ATLANTA, Jan. 24, 2019 (GLOBE NEWSWIRE) -- Brian D. Schmitt, Chief Executive Officer of SouthCrest Financial Group, Inc. (SCSG:PK) announced today that the Company reported preliminary earnings of $1.27MM or $0.15/share for the third quarter ended December 31, 2018. Excluding the impact of one-time items, net income would have been $1.4MM or $0.17/share vs. $0.9MM or 0.11/share in 4Q17. For the full year 2018, preliminary earnings were $4.0MM or $0.47/ share, with core earnings of $4.8MM or $0.57/share vs. 2017 core of $3.8MM or $0.45/share.
“We are pleased to say we have completed the vast majority of the transformational change that we have been striving towards for several years at SouthCrest. During 2018 the Company continued to improve its efficiency, exited its loss share agreement, grew loans 10%, grew deposits 4% while maintaining its cost of deposit advantage versus peers, reduced wholesale borrowings by $10MM, and increased its Atlanta MSA concentrations in both loans (65%, up from 62% at YE 2017) and deposits (30%, up from 27% at YE 2017). We expect both trends to continue. In addition, 80% of the loan growth in 2018 was due to the increase in small business relationships. With this said, management is still focused on executing additional operational and financial improvements and finding ways to enhance overall shareholder value, including increasing our Atlanta presence.
“We are also proud to announce that we will be increasing the divided to $0.04/share in the first quarter of 2019. These dividends will be payable February 15, 2019 to holders of record on February 1, 2019.”
Total assets were up from 3Q at $550.5MM vs. $544.0MM in 3Q18, and up slightly vs. $545.4MM in 4Q17 even after the $10MM reduction in borrowings in the quarter.
Deposit balance growth was very strong even after excluding seasonal factors, sequentially up 6% from 3Q18, and continued to be well above internal projections. Total deposits were up 4.3% from 4Q17, with a 7% YOY increase in non-interest bearing deposits from the previous year.
The estimated Tier 1 Leverage ratio at the end of the quarter for SouthCrest Bank increased to 9.16%. On a fully converted basis (including the conversion of all preferred equity), TBV/share ended the quarter at $6.57 per share. This metric will continue to be influenced by OCI changes resulting from the swings in interest rates. Currently, the negative impact to TBV by OCI is -$0.38/share vs. -$0.55/share as of 3Q18. Excluding the OCI impact, TBV/share grew $0.12 during the quarter. The current fully converted share count at the end of the quarter was 8.42 million shares. In addition, the Company still retains a small deferred tax asset valuation allowance related to state taxes that totals approximately $0.07/fully converted share.
Asset quality ratios remained within a reasonable range during the quarter, with NPAs to assets moving down slightly to 0.92% from 1.11%, excluding the $540,000 of a former bank building in OREO. Including this building, 4Q18 NPAs/total assets were 1.02% of assets vs. 1.21% in 3Q18. Excluding the impact of the Bank buildings in OREO, OREO balances were just $281,000.
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.
Andy Borrmann
Chief Financial Officer
678.734.3505
| Statement of Operations ($000s, Unaudited) | |||||||||||||||||||||||||||||
| Q4 2017 | Q1 2018 | Q2 2018 | Q3 2018 | Q4 2018 | |||||||||||||||||||||||||
| Interest Income | |||||||||||||||||||||||||||||
| Loans | |||||||||||||||||||||||||||||
| Construction and Development | $ | 360 | $ | 535 | $ | 479 | $ | 560 | $ | 633 | |||||||||||||||||||
