First Community Financial Partners, Inc. Announces Fourth Quarter 2016 Financial Results
Fourth Quarter 2016 Highlights
- Diluted earnings per share (“EPS”) of $0.15
- Asset growth of $21.6 million, or 1.73%, from the end of the third quarter of 2016
- Loan growth of $34.7 million, or 3.62%, from the end of the third quarter of 2016
- Deposit growth of $17.9 million, or 1.68%, from the end of the third quarter of 2016
- Noninterest bearing deposits increase of $1.6 million, or 0.65%, from the end of the third quarter of 2016
JOLIET, Ill., Jan. 23, 2017 (GLOBE NEWSWIRE) — First Community Financial Partners, Inc. (NASDAQ:FCFP) (“First Community,” “FCFP” or the “Company”), the parent company of First Community Financial Bank (the “Bank”), today reported financial results as of and for the three and twelve months ended December 31, 2016.
Net income applicable to shareholders for the quarter ended December 31, 2016 was $2.7 million, or $0.15 per diluted share, compared with $2.9 million, or $0.17 per diluted share, for the quarter ended December 31, 2015. Financial results for the fourth quarter of 2015 were positively impacted by a negative provision for credit losses of $515,000. Pre-tax, pre-provision core income was $4.3 million in the fourth quarter of 2016, an increase of 11.29% from $3.8 million in the same period of the prior year.
“We delivered a strong performance in the fourth quarter, driven by positive trends in revenue, operating efficiencies and asset quality,” said Roy Thygesen, Chief Executive Officer of First Community.
“We had another strong quarter of business development, resulting in organic loan growth of 15% on an annualized basis. We are generating well balanced loan production and seeing solid growth across all of our major lending areas.”
“We were able to create significant franchise value in 2016 through organic growth and the completion of our first acquisition. We intend to continue to execute on our core strategies in 2017, focusing on developing additional commercial banking relationships with small- and middle-market companies and exploring other acquisitions in our existing footprint that can strengthen our core deposit base. We anticipate another year of double-digit organic loan growth, increased operating efficiencies, and stable credit quality in 2017, resulting in further improvement in our overall level of profitability and additional value being created for our shareholders,” said Mr. Thygesen.
Fourth Quarter 2016 Financial Results
Loans
At December 31, 2016, total loans were $991.6 million, an increase of $34.7 million, or 3.62%, since the end of the third quarter of 2016, and $219.3 million, or 28.39%, year-over-year. The loan growth was the result of a continued strong loan pipeline along with results produced by the addition of six commercial lenders and one new leasing officer hired during the first quarter of 2016.
Commercial loans grew $6.9 million, or 2.52%, since the end of the third quarter and $102.2 million, or 56.89%, year-over-year. Commercial real estate loans increased $6.0 million, or 1.42%, since the end of the third quarter and $44.9 million, or 11.78%, year-over-year. Residential real estate loans grew $8.6 million, or 5.13%, since the end of the third quarter and $40.1 million, or 29.53%, year-over-year. Construction loans were up $7.5 million, or 18.83%, since the third quarter and $25.3 million, or 114.37%, year-over-year.
Deposits and Other Borrowings
At December 31, 2016, total deposits were $1.1 billion, an increase of $17.9 million, or 1.68%, since the end of the third quarter and $217.2 million, or 25.08%, year-over-year.
Noninterest bearing demand deposits increased $1.6 million, or 0.65%, since the end of the third quarter and $51.8 million, or 26.42%, year-over-year. Interest bearing transactional accounts (NOW, savings and money market accounts) increased $28.1 million, or 5.85%, during the fourth quarter of 2016 and $136.0 million, or 36.52%, year-over-year. Time deposits decreased $11.8 million, or 3.48%, to $326.9 million at December 31, 2016, from $338.7 million at September 30, 2016, and increased $29.4 million, or 9.87%, year-over-year. The ratio of time deposits to interest bearing deposits was 39.13% at December 31, 2016, down from 41.35% at September 30, 2016.
Other borrowings increased $4.5 million, or 7.34%, since the end of the third quarter due to higher FHLB borrowings resulting from loan growth during the fourth quarter, partially offset by the payoff of our secured borrowings of $7.0 million during the quarter.
Net Interest Income and Margin
Fourth quarter 2016 net interest income was up $418,000, or 4.26%, from the third quarter of 2016. The increase was primarily attributable to an increase in average loan balances, partially offset by a lower net interest margin.
