Chesapeake Financial Shares CEO Jeff Szyperski joins Natalie Stoberman from Proactive Studios to discuss the company's record earnings from 2022.
NATALIE STOBERMAN Welcome to a Proactive Studios. I’m Natalie Stoberman joined by the CEO of Chesapeake Financial Shares. Jeff Szyperski. Jeff, thank you for joining us.
JEFF SZYPERSKI My pleasure, Natalie, nice to be with you.
NATALIE STOBERMAN As always, and we get to talk about earnings today. What are the big numbers from the 2022 earnings from Chesapeake Bank this past year?
JEFF SZYPERSKI Sure. We had a record year in 2022. Natalie, it was great. We ended up about 17% over the prior year, which was also a record year. Part of that was a partially attributable to a one-time gain on the sale of a minority interest in a investment brokerage house… about 1.7 of it. But it was an excellent year for us, we were very pleased, especially with all the rate increases.
NATALIE STOBERMAN Yes, having a record year, especially during a very volatile markets is quite the accomplishment. How’s the bank, or how's the company been able to achieve this growth, despite the volatility?
JEFF SZYPERSKI You know, not dissimilar to a lot of other banks in our industry, Natalie. We had a fair amount of excess liquidity that accumulated during the pandemic. And so, we were able to hold fast on our deposit rates despite the Fed rate increases, and there was a trickle up in lending rates. And so, our margin expanded. We ended the fourth quarter with a 3.93% margin, which is very high. So that that was a big contributor to our record earnings also.
NATALIE STOBERMAN And when it comes to dividends, the company has been able to maintain rising dividends over the past 30 years. How does that tie into another record year?
JEFF SZYPERSKI Well, for us, Natalie, you know, we we've really focused on our earnings, you know, we have a dividend policy that targets a certain percentage of our net income. And with our net income consistently increasing year over year that has afforded us the ability to increase our dividends every year, we do think that’s … what we do is for the shareholders, it’s the shareholders’ money.
And so, we like to give that back. So, we did not increase our dividend this quarter. But this is only the third quarter, we've gone since our last increase. So, no telling where 2023 will take us, but we hope to continue that trend.
NATALIE STOBERMAN As do we and the cherry on top is sort of getting some recognition from some top magazines in the country to be one of the Best Banks to Work For, and also one of the Top Community Banks. How does that add some validation to a record year?
JEFF SZYPERSKI Yeah, the Top 200 Community Banks in the country is based on a three-year rolling return on average equity, American Banker Magazine, they do this survey. And we've made that for the last 15 years consecutively. So we're… I think our focus on return on equity is emblematic of how we feel like we represent our shareholders well. The Best Banks to Work For … we've been on that list for American Banker the last 10 years consecutively. And that just as the work environment, that's really the secret sauce that helps us do our earnings.
You know, we pay a lot of attention to making a good work environment for our employees, we train them well, and in turn, they treat our customers well. So it's, it works well. They those two tie directly together to each other, not even in a tangential sense, but in a very direct sense.
NATALIE STOBERMAN Well, Jeff, it's always good to talk about good news. And we thank you so much for stopping by.
JEFF SZYPERSKI Natalie, thank you so much. It's been my pleasure.
NATALIE STOBERMAN Again, the CEO of Chesapeake Financial Shares, Jeff Szyperski.
