Chesapeake Financial Shares Inc (OTCQX:CPKF), the parent of Chesapeake Bank and Chesapeake Wealth Management, said that asset growth and a strong mortgage market helped it post record earnings for the 2020 calendar year, leading it to increase its quarterly dividend.
Despite the challenges of the pandemic, last year to end-December, earnings came in at $11,749,391, which was a 3.1% increase compared to 2019. Fully diluted earnings per share (EPS) were $2.395 as against $2.292 in 2019, said Cheseapeake Financial.
READ: Chesapeake Bank reports 3Q earnings of $3.38M for a 4.8% year-over-year increase
"We have worked diligently over the last 25+ years to diversify our revenue stream and this is reflected in our earnings," said the chief executive and chairman Jeffrey M. Szyperski in a statement.
"A strong mortgage market as well as record-breaking asset growth were the primary contributors to the record-breaking year.
"Of the roughly $3 million in Paycheck Protection Program fees earned, only $770,000 were recognized into income in 2020. In addition to our strong earnings, American Banker named us one of the ‘Top 200 Community Banks' in the United States for the thirteenth consecutive year and one of the ‘Best Banks to Work For' for the eighth consecutive year," he added.
On January 22, the board agreed to increase the quarterly dividend to $0.130 a share with effect from March 1, this year, payable on or before March 15.
Chesapeake Financial Shares ended the year with total assets of $1,207,714,231, a 26% increase over year-end 2019.
"This large increase was largely fueled by economic stimulus and Paycheck Protection Program funds as part of the CARES Act," Szyperski continued.
"We strengthened our loan loss reserve in 2020, and it represented 1.34% of total loans (excluding PPP) at December 31, 2020. Nonperforming assets were 1.034% as of December 31, 2020 compared to 0.881% on December 31, 2019 representing a 17.4% increase. Given the level of economic disruption in 2020, we feel thankful for being able to maintain such strong asset quality," he added.
Founded in 1900, Chesapeake Bank is a lender to small businesses. Headquartered in Kilmarnock, Virginia, it operates 16 community banks in the Northern Neck, Middle Peninsula, Williamsburg and Richmond region.
Chesapeake Wealth Management Inc is an independent wealth management firm offering brokerage, trust, and estate management services.
Contact the author at giles@proactiveinvestors.com