ATLANTA, April 21, 2020 (GLOBE NEWSWIRE) -- Brian D. Schmitt, Chief Executive Officer of SouthCrest Financial Group, Inc. (SCSG:PK) announced today that the Company reported preliminary earnings of $1.04 million or $0.13/share for the first quarter ended March 31, 2020. Excluding non-core items, core earnings were $1.00 million, or $0.13/share. Total net income is down 15% from 1Q19, but core EPS only declined $0.01/share from $0.14 in the year ago quarter.
“Most importantly, I would like to say how proud I am of our employees at SouthCrest who have performed amazingly well during this time of real hardship. Our customer facing teams have handled every transaction as safely as possible. Our operational and IT teams have supported their internal customers with efficiency and patience. And finally our leadership has worked tirelessly to make sure we make every new decision with as much knowledge and forethought as possible.”
“Financially, the first quarter was a challenge due to the changes in the interest rate environment that occurred starting in late February, and accelerated with the FOMC’s rate cut decisions in March. We do remain comfortable with our current capital and balance sheet position, but we will remain appropriately conservative until there is more transparency in the economic outlook and potential credit costs for the remainder of 2020. Importantly, we were able to take advantage of some of the pricing dislocation that occurred in municipal bonds in late March, which should partially offset the negative impact to revenues from the rate cuts.”
The Company also is announcing that it will pay the regular quarterly dividend of $0.05/share on May 14, 2020 to shareholders of record April 30, 2020.
Total assets increased to $577.7 million vs. $556.0 million in 4Q19, due to both an increase in deposits and an increase in wholesale funding, and vs. $542.6 million in 1Q19. Wholesale funding increased during the quarter to partially fund the increased purchases of municipal bonds. Loan growth was slightly below plan for the quarter with total loans outstanding finishing at $336.1 million vs. $334.6 million at the end of 4Q19 and $315.3 million in the year ago quarter. The cost of funds was up 3bps to 0.58%, from 0.55% in 4Q19 due to the lower day count and the increase in wholesale funding.
The estimated Tier 1 Leverage ratio at the end of the quarter for SouthCrest Bank was effectively flat with 4Q19 at to 9.62% from 9.63%. On a fully converted basis (including the conversion of all preferred equity), TBV/share ended the quarter at $7.09 per share, up from $6.83 at the end of 2019. This metric will continue to be influenced by OCI changes resulting from the swings in interest rates. Currently, the positive impact to TBV by OCI is $0.28/share vs. $0.09/share at the end of 4Q19. The current fully converted share count at the end of the quarter was 7.888 million shares, comprised of 5.833 million common shares and 2.055 million preferred shares.
Asset quality ratios remained effectively flat with the prior quarter, with NPAs to assets increasing to 0.80% vs. 0.77% in 4Q19. As of December 31, 2019 the Company’s OREO balances were $529,000.
ABOUT SOUTHCREST
SouthCrest Financial Group, Inc. is a bank holding company with over half a billion dollars in assets, headquartered in Atlanta, GA. The company operates a 9 branch network throughout Georgia through its subsidiary bank, SouthCrest Bank, N.A. The bank provides a full suite of retail, private, entrepreneurial, high-net-worth and commercial banking services, and online banking services.
FORWARD-LOOKING STATEMENTS
This presentation may contain certain “forward-looking statements” that are subject to risks, uncertainties, and other factors that could cause actual results and shareholder values to differ materially from those projected. Factors that could cause or contribute to such differences include economic conditions, government regulation and legislation, changes in interest rates, credit quality, competition, and other risk factors. You should not rely upon forward-looking statements, as they are inherently unlikely to occur, and we do not assume any liability to update or correct any forward-looking statements that we make.
