GREENSBORO, N.C., April 28, 2014 (GLOBE NEWSWIRE) -- Carolina Bank Holdings, Inc. (Nasdaq:CLBH) today reported first quarter 2014 results with highlights as follows:
1st Quarter Financial Highlights
- Average non-interest bearing demand deposits increased 13.8% in the first quarter of 2014 from the first quarter of 2013.
- Loans held for investment increased $4.8 million during the first quarter to $448.9 million at March 31, 2014; however, average balances increased $22.4 million during the first quarter of 2014 from the fourth quarter of 2013.
- The net interest margin, computed on a fully taxable basis, improved to 3.75% in the first quarter of 2014 from 3.46% in the fourth quarter of 2013.
- Mortgage banking gross revenues decreased $2.6 million to $1.3 million for the first quarter of 2014 from the first quarter of 2013. The Mortgage Division incurred a net loss of $435,000 in the first quarter of 2014 compared to net income of $687,000 in the first quarter of 2013.
- Excluding the loss from the Mortgage Division and an additional loan loss provision of $540,000 ($340,000 after-tax) for an impaired loan, net income available to common stockholders would have been approximately $849,000, or $0.25 diluted EPS.
- Diluted net income per common share decreased to $0.02 in the first quarter of 2014 from $0.42 in the first quarter of 2013. Net income available to common stockholders was $74,000 and $1,414,000 for the first quarters of 2014 and 2013, respectively.
- Noninterest expense decreased $1.0 million, or 14.2%, in the first quarter of 2014 from the first quarter of 2013.
- Non-performing assets decreased $1.0 million during the first quarter to $18.1 million at March 31, 2014.
- Our Winston-Salem office was relocated to Stratford Road, the most desirable shopping area, in December 2013 and was fully staffed during the first quarter of 2014. Construction recently began on our second Winston-Salem office on Peace Haven Road.
- Carolina Bank, the subsidiary of Carolina Bank Holdings, Inc., continued to maintain 'Well Capitalized' status, the highest regulatory capital measure. Capital ratios at March 31, 2014 for Carolina Bank were 8.97% for Tier 1 leverage, 11.13% for Tier 1 risk-based, and 13.79% for total risk-based.
Robert T. Braswell, President and CEO, commented, "We continue to build value for our shareholders through our reduction in non-performing assets, by increasing our loans held for investment, and by growing non-interest bearing deposits. As a result of our progress, our net interest margin increased to 3.75% in the first quarter of 2014 from 3.46% in the fourth quarter of 2013. We are increasing our strong base in the Piedmont Triad through the recent relocation of our Winston-Salem office to Stratford Road and the construction of a new office on Peace Haven Road."
"We were disappointed in our first quarter 2014 results but believe several unusual factors negatively impacted results. The severe cold weather put a damper on our mortgage loan originations which resulted in a quarterly net loss from our Mortgage Division even though we significantly reduced our staffing in 2013. We have seen an upswing in mortgage applications recently which indicates future improvement. We have also expanded the footprint of our Wholesale Mortgage Division into several new states. In addition to the cold weather, we increased our loan loss provision by $540,000 for one loan relationship that I highlighted in my last report as not meeting our high current standards. We believe we are fully reserved in this loan relationship based on new appraisals and estimated cash flows," said Braswell.
Braswell further commented, "It is a pleasure to announce several recent additions and retirements to our Carolina Bank family. Abby Donnelly joined our Board of Directors in April to replace George Carr who is retiring and has served us admirably since 2000. Rich Spiker joined us in late 2013 and has transitioned well as our new Chief Lending Officer to replace Gunnar Fromen who has served us tirelessly since 1998. Andy McDowell joined us in the first quarter of 2014 as Market Executive for Winston-Salem to replace Gerald Church who is retiring but will continue to assist us in a customer marketing role. All of our new staff have significant business and banking experience and should contribute substantially to our future financial performance."