The Company’s net interest margin was 3.42% for the fourth quarter of 2016, compared to 3.40% in the third quarter of 2016. The increase was due to the effect of the prime rate increase in mid December 2016.
Noninterest Income and Expense
Fourth quarter 2016 noninterest income decreased $1.9 million, or 67.62%, from the third quarter of 2016 and increased $3.0 million, or 54.33%, from the year ended December 31, 2015. The decrease from the third quarter was primarily attributable to a $1.9 million bargain purchase option gain recorded in the third quarter related to the acquisition of Mazon State Bank.
Service charges on deposits decreased $4,000, or 1.38%, from the third quarter of 2016, which was primarily the result of a decrease in overdraft fees, partially offset by an increase in account analysis charges. Mortgage income was also up $45,000, or 26.63%, for the fourth quarter of 2016, compared to the third quarter, as a result of higher mortgage sale volumes.
Fourth quarter 2016 noninterest expense decreased $140,000, or 1.98%, from the third quarter of 2016 due to reduced data processing fees following the integration of Mazon State Bank, partially offset by increased incentive compensation expense.
Salaries and benefits expense increased $497,000, or 13.04%, from the third quarter 2016 due to increased incentive compensation expense, partially offset by cost savings from the integration of Mazon State Bank. Data processing fees decreased $433,000, or 61.86%, from the third quarter due to lower data processing conversion expenses following the integration of Mazon State Bank.
Asset Quality
Total nonperforming assets decreased $2.6 million, or 28.48%, to $6.6 million at December 31, 2016 from $9.2 million at September 30, 2016. The ratio of nonperforming assets to total assets was 0.52% at December 31, 2016 compared to 0.74% at September 30, 2016. The decrease was the result of the sale of $2.6 million in nonaccrual loans, $1.1 million in loans transferred to loans held for sale, and the charge-offs recorded in the quarter. This outflow was partially offset by new additions to nonaccrual loans.
The Company had net charge-offs on loans of $783,000 in the fourth quarter of 2016, compared to net charge-offs of $143,000 in the third quarter of 2016. The net charge-offs in the fourth quarter of 2016 primarily related to one loan relationship totaling $4.5 million that was placed on non-accrual status during the third quarter of 2016. At year-end 2016, $1.1 million of this relationship remained and was held for sale. This sale took place after year-end and this loan relationship has been paid off in full.
The ratios of the Company’s allowance for loan losses to nonperforming loans and allowance for loan losses to total loans were 199.52% and 1.18% at December 31, 2016, respectively.
The Company recorded a provision for loan losses in the fourth quarter of 2016 of $183,000, primarily as a result of the growth in the loan portfolio.
About First Community Financial Partners, Inc.: First Community Financial Partners, Inc., headquartered in Joliet, Illinois, is a bank holding company whose common stock trades on the NASDAQ Capital Market (NASDAQ:FCFP). First Community Financial Partners has one bank subsidiary, First Community Financial Bank. First Community Financial Bank, based in Plainfield, Illinois, has locations in Joliet, Plainfield, Homer Glen, Channahon, Naperville, Burr Ridge, Mazon, Braidwood, and Diamond, Illinois. The Bank is dedicated to its founding principles by being actively involved in the communities it serves and providing exceptional personal service delivered by experienced local professionals.
Special Note Concerning Forward-Looking Statements
———————————————————————
Any statements in this release other than statements of historical facts, including statements about management’s beliefs and expectations, are forward-looking statements and should be evaluated as such. These statements are made on the basis of management’s views and assumptions regarding future events and business performance. Words such as “estimate,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “target,” “project,” “should,” “may,” “will” and similar expressions are intended to identify forward-looking statements. Forward-looking statements (including oral representations) involve risks and uncertainties that may cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. These risks and uncertainties involve a number of factors related to the businesses of First Community and its wholly owned bank subsidiary, including: risks associated with First Community’s possible pursuit of acquisitions; unexpected results of acquisitions, including the acquisition of Mazon State Bank; economic conditions in First Community’s, and its wholly owned bank subsidiary’s service areas; system failures; losses of large customers; disruptions in relationships with third party vendors; losses of key management personnel and the inability to attract and retain highly qualified management personnel in the future; the impact of legislation and regulatory changes on the banking industry, including the implementation of the Basel III capital reforms; losses related to cyber-attacks; and liability and compliance costs regarding banking regulations; and changes in local, national and international economic conditions. These and other risks and uncertainties are discussed in more detail in First Community’s filings with the Securities and Exchange Commission, including First Community’s Annual Report on Form 10-K filed on March 14, 2016.
