GREENFIELD, Wis., Dec. 8, 2023
/PRNewswire/ -- 1895 Bancorp of Wisconsin, Inc. (the "Company") (NASDAQ
Capital Market: BCOW), the holding company for PyraMax Bank, FSB,
announced today the completion of a second balance sheet
repositioning strategy related to its investment securities
portfolio.
The Company executed the sale of $28.1
million in book value of its lower-yielding investment
securities for a pre-tax realized loss of approximately
$2.7 million. These securities were
classified as available-for-sale. Proceeds from the sale of these
securities of $25.4 million
were redeployed into approximately $28.7 million of U.S. government sponsored
mortgage-backed securities, which were classified as
available-for-sale upon purchase. The purchased securities have a
positive spread differential of approximately 345 basis points over
the securities that were sold, which is expected to result in
$1.0 million in additional pre-tax
earnings, on an annualized basis. The Company estimates that the
loss on the sale of securities will be recouped within
approximately 2.76 years. The effective duration of the securities
sold was 3.6 years, while the effective duration of the securities
purchased is 1.8 years.
The loss on the sale of securities has a neutral impact on
shareholders' equity and the Company's book value per share. Upon
execution of the repositioning strategy, PyraMax Bank's
capital levels remain well in excess of those required to be
categorized as well-capitalized. This repositioning is projected to
be accretive to earnings, net interest margin and return on assets
in future periods, and to provide the Company with greater
flexibility in managing balance sheet growth.
Forward Looking Statements
Certain statements herein constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements may be identified by words such as
"believes," "will," "expects," "project," "may," "could,"
"developments," "strategic," "launching," "opportunities,"
"anticipates," "estimates," "intends," "plans," "targets" and
similar expressions. These statements are based upon the current
beliefs and expectations of the Company's management and are
subject to significant risks and uncertainties. Actual results may
differ materially from those set forth in the forward-looking
statements as a result of numerous factors. Factors that could
cause such differences to exist include, but are not limited to,
general economic conditions, changes in interest rates, regulatory
considerations, and competition and the other risks described in
the Company's Annual Report on Form 10-K and Quarterly Reports on
Form 10-Q as filed with the Securities and Exchange Commission.
Should one or more of these risks materialize or should underlying
beliefs or assumptions prove incorrect, the Company's actual
results could differ materially from those discussed. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this release. We
assume no obligation to update any of these statements in light of
new information, future events or otherwise unless required under
federal securities laws.
Contact: David R. Ball
Telephone: (414) 421-8200
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SOURCE PyraMax Bank / 1895 Bancorp of Wisconsin Inc.