| Commercial Real Estate | 1,669 | 1,667 | 1,696 | 1,776 | 1,819 | ||||||||||||||||||||||||
| Commercial Loans | 368 | 341 | 370 | 454 | 401 | ||||||||||||||||||||||||
| Multi Family | 30 | 28 | 28 | 27 | 20 | ||||||||||||||||||||||||
| Residential Mortgage | 1,117 | 1,087 | 1,116 | 1,119 | 1,167 | ||||||||||||||||||||||||
| Consumer Loans | 68 | 57 | 56 | 51 | 48 | ||||||||||||||||||||||||
| County/Municipal Loans | 24 | 23 | 23 | 23 | 25 | ||||||||||||||||||||||||
| Loss Share Loans | 81 | 80 | 79 | 70 | 64 | ||||||||||||||||||||||||
| Investment Securities | |||||||||||||||||||||||||||||
| Federal Funds/Overnight Funds | $ | 99 | $ | 98 | $ | 48 | $ | 41 | $ | 65 | |||||||||||||||||||
| Bank Owned CDs | 7 | 6 | 6 | 7 | 7 | ||||||||||||||||||||||||
| Investment Securities | 1,036 | 1,187 | 1,214 | 1,181 | 1,187 | ||||||||||||||||||||||||
| Total Interest Income | $ | 4,859 | $ | 5,109 | $ | 5,115 | $ | 5,311 | $ | 5,436 | |||||||||||||||||||
| Total Interest Expense | $ | 393 | $ | 460 | $ | 506 | $ | 586 | $ | 728 | |||||||||||||||||||
| Net Interest Income | $ | 4,466 | $ | 4,649 | $ | 4,609 | $ | 4,725 | $ | 4,708 | |||||||||||||||||||
| Provision for Loan Losses | 0 | 125 | 0 | 46 | 0 | ||||||||||||||||||||||||
| Net Interest Income after Loan Losses | $ | 4,466 | $ | 4,524 | $ | 4,609 | $ | 4,679 | $ | 4,708 | |||||||||||||||||||
| Other Income | |||||||||||||||||||||||||||||
| Service Charges on Deposits | $ | 174 | $ | 168 | $ | 165 | $ | 169 | $ | 164 | |||||||||||||||||||
| NSF/Overdraft Fees | 393 | 350 | 334 | 350 | 396 | ||||||||||||||||||||||||
| Other Service Charges | 63 | 64 | 63 | 62 | 65 | ||||||||||||||||||||||||
| ATM/Billpay/DR Card Income | 266 | 262 | 280 | 273 | 260 | ||||||||||||||||||||||||
| Other Income | (969 | ) | 227 | 125 | 316 | 172 | |||||||||||||||||||||||
| Total Other Income | $ | (73 | ) | $ | 1,071 | $ | 967 | $ | 1,170 | $ | 1,057 | ||||||||||||||||||
| Non-Interest Expense | |||||||||||||||||||||||||||||
| Salaries, Other Comp (+ FAS123R) | $ | 1,977 | $ | 1,948 | $ | 1,969 | $ | 1,889 | $ | 1,822 | |||||||||||||||||||
| Employee Benefits | 409 | 473 | 524 | 435 | 458 | ||||||||||||||||||||||||
| Occupancy & FF&E Expense | 934 | 653 | 590 | 621 | 588 | ||||||||||||||||||||||||
| Professional Fees | 154 | 161 | 156 | 305 | 136 | ||||||||||||||||||||||||
| Data Processing | 488 | 480 | 489 | 485 | 476 | ||||||||||||||||||||||||
| Other Expense | 825 | 883 | 832 | 693 | 724 | ||||||||||||||||||||||||
| Total Noninterest Expenses | $ | 4,787 | $ | 4,598 | $ | 4,560 | $ | 4,428 | $ | 4,204 | |||||||||||||||||||
| Pre-Tax Income (Loss) | $ | (394 | ) | $ | 997 | $ | 1,016 | $ | 1,421 | $ | 1,561 | ||||||||||||||||||
| Income Taxes | 4,192 | 197 | 210 | 319 | 289 | ||||||||||||||||||||||||
| Net Income | $ | (4,586 | ) | $ | 800 | $ | 806 | $ | 1,102 | $ | 1,272 | ||||||||||||||||||
| Balance Sheet ($000s, Unaudited) | |||||||||||||||||||||||
| Assets | Q4 2017 | Q1 2018 | Q2 2018 | Q3 2018 | Q4 2018 | ||||||||||||||||||
| Current Assets | |||||||||||||||||||||||
| Cash & Due from Bank | $ | 42,146 | $ | 24,603 | $ | 18,408 | $ | 14,189 | $ | 20,168 | |||||||||||||
| Federal Funds/Overnight Funds | 2,356 | 0 | 5,446 | 0 | 6,070 | ||||||||||||||||||
| Bank Owned CDs | 1,319 | 1,319 | 1,319 | 1,322 | 1,322 | ||||||||||||||||||
| Investment Securities | 165,203 | 182,569 | 169,924 | 166,632 | 162,936 | ||||||||||||||||||
| Total Current Assets | $ | 211,024 | $ | 208,491 | $ | 195,097 | $ | 182,143 | 190,496 | ||||||||||||||
| Loans | |||||||||||||||||||||||
