UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number 0-33203

LANDMARK BANCORP, INC.

(Exact name of registrant as specified in its charter)

Delaware	43-1930755
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

701 Poyntz Avenue, Manhattan, Kansas 66502

(Address of principal executive offices) (Zip code)

(785) 565-2000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:	Trading Symbol(s)	Name of exchange on which registered:
Common Stock, par value $0.01 per share	LARK	Nasdaq Global Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: as November 12, 2024, the issuer had outstanding 5,501,221 shares of its common stock, $0.01 par value per share.

LANDMARK BANCORP, INC.

Form 10-Q Quarterly Report

Table of Contents

		Page Number
	PART I
Item 1.	Financial Statements	2 - 25
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26 – 35
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	34 – 35
Item 4.	Controls and Procedures	35
	PART II
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 3.	Defaults Upon Senior Securities	36
Item 4.	Mine Safety Disclosures	36
Item 5.	Other Information	36
Item 6.	Exhibits	37
	Signature Page	38

1

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LANDMARK BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share amounts)	September 30,			December 31,
	2024			2023
	(Unaudited)
Assets
Cash and cash equivalents	$	21,211		$	27,101
Interest-bearing deposits at other banks		4,363			4,918
Investment securities available-for-sale, at fair value		411,012			452,769
Investment securities, held-to-maturity, net of allowance for credit losses of $91 and $91,fair value of $3,131 and $3,049		3,643			3,555
Bank stocks, at cost		7,894			8,123
Loans, net of allowance for credit losses of $11,544 and $10,608		990,242			937,619
Loans held for sale, at fair value		3,250			853
Bank owned life insurance		39,176			38,333
Premises and equipment, net		20,976			19,709
Goodwill		32,377			32,377
Other intangible assets, net		2,729			3,241
Mortgage servicing rights		3,041			3,158
Real estate owned, net		428			928
Accrued interest and other assets		23,309			28,988
Total assets	$	1,563,651		$	1,561,672
Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Non-interest-bearing demand	$	360,188		$	367,103
Money market and checking		565,629			613,613
Savings		145,825			152,381
Certificates of deposit		203,860			183,154
Total deposits		1,275,502			1,316,251
Federal Home Loan Bank and other borrowings		92,050			64,662
Subordinated debentures		21,651			21,651
Repurchase agreements		9,528			12,714
Accrued interest and other liabilities		25,229			19,480
Total liabilities		1,423,960			1,434,758
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value per share, 200,000 shares authorized; none issued		-			-
Common stock, $0.01 par value per share, 7,500,000 shares authorized; 5,522,582 and 5,481,407 shares issued at September 30, 2024 and December 31, 2023, respectively		55			55
Additional paid-in capital		89,532			89,208
Retained earnings		60,549			54,282
Treasury stock, at cost; 21,361 and 3,812 shares at September 30, 2024 and December 31, 2023, respectively		(396	)		(75	)
Accumulated other comprehensive loss		(10,049	)		(16,556	)
Total stockholders’ equity		139,691			126,914
Total liabilities and stockholders’ equity	$	1,563,651		$	1,561,672

See accompanying notes to consolidated financial statements.