Andy Borrmann
Chief Financial Officer
678.734.3505
| Statement of Operations ($000s, Unaudited) | |||||||||||||||
| Q1 2019 | Q2 2019 | Q3 2019 | Q4 2019 | Q1 2020 | |||||||||||
| Interest Income | |||||||||||||||
| Loans | |||||||||||||||
| Construction and Development | $609 | $603 | $636 | $669 | $744 | ||||||||||
| Commercial Real Estate | 1,800 | 1,834 | 2,037 | 2,030 | 1,856 | ||||||||||
| Commercial Loans | 458 | 429 | 446 | 645 | 553 | ||||||||||
| Multi Family | 19 | 32 | 27 | 28 | 21 | ||||||||||
| Residential Mortgage | 1,176 | 1,101 | 991 | 1,029 | 904 | ||||||||||
| Consumer Loans | 41 | 41 | 41 | 34 | 36 | ||||||||||
| County/Municipal Loans | 25 | 22 | 22 | 24 | 34 | ||||||||||
| Loss Share Loans | 62 | 61 | 61 | 58 | 46 | ||||||||||
| Investment Securities | |||||||||||||||
| Federal Funds/Overnight Funds | $82 | $88 | $107 | $77 | $129 | ||||||||||
| Bank Owned CDs | 7 | 6 | 6 | 2 | 0 | ||||||||||
| Investment Securities | 1,168 | 1,111 | 950 | 996 | 1,023 | ||||||||||
| Total Interest Income | $5,447 | $5,329 | $5,324 | $5,592 | $5,346 | ||||||||||
| Total Interest Expense | $746 | $759 | $658 | $699 | $769 | ||||||||||
| Net Interest Income | $4,701 | $4,570 | $4,666 | $4,893 | $4,577 | ||||||||||
| Provision for Loan Losses | 0 | 0 | 39 | 0 | 150 | ||||||||||
| Net Interest Income after Loan Losses | $4,701 | $4,570 | $4,627 | $4,893 | $4,427 | ||||||||||
| Other Income | |||||||||||||||
| Service Charges on Deposits | $156 | $153 | $148 | $144 | $138 | ||||||||||
| NSF/Overdraft Fees | 309 | 310 | 356 | 348 | 305 | ||||||||||
| Other Service Charges | 65 | 70 | 78 | 95 | 64 | ||||||||||
| ATM/Billpay/DR Card Income | 255 | 284 | 278 | 271 | 247 | ||||||||||
| Other Income | 204 | 131 | 308 | 268 | 238 | ||||||||||
| Total Other Income | $989 | $947 | $1,169 | $1,186 | $992 | ||||||||||
| Non-Interest Expense | |||||||||||||||
| Salaries, Other Comp (+ FAS123R) | $1,849 | $1,842 | $1,856 | $2,140 | $1,940 | ||||||||||
| Employee Benefits | 419 | 370 | 391 | 379 | 412 | ||||||||||
| Occupancy & FF&E Expense | 621 | 570 | 564 | 529 | 503 | ||||||||||
| Professional Fees | 170 | 274 | 152 | 149 | 141 | ||||||||||
| Data Processing | 481 | 488 | 497 | 502 | 488 | ||||||||||
| Other Expense | 649 | 613 | 505 | 667 | 632 | ||||||||||
| Total Noninterest Expenses | $4,189 | $4,157 | $3,963 | $4,366 | $4,116 | ||||||||||
| Pre-Tax Income (Loss) | $1,501 | $1,360 | $1,832 | $1,713 | $1,303 | ||||||||||
| Income Taxes | 321 | 315 | 417 | 389 | 265 | ||||||||||
| Net Income | $1,180 | $1,045 | $1,414 | $1,323 | $1,038 | ||||||||||
| Balance Sheet ($000s, Unaudited) | |||||||||||||||
| Assets | Q1 2019 | Q2 2019 | Q3 2019 | Q4 2019 | Q1 2020 | ||||||||||
| Current Assets | |||||||||||||||
| Cash & Due from Bank | $20,243 | $30,930 | $13,758 | $38,555 | $19,845 | ||||||||||
| Federal Funds/Overnight Funds | 1,718 | 0 | 0 | 5,215 | 0 | ||||||||||
| Bank Owned CDs | 1,322 | 1,322 | 1,069 | 77 | 0 | ||||||||||
| Investment Securities | 161,561 | 141,013 | 139,907 | 139,880 | 184,377 | ||||||||||
| Total Current Assets | $184,844 | $173,265 | $154,733 | $183,727 | $204,222 | ||||||||||
| Loans | |||||||||||||||
| Construction and Development | $41,777 | $40,040 | $43,661 | $47,593 | $56,430 | ||||||||||
| Commercial Real Estate | 144,178 | 153,527 | 155,397 | 146,287 | 142,610 | ||||||||||
