WALDORF, Md., Oct. 18, 2016 (GLOBE NEWSWIRE) -- The Community Financial Corporation (NASDAQ:TCFC) (the “Company”), the holding company for Community Bank of the Chesapeake (the “Bank”), reported its results of operations for the third quarter and nine months of 2016. Consolidated net income available to common shareholders was $2.0 million or $0.42 per common share (diluted) for the three months ended September 30, 2016, an increase of $225,000, or $0.04 per common share (diluted), compared to the three months ended June 30, 2016. The Company’s income before income taxes increased $161,000 to $3.0 million for the three months ended September 30, 2016 from $2.8 million for the three months ended June 30, 2016.
Consolidated net income available to common shareholders was $2.0 million for the three months ended September 30, 2016, an increase of $680,000, compared to $1.3 million for the three months ended September 30, 2015. Earnings per common share (diluted) at $0.42 increased $0.15 from $0.27 per common share (diluted) for the three months ended September 30, 2015. Third quarter 2015 operating results reflected a $0.05 impact to earnings per share for the loss on the sale of the Company’s King George branch. Consolidated net income available to common shareholders of $5.3 million or $1.15 per common share (diluted) for the nine months ended September 30, 2016 increased $517,000 or $0.13 per common share (diluted) compared to the nine months ended September 30, 2015.
“The Company’s current year loan growth of 19.2% (annualized) to $1,051.4 million as of September 30, 2016, on a stable operating expense base has increased the Company’s operating leverage,” stated James M. Burke, President of Community Bank of the Chesapeake and Chief Risk Officer. “Based on our loan pipeline, we are optimistic that our interest-earning assets will continue to grow at a rate faster than expenses through 2017. During the third quarter, the Company’s efficiency and net operating expense ratios improved 178 and nine basis points to 66.55% and 2.06%, respectively, compared to the second quarter.”
“The continued success in overall operations including the organic growth in funding and loans as well as significant progress in resolving nonperforming and classified assets closely tracks to our strategic plan,” stated Chairman Michael Middleton.
Operations – Three Months Ended September 30, 2016 compared to Three Months Ended June 30, 2016
Consolidated net income available to common shareholders was $2.0 million for the three months ended September 30, 2016, an increase of $225,000 compared to the three months ended June 30, 2016. This is attributable to increased net interest income of $249,000 and noninterest income of $65,000 and a reduction in income tax expense of $64,000, partially offset by increases to the provision for loan losses of $134,000 and noninterest expense of $19,000.
Net interest income increased $249,000 to $10.1 million for the three months ended September 30, 2016 compared to $9.9 million for the three months ended June 30, 2016. Net interest margin at 3.47% for the three months ended September 30, 2016 decreased five basis points from 3.52% for the three months ended June 30, 2016. Net interest margin in the second quarter of 2016 was positively impacted by approximately five basis points from loans returning to performing status from nonaccrual and other miscellaneous activities, such as loan payoffs. The Company expects slight net interest margin compression during the fourth quarter based on the repricing of its portfolio and the loan pipeline and plans to add additional investments.
During the three months ended September 30, 2016, the Company’s cost of funds decreased one basis point to 0.73% compared to 0.74% for the second quarter of 2016. Average transaction deposits, which include savings, money market, interest-bearing demand and non-interest bearing demand accounts, for the three months ended September 30, 2016 increased $39.4 million, or 7.1%, to $595.4 million compared to $556.0 million for the three months ended June 30, 2016. Average non-interest-bearing demand deposits increased $2.6 million, or 1.9%, to $144.8 million compared to the prior quarter.
Medium-term interest rates have fallen since the fourth quarter of 2015, with the ten year U.S. Treasury rate as of October 11, 2016 ending at 1.77%. Although the ten year rate has seen some slight increases recently it has been as low as 1.37% (July 8, 2016) in 2016. This is down from 2.27% at December 31, 2015. The five year U.S. Treasury rate as of October 11, 2016 was 1.30%. This is down from 1.76% at December 31, 2015. Assuming treasury rates remain at current rates in the 5 to 10 year range, there will be more negative pressure on the re-pricing of the loan portfolio and the pricing of new loans. The downward trend in treasury rates had a positive impact on local deposit pricing through the second quarter of 2016. The Company is optimistic that interest-earning asset growth will continue to offset the negative impacts of lower asset yields in the current interest rate environment during the fourth quarter of 2016.
Interest and dividend income increased by $295,000 to $12.2 million for the three months ended September 30, 2016 compared to $11.9 million for the three months ended June 30, 2016, primarily due to increased income from the growth in the average balance of loans. Additionally, interest income increased due to higher yields on investments. These increases to interest income were partially offset by a decrease in yields on loans and lower average investment balances. Second quarter 2016 loan yields were positively impacted by loans returning to performing status from nonaccrual and loan payoffs. Interest income on loans increased $560,000 due to growth of $49.7 million in the average balance of loans from $966.7 million for the three months ended June 30, 2016 to $1,016.4 million for the three months ended September 30, 2016. Average loan yields decreased 11 basis points from 4.62% for the three months ended June 30, 2016 to 4.51% for the three months ended September 30, 2016, which resulted in a decrease in interest income of $270,000. Second quarter 2016 loan yields would have been 4.56% if the positive impacts to interest income were subtracted for loans returning to performing status from nonaccrual and loan payoffs. Overall portfolio loan yields have decreased as the Bank has added residential owner-occupied first mortgages during 2016, which have increased from 14.30% of the loan portfolio at December 31, 2015 to 15.91% of the portfolio at September 30, 2016. Interest and dividend income on investments increased a net of $5,000 during the third quarter of 2016 compared to the prior quarter. An increase in average yields from 1.93% to 1.99% resulted in an increase of $22,000 partially offset by a $17,000 reduction in interest and dividend investment income due to a $3.5 million decrease in average investment balances.
Interest expense increased $46,000 to $2.1 million for the three months ended September 30, 2016 compared to the prior quarter due to an increase in the average balances of interest-bearing liabilities partially offset by a small decrease in the cost of interest-bearing liabilities. During the three months ended September 30, 2016, interest expense increased $25,000 due to larger average balances of interest-bearing transaction deposit accounts which increased $36.7 million from $413.9 million for the three months ended June 30, 2016 to $450.6 million for the three months ended September 30, 2016. Interest expense increased $38,000 due to $4.9 million in higher average long-term and short-term debt balances than the prior quarter. Interest-bearing deposit accounts interest expense increased a net of $2,000 due to rates. Certificates of deposit interest expense increased $24,000 or three basis points from 0.85% in the prior quarter to 0.88% for the three months ended September 30, 2016. This was partially offset by a $22,000 reduction in interest expense due to lower rates for savings and interest-bearing demand and money market accounts for the comparable periods. Savings and interest-bearing demand and money market accounts decreased seven and one basis points, respectively, from the prior quarter to 0.05% and 0.30% for the three months ended September 30, 2016. The cost of total deposits at 0.48% for the three months ended September 30, 2016 decreased one basis point from 0.49% for the three months ended June 30, 2016 due to an increase in average transaction deposit accounts as a percentage of total deposits from 57.3% in the second quarter of 2016 to 59.1% in the third quarter of 2016. Additionally, interest expense decreased $16,000 for the comparable period due a reduction in the average rate paid on debt. The average rate paid on debt, which includes long-term debt, trust preferred junior subordinated debentures (“TRUPS”), subordinated notes, and short-term borrowings, declined from 2.66% for the three months ended June 30, 2016 to 2.63% for the three months ended September 30, 2016.
The provision for loan losses increased $134,000 to $698,000 for the three months ended September 30, 2016 compared to $564,000 for the three months ended June 30, 2016. Net charge-offs for the current quarter increased $94,000 from $48,000 for the three months ended June 30, 2016 to $142,000 for the three months ended September 30, 2016. Improvements to baseline charge-off factors for the periods used to evaluate the adequacy of the allowance as well as improvements in some qualitative factors, such as reductions in classified assets and delinquency, were offset by increases in other qualitative factors, such as increased loan growth. Overall, these changes resulted in a higher provision for loan losses for the comparable periods. The specific allowance is based on management’s estimate of realizable value for particular loans and has decreased as specific credits have been resolved through a return to performance, charge-offs or additions to other real estate owned.
Noninterest income increased by $65,000 to $842,000 for the three months ended September 30, 2016 compared to $777,000 for the three months ended June 30, 2016. During the second quarter of 2016, the Company recognized losses on the disposition of other real estate owned (“OREO”) which was partially offset by increased service charge income attributable to wealth services and rental income on OREO properties that were disposed of during the second quarter. Second quarter noninterest income adjusted for OREO activity and wealth service income was comparable to the first and third quarters of 2016.