About the Company
Carolina Bank, the banking subsidiary of Carolina Bank Holdings, Inc. began banking operations on November 25, 1996. The parent company is a North Carolina corporation organized in 2000. The bank is engaged in lending and deposit gathering activities in the Piedmont Triad of North Carolina, with operations in four counties: Guilford, Alamance, Forsyth and Randolph. The bank has eight full-service banking locations, four in Greensboro, one in Asheboro, one in High Point, one in Burlington, and one in Winston-Salem. Residential mortgage loan production offices are located in Burlington, Chapel Hill, Hillsborough, and Sanford in addition to a wholesale residential mortgage operation in Greensboro. The Company's stock is listed on the NASDAQ Global Market under the symbol CLBH. Further information is available on the Company's web site: www.carolinabank.com.
This press release contains forward-looking statements regarding future events. These statements are only predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks of managing our growth, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to be materially different from those in the forward-looking statements is contained in the Company's filings with the Securities and Exchange Commission. Carolina Bank Holdings, Inc. undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.
| Carolina Bank Holdings, Inc. and Subsidiary | ||
| Consolidated Balance Sheets | ||
|
March 31, 2014 |
December 31, 2013 |
|
| (unaudited) | ||
| (in thousands, except share data) | ||
| Assets | ||
| Cash and due from banks | $ 11,465 | $ 6,037 |
| Interest-bearing deposits with banks | 38,048 | 58,859 |
| Bank term deposits | 11,865 | 11,118 |
| Securities available-for-sale, at fair value | 65,191 | 62,016 |
| Securities held-to-maturity | 16,575 | 14,810 |
| Loans held for sale | 30,218 | 28,382 |
| Loans | 448,858 | 444,087 |
| Less allowance for loan losses | (8,289) | (7,663) |
| Net loans | 440,569 | 436,424 |
| Premises and equipment, net | 18,439 | 18,261 |
| Other real estate owned | 1,494 | 2,329 |
| Bank-owned life insurance | 11,216 | 11,129 |
| Other assets | 12,285 | 12,442 |
| Total assets | $ 657,365 | $ 661,807 |
| Liabilities and Stockholders' Equity | ||
| Deposits | ||
| Non-interest bearing demand | $ 88,623 | $ 84,911 |
| NOW, money market and savings | 340,983 | 342,970 |
| Time | 146,244 | 151,216 |
| Total deposits | 575,850 | 579,097 |
| Advances from the Federal Home Loan Bank | 2,860 | 2,885 |
| Securities sold under agreements to repurchase | 1,596 | 3,032 |
| Subordinated debentures | 19,610 | 19,610 |
| Other liabilities and accrued expenses | 7,493 | 7,579 |
| Total liabilities | 607,409 | 612,203 |
| Stockholders' equity | ||
| Preferred stock, no par value, authorized 1,000,000 shares; issued and outstanding 10,994 shares in 2014 and 2013 | 10,994 | 10,994 |
| Common stock, $1 par value; authorized 20,000,000 shares; issued and outstanding 3,429,640 in 2014 and 3,428,776 in 2013 | 3,430 | 3,429 |
| Additional paid-in capital | 16,233 | 16,226 |
| Retained earnings | 18,410 | 18,336 |
| Stock in directors' rabbi trust | (1,420) | (1,347) |
