 MOUNTLAKE TERRACE, Wash., July 23, 2020 GLOBE NEWSWIRE -- FS Bancorp, Inc. NASDAQ:FSBW the Company, the holding company for 1st Security Bank of Washington the Bank today reported 2020 second quarter net income of 10.0 million, or 2.30 per diluted share, compared to 4.5 million, or 0.98 per diluted share for the same period last year. During the last eight years of significant growth, we focused on maintaining diversified revenue streams through challenging economic environments. The results of the second quarter reflect our diversified strategy and commitment to long-term shareholder value as we surpassed the 2 billion in assets mark this quarter, stated Joe Adams, CEO. We are also pleased to announce that our Board of Directors has approved our thirtieth consecutive quarterly cash dividend. The quarterly dividend of 0.21 will be paid on August 20, 2020, to shareholders of record as of August 6, 2020.Updated response to the novel coronavirus of 2019 COVID-19 pandemic: The Company is following the Federal Housing Finance Agency guidelines for forbearance, foreclosure relief, and late payment reporting for the COVID-19 pandemic on all serviced loans and a modified format for portfolio loans. For portfolio loans, the primary method of relief is to allow the borrower up to 90-days of interest only payments andor loan payment deferments, and, on a more limited basis waived interest, late fees or interest only loan payments and suspended foreclosure proceedings. During the first and second quarters of 2020, the Company has provided relief to portfolio held for investment loans impacted by COVID-19 in the amount of 103.6 million. As of June 30, 2020, the amount of loans remaining under paymentrelief agreements includes commercial real estate loans of 53.0 million, commercial business loans of 24.1 million, portfolio one-to-four-family loans of 18.8 million, and consumer loans of 4.0 million. Additional detail is provided below in the Credit Quality discussion.During the second quarter, the Company participated in the U.S. Small Business Administrations SBA Paycheck Protection Program PPP. For borrowers in the communities we serve, the Company has funded 463 PPP loans totaling 75.3 million as of June 30, 2020.All of our branches are open, with the exception of one branch which is operating through the drive-up window and accepting customer appointments. The majority of our employees continue to work remotely, where feasible.2020 Second Quarter Highlights Net income was 10.0 million for the second quarter of 2020, compared to 5.2 million in the previous quarter, and 4.5 million for the same quarter one year ago; In response to the COVID-19 pandemic and its continued adverse economic impact, the provision for loan losses increased to 4.6 million, compared to 3.7 million in the previous quarter, and 910,000 for the same quarter one year ago; Total gross loans increased 57.0 million during the quarter to 1.47 billion at June 30, 2020, compared to 1.41 billion at March 31, 2020, and 1.30 billion at June 30, 2019; The allowance for loan and lease losses ALLL to gross loans receivable excluding loans held for sale HFS for the second quarter of 2020 was 1.47, up from 1.20 in the previous quarter and 0.95 for the same quarter one year ago. The adjusted ALLL to gross loans receivable, excluding loans HFS and PPP loans, was 1.54 See Non-GAAP Financial Measures; Total deposits increased 160.6 million during the quarter, including an increase of 71.2 million in relationship-based transactional deposits noninterest-bearing checking, interest-bearing checking, and escrow accounts, mostly due to managements focus on deposit mix and increases in PPP funds; The Company repurchased 87,155 shares of its common stock during the quarter ended June 30, 2020, at an average price per share of 37.62; and The Banks Community Bank Leverage Ratio CBLR was 10.8 at June 30, 2020.Asset SummaryTotal assets increased 161.6 million, or 8.7, to 2.01 billion at June 30, 2020, compared to 1.85 billion at March 31, 2020, and increased 367.7 million, or 22.4, from 1.64 billion at June 30, 2019. The quarter over linked quarter increase in total assets was primarily due to increases in total cash and cash equivalents of 77.2 million, loans receivable, net of 51.4 million, loans HFS of 23.8 million, and securities available-for-sale of 12.2 million, partially offset by a decrease in Federal Home Loan Bank FHLB stock of 3.3 million. Year over year increases in total assets included increases in loans receivable, net of 162.3 million, loans HFS of 72.9 