Noninterest expense was flat at $7.3 million for the second and third quarters of 2016. Noninterest expense increased $19,000 or 0.3% compared to the second quarter with slight increases to compensation and benefits and OREO costs offset by decreased operating expenses. The Company’s compensation and benefits increased slightly in the third quarter of 2016 compared to the prior quarter due to a slight increase in incentive based compensation accruals. The Company is focused on continuing its 2016 initiative to control the growth of expenses by streamlining internal processes and reviewing vendor relationships. The Company’s strategy is to create operating leverage and increase both its return on average assets and return on equity over the next year through continued asset growth combined with controlling the growth in expenses. The Company’s efficiency ratio, noninterest expense as a percentage of average assets and net operating expense as a percentage of average assets for the three months ended September 30, 2016 compared to the three months ended June 30, 2016 were 66.55%, 2.33%, and 2.06% , respectively, and 68.33%, 2.41%, and 2.15%, respectively. The following is a summary breakdown of noninterest expense compared to the prior quarter:
Three Months Ended | ||||||||||||||||
(dollars in thousands) | September 30, 2016 | June 30, 2016 | $ Change | % Change | ||||||||||||
Compensation and Benefits | $ | 4,268 | $ | 4,197 | $ | 71 | 1.7 | % | ||||||||
OREO Valuation Allowance and Expenses | 203 | 105 | 98 | 93.3 | % | |||||||||||
Operating Expenses | 2,840 | 2,990 | (150 | ) | (5.0 | %) | ||||||||||
Total Noninterest Expense | $ | 7,311 | $ | 7,292 | $ | 19 | 0.3 | % | ||||||||
Operations – Three Months Ended September 30, 2016 compared to Three Months Ended September 30, 2015
Consolidated net income available to common shareholders of $2.0 million for the three months ended September 30, 2016 increased $680,000 compared to the three months ended September 30, 2015. This is attributable to increased net interest income of $1.1 million and noninterest income of $376,000, partially offset by increases to the provision for loan losses of $197,000, noninterest expense of $280,000 and income tax expense of $279,000.
Net interest income increased $1.1 million to $10.1 million for the three months ended September 30, 2016 compared to $9.1 million for the three months ended September 30, 2015. The net interest margin was 3.47% for the three months ended September 30, 2016, an eight basis point decrease from 3.55% for the three months ended September 30, 2015. The decrease in net interest margin was largely the result of lower yields on loans partially offset on a lower cost of funds.
Interest and dividend income increased by $1.2 million to $12.2 million for the three months ended September 30, 2016 compared to $11.0 million for the three months ended September 30, 2015, primarily due to increased income from the growth in the average balance of loans. Interest and dividend income also increased due to moderate growth in the average balance of investments and increased investment yields. Interest and dividend income on loans increased $1.5 million due to growth of $136.7 million in the average balance of loans from $879.7 million for the three months ended September 30, 2015 to $1,016.4 million for the three months ended September 30, 2016. Interest and dividend income on investments increased $97,000 during the third quarter of 2016 compared to the same period in the prior year as average interest-earning investment balances increased $8.3 million and average yields increased from 1.84% to 1.99%. Average loan yields declined 19 basis points from 4.70% for the three months ended September 30, 2015 to 4.51% for the three months ended September 30, 2016, which resulted in a decrease in interest and dividend income of $417,000.
Interest expense increased $161,000 to $2.1 million for the three months ended September 30, 2016 compared to $1.9 million for the three months ended September 30, 2015, due primarily to an increase in the average balances of interest-bearing liabilities and a slight change in the composition of interest-bearing liabilities between the comparable periods. During the three months ended September 30, 2016, interest expense increased $153,000 due to larger average balances of interest-bearing transaction deposit accounts, time deposits and short-term borrowings compared to the same quarter of 2015. Additionally, interest expense increased $51,000 due to increased rates on certificates of deposits and debt. These increases to interest expense were partially offset by a reduction in interest expense of $30,000 due to a $5.1 million decrease in average long-term debt balances from the comparable period to $65.6 million for the three months ended September 30, 2016. As a result of the change in the composition of debt, the average rate paid on debt declined from 3.06% for the three months ended September 30, 2015 to 2.63% for the comparable period in 2016.
The Company continued to make progress in controlling overall deposit costs by increasing transaction deposits as a percentage of overall deposits. Average transaction accounts as a percentage of average total deposits increased from 57.0% for the three months ended September 30, 2015 to 59.1% for the three months ended September 30, 2016. Deposit costs at 0.48% were the same for the three months ended September 30, 2016 and 2015, respectively. Average transaction deposits, which include savings, money market, interest-bearing demand and noninterest bearing demand accounts, for the three months ended September 30, 2016 increased $91.9 million or 18.3% to $595.4 million compared to $503.5 million for the comparable period in 2015. The increase in average transaction deposits included growth in average noninterest bearing demand deposits of $21.7 million from $123.1 million for the three months ended September 30, 2015 to $144.8 million for the three months ended September 30, 2016.
The provision for loan losses increased $197,000 to $698,000 for the three months ended September 30, 2016 compared to $501,000 for the three months ended September 30, 2015. Net charge-offs for the quarter decreased $741,000 from $883,000 for the three months ended September 30, 2015 to $142,000 for the three months ended September 30, 2016. Improvements to baseline charge-off factors for the periods used to evaluate the adequacy of the allowance as well as improvements in some qualitative factors, such as reductions in classified assets and delinquency, were offset by increases in other qualitative factors, such as increased loan growth. Overall, these changes resulted in a higher provision for loan losses for the comparable periods. The specific allowance is based on management’s estimate of realizable value for particular loans and has decreased as specific credits have been resolved through a return to performance, charge-offs or additions to OREO.
Noninterest income increased by $376,000 to $842,000 for the three months ended September 30, 2016 compared to $466,000 for the three months ended September 30, 2015. During the third quarter of 2015, noninterest income was adversely affected by a one-time expense to record a $426,000 provision for the loss on the sale of the King George, Virginia branch building and equipment, which settled during the first quarter of 2016. Third quarter 2016 and 2015 noninterest income were comparable after adjustment for 2015 branch building and equipment sale.
For the three months ended September 30, 2016, noninterest expense increased 4.0%, or $280,000, to $7.3 million from $7.0 million for the comparable period in 2015. The Company’s 2015 total growth in salary and benefit costs was 3.2%. Total growth of salary and benefits in the first nine months of 2016 was $399,000 or 3.3%. The Company’s efficiency ratio, noninterest expense as a percentage of average assets and net operating expense as a percentage of average assets for the three months ended September 30, 2016 and 2015 were 66.55%, 2.33%, and 2.06%, respectively, and 73.62%, 2.55%, and 2.38%, respectively. The following is a summary breakdown of noninterest expense:
Three Months Ended September 30, | ||||||||||||||||
(dollars in thousands) | 2016 | 2015 | $ Change | % Change | ||||||||||||
Compensation and Benefits | $ | 4,268 | $ | 4,185 | $ | 83 | 2.0 | % | ||||||||
OREO Valuation Allowance and Expenses | 203 | 129 | 74 | 57.4 | % | |||||||||||
Operating Expenses | 2,840 | 2,717 | 123 | 4.5 | % | |||||||||||
Total Noninterest Expense | $ | 7,311 | $ | 7,031 | $ | 280 | 4.0 | % | ||||||||
Operations – Nine months Ended September 30, 2016 compared to Nine months Ended September 30, 2015
Consolidated net income available to common shareholders of $5.3 million for the nine months ended September 30, 2016 increased $517,000 compared to the nine months ended September 30, 2015. This is attributable to increased net interest income and noninterest income of $2.2 million and $79,000, respectively, and preferred dividends paid of $23,000 in 2015, partially offset by increases to the provision for loan losses of $618,000, noninterest expense of $981,000 and income tax expense of $238,000.
Net interest income increased $2.2 million to $29.4 million for the nine months ended September 30, 2016 compared to $27.2 million for the nine months ended September 30, 2015. The net interest margin was 3.50% for the nine months ended September 30, 2016, a 10 basis point decrease from 3.60% for the nine months ended September 30, 2015. The decrease in net interest margin was largely the result of lower yields on loans and slightly higher funding costs.
Interest and dividend income increased by $2.8 million to $35.5 million for the nine months ended September 30, 2016 compared to $32.7 million for the nine months ended September 30, 2015, primarily due to increased income from the growth in the average balance of loans. Interest and dividend income also increased due to growth in the average balance of investments and increased investment yields. Interest and dividend income on loans increased $3.4 million due to growth of $98.3 million, or 11.3%, in the average balance of loans from $869.3 million for the nine months ended September 30, 2015 to $967.6 million for the nine months ended September 30, 2016. Interest and dividend income on investments increased $509,000 during the first nine months of 2016 compared to the same period in the prior year as average interest-earning investment balances increased $18.8 million and average yields increased from 1.74% to 1.97%. Average loan yields declined 17 basis points from 4.74% for the nine months ended September 30, 2015 to 4.57% for the nine months ended September 30, 2016, which resulted in a decrease in interest and dividend income of $1.1 million. As described previously, ten year and five year U.S. Treasury rates have remained depressed and below 2015 average rates during 2016. Assuming treasury rates remain at current rates in the 5 to 10 year range, there will be continued pressure on the re-pricing of the loan portfolio and the pricing of new loans. The Company is optimistic that interest-earning asset growth will offset the negative impacts of lower asset yields in the current interest rate environment. Additionally, overall portfolio loan yields have decreased as the Bank has added residential first mortgages during 2016, which have increased from 14.30% of the loan portfolio at December 31, 2015 to 15.91% of the portfolio at September 30, 2016.