Many of these risks are beyond management’s ability to control or predict. All forward-looking statements attributable to First Community, and its wholly owned bank subsidiary, or persons acting on behalf of each of them are expressly qualified in their entirety by the cautionary statements and risk factors contained in this communication. Because of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. Furthermore, forward-looking statements speak only as of the date they are made. Except as required under the federal securities laws or the rules and regulations of the Securities and Exchange Commission, First Community does not undertake any obligation to update or review any forward-looking information, whether as a result of new information, future events or otherwise.
| FINANCIAL SUMMARY | |||||||||||||||
| December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | |||||||||||
| Period-End Balance Sheet | |||||||||||||||
| (In thousands)(Unaudited) | |||||||||||||||
| Assets | |||||||||||||||
| Cash and due from banks | $ | 16,225 | $ | 21,622 | $ | 13,777 | $ | 9,132 | $ | 10,699 | |||||
| Interest-bearing deposits in banks | 8,548 | 33,349 | 19,335 | 30,558 | 7,406 | ||||||||||
| Securities available for sale | 202,198 | 188,062 | 179,517 | 203,874 | 205,604 | ||||||||||
| Mortgage loans held for sale | 1,230 | 1,331 | 711 | 133 | 400 | ||||||||||
| Loans held for sale | 1,085 | — | — | — | |||||||||||
| Commercial real estate | 425,910 | 419,958 | 410,461 | 378,304 | 381,098 | ||||||||||
| Commercial | 281,804 | 274,889 | 239,038 | 181,142 | 179,623 | ||||||||||
| Residential 1-4 family | 175,978 | 167,388 | 143,908 | 139,208 | 135,864 | ||||||||||
| Multifamily | 36,703 | 31,880 | 30,809 | 31,511 | 34,272 | ||||||||||
| Construction and land development | 47,338 | 39,836 | 30,834 | 27,798 | 22,082 | ||||||||||
| Farmland and agricultural production | 12,628 | 12,985 | 9,235 | 9,060 | 9,989 | ||||||||||
| Consumer and other | 7,967 | 9,280 | 7,924 | 7,250 | 9,391 | ||||||||||
| Leases | 3,290 | 739 | 448 | — | — | ||||||||||
| Total loans and leases | 991,618 | 956,955 | 872,657 | 774,273 | 772,319 | ||||||||||
| Allowance for loan and lease losses | 11,684 | 12,284 | 12,044 | 11,335 | 11,741 | ||||||||||
| Net loans and leases | 979,934 | 944,671 | 860,613 | 762,938 | 760,578 | ||||||||||
| Other assets | 58,990 | 57,563 | 51,409 | 54,227 | 55,965 | ||||||||||
| Total Assets | $ | 1,268,210 | $ | 1,246,598 | $ | 1,125,362 | $ | 1,060,862 | $ | 1,040,652 | |||||
| Liabilities and Shareholders’ Equity | |||||||||||||||
| Noninterest bearing deposits | $ | 247,856 | $ | 246,262 | $ | 203,258 | $ | 204,414 | $ | 196,063 | |||||
| Savings deposits | 64,695 | 61,399 | 40,603 | 38,481 | 36,206 | ||||||||||
| NOW accounts | 160,862 | 151,243 | 103,324 | 104,136 | 102,882 | ||||||||||
| Money market accounts | 282,865 | 267,667 | 238,229 | 237,873 | 233,315 | ||||||||||
| Time deposits | 326,878 | 338,680 | 311,416 | 294,076 | 297,525 | ||||||||||
| Total deposits | 1,083,156 | 1,065,251 | 896,830 | 878,980 | 865,991 | ||||||||||
| Total borrowings | 66,419 | 61,879 | 114,701 | 72,237 | 68,315 | ||||||||||
| Other liabilities | 4,920 | 4,304 | 2,722 | 2,855 | 3,305 | ||||||||||
| Total Liabilities | 1,154,495 | 1,131,434 | 1,014,253 | 954,072 | 937,611 | ||||||||||
