Highlights
- Net income of $2.6 million for the first quarter of 2017, an increase of 21.0% over the first quarter of 2016
- Diluted earnings per share of $0.38 for the first quarter of 2017
- Book value per share of $19.06 and tangible book value per share of $18.10 as of March 31, 2017
- Loan growth of $18.5 million in the first quarter of 2017
- Deposit growth of $3.8 million in the first quarter of 2017
MANITOWOC, Wis., April 20, 2017 (GLOBE NEWSWIRE) -- County Bancorp, Inc. (NASDAQ:ICBK), the holding company of Investors Community Bank, a commercial bank headquartered in Manitowoc, Wisconsin, reported net income of $2.6 million, or $0.38 diluted earnings per share, for the first quarter of 2017, compared to net income of $2.2 million, or $0.35 diluted earnings per share, for the first quarter of 2016. This represents a return on average assets of 0.85% for the three months ended March 31, 2017, compared to 0.97% for the three months ended March 31, 2016.
“Our financial performance this quarter was solid, including commercial sector loan growth, and built upon our existing foundation,” said Tim Schneider, President of County Bancorp, Inc. and CEO of Investors Community Bank. “We feel that our acquisition of Fox River Valley Bancorp, Inc. in 2016 continues to create opportunities for commercial loan growth in the new markets we serve and has had a positive impact on our balance sheet. We did see a decline in non-interest income, which is primarily due to Farm Service Agency procedural changes that will temporarily delay secondary market sale activity. Non-performing assets saw slight improvement, but the dairy sector is experiencing some challenges from a prolonged lower milk price cycle. However, our organization has been through four down milk price cycles in our 20-year history and we have worked through these previous cycles with minimal credit losses. As we move the organization forward we continue to focus on sound underwriting, loan growth, and an efficient operating model, which result in strong bottom line returns.”
Total assets at March 31, 2017 were $1.3 billion, an increase of $8.7 million over total assets as of December 31, 2016, and an increase of $341.8 million over total assets as of March 31, 2016. Total loans were $1.0 billion at March 31, 2017, which represents an $18.5 million increase over total loans at December 31, 2016, and a $273.2 million increase over total loans at March 31, 2016. Total deposits at March 31, 2017 were $981.3 million, an increase of $3.8 million over total deposits as of December 31, 2016, and an increase of $288.1 million over total deposits as of March 31, 2016. The increases between March 31, 2016 and March 31, 2017 were primarily due to the acquisition of Fox River Valley Bancorp, Inc., and its subsidiary bank, The Business Bank, which closed in May 2016.
Non-interest income for the first quarter of 2017 decreased $0.2 million to $1.7 million from the first quarter of 2016 primarily due to a $0.4 million decrease in loan servicing rights, partially offset by an aggregate $0.2 million increase in loan servicing fees and service charges. The decrease in loan servicing rights resulted from lower volumes of secondary market sales and participations.
Non-interest expense for the first quarter of 2017 increased $1.3 million to $5.9 million from the first quarter of 2016 primarily as the result of a $1.1 million increase in employee compensation and benefits due to an increase in employees of approximately 35%, primarily related to the acquisition, and an increase in benefit costs of approximately 30% between the two periods. There was also an increase in depreciation and amortization of $0.2 million related to the addition of two branches in new markets during the second quarter of 2016 in connection with the acquisition, which was offset by a $0.4 million gain on the sale of two OREO properties.
Net income for the quarters ended March 31, 2017 and 2016 were $2.6 million and $2.2 million, respectively. The increase in net income of $0.4 million between the first quarters of 2017 and 2016 was primarily the result of increased interest income due to increased loan volumes and was partially offset by a $0.4 million decrease in loan serving rights and a $1.1 million increase in employee compensation and benefits. Net interest margin decreased to 3.07% for the three months ended March 31, 2017, compared to 3.19% for the three months ended March 31, 2016.
Provision for loan losses for the three months ended March 31, 2017 was $761.0 thousand compared to $812.0 thousand for the three months ended March 31, 2016. The decreased provision resulted from an improvement in the qualitative economic factors we use to assess our portfolio.
About County Bancorp, Inc.