Interest expense increased $546,000 to $6.0 million for the nine months ended September 30, 2016 compared to $5.5 million for the nine months ended September 30, 2015, due primarily to an increase in the average balances of interest-bearing liabilities and a change in the composition of interest-bearing liabilities between the comparable periods. During the nine months ended September 30, 2016, interest expense increased $529,000 due to larger average balances of interest-bearing transaction deposit accounts, time deposits, short-term borrowings and subordinated notes compared to the same period of 2015. Additionally, interest expense increased $246,000 due to increased rates on interest-bearing deposit accounts and debt. These increases to interest expense were partially offset by a reduction in interest expense of $229,000 due to a $12.5 million decrease in average long-term debt balances from the comparable period to $58.8 million for the nine months ended September 30, 2016. The average rate paid on debt, which includes long-term debt, trust preferred junior subordinated debentures (“TRUPS”), subordinated notes, and short-term borrowings, decreased from 2.77% for the nine months ended September 30, 2015 to 2.67% for the nine months ended September 30, 2016. Interest expense for the nine months ended September 30, 2016 was $148,000 greater than the comparable period as a result of the timing of the funding of the subordinated notes in February 2015.
The Company continued to make progress in controlling deposit costs by increasing transaction deposits as a percentage of overall deposits. Average transaction accounts as a percentage of total deposits increased from 55.8% for the nine months ended September 30, 2015 to 57.8% for the nine months ended September 30, 2016. Deposit costs at 0.48% were the same for the nine months ended September 30, 2016 and 2015, respectively. Average transaction deposits, which include savings, money market, interest-bearing demand and noninterest bearing demand accounts, for the nine months ended September 30, 2016 increased $80.4 million, or 16.8%, to $559.4 million compared to $479.0 million for the comparable period in 2015. The increase in average transaction deposits included growth in noninterest bearing demand deposits of $22.9 million, or 19.67%, from $117.1 million for the nine months ended September 30, 2015 to $140.0 million for the nine months ended September 30, 2016.
The provision for loan losses increased $618,000 to $1.7 million for the nine months ended September 30, 2016 compared to $1.1 million for the nine months ended September 30, 2015. Net charge-offs for the first nine months decreased $610,000 from $1.2 million for the nine months ended September 30, 2015 to $567,000 for the nine months ended September 30, 2016. Improvements to baseline charge-off factors for the periods used to evaluate the adequacy of the allowance as well as improvements in some qualitative factors, such as reductions in classified assets and delinquency, were offset by increases in other qualitative factors, such as increased loan growth. Overall, these changes resulted in a higher provision for loan losses for the comparable periods. The specific allowance is based on management’s estimate of realizable value for particular loans and has decreased as specific credits have been resolved through a return to performance, charge-offs or additions to other real estate owned.
Noninterest income increased by $79,000 to $2.5 million for the nine months ended September 30, 2016 compared to $2.4 million for the nine months ended September 30, 2015. Noninterest income is up $161,000 compared to the prior year due to higher service charge income from the growth in the number of customer accounts, wealth services and rental income on OREO properties that were disposed of during the second quarter of 2016. In addition, no loss was recognized in 2016 comparable to the third quarter 2015 one-time expense to record a $426,000 provision for the loss on the sale of the King George, Virginia branch building and equipment. These positive impacts on noninterest income were offset by decreases to noninterest income from the Company’s exit from the origination of residential first mortgage loans during the second quarter of 2015. There were no gains on residential loans held for sale in the nine months ended September 30, 2016 compared to $104,000 for the nine months ended September 30, 2015. In addition, during the first nine months of 2016, the Company recognized losses of $440,000 on the disposition of OREO compared to $20,000 in OREO losses recognized for the comparable period.
For the nine months ended September 30, 2016, noninterest expense increased 4.7%, or $981,000, to $21.8 million from $20.9 million for the comparable period in 2015. The Company’s 2015 total growth in salary and benefit costs was 3.2%. Total growth of salary and benefits in the first nine months of 2016 was $399,000 or 3.3%. The Company’s efficiency ratio, noninterest expense as a percentage of average assets and net operating expense as a percentage of average assets for the nine months ended September 30, 2016 and 2015 were 68.47%, 2.41%, and 2.14%, respectively, and 70.55%, 2.56%, and 2.27%, respectively. The following is a summary breakdown of noninterest expense:
Nine Months Ended September 30, | ||||||||||||||||
(dollars in thousands) | 2016 | 2015 | $ Change | % Change | ||||||||||||
Compensation and Benefits | $ | 12,617 | $ | 12,218 | $ | 399 | 3.3 | % | ||||||||
OREO Valuation Allowance and Expenses | 609 | 682 | (73 | ) | (10.7 | %) | ||||||||||
Operating Expenses | 8,617 | 7,962 | 655 | 8.2 | % | |||||||||||
Total Noninterest Expense | $ | 21,843 | $ | 20,862 | $ | 981 | 4.7 | % | ||||||||
Financial Condition at September 30, 2016 compared to December 31, 2015
Total assets at September 30, 2016 were $1.28 billion, an increase of $138.5 million, or 12.1% (16.2% on an annualized basis), compared to total assets of $1.14 billion at December 31, 2015. The increase in total assets was primarily attributable to growth in loans. Net loans increased $132.7 million, or 14.6% (19.5% on an annualized basis), from $909.2 million at December 31, 2015 to $1,041.9 million at September 30, 2016, mainly due to increases in loans for commercial real estate and residential first mortgages.
The Company separated residential rentals into a new loan portfolio segment beginning in the second quarter of 2016. Residential rentals include income producing properties that are 1-4 family units and apartment buildings. The Company’s decision to segregate the residential rental portfolio for financial reporting was based on the growth and size of the portfolio and risk characteristics unique to residential rental properties. Residential rentals were previously included in the residential first mortgage and commercial real estate mortgage portfolios.
The following is a breakdown of the Company’s loan portfolio at September 30, 2016 and December 31, 2015:
(dollars in thousands) | September 30, 2016 | % | December 31, 2015 | % | ||||||||||||
Commercial real estate | $ | 625,504 | 59.51 | % | $ | 538,888 | 58.64 | % | ||||||||
Residential first mortgages | 167,306 | 15.91 | % | 131,401 | 14.30 | % | ||||||||||
Residential rentals | 99,288 | 9.44 | % | 93,157 | 10.14 | % | ||||||||||
Construction and land development | 35,475 | 3.37 | % | 36,189 | 3.94 | % | ||||||||||
Home equity and second mortgages | 21,458 | 2.04 | % | 21,716 | 2.36 | % | ||||||||||
Commercial loans | 67,334 | 6.40 | % | 67,246 | 7.32 | % | ||||||||||
Consumer loans | 422 | 0.04 | % | 366 | 0.04 | % | ||||||||||
Commercial equipment | 34,632 | 3.29 | % | 29,931 | 3.26 | % | ||||||||||
1,051,419 | 100.00 | % | 918,894 | 100.00 | % | |||||||||||
Less: | ||||||||||||||||
Deferred loan fees and premiums | (154 | ) | -0.01 | % | 1,154 | 0.13 | % | |||||||||
Allowance for loan losses | 9,663 | 0.92 | % | 8,540 | 0.93 | % | ||||||||||
9,509 | 9,694 | |||||||||||||||
$ | 1,041,910 | $ | 909,200 | |||||||||||||
The Company has been working to reduce classified loans by using approaches that maximize the Company’s contractual rights with each individual customer relationship. The objective is to move non-performing or substandard credits that are not likely to become performing or passing credits in a reasonable timeframe off the balance sheet. The Company is encouraging existing classified customers to obtain financing with other lenders or enforcing its contractual rights. Management believes this strategy is in the best long-term interest of the Company. As a result of these efforts, non-accrual loans and OREO to total assets decreased 50 basis points from 1.83% at December 31, 2015 to 1.33% at September 30, 2016. Non-accrual loans, OREO and TDRs to total assets decreased $6.3 million or 82 basis points from $34.0 million or 2.98%, at December 31, 2015 to $27.7 million or 2.16%, at September 30, 2016.
Management considers classified assets to be an important measure of asset quality. Classified assets have been trending downward the last several years from a high point of greater than $81.9 million at September 30, 2011 to $40.2 million as of September 30, 2016 representing a decline of greater than 50%. During the fourth quarter of 2015, the Company reduced classified loans $3.5 million to $32.8 million. Of the fourth quarter 2015 reduction in classified loans, $2.7 million was transferred to OREO. These properties consisted of a 21 unit apartment building and 11 condo units. The Company disposed of $3.6 million of OREO properties during the first nine months of 2016, including the aforementioned properties. During the three months ended March 31, 2016, the Company took a deed in lieu of foreclosure on a $2.1 million improved commercial office building with multiple tenants and a ratified contract for its sale. That contract was voided during the second quarter. The Company plans to manage the property until its sale and will recognize miscellaneous rental income during our ownership and management of the property. There is no expected loss from the eventual disposal of this property based on current appraised values, the current rent roll and rents of similar space in the area.