| Shareholders’ equity | 113,715 | 115,164 | 111,109 | 106,790 | 103,041 | ||||||||||
| Total Shareholders’ Equity | 113,715 | 115,164 | 111,109 | 106,790 | 103,041 | ||||||||||
| Total Liabilities and Shareholders’ Equity | $ | 1,268,210 | $ | 1,246,598 | $ | 1,125,362 | $ | 1,060,862 | $ | 1,040,652 | |||||
| FINANCIAL SUMMARY | |||||||||||||||
| Three months ended, | |||||||||||||||
| December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | |||||||||||
| Interest income: | (In thousands, except per share data)(Unaudited) | ||||||||||||||
| Loans, including fees | $ | 10,663 | $ | 10,229 | $ | 9,024 | $ | 8,508 | $ | 8,401 | |||||
| Securities | 1,033 | 1,041 | 1,042 | 1,101 | 1,117 | ||||||||||
| Federal funds sold and other | 53 | 43 | 21 | 19 | 19 | ||||||||||
| Total interest income | 11,749 | 11,313 | 10,087 | 9,628 | 9,537 | ||||||||||
| Interest expense: | |||||||||||||||
| Deposits | 1,150 | 1,081 | 957 | 940 | 986 | ||||||||||
| Federal funds purchased and other borrowed funds | 61 | 112 | 119 | 93 | 87 | ||||||||||
| Subordinated debentures | 297 | 297 | 297 | 297 | 297 | ||||||||||
| Total interest expense | 1,508 | 1,490 | 1,373 | 1,330 | 1,370 | ||||||||||
| Net interest income | 10,241 | 9,823 | 8,714 | 8,298 | 8,167 | ||||||||||
| Provision for loan losses | 183 | 383 | 500 | — | (515 | ) | |||||||||
| Net interest income after provision for loan losses | 10,058 | 9,440 | 8,214 | 8,298 | 8,682 | ||||||||||
| Noninterest income: | |||||||||||||||
| Service charges on deposit accounts | 285 | 289 | 207 | 204 | 190 | ||||||||||
| Gain on sale of loans | 9 | — | 7 | — | — | ||||||||||
| Gain on sale of securities | — | 14 | 603 | — | 212 | ||||||||||
| Mortgage fee income | 214 | 169 | 109 | 78 | 96 | ||||||||||
| Bargain purchase gain | — | 1,920 | — | — | — | ||||||||||
| Other | 390 | 381 | 315 | 273 | 261 | ||||||||||
| Total noninterest income | 898 | 2,773 | 1,241 | 555 | 759 | ||||||||||
| Noninterest expenses: | |||||||||||||||
| Salaries and employee benefits | 4,309 | 3,812 | 3,311 | 3,256 | 3,004 | ||||||||||
| Occupancy and equipment expense | 548 | 568 | 429 | 437 | 494 | ||||||||||
| Data processing | 267 | 700 | 690 | 257 | 203 | ||||||||||
| Professional fees | 286 | 369 | 375 | 392 | 68 | ||||||||||
| Advertising and business development | 245 | 328 | 262 | 215 | 219 | ||||||||||
| Losses on sale and writedowns of foreclosed assets, net | — | 1 | 31 | 16 | 109 | ||||||||||
| Foreclosed assets expenses, net of rental income | 26 | (99 | ) | 60 | 53 | 50 | |||||||||
| Other expense | 1,238 | 1,380 | 974 | 1,310 | 898 | ||||||||||
| Total noninterest expense | 6,919 | 7,059 | 6,132 | 5,936 | 5,045 | ||||||||||
| Income before income taxes | 4,037 | 5,154 | 3,323 | 2,917 | 4,396 | ||||||||||
| Income taxes | 1,358 | 1,019 | 1,058 | 889 | 1,474 | ||||||||||
| Net income | $ | 2,679 | $ | 4,135 | $ | 2,265 | $ | 2,028 | $ | 2,922 | |||||
| Basic earnings per share | $ | 0.16 | $ | 0.24 | $ | 0.13 | $ | 0.12 | $ | 0.17 | |||||
| Diluted earnings per share | $ | 0.15 | $ | 0.24 | $ | 0.13 | $ | 0.12 | $ | 0.17 | |||||
| Years Ended December 31, | ||||||
| 2016 | 2015 | |||||
| Interest income: | (in thousands, except share data) (unaudited) | |||||
| Loans, including fees | $ | 38,424 | $ | 32,525 | ||
| Securities | 4,217 | 4,134 | ||||
| Federal funds sold and other | 136 | 66 | ||||
