Guaranty's earnings hampered by loan loss provision

Guaranty Federal Bancshares Inc.'s (Nasdaq: GFED) third quarter net income dropped as the company posted a higher provision for loan losses.

President and CEO Shaun Burke said the provision increase was "in response to the current economic climate," according to a news release. The provision, which anticipates future loan modifications and deferrals, grew 89% to $950,000 from $100,000 a year earlier.

The Guaranty Bank operator reported quarterly profits of $1.9 million, or 44 cents per diluted share, compared with $2.6 million, or 57 cents per share, a year earlier.

"The buzzword of a new normal is being embraced by the bank as we continue to adapt to virtual meetings, local health guidelines and segments of unknowns in the overall economy," Burke said in the release.

Among the company's quarterly highlights, Guaranty Bank in July completed a $20 million debt offering.

Guaranty had $1.1 billion in assets and $926.9 million in deposits as of Sept. 30, according to the release. The company held $750 million in Springfield metropolitan statistical area deposits as of June 30, equating to a 5.6% market share, according to Federal Deposit Insurance Corp. data.

GFED shares were trading at $14.50 as of 10 a.m., compared with a 52-week range of $12.70 to $26.93.