The following is a breakdown of the Company’s classified and special mention assets at September 30, 2016, June 30, 2016, March 31, 2016 and December 31, 2015, 2014, 2013, 2012 and 2011, respectively:
Classified Assets and Special Mention Assets | ||||||||||||||||||||||||||||||||
(dollars in thousands) | As of 9/30/2016 | As of 6/30/2016 | As of 3/31/2016 | As of 12/31/2015 | As of 12/31/2014 | As of 12/31/2013 | As of 12/31/2012 | As of 12/31/2011 | ||||||||||||||||||||||||
Classified loans | ||||||||||||||||||||||||||||||||
Substandard | $ | 30,181 | $ | 31,433 | $ | 31,944 | $ | 31,943 | $ | 46,735 | $ | 47,645 | $ | 48,676 | $ | 68,515 | ||||||||||||||||
Doubtful | 502 | 502 | 502 | 861 | - | - | - | - | ||||||||||||||||||||||||
Loss | - | - | - | - | - | - | - | 37 | ||||||||||||||||||||||||
Total classified loans | 30,683 | 31,935 | 32,446 | 32,804 | 46,735 | 47,645 | 48,676 | 68,552 | ||||||||||||||||||||||||
Special mention loans | - | - | - | 1,642 | 5,460 | 9,246 | 6,092 | - | ||||||||||||||||||||||||
Total classified and special mention loans | $ | 30,683 | $ | 31,935 | $ | 32,446 | $ | 34,446 | $ | 52,195 | $ | 56,891 | $ | 54,768 | $ | 68,552 | ||||||||||||||||
Classified loans | 30,683 | 31,935 | 32,446 | 32,804 | 46,735 | 47,645 | 48,676 | 68,552 | ||||||||||||||||||||||||
Classified securities | 931 | 975 | 1,028 | 1,093 | 1,404 | 2,438 | 3,028 | 6,057 | ||||||||||||||||||||||||
Other real estate owned | 8,620 | 8,460 | 11,038 | 9,449 | 5,883 | 6,797 | 6,891 | 5,029 | ||||||||||||||||||||||||
Total classified assets | $ | 40,234 | $ | 41,370 | $ | 44,512 | $ | 43,346 | $ | 54,022 | $ | 56,880 | $ | 58,595 | $ | 79,638 | ||||||||||||||||
As a percentage of Total Assets | 3.14 | % | 3.35 | % | 3.78 | % | 3.79 | % | 4.99 | % | 5.56 | % | 5.97 | % | 8.10 | % | ||||||||||||||||
As a percentage of Risk Based Capital | 27.08 | % | 28.25 | % | 30.79 | % | 30.19 | % | 39.30 | % | 43.11 | % | 59.02 | % | 83.89 | % | ||||||||||||||||
Non-accrual loans (90 days or greater delinquent and non-accrual only loans) decreased $3.0 million from $11.4 million or 1.24% of total loans at December 31, 2015 to $8.4 million or 0.80% of total loans at September 30, 2016. Non-accrual only loans are loans classified as non-accrual due to customer operating results or payment history. In accordance with the Company’s policy, interest income is recognized on a cash basis for these loans. The Company had 28 non-accrual loans at September 30, 2016 compared to 38 non-accrual loans at December 31, 2015. Non-accrual loans at September 30, 2016 included $7.0 million, or 83% of non-accrual loans, attributed to 16 loans representing six customer relationships classified as substandard. Non-accrual loans at December 31, 2015 included $8.1 million, or 71% of non-accrual loans, attributed to 19 loans representing six customer relationships classified as substandard. Of these loans at September 30, 2016 and December 31, 2015, $3.6 million and $3.8 million, respectively, represented a residential development project. During the second quarter of 2014, the Company deferred the collection of principal and interest on this project. The project is currently being continued with the support of non-bank investment, which has been used for vertical construction that has significantly improved the collateral value and the viability of the project. The loans remain classified as troubled debt restructures (“TDRs”) and non-accrual. In addition, at September 30, 2016 and December 31, 2015, the Company had three TDR loans totaling $1.6 million and $1.7 million, respectively, classified as non-accrual. These loans are classified solely as non-accrual loans for the calculation of financial ratios.
Loan delinquency (90 days or greater delinquent and 31-89 days delinquent) decreased $3.2 million from $11.7 million, or 1.27% of loans, at December 31, 2015 to $8.5 million, or 0.81% of loans, at September 30, 2016.
At September 30, 2016, the Company had 17 accruing TDRs totaling $10.6 million compared to 23 accruing TDRs totaling $13.1 million as of December 31, 2015. The Company had specific reserves of $929,000 on seven TDRs totaling $6.2 million at September 30, 2016 and specific reserves of $1.3 million on nine TDRs totaling $3.6 million at December 31, 2015. At September 30, 2016, $8.0 million or 76% of accruing TDRs of $10.6 million relate to one customer relationship. The $8.0 million in TDRs is for eight loans with two construction and land development loans totaling $724,000, one residential rental property of $228,000 and five commercial real estate loans totaling $7.1 million. The loans in this relationship have been classified as TDRs since the fourth quarter of 2014 and have performed according to the terms of their restructured agreements with all required payments made timely. They presently remain as TDRs due to below market rates of interest negotiated at the time of the restructure to obtain additional collateral. The Company has a strong collateral position in this relationship and as of September 30, 2016 has specific reserves of $426,000 on the relationship.
The following is a breakdown by loan classification of the Company’s TDRs at September 30, 2016 and December 31, 2015:
September 30, 2016 | December 31, 2015 | |||||||||||||||
(dollars in thousands) | Dollars | Number of Loans | Dollars | Number of Loans | ||||||||||||
Commercial real estate | $ | 9,667 | 8 | $ | 9,839 | 8 | ||||||||||
Residential first mortgages | 552 | 2 | 881 | 3 | ||||||||||||
Residential rentals | 228 | 1 | 2,058 | 5 | ||||||||||||
Construction and land development | 4,340 | 4 | 4,283 | 4 | ||||||||||||
Commercial loans | 883 | 5 | 1,384 | 8 | ||||||||||||
Commercial equipment | 116 | 2 | 123 | 2 | ||||||||||||
Total TDRs | $ | 15,786 | 22 | $ | 18,568 | 30 | ||||||||||
Less: TDRs included in non-accrual loans | (5,191 | ) | (5 | ) | (5,435 | ) | (7 | ) | ||||||||
Total accrual TDR loans | $ | 10,595 | 17 | $ | 13,133 | 23 | ||||||||||
The OREO balance was $8.6 million at September 30, 2016, a decrease of $829,000 compared to $9.4 million at December 31, 2015. This decrease consisted of additions of $3.1 million offset by valuation allowances of $366,000 to adjust properties to current appraised values and $3.6 million in disposals. OREO carrying amounts reflect management’s estimate of the realizable value of these properties incorporating current appraised values, local real estate market conditions and related costs.
The allowance for loan losses was 0.92% of gross loans at September 30, 2016 and 0.93% at December 31, 2015. There was an increase in the general component of the allowance due to changes to general allowance factors that reflect changes in historical loss, loan growth, delinquency rates and general economic conditions. Management’s determination of the adequacy of the allowance is based on a periodic evaluation of the portfolio with consideration given to: overall loss experience; current economic conditions; size, growth and composition of the loan portfolio; financial condition of the borrowers; current appraised values of underlying collateral and other relevant factors that, in management’s judgment, warrant recognition in determining an adequate allowance. Improvements to baseline charge-off factors for the periods used to evaluate the adequacy of the allowance as well as improvements in some qualitative factors, such as reductions in classified assets and delinquency, were offset by increases in other qualitative factors, such as increased loan growth. The specific allowance is based on management’s estimate of realizable value for particular loans. Management believes that the allowance is adequate. The Company increased its general allowance as a percentage of gross loans five basis points from 0.75% at December 31, 2015 to 0.80% at September 30, 2016. The following is a breakdown of the Company’s general and specific allowances as a percentage of gross loans at September 30, 2016 and December 31, 2015, respectively.
(dollar in thousands) | September 30, 2016 | % of Gross Loans | December 31, 2015 | % of Gross Loans | ||||||||||||
General Allowance | $ | 8,409 | 0.80 | % | $ | 6,932 | 0.75 | % | ||||||||
Specific Allowance | 1,254 | 0.12 | % | 1,608 | 0.17 | % | ||||||||||
Total Allowance | $ | 9,663 | 0.92 | % | $ | 8,540 | 0.93 | % | ||||||||
The most important weighted factor in the Company’s allowance for loan loss methodology is the charge-off history of the loan portfolio. The historical loss experience factor is tracked over various time horizons for each portfolio segment. It is weighted as the most important factor of the general component of the allowance and has decreased as the Company’s charge-off history has improved. The following table provides a five-year trend of net charge-offs as a percentage of average loans.
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||||
September 30, | September 30, | Years Ended December 31, | |||||||||||||||||||||||||||||||||||
(dollars in thousands) | 2016 | 2015 | 2016 | 2015 | 2015 | 2014 | 2013 | 2012 | 2011 | ||||||||||||||||||||||||||||
Average loans | $ | 1,016,408 | $ | 879,702 | $ | 967,568 | $ | 869,262 | $ | 874,186 | $ | 819,381 | $ | 741,369 | $ | 719,798 | $ | 671,242 | |||||||||||||||||||
Net charge-offs | 142 | 884 | 567 | 1,177 | 1,374 | 2,309 | 1,049 | 1,937 | 4,101 | ||||||||||||||||||||||||||||
Net charge-offs to average loans | 0.06 | % | 0.40 | % | 0.08 | % | 0.18 | % | 0.16 | % | 0.28 | % | 0.14 | % | 0.27 | % | 0.61 | % | |||||||||||||||||||
Deposits increased by 11.5% (15.4% on an annualized basis) or $104.7 million, to $1,011.6 million at September 30, 2016 compared to $906.9 million at December 31, 2015. Between 2012 and 2016, the Company increased transaction deposits, including noninterest bearing deposits, to lower its overall cost of funds. Transaction deposits have increased from 44.9% of total deposits at December 31, 2011 to 58.9% of total deposits at September 30, 2016. Details of the Company’s deposit portfolio at September 30, 2016 and December 31, 2015 are presented below:
September 30, 2016 | December 31, 2015 | |||||||||||||||
(dollars in thousands) | Balance | % | Balance | % | ||||||||||||
Noninterest-bearing demand | $ | 143,221 | 14.16 | % | $ | 142,771 | 15.74 | % | ||||||||
Interest-bearing: | ||||||||||||||||
Demand | 158,585 | 15.68 | % | 120,918 | 13.33 | % | ||||||||||
Money market deposits | 242,321 | 23.95 | % | 219,956 | 24.25 | % | ||||||||||
Savings | 51,396 | 5.08 | % | 47,703 | 5.26 | % | ||||||||||
Certificates of deposit | 416,052 | 41.13 | % | 375,551 | 41.41 | % | ||||||||||
Total interest-bearing | 868,354 | 85.84 | % | 764,128 | 84.26 | % | ||||||||||
Total Deposits | $ | 1,011,575 | 100.00 | % | $ | 906,899 | 100.00 | % | ||||||||
Transaction accounts | $ | 595,523 | 58.87 | % | $ | 531,348 | 58.59 | % | ||||||||
The Company uses both traditional brokered deposits and reciprocal brokered deposits. Traditional brokered deposits at September 30, 2016 and December 31, 2015 were $109.8 million and $49.1 million, respectively. Reciprocal brokered deposits at September 30, 2016 and December 31, 2015 were $63.3 million and $61.1 million, respectively. The reciprocal brokered deposits have many characteristics of core deposits and are used to maximize FDIC insurance available to our customers.