2

LANDMARK BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

	Three months ended				Nine months ended
(Dollars in thousands, except per share amounts)	September 30				September 30
	2024		2023		2024		2023
Interest income:
Loans	$	15,933	$	13,531	$	45,445	$	37,530
Investment securities:
Taxable		2,301		2,445		7,088		7,141
Tax-exempt		747		772		2,270		2,333
Interest-bearing deposits at banks		41		46		144		193
Total interest income		19,022		16,794		54,947		47,197
Interest expense:
Deposits		5,830		4,384		16,960		10,375
Federal Home Loan Bank and other borrowings		1,100		1,251		3,149		2,845
Subordinated debentures		416		417		1,246		1,168
Repurchase agreements		72		116		267		403
Total interest expense		7,418		6,168		21,622		14,791
Net interest income		11,604		10,626		33,325		32,406
Provision for credit losses		500		-		800		299
Net interest income after provision for credit losses		11,104		10,626		32,525		32,107
Non-interest income:
Fees and service charges		2,880		2,618		8,032		7,457
Gains on sales of loans, net		704		491		1,864		2,014
Increase in cash surrender value of bank owned life insurance		254		230		747		671
Other		415		313		730		834
Total non-interest income		4,253		3,652		11,373		10,976
Non-interest expense:
Compensation and benefits		5,803		5,811		16,839		16,925
Occupancy and equipment		1,429		1,373		4,113		4,136
Data processing		464		458		1,437		1,478
Amortization of mortgage servicing rights and other intangibles		256		474		924		1,407
Professional fees		573		624		1,869		1,722
Other		2,034		1,989		7,023		5,753
Total non-interest expense		10,559		10,729		32,205		31,421
Earnings before income taxes		4,798		3,549		11,693		11,662
Income tax expense		867		671		1,972		2,065
Net earnings	$	3,931	$	2,878	$	9,721	$	9,597
Earnings per share:
Basic (1)	$	0.72	$	0.53	$	1.77	$	1.75
Diluted (1)	$	0.72	$	0.52	$	1.77	$	1.75
Dividends per share (1)	$	0.21	$	0.20	$	0.63	$	0.60

(1) Per share amounts for the periods ended September 30, 2023 have been adjusted to give effect to the 5% stock dividend issued in December of 2023.

See accompanying notes to consolidated financial statements.

3

LANDMARK BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

	Three months ended						Nine months ended
(Dollars in thousands)	September 30,						September 30,
	2024			2023			2024			2023
Net earnings	$	3,931		$	2,878		$	9,721		$	9,597
Other comprehensive income (loss):
Net unrealized holding (losses) gains on available-for-sale securities		11,477			(12,810	)		8,618			(9,639	)
Income tax effect on net unrealized holding losses (gains)		(2,812	)		3,139			(2,111	)		2,362
Other comprehensive income (loss) gains		8,665			(9,671	)		6,507			(7,277	)
Total comprehensive income (loss)	$	12,596		$	(6,793	)	$	16,228		$	2,320

See accompanying notes to consolidated financial statements.

4

LANDMARK BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands, except per share amounts)	Common stock		Additional paid-in capital		Retained earnings			Treasury stock			Accumulated other comprehensive income (loss)			Total
Balance at July 1, 2023	$	52	$	84,475	$	55,498		$	-		$	(22,672	)	$	117,353
Net earnings		-		-		2,878			-			-			2,878
Other comprehensive income (loss)		-		-		-			-			(9,671	)		(9,671	)
Dividends paid ($0.20 per share) (1)		-		-		(1,096	)		-			-			(1,096	)
Issue of restricted common stock, 17,551 shares		-		-		-			-			-			-
Stock-based compensation		-		93		-			-			-			93
Balance at September 30, 2023	$	52	$	84,568	$	57,280		$	-		$	(32,343	)	$	109,557
Balance at July 1, 2024	$	55	$	89,469	$	57,774		$	(330	)	$	(18,714	)	$	128,254
Net earnings		-		-		3,931			-			-			3,931
Other comprehensive income (loss)		-		-		-			-			8,665			8,665
Dividends paid ($0.21 per share)		-		-		(1,156	)		-			-			(1,156	)
Issuance of restricted common stock, 36,175 shares		-		-		-			-			-			-
Stock-based compensation		-		63		-			-			-			63
Purchase of 3,338 shares treasury stock		-		-		-			(66	)		-			(66	)
Balance at September 30, 2024	$	55	$	89,532	$	60,549		$	(396	)	$	(10,049	)	$	139,691

(1) Dividends per share have been adjusted to give effect to the 5% stock dividend issued in December of 2023.