County Bancorp, Inc., a Wisconsin corporation and registered bank holding company founded in May 1996, and our wholly-owned subsidiary Investors Community Bank, a Wisconsin-chartered bank, are headquartered in Manitowoc, Wisconsin. The state of Wisconsin is often referred to as “America’s Dairyland,” and one of the niches we have developed is providing financial services to agricultural businesses statewide, with a primary focus on dairy-related lending. We also serve business and retail customers throughout Wisconsin, with a focus on northeastern and central Wisconsin. Our customers are served from our full-service locations in Manitowoc, Appleton, Green Bay, and Stevens Point and our loan production offices in Darlington, Eau Claire, Fond du Lac, and Sheboygan.
Forward-Looking Statements
This press release includes "forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking statements presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "plan," "seek," "will," "expect," "intend," "estimate," "anticipate," "believe" or "continue" or the negative thereof or variations thereon or similar terminology. Factors that may cause actual results to differ materially from those made or suggested by the forward-looking statements contained in this press release include those identified in County Bancorp, Inc.’s most recent annual report on Form 10-K and subsequent filings with the Securities and Exchange Commission. Any forward-looking statements presented herein are made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.
County Bancorp, Inc.
Consolidated Financial Summary (Unaudited)
| March 31, 2017 | December 31, 2016 | March 31, 2016 | ||||||||||
| (dollars in thousands, except per share data) | ||||||||||||
| Selected Balance Sheet Data: | ||||||||||||
| Total assets | $ | 1,251,414 | $ | 1,242,670 | $ | 909,557 | ||||||
| Total loans | 1,049,009 | 1,030,486 | 775,848 | |||||||||
| Allowance for loan losses | 13,428 | 12,645 | 11,218 | |||||||||
| Securities available for sale, at fair value | 115,431 | 123,437 | 79,692 | |||||||||
| Goodwill | 5,038 | 5,038 | - | |||||||||
| Core deposit intangible, net of amortization | 1,300 | 1,441 | - | |||||||||
| Deposits | 981,317 | 977,518 | 693,181 | |||||||||
| Shareholders' equity | 134,074 | 131,288 | 109,378 | |||||||||
| Common equity | 126,074 | 123,288 | 101,378 | |||||||||
| Stock Price Information: | ||||||||||||
| High - Year-to-date | $ | 35.89 | $ | 26.97 | $ | 21.80 | ||||||
| Low - Year-to-date | $ | 24.70 | $ | 18.25 | $ | 18.25 | ||||||
| Market price per common share | $ | 29.06 | $ | 26.97 | $ | 20.08 | ||||||
| Book value per share | $ | 19.06 | $ | 18.72 | $ | 17.52 | ||||||
| Tangible book value per share (1) | $ | 18.10 | $ | 17.74 | $ | 17.52 | ||||||
| Average diluted shares of common stock year-to-date | 6,727,502 | 6,415,204 | 5,888,054 | |||||||||
| Common shares outstanding | 6,615,232 | 6,586,335 | 5,786,701 | |||||||||
| Non-Performing Assets: | ||||||||||||
| Nonaccrual loans | $ | 15,263 | $ | 20,107 | $ | 19,564 | ||||||
| Other real estate owned | 6,597 | 2,763 | 2,947 | |||||||||
| Total non-performing assets | $ | 21,860 | $ | 22,870 | $ | 22,511 | ||||||
| Restructured loans not on nonaccrual | $ | 4,446 | $ | 4,300 | $ | 602 | ||||||
| Non-performing assets as a % of total loans | 2.08 | % | 2.22 | % | 2.90 | % | ||||||
| Non-performing assets as a % of total assets | 1.75 | % | 1.84 | % | 2.47 | % | ||||||
| Allowance for loan losses as a % of nonperforming assets | 61.43 | % | 55.29 | % | 49.83 | % | ||||||
| Allowance for loan losses as a % of total loans | 1.28 | % | 1.23 | % | 1.45 | % | ||||||
| Net charge-offs (recoveries) year-to-date | $ | (21 | ) | $ | 718 | $ | (1 | ) | ||||
| Provision for loan loss year-to-date | $ | 761 | $ | 2,959 | $ | 812 | ||||||
(1) This is a non-GAAP financial measure. A reconciliation to GAAP is included below.