| Total interest income | 42,777 | 36,725 | ||||
| Interest expense: | ||||||
| Deposits | 4,128 | 3,923 | ||||
| Federal funds purchased and other borrowed funds | 385 | 215 | ||||
| Subordinated debt | 1,188 | 1,800 | ||||
| Total interest expense | 5,701 | 5,938 | ||||
| Net interest income | 37,076 | 30,787 | ||||
| Provision for loan losses | 1,066 | (2,077 | ) | |||
| Net interest income after provision for loan losses | 36,010 | 32,864 | ||||
| Noninterest income: | ||||||
| Service charges on deposit accounts | 985 | 756 | ||||
| Gain on sale of loans | 16 | — | ||||
| Gain on sale of securities | 617 | 484 | ||||
| Gain on foreclosed assets, net | — | — | ||||
| Mortgage fee income | 570 | 531 | ||||
| Bargain purchase gain | 1,920 | — | ||||
| Other | 1,359 | 726 | ||||
| 5,467 | 2,497 | |||||
| Noninterest expenses: | ||||||
| Salaries and employee benefits | 14,688 | 11,538 | ||||
| Occupancy and equipment expense | 1,982 | 1,977 | ||||
| Data processing | 1,914 | 912 | ||||
| Professional fees | 1,422 | 1,201 | ||||
| Advertising and business development | 1,050 | 853 | ||||
| Losses on sale and writedowns of foreclosed assets, net | 48 | 187 | ||||
| Foreclosed assets expenses, net of rental income | 40 | 130 | ||||
| Other expense | 4,902 | 3,744 | ||||
| 26,046 | 20,542 | |||||
| Income before income taxes | 15,431 | 14,819 | ||||
| Income taxes | 4,324 | 5,000 | ||||
| Net income | $ | 11,107 | $ | 9,819 | ||
| Common share data | ||||||
| Basic earnings per common share | $ | 0.65 | $ | 0.58 | ||
| Diluted earnings per common share | 0.64 | 0.57 | ||||
| Weighted average common shares outstanding for basic earnings per common share | 17,184,432 | 16,939,010 | ||||
| Weighted average common shares outstanding for diluted earnings per common share | 17,630,600 | 17,085,752 | ||||
| Three months ended, | ||||||||||||||||||||||||
| December 31, 2016 | September 30, 2016 | December 31, 2015 | ||||||||||||||||||||||
| Average Balances |
Income/ Expense |
Yields/ Rates |
Average Balances |
Income/ Expense |
Yields/ Rates |
Average Balances |
Income/ Expense |
Yields/ Rates |
||||||||||||||||
| Assets | (Dollars in thousands)(Unaudited) | |||||||||||||||||||||||
| Loans (1) | $ | 973,149 | $ | 10,663 | 4.38 | % | $ | 932,047 | $ | 10,229 | 4.39 | % | $ | 760,332 | $ | 8,401 | 4.42 | % | ||||||
| Investment securities (2) | 199,940 | 1,033 | 2.07 | % | 199,139 | 1,041 | 2.09 | % | 209,936 | 1,117 | 2.13 | % | ||||||||||||
| Interest-bearing deposits with other banks | 25,612 | 53 | 0.83 | % | 24,580 | 43 | 0.70 | % | 22,378 | 19 | 0.34 | % | ||||||||||||
| Total earning assets | $ | 1,198,701 | $ | 11,749 | 3.92 | % | $ | 1,155,766 | $ | 11,313 | 3.92 | % | $ | 992,646 | $ | 9,537 | 3.84 | % | ||||||
| Other assets | 61,777 | 62,470 | 61,572 | |||||||||||||||||||||
| Total assets | $ | 1,260,478 | $ | 1,218,236 | $ | 1,054,218 | ||||||||||||||||||
| Liabilities | ||||||||||||||||||||||||
| NOW accounts | $ | 147,627 | $ | 118 | 0.32 | % | $ | 122,727 | $ | 90 | 0.29 | % | $ | 102,783 | $ | 66 | 0.26 | % | ||||||
| Money market accounts | 279,110 | 203 | 0.29 | % | 260,070 | 190 | 0.29 | % | 237,818 | 163 | 0.27 | % | ||||||||||||
| Savings accounts | 63,816 | 15 | 0.09 | % | 62,179 | 15 | 0.10 | % | 36,015 | 14 | 0.16 | % | ||||||||||||