| Construction and Development | $ | 31,184 | $ | 31,475 | $ | 34,157 | $ | 43,113 | $ | 40,420 | |||||||||||||
| Commercial Real Estate | 133,191 | 138,931 | 134,653 | 148,219 | 144,329 | ||||||||||||||||||
| Commercial Loans | 26,681 | 28,048 | 29,873 | 29,997 | 29,452 | ||||||||||||||||||
| Multi Family | 2,283 | 2,150 | 2,230 | 1,518 | 1,466 | ||||||||||||||||||
| Residential Mortgage | 87,001 | 92,973 | 92,346 | 88,357 | 94,199 | ||||||||||||||||||
| Consumer Loans | 3,304 | 5,738 | 3,361 | 2,143 | 2,579 | ||||||||||||||||||
| County/Municipal Loans | 2,771 | 2,511 | 2,480 | 2,459 | 2,438 | ||||||||||||||||||
| Loss Share Loans | 4,593 | 4,536 | 4,480 | 3,466 | 4,030 | ||||||||||||||||||
| Total Loans | $ | 291,008 | $ | 306,362 | $ | 303,581 | $ | 319,272 | $ | 318,914 | |||||||||||||
| Allowance for Loss | (2,820 | ) | (3,028 | ) | (3,037 | ) | (3,060 | ) | (3,042 | ||||||||||||||
| Net Loans | $ | 288,188 | $ | 303,334 | $ | 300,544 | $ | 316,212 | $ | 315,872 | |||||||||||||
| OREO | 2,760 | 2,697 | 879 | 720 | 821 | ||||||||||||||||||
| FDIC Indemnification | 112 | 112 | 112 | 0 | 0 | ||||||||||||||||||
| BOLI | 21,359 | 21,490 | 21,640 | 21,773 | 21,909 | ||||||||||||||||||
| Fixed Assets, net | 9,915 | 10,166 | 9,970 | 9,733 | 9,511 | ||||||||||||||||||
| Intangible Assets | 242 | 197 | 152 | 126 | 116 | ||||||||||||||||||
| Other Assets | 11,754 | 13,228 | 12,880 | 13,365 | 11,759 | ||||||||||||||||||
| Total Assets | $ | 545,354 | $ | 559,715 | $ | 541,274 | $ | 544,072 | $ | 550,484 | |||||||||||||
| Liabilities & Stockholders' Equity | |||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Deposits | |||||||||||||||||||||||
| DDAs | $ | 99,906 | $ | 95,714 | $ | 97,587 | $ | 88,768 | $ | 106,821 | |||||||||||||
| Interest Bearing Demand | 73,555 | 76,198 | 81,262 | 64,684 | 62,829 | ||||||||||||||||||
| Celebration Checking | 102,368 | 105,247 | 105,358 | 101,474 | 99,694 | ||||||||||||||||||
| Money Market Accts | 29,699 | 29,673 | 30,402 | 47,286 | 55,836 | ||||||||||||||||||
| Savings | 43,147 | 44,030 | 43,862 | 44,139 | 43,574 | ||||||||||||||||||
| CDs Less Than $100k | 59,273 | 57,827 | 57,600 | 57,349 | 56,864 | ||||||||||||||||||
| CDs Greater than $100k | 36,723 | 37,232 | 30,477 | 34,795 | 38,007 | ||||||||||||||||||
| Total Deposits | $ | 444,671 | $ | 445,921 | $ | 446,548 | $ | 438,495 | $ | 463,625 | |||||||||||||
| Other Liabilities | 7,067 | 1,639 | 1,874 | 2,115 | 1,493 | |||||||||
| Net Borrowings (Wholesale Funding) | 40,000 | 59,666 | 40,000 | 50,641 | 30,000 | |||||||||
| Total Liabilities | $ | 491,738 | $ | 507,226 | $ | 488,422 | $ | 491,251 | $ | 495,118 | ||||
| Total Equity | 53,616 | 52,489 | 52,852 | 52,821 | 55,366 | |||||||||
| Total Liabilities & Stockholders' Equity | $ | 545,354 | $ | 559,715 | $ | 541,274 | $ | 544,072 | $ | 550,484 |
| Ratios | ||||||||||
| Q4 2017 | Q1 2018 | Q2 2018 | Q3 2018 | Q4 2018 | ||||||
| ROAA | -0.84 | % | 0.58 | % | 0.59 | % | 0.81 | % | 0.93 | % |
| ROAE | -7.81 | % | 6.03 | % | 6.12 | % | 8.35 | % | 9.40 | % |
| NPAs/Assets (Core) | 1.05 | % | 0.99 | % | 1.25 | % | 1.11 | % | 0.92 | % |
| Est. T1 Leverage (Bank) | 8.27 | % | 8.42 | % | 8.56 | % | 8.94 | % | 9.16 | % |
| Total Common Equiv. Shares | 8,413,372 | 8,413,372 | 8,413,372 | 8,421,992 | 8,421,992 | |||||
| NIM | 3.68 | % | 3.83 | % | 3.73 | % | 3.78 | % | 3.79 | % |
| Cost of Deposits | 0.24 | % | 0.24 | % | 0.25 | % | 0.33 | % | 0.44 | % |
| Loan/Deposit | 65.3 | % | 68.3 | % | 68.0 | % | 72.5 | % | 68.8 | % |
| Employees | 115 | 116 | 115 | 110 | 106 | |||||