Long-term debt and short-term borrowings increased $29.5 million from $91.6 million at December 31, 2015 to $121.1 million at September 30, 2016. The Company uses brokered deposits and other wholesale funding to supplement funding when loan growth exceeds core deposit growth and for asset-liability management purposes.
During the nine months ended September 30, 2016, stockholders’ equity increased $4.2 million to $104.0 million. The increase in stockholders’ equity was due to net income of $5.3 million, net stock related activities related to stock-based compensation of $264,000 and a current year increase in accumulated other comprehensive income of $326,000. These increases to capital were partially offset by quarterly common dividends paid of $1.4 million and repurchases of common stock of $337,000. Common stockholders' equity of $104.0 million at September 30, 2016 resulted in a book value of $22.33 per common share compared to $21.48 at December 31, 2015. The Company remains well-capitalized at September 30, 2016 with a Tier 1 capital to average assets ratio of 9.22%.
About The Community Financial Corporation - The Company is the bank holding company for Community Bank of the Chesapeake. Headquartered in Waldorf, Maryland, Community Bank of the Chesapeake is a full-service commercial bank, with assets over $1.2 billion. Through its 12 banking centers and five commercial lending centers, Community Bank of the Chesapeake offers a broad range of financial products and services to individuals and businesses. The Company’s banking centers are located at its main office in Waldorf, Maryland, and 11 branch offices in Waldorf, Bryans Road, Dunkirk, Leonardtown, La Plata, Charlotte Hall, Prince Frederick, Lusby and California, Maryland; and Central Park and downtown Fredericksburg, Virginia.
Forward-looking Statements - This news release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements can generally be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Statements in this release that are not strictly historical are forward-looking and are based upon current expectations that may differ materially from actual results. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. These risks and uncertainties involve general economic trends, changes in interest rates, loss of deposits and loan demand to other financial institutions, substantial changes in financial markets; changes in real estate value and the real estate market, regulatory changes, possibility of unforeseen events affecting the industry generally, the uncertainties associated with newly developed or acquired operations, the outcome of litigation that may arise, market disruptions and other effects of terrorist activities and the matters described in “Item 1A Risk Factors” in the Company’s Annual Report on Form 10-K for the Year Ended December 31, 2015. The Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unforeseen events, except as required under the rules and regulations of the Securities and Exchange Commission.
Data is unaudited as of September 30, 2016. This selected information should be read in conjunction with the financial statements and notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2015.
THE COMMUNITY FINANCIAL CORPORATION | |||||||||||||||||||||
SELECTED FINANCIAL INFORMATION AND RATIOS (UNAUDITED) | |||||||||||||||||||||
Three Months Ended (Unaudited) | Nine Months Ended (Unaudited) | ||||||||||||||||||||
September 30, 2016 | June 30, 2016 | September 30, 2015 | September 30, 2016 | September 30, 2015 | |||||||||||||||||
KEY OPERATING RATIOS | |||||||||||||||||||||
Return on average assets | 0.63 | % | 0.57 | % | 0.46 | % | 0.59 | % | 0.59 | % | |||||||||||
Return on average common equity | 7.48 | 6.79 | 5.09 | 6.89 | 6.42 | ||||||||||||||||
Return on average total equity | 7.48 | 6.79 | 5.09 | 6.89 | 6.26 | ||||||||||||||||
Average total equity to average total assets | 8.37 | 8.46 | 9.12 | 8.52 | 9.46 | ||||||||||||||||
Interest rate spread | 3.34 | 3.40 | 3.41 | 3.37 | 3.48 | ||||||||||||||||
Net interest margin | 3.47 | 3.52 | 3.55 | 3.50 | 3.60 | ||||||||||||||||
Cost of funds | 0.73 | 0.74 | 0.77 | 0.73 | 0.75 | ||||||||||||||||
Cost of deposits | 0.48 | 0.49 | 0.48 | 0.48 | 0.48 | ||||||||||||||||
Cost of debt | 2.63 | 2.66 | 3.06 | 2.67 | 2.77 | ||||||||||||||||
Efficiency ratio | 66.55 | 68.33 | 73.62 | 68.47 | 70.55 | ||||||||||||||||
Non-interest expense to average assets | 2.33 | 2.41 | 2.55 | 2.41 | 2.56 | ||||||||||||||||
Net operating expense to average assets | 2.06 | 2.15 | 2.38 | 2.14 | 2.27 | ||||||||||||||||
Avg. int-earning assets to avg. int-bearing liabilities | 117.49 | 117.61 | 117.61 | 117.62 | 117.46 | ||||||||||||||||
Net charge-offs to average loans | 0.06 | 0.02 | 0.40 | 0.08 | 0.18 | ||||||||||||||||
COMMON SHARE DATA | |||||||||||||||||||||
Basic net income per common share | $ | 0.43 | $ | 0.38 | $ | 0.28 | $ | 1.16 | $ | 1.03 | |||||||||||
Diluted net income per common share | 0.42 | 0.38 | 0.27 | 1.15 | 1.02 | ||||||||||||||||
Cash dividends paid per common share | 0.10 | 0.10 | 0.10 | 0.30 | 0.30 | ||||||||||||||||
Weighted average common shares outstanding: | |||||||||||||||||||||
Basic | 4,590,644 | 4,590,444 | 4,646,702 | 4,591,926 | 4,651,383 | ||||||||||||||||
Diluted | 4,622,579 | 4,617,794 | 4,683,750 | 4,621,628 | 4,688,431 | ||||||||||||||||
(Unaudited) | |||||||||||||||||||||
(dollars in thousands, except per share amounts) | September 30, 2016 | December 31, 2015 | $ Change | % Change | |||||||||||||||||
ASSET QUALITY | |||||||||||||||||||||
Total assets | $ | 1,281,874 | $ | 1,143,332 | $ | 138,542 | 12.1 | % | |||||||||||||
Gross loans | 1,051,419 | 918,894 | 132,525 | 14.4 | |||||||||||||||||
Classified Assets | 40,234 | 43,346 | (3,112 | ) | (7.2 | ) | |||||||||||||||
Allowance for loan losses | 9,663 | 8,540 | 1,123 | 13.1 | |||||||||||||||||
Past due loans (PDLs) (31 to 89 days) | 723 | 948 | (225 | ) | (23.7 | ) | |||||||||||||||
Nonperforming loans (NPLs) (>=90 days) | 7,778 | 10,740 | (2,962 | ) | (27.6 | ) | |||||||||||||||
Non-accrual loans (a) | 8,455 | 11,433 | (2,978 | ) | (26.0 | ) | |||||||||||||||
Accruing troubled debt restructures (TDRs) (b) | 10,595 | 13,133 | (2,538 | ) | (19.3 | ) | |||||||||||||||
Other real estate owned (OREO) | 8,620 | 9,449 | (829 | ) | (8.8 | ) | |||||||||||||||
Non-accrual loans, OREO and TDRs | 27,670 | 34,015 | (6,345 | ) | (18.7 | ) | |||||||||||||||
ASSET QUALITY RATIOS | |||||||||||||||||||||
Classified assets to total assets | 3.14 | % | 3.79 | % | |||||||||||||||||
Classified assets to risk-based capital | 27.08 | 30.19 | |||||||||||||||||||
Allowance for loan losses to total loans | 0.92 | 0.93 | |||||||||||||||||||
Allowance for loan losses to nonperforming loans | 124.24 | 79.52 | |||||||||||||||||||
Past due loans (PDLs) to total loans | 0.07 | 0.10 | |||||||||||||||||||
Nonperforming loans (NPLs) to total loans | 0.74 | 1.17 | |||||||||||||||||||
Loan delinquency (PDLs + NPLs) to total loans | 0.81 | 1.27 | |||||||||||||||||||
Non-accrual loans to total loans | 0.80 | 1.24 | |||||||||||||||||||
Non-accrual loans and TDRs to total loans | 1.81 | 2.67 | |||||||||||||||||||
Non-accrual loans and OREO to total assets | 1.33 | 1.83 | |||||||||||||||||||
Non-accrual loans, OREO and TDRs to total assets | 2.16 | 2.98 | |||||||||||||||||||