| Directors' deferred fees obligation | 1,420 | 1,347 |
| Accumulated other comprehensive income | 889 | 619 |
| Total stockholders' equity | 49,956 | 49,604 |
| Total liabilities and stockholders' equity | $ 657,365 | $ 661,807 |
| Carolina Bank Holdings, Inc. and Subsidiary | ||
| Consolidated Statements of Income (unaudited) | ||
|
Three Months Ended March 31, |
||
| 2014 | 2013 | |
| (in thousands, except per share data) | ||
| Interest income | ||
| Loans | $ 5,754 | $ 6,719 |
| Investment securities, taxable | 420 | 248 |
| Investment securities, non taxable | 142 | 106 |
| Interest from deposits in banks | 60 | 18 |
| Total interest income | 6,376 | 7,091 |
| Interest expense | ||
| NOW, money market and savings | 236 | 320 |
| Time deposits | 418 | 520 |
| Other borrowed funds | 164 | 188 |
| Total interest expense | 818 | 1,028 |
| Net interest income | 5,558 | 6,063 |
| Provision for loan losses | 770 | 400 |
| Net interest income after provision for loan losses | 4,788 | 5,663 |
| Non-interest income | ||
| Service charges | 299 | 252 |
| Mortgage banking income | 1,333 | 3,895 |
| Gain on sale of investment securities | 49 | 22 |
| Other | 69 | 145 |
| Total non-interest income | 1,750 | 4,314 |
| Non-interest expense | ||
| Salaries and benefits | 3,835 | 4,748 |
| Occupancy and equipment | 761 | 747 |
| Foreclosed property expense | 105 | 331 |
| Professional fees | 458 | 186 |
| Outside data processing | 251 | 259 |
| FDIC insurance | 134 | 169 |
| Advertising and promotion | 321 | 206 |
| Stationery, printing and supplies | 137 | 153 |
| Other | 333 | 583 |
| Total non-interest expense | 6,335 | 7,382 |
| Income before income taxes | 203 | 2,595 |
| Income tax expense (benefit) | (62) | 877 |
| Net income | 265 | 1,718 |
| Dividends and accretion on preferred stock | 191 | 304 |
| Net income available to common shareholders | $ 74 | $ 1,414 |
| Net income per common share | $ 0.02 | $ 0.42 |
| Basic | $ 0.02 | $ 0.42 |
| Diluted | ||
| Carolina Bank Holdings, Inc. | |||||||
| Consolidated Financial Highlights | |||||||
| First Quarter 2014 | |||||||
| (unaudited) | |||||||
| Quarterly | Years Ended | ||||||
| ($ in thousands except for share data) |
1st Qtr 2014 |
4th Qtr 2013 |
3rd Qtr 2013 |
2nd Qtr 2013 |
1st Qtr 2013 |
2013 |
2012 |
| EARNINGS | |||||||
| Net interest income | $ 5,558 | 5,360 | 5,302 | 5,590 | 6,063 | 22,315 | 24,187 |
| Provision for loan losses | $ 770 | 2,350 | 600 | 100 | 400 | 3,450 | 2,360 |
| NonInterest income | $ 1,750 | 2,909 | 2,905 | 4,206 | 4,314 | 14,334 | 19,650 |
| NonInterest expense | $ 6,335 | 6,475 | 6,229 | 7,534 | 7,382 | 27,620 | 30,243 |
| Net income (loss) | $ 265 | (201) | 1,023 | 1,470 | 1,718 | 4,010 | 7,502 |
| Net income (loss) available to common stockholders | $ 74 | (425) | 776 | 1,164 | 1,414 | 2,928 | 6,276 |
| Basic earnings (loss) per common share | $ 0.02 | (0.12) | 0.23 | 0.34 | 0.42 | 0.86 | 1.85 |
| Diluted earnings (loss) per common share | $ 0.02 | (0.12) | 0.23 | 0.34 | 0.42 | 0.85 | 1.85 |
| Average common shares outstanding | 3,428,891 | 3,428,776 | 3,423,961 | 3,403,347 | 3,387,813 | 3,410,974 | 3,387,045 |