(Dollars in thousands, except per share amounts)	Common stock		Additional paid-in capital		Retained earnings			Treasury stock			Accumulated other comprehensive income (loss)			Total
Balance at December 31, 2022	$	52	$	84,273	$	52,174		$	-		$	(25,066	)	$	111,433
Cumulative effect of change in accounting
principle from implementation of ASU 2016-3		-		-		(1,204	)		-			-			(1,204	)
Balance at January 1, 2023	$	52	$	84,273	$	50,970		$	-		$	(25,066	)	$	110,229
Net earnings		-		-		9,597			-			-			9,597
Other comprehensive income (loss)		-		-		-			-			(7,277	)		(7,277	)
Dividends paid ($0.60per share) (1)		-		-		(3,287	)		-			-			(3,287	)
Issue of restricted common stock, 17,551 shares		-		-		-			-			-			-
Stock-based compensation		-		243		-			-			-			243
Exercise of stock options, 2,693 shares		-		52		-			-			-			52
Balance at September 30, 2023	$	52	$	84,568	$	57,280		$	-		$	(32,343	)	$	109,557
Balance at January 1, 2024	$	55	$	89,208	$	54,282		$	(75	)	$	(16,556	)	$	126,914
Net earnings		-		-		9,721			-			-			9,721
Other comprehensive income (loss)		-		-		-			-			6,507			6,507
Dividends paid ($0.63 per share)		-		-		(3,454	)		-			-			(3,454	)
Issuance of restricted common stock, 41,175 shares		-		-		-			-			-			-
Stock-based compensation		-		324		-			-			-			324
Purchase of 16,367 shares treasury stock		-		-		-			(321	)		-			(321	)
Balance at September 30, 2024	$	55	$	89,532	$	60,549		$	(396	)	$	(10,049	)	$	139,691

(1) Dividends per share have been adjusted to give effect to the 5% stock dividend issued in December of 2023.

See accompanying notes to consolidated financial statements.

5

LANDMARK BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine months ended
(Dollars in thousands)	September 30,
	2024			2023
Cash flows from operating activities:
Net earnings	$	9,721		$	9,597
Adjustments to reconcile net earnings to net cash provided by operating activities:
Provision for credit losses		800			299
Valuation allowance on real estate held for sale		1,108			-
Amortization of investment security premiums, net		(18	)		221
Accretion of purchase accounting adjustments		(850	)		(750	)
Amortization of mortgage servicing rights and other intangibles		924			1,407
Depreciation		987			936
Increase in cash surrender value of bank owned life insurance		(747	)		(671	)
Stock-based compensation		324			243
Deferred income taxes		(177	)		7
Net loss on sales of premises and equipment and foreclosed assets		282			-
Net gains on sales of loans		(1,864	)		(2,014	)
Proceeds from sales of loans		64,500			69,747
Origination of loans held for sale		(65,328	)		(67,472	)
Changes in assets and liabilities:
Accrued interest and other assets		(183	)		(625	)
Accrued expenses, taxes, and other liabilities		5,849			445
Net cash provided by operating activities		15,328			11,370
Cash flows from investing activities:
Net increase in loans		(52,761	)		(86,015	)
Net change in interest-bearing deposits at banks		555			3,166
Maturities and prepayments of investment securities		54,193			41,250
Purchases of investment securities		(3,800	)		(18,647	)
Redemption of bank stocks		11,956			8,564
Purchase of bank stocks		(11,727	)		(11,103	)
Premiums paid on bank owned life insurance		(96	)		(96	)
Proceeds from sales of premises and equipment and foreclosed assets		2,998			-
Purchases of premises and equipment, net		(2,214	)		(520	)
Net cash used in investing activities		(896	)		(63,401	)
Cash flows from financing activities:
Net (decrease) increase in deposits		(40,749	)		7,374
Federal Home Loan Bank advance borrowings		595,463			560,546
Federal Home Loan Bank advance repayments		(567,077	)		(494,179	)
Proceeds from other borrowings		360			-
Repayments on other borrowings		(1,358	)		(998	)
Change in repurchase agreements		(3,186	)		(16,812	)
Proceeds from exercise of stock options		-			52
Payment of dividends		(3,454	)		(3,287	)
Purchase of treasury stock		(321	)		-
Net cash (used in) provided by financing activities		(20,322	)		52,696
Net (decrease) increase in cash and cash equivalents		(5,890	)		665
Cash and cash equivalents at beginning of period		27,101			23,156
Cash and cash equivalents at end of period	$	21,211		$	23,821