COMMON SHARE DATA | |||||||||||||||||||||
Book value per common share | $ | 22.33 | $ | 21.48 | |||||||||||||||||
Common shares outstanding at end of period | 4,656,989 | 4,645,429 | |||||||||||||||||||
OTHER DATA | |||||||||||||||||||||
Number of: | |||||||||||||||||||||
Full-time equivalent employees | 166 | 171 | |||||||||||||||||||
Branches | 12 | 12 | |||||||||||||||||||
Loan Production Offices | 5 | 5 | |||||||||||||||||||
REGULATORY CAPITAL RATIOS | |||||||||||||||||||||
Tier 1 capital to average assets | 9.22 | % | 10.01 | % | |||||||||||||||||
Tier 1 common capital to risk-weighted assets | 9.75 | 10.16 | |||||||||||||||||||
Tier 1 capital to risk-weighted assets | 10.87 | 11.38 | |||||||||||||||||||
Total risk-based capital to risk-weighted assets | 13.94 | 14.58 | |||||||||||||||||||
(a) Non-accrual loans include all loans that are 90 days or more delinquent and loans that are non-accrual due to the operating results or cash flows of a customer. Non-accrual loans can include loans that are current with all loan payments. Interest and principal are recognized on a cash-basis in accordance with the Bank's policy if the loans are not impaired or there is no impairment. | |||||||||||||||||||||
(b) At September 30, 2016 and December 31, 2015, the Bank had total TDRs of $15.8 million and $18.6 million, respectively, with three TDR relationships totaling $5.2 million and $5.4 million, respectively, in non-accrual status. These loans are classified as non-accrual loans for the calculation of financial ratios. | |||||||||||||||||||||
THE COMMUNITY FINANCIAL CORPORATION | ||||||||
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | ||||||||
Three Months Ended | ||||||||
September 30, | June 30, | |||||||
(dollars in thousands, except per share amounts ) | 2016 | 2016 | ||||||
Interest and Dividend Income | ||||||||
Loans, including fees | $ | 11,460 | $ | 11,170 | ||||
Taxable interest and dividends on investment securities | 758 | 752 | ||||||
Interest on deposits with banks | 5 | 6 | ||||||
Total Interest and Dividend Income | 12,223 | 11,928 | ||||||
Interest Expense | ||||||||
Deposits | 1,209 | 1,182 | ||||||
Short-term borrowings | 36 | 49 | ||||||
Long-term debt | 834 | 802 | ||||||
Total Interest Expense | 2,079 | 2,033 | ||||||
Net Interest Income | 10,144 | 9,895 | ||||||
Provision for loan losses | 698 | 564 | ||||||
Net Interest Income After Provision For Loan Losses | 9,446 | 9,331 | ||||||
Noninterest Income | ||||||||
Loan appraisal, credit, and miscellaneous charges | 60 | 102 | ||||||
Gain on sale of asset | - | 4 | ||||||
Net (losses) gains on sale of OREO | 3 | (448 | ) | |||||
Net gains on sale of investment securities | - | 39 | ||||||
Income from bank owned life insurance | 199 | 198 | ||||||
Service charges | 580 | 882 | ||||||
Total Noninterest Income | 842 | 777 | ||||||
Noninterest Expense | ||||||||
Salary and employee benefits | 4,268 | 4,197 | ||||||
Occupancy expense | 597 | 636 | ||||||
Advertising | 290 | 156 | ||||||
Data processing expense | 544 | 580 | ||||||
Professional fees | 308 | 380 | ||||||
Depreciation of furniture, fixtures, and equipment | 206 | 206 | ||||||
Telephone communications | 43 | 46 | ||||||
Office supplies | 33 | 29 | ||||||
FDIC Insurance | 215 | 184 | ||||||
OREO valuation allowance and expenses | 203 | 105 | ||||||
Other | 604 | 773 | ||||||
Total Noninterest Expense | 7,311 | 7,292 | ||||||
Income before income taxes | 2,977 | 2,816 | ||||||
Income tax expense | 1,014 | 1,078 | ||||||
Net Income Available to Common Stockholders | $ | 1,963 | $ | 1,738 | ||||
Earnings Per Common Share | ||||||||
Basic | $ | 0.43 | $ | 0.38 | ||||
Diluted | $ | 0.42 | $ | 0.38 | ||||
Cash dividends paid per common share | $ | 0.10 | $ | 0.10 | ||||
The following table presents information on the average balances of the Company’s interest-earning assets and interest-bearing liabilities and interest earned or paid thereon for the three months ended September 30, 2016 and June 30, 2016, respectively. There are no tax equivalency adjustments.
For the Three Months Ended | ||||||||||||||||||||||||
September 30, 2016 | June 30, 2016 | |||||||||||||||||||||||
Average | Average | |||||||||||||||||||||||
Average | Yield/ | Average | Yield/ | |||||||||||||||||||||
dollars in thousands | Balance | Interest | Cost | Balance | Interest | Cost | ||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loan portfolio (1) | $ | 1,016,408 | $ | 11,460 | 4.51 | % | $ | 966,701 | $ | 11,170 | 4.62 | % | ||||||||||||
Investment securities, federal funds | ||||||||||||||||||||||||
sold and interest-bearing deposits | 153,443 | 763 | 1.99 | % | 156,893 | 758 | 1.93 | % | ||||||||||||||||
Total Interest-Earning Assets | 1,169,851 | 12,223 | 4.18 | % | 1,123,594 | 11,928 | 4.25 | % | ||||||||||||||||
Cash and cash equivalents | 13,166 | 12,206 | ||||||||||||||||||||||
Other assets | 71,948 | 73,877 | ||||||||||||||||||||||
Total Assets | $ | 1,254,965 | $ | 1,209,677 | ||||||||||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Savings | $ | 50,363 | $ | 6 | 0.05 | % | $ | 47,888 | $ | 14 | 0.12 | % | ||||||||||||
Interest-bearing demand and money | ||||||||||||||||||||||||
market accounts | 400,214 | 297 | 0.30 | % | 365,966 | 286 | 0.31 | % | ||||||||||||||||
Certificates of deposit | 412,683 | 904 | 0.88 | % | 413,952 | 883 | 0.85 | % | ||||||||||||||||
Long-term debt | 65,578 | 386 | 2.35 | % | 58,835 | 352 | 2.39 | % | ||||||||||||||||
Short-term debt | 31,886 | 37 | 0.46 | % | 33,754 | 49 | 0.58 | % | ||||||||||||||||
Subordinated Notes | 23,000 | 359 | 6.24 | % | 23,000 | 359 | 6.24 | % | ||||||||||||||||
Guaranteed preferred beneficial interest | ||||||||||||||||||||||||
in junior subordinated debentures | 12,000 | 90 | 3.00 | % | 12,000 | 90 | 3.00 | % | ||||||||||||||||
Total Interest-Bearing Liabilities | 995,724 | 2,079 | 0.84 | % | 955,395 | 2,033 | 0.85 | % | ||||||||||||||||
Noninterest-bearing demand deposits | 144,837 | 142,182 | ||||||||||||||||||||||
Other liabilities | 9,419 | 9,724 | ||||||||||||||||||||||
Stockholders' equity | 104,985 | 102,376 | ||||||||||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 1,254,965 | $ | 1,209,677 | ||||||||||||||||||||
Net interest income | $ | 10,144 | $ | 9,895 | ||||||||||||||||||||
Interest rate spread | 3.34 | % | 3.40 | % | ||||||||||||||||||||
Net yield on interest-earning assets | 3.47 | % | 3.52 | % | ||||||||||||||||||||
Ratio of average interest-earning | ||||||||||||||||||||||||
assets to average interest bearing | ||||||||||||||||||||||||
liabilities | 117.49 | % | 117.61 | % | ||||||||||||||||||||
Cost of funds | 0.73 | % | 0.74 | % | ||||||||||||||||||||
Cost of deposits | 0.48 | % | 0.49 | % | ||||||||||||||||||||
Cost of debt | 2.63 | % | 2.66 | % | ||||||||||||||||||||
(1) Average balance includes non-accrual loans | ||||||||||||||||||||||||
The table below sets forth certain information regarding changes in interest income and interest expense of the Company for the periods indicated. For each category of interest earning asset and interest bearing liability, information is provided on changes attributable to (1) changes in volume (changes in volume multiplied by old rate); and (2) changes in rate (changes in rate multiplied by old volume). Changes in rate volume (changes in rate multiplied by the change in volume) have been allocated to changes due to volume.