| Commercial Loans | 28,177 | 28,036 | 42,921 | 53,833 | 53,383 | ||||||||||
| Multi Family | 1,438 | 1,970 | 1,939 | 1,611 | 1,601 | ||||||||||
| Residential Mortgage | 92,405 | 85,064 | 80,391 | 77,772 | 73,778 | ||||||||||
| Consumer Loans | 1,086 | 1,384 | 1,022 | 830 | 2,144 | ||||||||||
| County/Municipal Loans | 2,301 | 2,037 | 2,037 | 3,109 | 3,732 | ||||||||||
| Loss Share Loans | 3,975 | 3,933 | 3,859 | 3,601 | 2,451 | ||||||||||
| Total Loans | $315,337 | $315,991 | $331,227 | $334,488 | $334,488 | ||||||||||
| Allowance for Loss | (2,968 | ) | (3,022 | ) | (3,073 | ) | (3,039 | ) | (3,184 | ) | |||||
| Net Loans | $312,369 | $312,698 | $328,154 | $331,596 | $331,596 | ||||||||||
| OREO | 670 | 575 | 0 | 497 | 529 | ||||||||||
| FDIC Indemnification | 0 | 0 | 0 | 0 | 0 | ||||||||||
| BOLI | 22,039 | 22,186 | 22,323 | 22,456 | 22,583 | ||||||||||
| Fixed Assets, net | 9,268 | 9,180 | 8,982 | 8,862 | 8,705 | ||||||||||
| Intangible Assets | 107 | 100 | 96 | 84 | 80 | ||||||||||
| Other Assets | 13,336 | 10,083 | 9,424 | 8,740 | 8,604 | ||||||||||
| Total Assets | $542,633 | $528,503 | $523,711 | $555,960 | $577,669 | ||||||||||
| Liabilities & Stockholders' Equity | |||||||||||||||
| Liabilities | |||||||||||||||
| Deposits | |||||||||||||||
| DDAs | $99,896 | $98,229 | $94,680 | $103,154 | $96,517 | ||||||||||
| Interest Bearing Demand | 59,270 | 59,606 | 63,386 | 87,685 | 85,746 | ||||||||||
| Celebration Checking | 102,617 | 100,950 | 97,277 | 98,558 | 103,718 | ||||||||||
| Money Market Accts | 49,584 | 33,080 | 32,382 | 33,888 | 37,693 | ||||||||||
| Savings | 44,152 | 44,407 | 44,383 | 44,370 | 44,516 | ||||||||||
| CDs Less Than $100k | 56,664 | 56,256 | 56,543 | 54,228 | 53,616 | ||||||||||
| CDs Greater than $100k | 39,867 | 38,854 | 41,846 | 43,404 | 47,259 | ||||||||||
| Total Deposits | $452,054 | $431,382 | $430,497 | $465,288 | $469,064 | ||||||||||
| Other Liabilities | 2,492 | 2,583 | 2,516 | 2,143 | 2,415 | ||||||||||
| Net Borrowings (Wholesale Funding) | 30,000 | 33,795 | 33,429 | 34,697 | 50,228 | ||||||||||
| Total Liabilities | $484,546 | $467,760 | $466,443 | $502,127 | $521,708 | ||||||||||
| Total Equity | 58,087 | 60,743 | 57,268 | 53,833 | 55,961 | ||||||||||
| Total Liabilities & Stockholders' Equity | $542,633 | $528,503 | $523,711 | $555,960 | $577,669 | ||||||||||
| Ratios | ||||||||||
| Q1 2019 | Q2 2019 | Q3 2019 | Q4 2019 | Q1 2020 | ||||||
| ROAA | 0.86% | 0.78% | 1.09% | 0.98% | 0.75% | |||||
| ROAE | 8.32% | 7.04% | 10.10% | 9.52% | 7.30% | |||||
| NPAs/Assets (Core) | 0.92% | 1.09% | 1.00% | 0.77% | 0.80% | |||||
| Est. T1 Leverage (Bank) | 9.46% | 9.95% | 9.65% | 9.63% | 9.62% | |||||
| Total Common Shares | 6,198,632 | 6,360,273 | 5,849,101 | 5,832,793 | 5,832,793 | |||||
| Total Preferred Shares | 2,223,360 | 2,061,719 | 2,058,121 | 2,054,759 | 2,054,759 | |||||
| Total Common Equiv. Shares | 8,421,992 | 8,421,992 | 7,907,222 | 7,887,552 | 7,887,552 | |||||
| NIM (Bank) | 3.79% | 3.74% | 3.92% | 4.03% | 3.65% | |||||
| Cost of Deposits | 0.49% | 0.51% | 0.54% | 0.53% | 0.54% | |||||
| Loan/Deposit | 69.5% | 73.0% | 76.7% | 71.9% | 71.6% | |||||
| Employees | 105 | 106 | 103 | 105 | 104 | |||||
| Loans in Atlanta MSA | 66.0% | 67.4% | 76.8% | 77.5% | 78.2% | |||||