial statements. (1) Represents gross transition adjustment amount of $ 13,000 , net of taxes of $ 4,000 , to reflect the cumulative impact on retained earnings pursuant to the Company's adoption of Accounting Standards Update ("ASU") 2016-13 Financial Instruments-Credit Losses on Financial Instruments and relevant amendments. 5 WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED (Dollars in thousands) Six Months Ended June 30, 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 6,474 $ 8,067 Adjustments to reconcile net income to net cash (used in) provided by operating activities: (Reversal of) provision for credit losses ( 844 ) 32 Depreciation and amortization of premises and equipment 1,110 1,110 (Accretion) amortization of purchase accounting adjustments, net ( 51 ) 77 Amortization of core deposit intangible 188 188 Net amortization of premiums and discounts on securities and mortgage loans 585 661 Net amortization of deferred costs on mortgage loans 219 232 Net amortization of premiums on subordinated debt 19 19 Share-based compensation expense 823 829 ESOP expense 283 330 Net change in unrealized gains on marketable equity securities ( 12 ) — Loss on disposal of premises and equipment, net 6 — Income from bank-owned life insurance ( 955 ) ( 934 ) Net change in: Accrued interest receivable ( 209 ) 328 Other assets ( 936 ) ( 3,549 ) Other liabilities ( 3,565 ) ( 9,124 ) Net cash provided by (used in) operating activities 3,135 ( 1,734 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of securities held-to-maturity ( 1,100 ) — Proceeds from calls, maturities, and principal collections of securities held-to-maturity 6,633 7,055 Purchases of securities available-for-sale ( 9,367 ) — Proceeds from calls, maturities, and principal collections of securities available-for-sale 8,446 6,069 Proceeds fro

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