(Continued)

6

LANDMARK BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED

(Unaudited)

	Nine months ended
(Dollars in thousands)	September 30,
	2024		2023
Supplemental disclosure of cash flow information:
Cash payments for income taxes	$	628	$	-
Cash paid for interest		21,371		13,641
Cash paid for operating leases		128		118

See accompanying notes to consolidated financial statements.

7

LANDMARK BANCORP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Interim Financial Statements

The unaudited consolidated financial statements of Landmark Bancorp, Inc. (the “Company”) and its wholly owned subsidiaries, Landmark National Bank (the “Bank”) and Landmark Risk Management Inc., have been prepared in accordance with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements and should be read in conjunction with the Company’s most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 27, 2024, containing the latest audited consolidated financial statements and notes thereto. The consolidated financial statements in this report have not been audited by an independent registered public accounting firm, but in the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of financial statements have been reflected herein. The results of the three and nine month interim period ended September 30, 2024 are not necessarily indicative of the results expected for the year ending December 31, 2024 or any other future time period. The Company has evaluated subsequent events for recognition and disclosure up to the date the financial statements were issued.

2. Investments

A summary of the Company’s investment securities classified as available-for-sale and held-to-maturity as of September 30, 2024 and December 31, 2023 is as follows:

(Dollars in thousands)	As of September 30, 2024
			Gross		Gross
	Amortized		unrealized		unrealized			Estimated
	cost		gains		losses			fair value
Available-for-sale:
U. S. treasury securities	$	85,457	$	1	$	(1,705	)	$	83,753
Municipal obligations, tax exempt		114,184		94		(2,152	)		112,126
Municipal obligations, taxable		76,753		723		(2,347	)		75,129
Agency mortgage-backed securities		147,928		421		(8,345	)		140,004
Total available-for-sale	$	424,322	$	1,239	$	(14,549	)	$	411,012
Held-to-maturity:
Other	$	3,643	$	-	$	(512	)	$	3,131
Total held-to-maturity	$	3,643	$	-	$	(512	)	$	3,131

	As of December 31, 2023
			Gross		Gross
	Amortized		unrealized		unrealized			Estimated
	cost		gains		losses			fair value
Available-for-sale:
U. S. treasury securities	$	99,340	$	-	$	(3,673	)	$	95,667
Municipal obligations, tax exempt		122,775		186		(2,338	)		120,623
Municipal obligations, taxable		82,926		225		(4,068	)		79,083
Agency mortgage-backed securities		169,656		247		(12,507	)		157,396
Total available-for-sale	$	474,697	$	658	$	(22,586	)	$	452,769
Held-to-maturity:
Other	$	3,555	$	-	$	(506	)	$	3,049
Total held-to-maturity	$	3,555	$	-	$	(506	)	$	3,049

The amortized cost of the above held-to-maturity investment securities has been further reduced by the allowance for credit losses of $91,000 at both September 30, 2024 and December 31, 2023.

8

The tables above show that some of the securities in the Company’s available-for-sale and held-to-maturity investment portfolios had unrealized losses, or were temporarily impaired, as of both September 30, 2024 and December 31, 2023. This temporary impairment represents the estimated amount of loss that would be realized if the securities were sold on the valuation date.

The following table summarizes available-for-sale securities in an unrealized loss position for which an allowance for credit losses has not been recorded at September 30, 2024 and December 31, 2023 along with the length of time each category of securities has been in a continuous loss position:

			As of September 30, 2024
(Dollars in thousands)			Less than 12 months				12 months or longer		Total
	No. of		Fair		Unrealized		Fair	Unrealized	Fair	Unrealized
	securities		value		losses		value	losses	value	losses
Available-for-sale:
U.S. treasury securities		45	$	1,764	$	(