Three Months Ended September 30, 2016 | ||||||||||||
compared to Three Months Ended | ||||||||||||
June 30, 2016 | ||||||||||||
Due to | ||||||||||||
dollars in thousands | Volume | Rate | Total | |||||||||
Interest income: | ||||||||||||
Loan portfolio (1) | $ | 560 | $ | (270 | ) | 290 | ||||||
Investment securities, federal funds | - | - | - | |||||||||
sold and interest bearing deposits | (17 | ) | 22 | 5 | ||||||||
Total interest-earning assets | $ | 543 | $ | (248 | ) | $ | 295 | |||||
Interest-bearing liabilities: | ||||||||||||
Savings | - | (8 | ) | (8 | ) | |||||||
Interest-bearing demand and money | ||||||||||||
market accounts | 25 | (14 | ) | 11 | ||||||||
Certificates of deposit | (3 | ) | 24 | 21 | ||||||||
Long-term debt | 40 | (6 | ) | 34 | ||||||||
Short-term debt | (2 | ) | (10 | ) | (12 | ) | ||||||
Subordinated notes | - | - | - | |||||||||
Guaranteed preferred beneficial interest | ||||||||||||
in junior subordinated debentures | - | - | - | |||||||||
Total interest-bearing liabilities | $ | 60 | $ | (14 | ) | $ | 46 | |||||
Net change in net interest income | $ | 483 | $ | (234 | ) | $ | 249 | |||||
THE COMMUNITY FINANCIAL CORPORATION | ||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
(dollars in thousands, except per share amounts ) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Interest and Dividend Income | ||||||||||||||||
Loans, including fees | $ | 11,460 | $ | 10,336 | $ | 33,175 | $ | 30,886 | ||||||||
Interest and dividends on investment securities | 758 | 661 | 2,273 | 1,768 | ||||||||||||
Interest on deposits with banks | 5 | 5 | 15 | 11 | ||||||||||||
Total Interest and Dividend Income | 12,223 | 11,002 | 35,463 | 32,665 | ||||||||||||
Interest Expense | ||||||||||||||||
Deposits | 1,209 | 1,068 | 3,486 | 3,098 | ||||||||||||
Short-term borrowings | 36 | 5 | 123 | 26 | ||||||||||||
Long-term debt | 834 | 845 | 2,422 | 2,361 | ||||||||||||
Total Interest Expense | 2,079 | 1,918 | 6,031 | 5,485 | ||||||||||||
Net Interest Income | 10,144 | 9,084 | 29,432 | 27,180 | ||||||||||||
Provision for loan losses | 698 | 501 | 1,689 | 1,071 | ||||||||||||
Net Interest Income After Provision For Loan Losses | 9,446 | 8,583 | 27,743 | 26,109 | ||||||||||||
Noninterest Income | ||||||||||||||||
Loan appraisal, credit, and miscellaneous charges | 60 | 61 | 223 | 209 | ||||||||||||
Gain on sale of asset | - | - | 4 | 19 | ||||||||||||
Net losses on sale of OREO | 3 | (2 | ) | (440 | ) | (20 | ) | |||||||||
Net gains (losses) on sale of investment securities | - | - | 39 | (1 | ) | |||||||||||
Loss on premises and equipment held for sale | - | (426 | ) | - | (426 | ) | ||||||||||
Income from bank owned life insurance | 199 | 206 | 593 | 616 | ||||||||||||
Service charges | 580 | 627 | 2,050 | 1,889 | ||||||||||||
Gain on sale of loans held for sale | - | - | - | 104 | ||||||||||||
Total Noninterest Income | 842 | 466 | 2,469 | 2,390 | ||||||||||||
Noninterest Expense | ||||||||||||||||
Salary and employee benefits | 4,268 | 4,185 | 12,617 | 12,218 | ||||||||||||
Occupancy expense | 597 | 599 | 1,822 | 1,834 | ||||||||||||
Advertising | 290 | 164 | 509 | 450 | ||||||||||||
Data processing expense | 544 | 475 | 1,678 | 1,500 | ||||||||||||
Professional fees | 308 | 353 | 1,113 | 920 | ||||||||||||
Depreciation of furniture, fixtures, and equipment | 206 | 210 | 608 | 615 | ||||||||||||
Telephone communications | 43 | 56 | 133 | 141 | ||||||||||||
Office supplies | 33 | 38 | 105 | 108 | ||||||||||||
FDIC Insurance | 215 | 197 | 642 | 585 | ||||||||||||
OREO valuation allowance and expenses | 203 | 129 | 609 | 682 | ||||||||||||
Other | 604 | 625 | 2,007 | 1,809 | ||||||||||||
Total Noninterest Expense | 7,311 | 7,031 | 21,843 | 20,862 | ||||||||||||
Income before income taxes | 2,977 | 2,018 | 8,369 | 7,637 | ||||||||||||
Income tax expense | 1,014 | 735 | 3,060 | 2,822 | ||||||||||||
Net Income | $ | 1,963 | $ | 1,283 | $ | 5,309 | $ | 4,815 | ||||||||
Preferred stock dividends | - | - | - | 23 | ||||||||||||
Net Income Available to Common Stockholders | $ | 1,963 | $ | 1,283 | $ | 5,309 | $ | 4,792 | ||||||||
Earnings Per Common Share | ||||||||||||||||
Basic | $ | 0.43 | $ | 0.28 | $ | 1.16 | $ | 1.03 | ||||||||
Diluted | $ | 0.42 | $ | 0.27 | $ | 1.15 | $ | 1.02 | ||||||||
Cash dividends paid per common share | $ | 0.10 | $ | 0.10 | $ | 0.30 | $ | 0.30 | ||||||||
The following table presents information on the average balances of the Company’s interest-earning assets and interest-bearing liabilities and interest earned or paid thereon for the three months ended September 30, 2016 and 2015, respectively. There are no tax equivalency adjustments.
For the Three Months Ended September 30, | ||||||||||||||||||||||||
2016 | 2015 | |||||||||||||||||||||||
Average | Average | |||||||||||||||||||||||
Average | Yield/ | Average | Yield/ | |||||||||||||||||||||
dollars in thousands | Balance | Interest | Cost | Balance | Interest | Cost | ||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loan portfolio (1) | $ | 1,016,408 | $ | 11,460 | 4.51 | % | $ | 879,702 | $ | 10,336 | 4.70 | % | ||||||||||||
Investment securities, federal funds | ||||||||||||||||||||||||
sold and interest-bearing deposits | 153,443 | 763 | 1.99 | % | 145,145 | 666 | 1.84 | % | ||||||||||||||||
Total Interest-Earning Assets | 1,169,851 | 12,223 | 4.18 | % | 1,024,847 | 11,002 | 4.29 | % | ||||||||||||||||
Cash and cash equivalents | 13,166 | 12,108 | ||||||||||||||||||||||
Other assets | 71,948 | 67,352 | ||||||||||||||||||||||
Total Assets | $ | 1,254,965 | $ | 1,104,307 | ||||||||||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Savings | $ | 50,363 | $ | 6 | 0.05 | % | $ | 45,697 | $ | 11 | 0.10 | % | ||||||||||||
Interest-bearing demand and money | ||||||||||||||||||||||||
market accounts | 400,214 | 297 | 0.30 | % | 334,691 | 255 | 0.30 | % | ||||||||||||||||
Certificates of deposit | 412,683 | 904 | 0.88 | % | 379,867 | 802 | 0.84 | % | ||||||||||||||||
Long-term debt | 65,578 | 386 | 2.35 | % | 70,636 | 408 | 2.31 | % | ||||||||||||||||
Short-term debt | 31,886 | 37 | 0.46 | % | 5,526 | 5 | 0.36 | % | ||||||||||||||||
Subordinated Notes | 23,000 | 359 | 6.24 | % | 23,000 | 359 | 6.24 | % | ||||||||||||||||
Guaranteed preferred beneficial interest | ||||||||||||||||||||||||
in junior subordinated debentures | 12,000 | 90 | 3.00 | % | 12,000 | 78 | 2.60 | % | ||||||||||||||||
Total Interest-Bearing Liabilities | 995,724 | 2,079 | 0.84 | % | 871,417 | 1,918 | 0.88 | % | ||||||||||||||||
Noninterest-bearing demand deposits | 144,837 | 123,118 | ||||||||||||||||||||||
Other liabilities | 9,419 | 9,021 | ||||||||||||||||||||||
Stockholders' equity | 104,985 | 100,751 | ||||||||||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 1,254,965 | $ | 1,104,307 | ||||||||||||||||||||
Net interest income | $ | 10,144 | $ | 9,084 | ||||||||||||||||||||
Interest rate spread | 3.34 | % | 3.41 | % | ||||||||||||||||||||
Net yield on interest-earning assets | 3.47 | % | 3.55 | % | ||||||||||||||||||||
Ratio of average interest-earning | ||||||||||||||||||||||||
assets to average interest bearing | ||||||||||||||||||||||||
liabilities | 117.49 | % | 117.61 | % | ||||||||||||||||||||
Cost of funds | 0.73 | % | 0.77 | % | ||||||||||||||||||||
Cost of deposits | 0.48 | % | 0.48 | % | ||||||||||||||||||||
Cost of debt | 2.63 | % | 3.06 | % | ||||||||||||||||||||
(1) Average balance includes non-accrual loans | ||||||||||||||||||||||||
The table below sets forth certain information regarding changes in interest income and interest expense of the Company for the periods indicated. For each category of interest earning asset and interest bearing liability, information is provided on changes attributable to (1) changes in volume (changes in volume multiplied by old rate); and (2) changes in rate (changes in rate multiplied by old volume). Changes in rate volume (changes in rate multiplied by the change in volume) have been allocated to changes due to volume.