| Time deposits | 331,025 | 814 | 0.98 | % | 326,860 | 786 | 0.96 | % | 304,941 | 743 | 0.97 | % | ||||||||||||
| Total interest bearing deposits | 821,578 | 1,150 | 0.56 | % | 771,836 | 1,081 | 0.56 | % | 681,557 | 986 | 0.58 | % | ||||||||||||
| Securities sold under agreements to repurchase | 26,548 | 11 | 0.17 | % | 23,339 | 10 | 0.17 | % | 32,315 | 12 | 0.15 | % | ||||||||||||
| Secured borrowings | 2,134 | 22 | 4.12 | % | 7,752 | 58 | 2.99 | % | 12,875 | 73 | 2.27 | % | ||||||||||||
| FHLB borrowings | 21,764 | 28 | 0.51 | % | 42,391 | 44 | 0.42 | % | 3,261 | 2 | 0.25 | % | ||||||||||||
| Subordinated debentures | 15,300 | 297 | 7.76 | % | 15,300 | 297 | 7.76 | % | 15,300 | 297 | 7.76 | % | ||||||||||||
| Total interest bearing liabilities | $ | 887,324 | $ | 1,508 | 0.68 | % | $ | 860,618 | $ | 1,490 | 0.69 | % | $ | 745,308 | $ | 1,370 | 0.74 | % | ||||||
| Noninterest bearing deposits | 253,877 | 239,802 | 203,108 | |||||||||||||||||||||
| Other liabilities | 3,817 | 3,726 | 3,963 | |||||||||||||||||||||
| Total liabilities | $ | 1,145,018 | $ | 1,104,146 | $ | 952,379 | ||||||||||||||||||
| Total shareholders’ equity | $ | 113,509 | $ | 114,090 | $ | 101,839 | ||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 1,258,527 | $ | 1,218,236 | $ | 1,054,218 | ||||||||||||||||||
| Net interest income | $ | 10,241 | $ | 9,823 | $ | 8,167 | ||||||||||||||||||
| Interest rate spread | 3.24 | % | 3.23 | % | 3.10 | % | ||||||||||||||||||
| Net interest margin | 3.42 | % | 3.40 | % | 3.29 | % | ||||||||||||||||||
| Footnotes: |
| (1) Average loans include nonperforming loans. |
| (2) No tax-equivalent adjustments were made, as the effect thereof was not material. |
| Year ended December 31, | ||||||||||||||||
| 2016 | 2015 | |||||||||||||||
| Average Balances |
Income/ Expense |
Yields/ Rates |
Average Balances |
Income/ Expense |
Yields/ Rates |
|||||||||||
| Assets | (Dollars in thousands)(Unaudited) | |||||||||||||||
| Loans (1) | $ | 842,580 | $ | 38,424 | 4.56 | % | $ | 728,276 | $ | 32,525 | 4.47 | % | ||||
| Investment securities (2) | 198,867 | 4,217 | 2.12 | % | 197,427 | 4,134 | 2.09 | % | ||||||||
| Federal funds sold | — | — | — | % | — | — | — | % | ||||||||
| Interest-bearing deposits with other banks | 17,256 | 136 | 0.79 | % | 18,087 | 66 | 0.36 | % | ||||||||
| Total earning assets | $ | 1,058,703 | $ | 42,777 | 4.04 | % | $ | 943,790 | $ | 36,725 | 3.89 | % | ||||
| Other assets | 56,124 | 49,879 | ||||||||||||||
| Total assets | $ | 1,114,827 | $ | 993,669 | ||||||||||||
| Liabilities | ||||||||||||||||
| NOW accounts | $ | 112,221 | $ | 360 | 0.32 | % | $ | 91,410 | $ | 204 | 0.22 | % | ||||
| Money market accounts | 242,890 | 716 | 0.29 | % | 224,640 | 620 | 0.28 | % | ||||||||
| Savings accounts | 46,357 | 53 | 0.11 | % | 33,815 | 56 | 0.17 | % | ||||||||
| Time deposits | 304,138 | 2,999 | 0.99 | % | 303,668 | 3,043 | 1.00 | % | ||||||||
| Total interest bearing deposits | 705,606 | 4,128 | 0.59 | % | 653,533 | 3,923 | 0.60 | % | ||||||||
| Securities sold under agreements to repurchase | 22,966 | 38 | 0.17 | % | 30,849 | 39 | 0.13 | % | ||||||||
| Secured borrowings | 9,175 | 221 | 2.41 | % | 6,662 | 160 | 2.40 | % | ||||||||
| Mortgage payable | — | — | — | % | 180 | 13 | 7.22 | % | ||||||||
| FHLB borrowings | 33,058 | 126 | 0.38 | % | 1,686 | 3 | 0.18 | % | ||||||||
