Hoosier Banker 35 of tangible book value and 12.1 times LTM earnings as of July 31, 2022. Based on second-quarter earnings releases, banks are generally experiencing strong earnings as a result of improved net interest income which more than offset reduced mortgage fee income. The improvement in net interest margins is the result of robust nonresidential loan demand and Federal Reserve actions to raise interest rates to stem high inflation. Higher interest rates, however, have lowered the value of investments portfolios and other financial assets, some of which negatively impacted capital ratios. Most banks are enjoying low charge-off and nonperforming loan ratios. This may be due in part to U.S. unemployment figures, which remain low despite continuing supply chain disruptions and high fuel and food costs. More broadly, the stock market is expected to remain volatile as investors weigh uncertainty on many fronts, including: the depth, length and breadth of a recession; actual and potential international wars and their impact on energy and other key supply chains; the outcome of the midterm elections on U.S. tax, regulatory and other domestic policies; and the lingering impact of the pandemic and other health issues. As of this writing, all announced merger and acquisition transactions involving Indiana-based banks have been completed. HB StockAnalysis Review as of July 31, 2022 INDIANA BANK & THRIFT STOCK UPDATE Michael A. Renninger Principal Renninger & Associates LLC mrenninger@ renningerllc.com Renninger & Associates LLC is a Diamond Associate Member of the Indiana Bankers Association. Securities offered through Ausdal Financial Partners Inc. Member FINRA/SIPC. 5187 Utica Ridge Road, Davenport IA 52807 563-326-2064. Renninger & Associates and Ausdal Financial Partners Inc. are separately owned and operated. Indiana Statistics Click on the hand icon in HB Digital to access statistics through July 31, June 30 and May 31, 2022, or visit: indiana.bank/bank-thriftstock-update. The Size, Pricing and Profitability Reports for Indiana Banks and Thrifts as of July 31, June 30 and May 31, 2022, are available by clicking on the icon on this page in HB Digital or by visiting the designated website location. These reports present the stock price changes for the 29 Indiana banks and thrifts that are traded on the NASDAQ and Over-The-Counter markets over the prior two years, one year and year-to-date, in addition to pricing and performance metrics. Selected banks headquartered outside Indiana, four broad market indices, and four bank and thrift indices are also tracked. The broad indices declined an average of 14.5% YTD, and the bank indices declined an average of 16.4% YTD as of July 31, 2022. In comparison, Indiana’s NASDAQ-traded banks are down a median of 8.5% YTD, while Indiana’s OTC/Pink Sheet-listed banks are down 7.6% YTD. Despite the current year performance, the broad and bank indices are up an average of 22.7% and 46.1%, respectively over the two-year time horizon. Indiana’s NASDAQ-traded banks are up a median of 38.5%, and Indiana’s OTC/Pink Sheet-listed banks are up 26.3% over the same period. Indiana’s NASDAQ-listed banks are trading at a median multiple of 153.5% of tangible book value and 10.3 times earnings, and OTC/Pink Sheet-listed banks are trading at a median multiple of 119.9% of tangible book value and 8.5 times earnings as of July 31, 2022. In comparison, the six selected banks headquartered outside Indiana with assets over $100 billion are trading at a median multiple of 195.9% of tangible book value and 9.9 times LTM earnings, while the eight selected banks headquartered outside Indiana with assets under $100 billion are trading at a median multiple of 169.2%
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