For the Three Months Ended September 30, 2016 | ||||||||||||
compared to the Three Months Ended | ||||||||||||
September 30, 2015 | ||||||||||||
Due to | ||||||||||||
dollars in thousands | Volume | Rate | Total | |||||||||
Interest income: | ||||||||||||
Loan portfolio (1) | $ | 1,541 | $ | (417 | ) | $ | 1,124 | |||||
Investment securities, federal funds | ||||||||||||
sold and interest bearing deposits | 41 | 56 | 97 | |||||||||
Total interest-earning assets | $ | 1,582 | $ | (361 | ) | $ | 1,221 | |||||
Interest-bearing liabilities: | ||||||||||||
Savings | 1 | (6 | ) | (5 | ) | |||||||
Interest-bearing demand and money | ||||||||||||
market accounts | 49 | (7 | ) | 42 | ||||||||
Certificates of deposit | 72 | 30 | 102 | |||||||||
Long-term debt | (30 | ) | 8 | (22 | ) | |||||||
Short-term debt | 31 | 1 | 32 | |||||||||
Subordinated notes | - | - | - | |||||||||
Guaranteed preferred beneficial interest | ||||||||||||
in junior subordinated debentures | - | 12 | 12 | |||||||||
Total interest-bearing liabilities | $ | 123 | $ | 38 | $ | 161 | ||||||
Net change in net interest income | $ | 1,459 | $ | (399 | ) | $ | 1,060 | |||||
The following table presents information on the average balances of the Company’s interest-earning assets and interest-bearing liabilities and interest earned or paid thereon for the nine months ended September 30, 2016 and 2015, respectively. There are no tax equivalency adjustments.
For the Nine Months Ended September 30, | ||||||||||||||||||||||||
2016 | 2015 | |||||||||||||||||||||||
Average | Average | |||||||||||||||||||||||
Average | Yield/ | Average | Yield/ | |||||||||||||||||||||
dollars in thousands | Balance | Interest | Cost | Balance | Interest | Cost | ||||||||||||||||||
Assets | ||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||
Loan portfolio (1) | $ | 967,568 | $ | 33,175 | 4.57 | % | $ | 869,262 | $ | 30,886 | 4.74 | % | ||||||||||||
Investment securities, federal funds | ||||||||||||||||||||||||
sold and interest-bearing deposits | 155,033 | 2,288 | 1.97 | % | 136,249 | 1,779 | 1.74 | % | ||||||||||||||||
Total Interest-Earning Assets | 1,122,601 | 35,463 | 4.21 | % | 1,005,511 | 32,665 | 4.33 | % | ||||||||||||||||
Cash and cash equivalents | 11,567 | 12,099 | ||||||||||||||||||||||
Other assets | 72,384 | 67,032 | ||||||||||||||||||||||
Total Assets | $ | 1,206,552 | $ | 1,084,642 | ||||||||||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||
Savings | $ | 48,290 | $ | 32 | 0.09 | % | $ | 44,334 | $ | 33 | 0.10 | % | ||||||||||||
Interest-bearing demand and money | ||||||||||||||||||||||||
market accounts | 371,113 | 837 | 0.30 | % | 317,650 | 660 | 0.28 | % | ||||||||||||||||
Certificates of deposit | 407,731 | 2,616 | 0.86 | % | 379,158 | 2,405 | 0.85 | % | ||||||||||||||||
Long-term debt | 58,804 | 1,083 | 2.46 | % | 71,265 | 1,202 | 2.25 | % | ||||||||||||||||
Short-term debt | 33,471 | 123 | 0.49 | % | 11,666 | 26 | 0.30 | % | ||||||||||||||||
Subordinated Notes | 23,000 | 1,078 | 6.25 | % | 19,967 | 930 | 6.21 | % | ||||||||||||||||
Guaranteed preferred beneficial interest | ||||||||||||||||||||||||
in junior subordinated debentures | 12,000 | 262 | 2.91 | % | 12,000 | 229 | 2.54 | % | ||||||||||||||||
Total Interest-Bearing Liabilities | 954,409 | 6,031 | 0.84 | % | 856,040 | 5,485 | 0.85 | % | ||||||||||||||||
Noninterest-bearing demand deposits | 140,031 | 117,061 | ||||||||||||||||||||||
Other liabilities | 9,336 | 8,919 | ||||||||||||||||||||||
Stockholders' equity | 102,776 | 102,622 | ||||||||||||||||||||||
Total Liabilities and Stockholders' Equity | $ | 1,206,552 | $ | 1,084,642 | ||||||||||||||||||||
Net interest income | $ | 29,432 | $ | 27,180 | ||||||||||||||||||||
Interest rate spread | 3.37 | % | 3.48 | % | ||||||||||||||||||||
Net yield on interest-earning assets | 3.50 | % | 3.60 | % | ||||||||||||||||||||
Ratio of average interest-earning | ||||||||||||||||||||||||
assets to average interest bearing | ||||||||||||||||||||||||
liabilities | 117.62 | % | 117.46 | % | ||||||||||||||||||||
Cost of funds | 0.73 | % | 0.75 | % | ||||||||||||||||||||
Cost of deposits | 0.48 | % | 0.48 | % | ||||||||||||||||||||
Cost of debt | 2.67 | % | 2.77 | % | ||||||||||||||||||||
(1) Average balance includes non-accrual loans | ||||||||||||||||||||||||
The table below sets forth certain information regarding changes in interest income and interest expense of the Company for the periods indicated. For each category of interest earning asset and interest bearing liability, information is provided on changes attributable to (1) changes in volume (changes in volume multiplied by old rate); and (2) changes in rate (changes in rate multiplied by old volume). Changes in rate volume (changes in rate multiplied by the change in volume) have been allocated to changes due to volume.
For the Nine Months Ended September 30, 2016 | ||||||||||||
compared to the Nine Months Ended | ||||||||||||
September 30, 2015 | ||||||||||||
Due to | ||||||||||||
dollars in thousands | Volume | Rate | Total | |||||||||
Interest income: | ||||||||||||
Loan portfolio (1) | $ | 3,371 | $ | (1,082 | ) | $ | 2,289 | |||||
Investment securities, federal funds | ||||||||||||
sold and interest bearing deposits | 277 | 232 | 509 | |||||||||
Total interest-earning assets | $ | 3,648 | $ | (850 | ) | $ | 2,798 | |||||
Interest-bearing liabilities: | ||||||||||||
Savings | 3 | (4 | ) | (1 | ) | |||||||
Interest-bearing demand and money | ||||||||||||
market accounts | 121 | 56 | 177 | |||||||||
Certificates of deposit | 183 | 28 | 211 | |||||||||
Long-term debt | (229 | ) | 110 | (119 | ) | |||||||
Short-term debt | 80 | 17 | 97 | |||||||||
Subordinated notes | 142 | 6 | 148 | |||||||||
Guaranteed preferred beneficial interest | ||||||||||||
in junior subordinated debentures | - | 33 | 33 | |||||||||
Total interest-bearing liabilities | $ | 300 | $ | 246 | $ | 546 | ||||||
Net change in net interest income | $ | 3,348 | $ | (1,096 | ) | $ | 2,252 | |||||
THE COMMUNITY FINANCIAL CORPORATION | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
September 30, 2016 | December 31, 2015 | |||||||
(dollars in thousands) | (Unaudited) | |||||||
Assets | ||||||||
Cash and due from banks | $ | 12,957 | $ | 9,059 | ||||
Federal funds sold | - | 225 | ||||||
Interest-bearing deposits with banks | 1,406 | 1,855 | ||||||
Securities available for sale (AFS), at fair value | 43,885 | 35,116 | ||||||
Securities held to maturity (HTM), at amortized cost | 102,956 | 109,420 | ||||||
Federal Home Loan Bank (FHLB) and Federal Reserve Bank (FRB) stock - at cost | 6,173 | 6,931 | ||||||
Loans receivable - net of allowance for loan losses of $9,663 and $8,540 | 1,041,910 | 909,200 | ||||||
Premises and equipment, net | 22,758 | 20,156 | ||||||
Premises and equipment held for sale | - | 2,000 | ||||||
Other real estate owned (OREO) | 8,620 | 9,449 | ||||||
Accrued interest receivable | 3,604 | 3,218 | ||||||
Investment in bank owned life insurance | 28,429 | 27,836 | ||||||
Other assets | 9,176 | 8,867 | ||||||
Total Assets | $ | 1,281,874 | $ | 1,143,332 | ||||
Liabilities and Stockholders' Equity | ||||||||
Liabilities | ||||||||
Deposits | ||||||||
Non-interest-bearing deposits | $ | 143,221 | $ | 142,771 | ||||
Interest-bearing deposits | 868,354 | 764,128 | ||||||
Total deposits | 1,011,575 | 906,899 | ||||||
Short-term borrowings | 55,500 | 36,000 | ||||||
Long-term debt | 65,573 | 55,617 | ||||||
Guaranteed preferred beneficial interest in | ||||||||
junior subordinated debentures (TRUPs) | 12,000 | 12,000 | ||||||
Subordinated notes - 6.25% | 23,000 | 23,000 | ||||||
Accrued expenses and other liabilities | 10,243 | 10,033 | ||||||
Total Liabilities | 1,177,891 | 1,043,549 | ||||||
Stockholders' Equity | ||||||||
Common stock - par value $.01; authorized - 15,000,000 shares; | ||||||||
issued 4,656,989 and 4,645,429 shares, respectively | 47 | 46 | ||||||
Additional paid in capital | 47,107 | 46,809 | ||||||
Retained earnings | 57,070 | 53,495 | ||||||
Accumulated other comprehensive gain (loss) | 75 | (251 | ) | |||||
Unearned ESOP shares | (316 | ) | (316 | ) | ||||
Total Stockholders' Equity | 103,983 | 99,783 | ||||||
Total Liabilities and Stockholders' Equity | $ | 1,281,874 | $ | 1,143,332 | ||||