| For the Three Months Ended | ||||||||
| March 31, 2017 | March 31, 2016 | |||||||
| (dollars in thousands, except per share data) | ||||||||
| Selected Income Statement Data: | ||||||||
| Net interest income | $ | 9,198 | $ | 6,937 | ||||
| Provision for loan losses | 761 | 812 | ||||||
| Net interest income after provision for loan losses | 8,437 | 6,125 | ||||||
| Non-interest income | 1,716 | 1,937 | ||||||
| Non-interest expense | 5,895 | 4,591 | ||||||
| Income tax expense | 1,626 | 1,295 | ||||||
| Net income | $ | 2,632 | $ | 2,176 | ||||
| Return on average assets | 0.85 | % | 0.97 | % | ||||
| Return on average shareholders' equity | 7.85 | % | 7.99 | % | ||||
| Return on average common shareholders' equity (1) | 8.09 | % | 8.99 | % | ||||
| Efficiency ratio (1) | 57.45 | % | 50.79 | % | ||||
| Per Common Share Data: | ||||||||
| Basic | $ | 0.39 | $ | 0.36 | ||||
| Diluted | $ | 0.38 | $ | 0.35 | ||||
| Dividends declared | $ | 0.06 | $ | 0.05 | ||||
(1) This is a non-GAAP financial measure. A reconciliation to GAAP is included below.
| For the Three Months Ended | ||||||||
| March 31, 2017 | March 31, 2016 | |||||||
| (dollars in thousands) | ||||||||
| Non-interest income: | ||||||||
| Service charges | $ | 325 | $ | 277 | ||||
| Gain on sale of loans | 25 | 100 | ||||||
| Loan servicing fees | 1,410 | 1,297 | ||||||
| Loan servicing rights | (205 | ) | 150 | |||||
| Income on OREO | 18 | 5 | ||||||
| Other | 143 | 108 | ||||||
| Total | $ | 1,716 | $ | 1,937 | ||||
| Non-interest expense: | ||||||||
| Employee compensation and benefits | $ | 4,057 | $ | 3,001 | ||||
| Occupancy | 177 | 93 | ||||||
| Information processing | 362 | 280 | ||||||
| Professional fees | 414 | 309 | ||||||
| Business development | 170 | 140 | ||||||
| FDIC assessment | 92 | 137 | ||||||
| OREO expenses | 62 | 36 | ||||||
| Writedown of OREO | - | 84 | ||||||
| Net gain on OREO | (375 | ) | - | |||||
| Depreciation and amortization | 343 | 98 | ||||||
| Other | 593 | 413 | ||||||
| Total | $ | 5,895 | $ | 4,591 | ||||
| Non-GAAP Financial Measures | ||||||||
| Return on average common shareholders' equity reconciliation: | ||||||||
| Return on average shareholders' equity | 7.85 | % | 7.99 | % | ||||
| Effect of excluding average preferred shareholders' equity | 0.24 | % | 1.00 | % | ||||
| Return on average common shareholders' equity | 8.09 | % | 8.99 | % | ||||
| Efficiency ratio GAAP to non-GAAP reconciliation: | ||||||||
| Non-interest expense | $ | 5,895 | $ | 4,591 | ||||
| Less: net gain (loss) on sales and write-downs of OREO | 375 | (84 | ) | |||||
| Adjusted non-interest expense (non-GAAP) | $ | 6,270 | $ | 4,507 | ||||
| Net interest income | $ | 9,198 | $ | 6,937 | ||||
| Non-interest income | 1,716 | 1,937 | ||||||
| Operating revenue | $ | 10,914 | $ | 8,874 | ||||
| Efficiency ratio | 57.45 | % | 50.79 | % | ||||
| Tangible book value per share reconciliation: | ||||||||
| Common equity | $ | 126,074 | $ | 123,288 | ||||
| Less: Goodwill | 5,038 | 5,038 | ||||||
| Less: Core deposit intangible, net of amortization | 1,300 | 1,441 | ||||||
| Tangible common equity (non-GAAP) | $ | 119,736 | $ | 116,809 | ||||