| Average diluted common shares outstanding | 3,433,381 | 3,437,015 | 3,435,335 | 3,423,373 | 3,411,335 | 3,426,764 | 3,395,383 |
| PERFORMANCE RATIOS | |||||||
| Return on average assets ** | 0.05% | -0.25% | 0.46% | 0.70% | 0.85% | 0.44% | 0.93% |
| Return on average common equity ** | 0.77% | -4.29% | 7.93% | 12.04% | 14.69% | 7.52% | 18.05% |
| Net interest margin (fully-tax equivalent) * | 3.75% | 3.46% | 3.46% | 3.65% | 3.94% | 3.59% | 3.89% |
| Efficiency ratio | 85.85% | 77.70% | 75.27% | 76.50% | 70.78% | 74.88% | 68.68% |
| # full-time equivalent employees - period end | 194 | 191 | 203 | 215 | 215 | 191 | 208 |
| CAPITAL | |||||||
| Equity to period-end assets | 7.60% | 7.50% | 7.54% | 8.09% | 8.21% | 7.50% | 7.79% |
| Common tangible equity to assets | 5.93% | 5.83% | 5.91% | 5.74% | 5.89% | 5.83% | 5.53% |
| Tier 1 leverage capital ratio - Bank | 8.97% | 8.86% | 8.81% | 9.39% | 9.34% | 8.86% | 9.23% |
| Tier 1 risk-based capital ratio - Bank | 11.13% | 11.19% | 11.67% | 12.68% | 12.23% | 11.19% | 11.27% |
| Total risk-based capital ratio - Bank | 13.79% | 13.85% | 14.76% | 15.81% | 15.28% | 13.85% | 14.18% |
| Book value per common share | $ 11.36 | 11.26 | 11.51 | 11.23 | 11.72 | 11.26 | 11.30 |
| ASSET QUALITY | |||||||
| Net charge-offs | $ 144 | 2,388 | 3,030 | 208 | 105 | 5,731 | 4,209 |
| Net charge-offs to average loans * | 0.13% | 2.21% | 2.85% | 0.20% | 0.09% | 1.33% | 0.90% |
| Allowance for loan losses | $ 8,289 | 7,663 | 7,701 | 10,131 | 10,239 | 7,663 | 9,944 |
| Allowance for loan losses to loans held invst. | 1.85% | 1.73% | 1.79% | 2.42% | 2.37% | 1.73% | 2.15% |
| Nonperforming loans | $ 16,610 | 16,731 | 19,606 | 16,501 | 10,806 | 16,731 | 13,067 |
| Performing restructured loans | $ 10,145 | 10,381 | 10,933 | 14,151 | 14,391 | 10,381 | 13,822 |
| Other real estate owned | $ 1,494 | 2,329 | 3,446 | 4,031 | 7,555 | 2,329 | 5,940 |
| Nonperforming loans to loans held for investment | 3.70% | 3.77% | 4.55% | 3.95% | 2.50% | 3.77% | 2.83% |
| Nonperforming assets to total assets | 2.75% | 2.88% | 3.45% | 3.07% | 2.72% | 2.88% | 2.75% |
| END OF PERIOD BALANCES | |||||||
| Total assets | $ 657,365 | 661,807 | 667,833 | 669,489 | 674,764 | 661,807 | 691,868 |
| Total loans held for investment | $ 448,858 | 444,087 | 430,736 | 418,158 | 431,754 | 444,087 | 461,728 |
| Total deposits | $ 575,850 | 579,097 | 584,494 | 581,404 | 585,954 | 579,097 | 590,925 |
| Stockholders' equity | $ 49,956 | 49,604 | 50,383 | 54,192 | 55,389 | 49,604 | 53,862 |
| AVERAGE BALANCES | |||||||
| Total assets | $ 657,959 | 664,516 | 671,632 | 671,745 | 678,373 | 671,529 | 671,376 |
| Total earning assets | $ 617,147 | 622,481 | 629,994 | 627,855 | 629,687 | 627,491 | 626,735 |
| Total loans held for investment | $ 454,039 | 431,602 | 425,271 | 423,587 | 449,704 | 432,471 | 465,478 |
| Total non interest-bearing demand deposits | $ 87,597 | 87,987 | 85,972 | 78,299 | 76,952 | 82,343 | 62,155 |
| Common stockholders' equity | $ 38,947 | 39,339 | 38,803 | 38,764 | 39,044 | 38,927 | 34,761 |
| * annualized for all periods presented | |||||||
| **return on average assets and on average common equity are computed using net income available to common stockholders | |||||||