| Subordinated debentures | 15,300 | 1,188 | 7.76 | % | 22,124 | 1,800 | 8.14 | % | ||||||||
| Total interest bearing liabilities | $ | 786,105 | $ | 5,701 | 0.73 | % | $ | 715,034 | $ | 5,938 | 0.83 | % | ||||
| Noninterest bearing deposits | 216,430 | 177,085 | ||||||||||||||
| Other liabilities | 3,113 | 4,157 | ||||||||||||||
| Total liabilities | $ | 1,005,648 | $ | 896,276 | ||||||||||||
| Total shareholders’ equity | $ | 109,179 | $ | 97,393 | ||||||||||||
| Total liabilities and shareholders’ equity | $ | 1,114,827 | $ | 993,669 | ||||||||||||
| Net interest income | $ | 37,076 | $ | 30,787 | ||||||||||||
| Interest rate spread | 3.31 | % | 3.06 | % | ||||||||||||
| Net interest margin | 3.50 | % | 3.26 | % | ||||||||||||
| Footnotes: |
| (1) Average loans include nonperforming loans. |
| (2) No tax-equivalent adjustments were made, as the effect thereof was not material. |
| COMMON STOCK DATA | |||||||||||||||
| 2016 | 2015 | ||||||||||||||
| Fourth Quarter | Third Quarter | Second Quarter | First Quarter | Fourth Quarter | |||||||||||
| (Unaudited) | |||||||||||||||
| Market value (1): | |||||||||||||||
| End of period | $ | 11.70 | $ | 9.52 | $ | 8.80 | $ | 8.70 | $ | 7.24 | |||||
| High | 12.15 | 9.55 | 9.10 | 8.84 | 7.31 | ||||||||||
| Low | 9.10 | 8.35 | 8.18 | 7.00 | 6.26 | ||||||||||
| Book value (end of period) | 6.59 | 6.68 | 6.47 | 6.22 | 6.05 | ||||||||||
| Tangible book value (end of period) | 6.53 | 6.62 | 6.47 | 6.22 | 6.05 | ||||||||||
| Shares outstanding (end of period) | 17,242,645 | 17,237,845 | 17,183,780 | 17,175,864 | 17,026,941 | ||||||||||
| Average shares outstanding | 17,239,897 | 17,189,113 | 17,182,197 | 17,125,928 | 16,939,010 | ||||||||||
| Average diluted shares outstanding | 17,860,017 | 17,565,667 | 17,550,547 | 17,451,354 | 17,085,752 | ||||||||||
| (1) The prices shown are as reported on the NASDAQ Capital Market |
| ASSET QUALITY DATA | |||||||||||||||
| December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | |||||||||||
| (Dollars in thousands)(Unaudited) | |||||||||||||||
| Loans identified as nonperforming | $ | 5,856 | $ | 8,385 | $ | 2,622 | $ | 2,146 | $ | 1,411 | |||||
| Other nonperforming loans | — | 91 | — | — | 67 | ||||||||||
| Total nonperforming loans | 5,856 | 8,476 | 2,622 | 2,146 | 1,478 | ||||||||||
| Foreclosed assets | 725 | 725 | 2,211 | 5,231 | 5,487 | ||||||||||
| Total nonperforming assets | $ | 6,581 | $ | 9,201 | $ | 4,833 | $ | 7,377 | $ | 6,965 | |||||
| Allowance for loan and lease losses | $ | 11,684 | $ | 12,284 | $ | 12,044 | $ | 11,335 | $ | 11,741 | |||||
| Nonperforming assets to total assets | 0.52 | % | 0.74 | % | 0.43 | % | 0.70 | % | 0.67 | % | |||||
| Nonperforming loans to total assets | 0.46 | % | 0.68 | % | 0.23 | % | 0.20 | % | 0.14 | % | |||||
| Allowance for loan and lease losses to nonperforming loans | 199.52 | % | 144.93 | % | 459.34 | % | 528.19 | % | 794.38 | % | |||||
| ALLOWANCE FOR LOAN AND LEASE LOSSES ROLLFORWARD | |||||||||||||||
| (Dollars in thousands)(Unaudited) | Three months ended, | ||||||||||||||
| December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | |||||||||||
| Beginning balance | $ | 12,284 | $ | 12,044 | $ | 11,335 | $ | 11,741 | $ | 11,753 | |||||
| Charge-offs | 1,363 | 340 | 193 | 506 | 133 | ||||||||||
| Recoveries | 580 | 197 | 402 | 100 | 636 | ||||||||||
| Net charge-offs (recoveries) | 783 | 143 | (209 | ) | 406 | (503 | ) | ||||||||