million, securities available-for-sale of 72.5 million, and total cash and cash equivalents of 66.5 million, partially offset by a decrease in certificates of deposit CDs at other financial institutions of 6.4 million.The Bank sold 9.2 million of securities available-for-sale during the second quarter of 2020 realizing a gain of 182,000. The Bank sold these securities to reduce portfolio duration and sell lower yielding mortgage-backed security investments that had been in a loss position over 12 months. The proceeds were allocated to term investments including municipal bonds and agency-backed securities. Dollars in thousands June 30, 2020 March 31, 2020 June 30, 2019 Amount Percent Amount Percent Amount Percent REAL ESTATE LOANS Commercial 222,265 15.1 220,509 15.6 206,834 16.0 Construction and development 183,029 12.5 168,658 12.0 214,140 16.5 Home equity 35,082 2.4 37,503 2.7 36,860 2.8 One-to-four-family excludes HFS 295,220 20.1 305,436 21.6 248,921 19.2 Multi-family 132,329 9.0 130,570 9.2 103,219 8.0 Total real estate loans 867,925 59.1 862,676 61.1 809,974 62.5 CONSUMER LOANS Indirect home improvement 264,781 18.0 261,566 18.5 232,844 17.9 Marine 76,893 5.2 69,473 4.9 66,064 5.1 Other consumer 3,647 0.3 4,056 0.3 4,875 0.4 Total consumer loans 345,321 23.5 335,095 23.7 303,783 23.4 COMMERCIAL BUSINESS LOANS Commercial and industrial 213,961 14.6 149,086 10.6 135,336 10.5 Warehouse lending 41,701 2.8 65,017 4.6 47,028 3.6 Total commercial business loans 255,662 17.4 214,103 15.2 182,364 14.1 Total loans receivable, gross 1,468,908 100.0 1,411,874 100.0 1,296,121 100.0 Allowance for loan losses 21,524 16,872 12,340 Deferred costs and fees, net 4,231 3,425 2,940 Premiums on purchased loans, net 1,272 1,493 1,278 Total loans receivable, net 1,444,425 1,393,070 1,282,119 Loans receivable, net increased 51.4 million to 1.44 billion at June 30, 2020, from 1.39 billion at March 31, 2020, and increased 162.3 million from 1.28 billion at June 30, 2019. The quarter over linked quarter increase in total real estate loans was 5.2 million, including increases in construction and development loans of 14.4 million, multi-family loans and commercial real estate loans both of 1.8 million, partially offset by decreases in one-to-four-family portfolio loans of 10.2 million and home equity loans of 2.4 million. Consumer loans increased 10.2 million, primarily due to an increase of 7.4 million in marine loans and 3.2 million in indirect home improvement loans. Commercial business loans increased 41.6 million, primarily due to an increase in commercial and industrial loans of 64.9 million, partially offset by reductions in warehouse lending of 23.3 million. The increase in commercial and industrial loans was primarily due to the origination of 75.3 million of PPP loans.One-to-four-family loans originated through the home lending segment, which includes loans HFS, loans held for investment, fixed rate seconds, and loans brokered to other institutions, were 478.4 million during the quarter ended June 30, 2020, an increase of 192.8 million, or 67.5, compared to 285.6 million for the preceding quarter. During the quarter ended June 30, 2020, the Company sold 427.0 million of one-to-four-family loans compared to sales of 212.4 million during the previous quarter, and sales of 173.4 million during the same quarter one year ago. During the six months ended June 30, 2020, the Company sold 639.4 million of one-to-four-family loans compared to sales of 304.3 million during the same period last year. Refinance activity increased significantly over the last year in response to decreases in market interest rates.Originations of one-to-four-family loans to purchase and to refinance a home for the three and six months ended June 30, 2020 and 2019 were as follows: Dollars in thousands For the Three Months Ended For the Three Months Ended Year Year June 30, 2020 June 30, 2019 over Year over Year Amount Percent Amount Percent Change Change Purchase 143,060 29.9 142,115 68.3 945 0.7 Refinance 335,333 70.1 65,841 31.7 269,492 409.3 Total 478,393 100.0 207,956 100.0 270,437 130.0 For the Six Months Ended For the Six Months Ended Year Year June 30, 2020 June 30, 2019 over Year over Year Amount Percent Amount Percent Change Change Purchase 257,712 33.7 247,708 70.4 10,004 4.0 Refinance 506,283 66.3 103,996 29.6 402,287 386.8 Total 763,995 100.0 351,704 100.0 412,291 117.2 Liabilities and Equity SummaryTotal deposits increased 160.6 million to 1.61 billion at June 30, 2020, compared to 1.45 billion at March 31, 2020, and increased 272.7 million from 1. 