| Common shares outstanding | 6,615,232 | 6,586,335 | ||||||
| Tangible book value per share | $ | 18.10 | $ | 17.74 | ||||
| Three Months Ended | ||||||||||||||||||||||||
| March 31, 2017 | March 31, 2016 | |||||||||||||||||||||||
| Average Balance (1) | Income/ Expense | Yields/ Rates | Average Balance (1) | Income/ Expense | Yields/ Rates | |||||||||||||||||||
| (dollars in thousands) | ||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||
| Investment securities | $ | 118,825 | $ | 522 | 1.76 | % | $ | 81,933 | $ | 349 | 1.70 | % | ||||||||||||
| Loans (2) | 1,043,454 | 11,554 | 4.43 | % | 768,927 | 8,730 | 4.54 | % | ||||||||||||||||
| Interest bearing deposits due from other banks | 36,996 | 60 | 0.65 | % | 19,114 | 39 | 0.82 | % | ||||||||||||||||
| Total interest-earning assets | $ | 1,199,275 | $ | 12,136 | 4.05 | % | $ | 869,974 | $ | 9,118 | 4.19 | % | ||||||||||||
| Allowance for loan losses | (13,047 | ) | (10,835 | ) | ||||||||||||||||||||
| Other assets | 52,894 | 41,085 | ||||||||||||||||||||||
| Total assets | $ | 1,239,122 | $ | 900,224 | ||||||||||||||||||||
| Liabilities | ||||||||||||||||||||||||
| Savings, NOW, money market, interest checking | $ | 258,080 | 355 | 0.55 | % | $ | 174,611 | 209 | 0.48 | % | ||||||||||||||
| Time deposits | 610,857 | 2,082 | 1.36 | % | 440,228 | 1,603 | 1.46 | % | ||||||||||||||||
| Total interest-bearing deposits | $ | 868,937 | $ | 2,437 | 1.12 | % | $ | 614,839 | $ | 1,812 | 1.18 | % | ||||||||||||
| Other borrowings | 1,863 | 27 | 5.80 | % | 3,973 | 48 | 4.83 | % | ||||||||||||||||
| FHLB advances | 116,617 | 354 | 1.21 | % | 83,142 | 255 | 1.23 | % | ||||||||||||||||
| Junior subordinated debentures | 15,470 | 120 | 3.10 | % | 12,372 | 66 | 2.13 | % | ||||||||||||||||
| Total interest-bearing liabilities | $ | 1,002,887 | $ | 2,938 | 1.17 | % | $ | 714,326 | $ | 2,181 | 1.22 | % | ||||||||||||
| Non-interest-bearing deposits | 93,323 | 60,352 | ||||||||||||||||||||||
| Other liabilities | 8,838 | 7,824 | ||||||||||||||||||||||
| Total liabilities | $ | 1,105,048 | $ | 782,502 | ||||||||||||||||||||
| SBLF preferred stock (3) | - | 8,736 | ||||||||||||||||||||||
| Shareholders' equity | 134,074 | 108,986 | ||||||||||||||||||||||
| Total liabilities and equity | $ | 1,239,122 | $ | 900,224 | ||||||||||||||||||||
| Net interest income | $ | 9,198 | $ | 6,937 | ||||||||||||||||||||
| Interest rate spread (4) | 2.88 | % | 2.97 | % | ||||||||||||||||||||
| Net interest margin (5) | 3.07 | % | 3.19 | % | ||||||||||||||||||||
| Ratio of interest-earning assets to interest-bearing liabilities | 1.20 | 1.22 | ||||||||||||||||||||||
(1) Average balances are calculated on amortized cost.
(2) Includes loan fee income, nonaccruing loan balances, and interest received on such loans.
(3) The SBLF preferred stock refers to our Noncumulative Perpetual Preferred Stock, Series C, issued to the U.S. Treasury through the U.S. Treasury’s Small Business Lending Fund program. This stock was redeemed on February 23, 2016.
(4) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(5) Net interest margin represents net interest income divided by average total interest-earning assets.