| Provision for loan losses | 183 | 383 | 500 | — | (515 | ) | |||||||||
| Ending balance | $ | 11,684 | $ | 12,284 | $ | 12,044 | $ | 11,335 | $ | 11,741 | |||||
| Net chargeoff percentage annualized | 0.32 | % | 0.06 | % | (0.11 | )% | 0.21 | % | (0.26 | )% | |||||
| OTHER DATA | ||||||||||
| (Unaudited) | ||||||||||
| Three months ended, | ||||||||||
| December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | ||||||
| Return on average assets | 0.85 | % | 1.36 | % | 0.84 | % | 0.78 | % | 1.11 | % |
| Return on average equity | 9.44 | % | 14.50 | % | 8.36 | % | 7.68 | % | 11.48 | % |
| Net interest margin | 3.42 | % | 3.44 | % | 3.39 | % | 3.36 | % | 3.29 | % |
| Average loans to assets | 77.20 | % | 75.50 | % | 76.55 | % | 73.63 | % | 72.12 | % |
| Average loans to deposits | 90.49 | % | 90.92 | % | 94.16 | % | 88.00 | % | 85.95 | % |
| Average noninterest bearing deposits to total deposits | 23.44 | % | 22.51 | % | 22.75 | % | 23.35 | % | 23.45 | % |
| COMPANY CAPITAL RATIOS | ||||||||||
| (Unaudited) | December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | |||||
| Tier 1 leverage ratio | 9.10 | % | 9.15 | % | 9.77 | % | 9.72 | % | 9.36 | % |
| Common equity tier 1 capital ratio | 10.51 | % | 10.83 | % | 11.26 | % | 11.94 | % | 11.62 | % |
| Tier 1 capital ratio | 10.51 | % | 10.83 | % | 11.26 | % | 11.94 | % | 11.62 | % |
| Total capital ratio | 12.99 | % | 13.52 | % | 14.14 | % | 14.99 | % | 14.69 | % |
| Tangible common equity to tangible assets | 8.88 | % | 9.24 | % | 10.47 | % | 10.26 | % | 10.07 | % |
| NON-GAAP MEASURES | |||||||||||||||
| Pre-tax pre-provision core income (1) | |||||||||||||||
| (In thousands)(Unaudited) | |||||||||||||||
| For the three months ended, | |||||||||||||||
| December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | |||||||||||
| Income before income taxes | $ | 4,037 | $ | 5,154 | $ | 3,323 | $ | 2,917 | $ | 4,396 | |||||
| Provision for loan losses | 183 | 383 | 500 | — | (515 | ) | |||||||||
| Gain on sale of securities | — | (14 | ) | (603 | ) | — | (212 | ) | |||||||
| Merger related expenses included in professional fees | — | 24 | 26 | 100 | — | ||||||||||
| Merger related expenses included in data processing fees | 14 | 363 | 410 | — | — | ||||||||||
| Severances paid in relation to the merger | — | 92 | — | — | — | ||||||||||
| Stock options included in other expense | — | 164 | |||||||||||||
| Bargain purchase option | (1,920 | ) | — | — | — | ||||||||||
| Losses (gain) on sale and writedowns of foreclosed assets, net | — | 1 | 31 | 16 | 109 | ||||||||||
| Foreclosed assets expense, net of rental income | 26 | (99 | ) | 60 | 53 | 50 | |||||||||
| Pre-tax pre-provision core income | $ | 4,260 | $ | 4,148 | $ | 3,747 | $ | 3,086 | $ | 3,828 | |||||
| (1) This is a non-GAAP financial measure. In compliance with applicable rules of the Securities and Exchange Commission, this non-GAAP measure is reconciled to pre-tax net income, which is the most directly comparable GAAP financial measure. The Company’s management believes the presentation of pre-tax pre-provision core income provides investors with a greater understanding of the Company’s operating results, in addition to the results measured in accordance with GAAP. |
Contact: Glen L. Stiteley, Chief Financial Officer - (815) 725-1885
