Citizens Community Bank Announces First Quarter 2013 Results
SOUTH HILL, Va., April 24, 2013 /PRNewswire/ -- Citizens Community Bank (OTCQB: CZYB) today announced its unaudited results of operations for the first quarter of 2013.
Earnings
For the first quarter of 2013, the Bank had a net loss to common shareholders of $1,081,003 after preferred stock dividends of $10,000 compared to net income of $85,197 after preferred stock dividends of $50,000 for the first quarter of 2012. On a basic and diluted basis, this was equivalent to a net loss of ($0.72) per share compared to $0.06 per share for the first quarter of 2012.
President and CEO James R. Black stated, "Although a painful process, I am pleased to report the significant progress made during the first three months of 2013. We have significantly reduced the level of credit risk and strengthened our balance sheet. Nonperforming assets were reduced by $1.2 million or 19.3% during the three month period, despite adding a $2.0 million loan to nonaccrual. At this time, we have specific reserves against this loan and believe the loan presents no additional credit risk other than what has already been reserved. We were also able to reduce adversely classified assets by $3.3 million or 30.2% from year end 2012. An auction is planned for the second quarter of 2013, where we expect to sell a portion of the existing other real estate owned. With these actions over the past three quarters, this concludes the significant negative earnings impact associated with the asset resolution strategy. We will continue to focus on reducing the level on problematic assets; however, the actions taken thus far will enable us to be more focused on value added strategic initiatives, such as the recent deployment of mobile banking which was well received."
In comparing the first quarter of 2013 to the same quarter in 2012, net interest revenue decreased by $46,064 or 3.1%. This resulted from a contracting net interest margin, which equaled 3.93%, down 16 basis points from the first quarter of 2012 and down 2 basis points the fourth quarter of 2012. Earning asset yields were 4.98% for the first three months of 2013, which was down 39 basis points from one year ago. For the same period, funding costs were 1.28%, down a modest 28 basis points from the first quarter of 2012.
Noninterest income totaled $202,585 for the first three months of 2013, a $4,471 or 2.2% decline from one year ago. Noninterest expense of $2,364,946 was $1,003,704 of 73.7% higher than the first quarter of 2012 due mostly to write-downs and losses on the sale of other real estate owned, costs associated with foreclosures and collections, coupled with additional professional and legal expenses. During the first quarter of 2013, valuation write-downs and losses on the sale of other real estate owned totaled $991,150. Other legal and professional expenses were higher due to the preparation of reducing problematic assets and other initiatives designed to enhance future core earnings.
Growth
At March 31, 2013, total assets were $160.9 million, down $1.6 million, or 1.0% from December 31, 2012. Gross loans were $130.1 million, a decrease of $2.2 million or 1.7% from December 31, 2012. The securities portfolio balance decreased by $345,910 or 2.5% from December 31, 2012. Deposits totaled $138.3 million, a decrease of $327,247 or 0.2% from December 31, 2012. Over the same comparable period, noninterest bearing demand deposits increased $541,440 or 3.3%. FHLB advance balances remained unchanged at $2.0 million as the Bank refinanced the borrowings at attractive lower rates during the first quarter of 2013.
Asset Quality
For the first quarter of 2013, $907,000 was provided to the loan loss reserve compared to $140,000 for the first three months of 2012 and $1.6 million for full year 2012. The sharp increase in the provision was due to higher charge-offs during the period as well as an increase in general reserves. The allowance for loan losses represented 1.88% of loans as of March 31, 2013, compared to 1.64% on December 31, 2012 and 2.20% as of March 31, 2012. For 2013, net charge-offs equaled $637,189 or 1.94% of loans compared to $46,113 or 0.14% one year ago. Nonperforming loans, which exclude performing troubled debt restructurings, equaled $3,027,441 or 2.33% of loans compared to $6,054,701 or 5.26% at March 31, 2012. This includes a single $2.0 million loan that was placed on nonaccrual during the first quarter of 2013. Management has established specific reserves against the loan and at this time believes the loan presents no additional credit risk. Nonperforming loans were down $831,682 or 21.6% from December 31, 2012. There were no loans 90 days past due and still accruing interest on March 31, 2013.
At March 31, 2013, other real estate owned totaled $2.1 million compared with $2.5 million at year end 2012 and March 31, 2012, respectively. For the first three months of 2013, there were $960,759 of valuation write-downs and $30,391 of losses on the sale of other real estate owned. The Bank is conducting an auction during the second quarter of 2013 to further reduce its holdings of other real estate owned. In aggregate, nonperforming assets equaled $5.1 or 3.20% of total assets, down $3.4 million or 53.5% from one year ago and down $1.2 million or 19.3% from December 31, 2012. As of March 31, 2013, total adversely classified assets totaled $7.6 million, down $8.3 million or 75.7% from one year ago and down $3.3 million or 30.2% from December 31, 2012.
Capital
As of March 31, 2013, total risk-based capital was 15.8% compared to 16.7% one year ago, and significantly higher than the 10.0% minimum regulatory requirement for well capitalized institutions. Tier 1 leverage was 11.7%, down from 12.6% at December 31, 2012.
Citizens Community Bank is a Virginia state chartered bank headquartered in South Hill, Virginia. Opened in December 1999, it operates four branches, three in south central Virginia and one in northern North Carolina as well as a loan production office in Oxford, North Carolina. For more information and additional financial data, please visit www.ccbsite.com.
This press release contains "forward-looking statements" that concern future events which are subject to risks and uncertainties. Any such statements are based on certain assumptions and analyses by the Bank and other factors it believes are appropriate in the circumstances and at the time at which such statements are made. The Bank's actual results, events and developments may differ materially from those contemplated by any forward-looking statement. The Bank has no responsibility to update such forward-looking statements.
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Citizens Community Bank |
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| Financial Highlights |
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| (Unaudited) |
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| (Actual dollars, except per share data) |
Three months ended March 31, |
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| Selected Operating Data: |
2013 |
2012 |
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| Net interest income |
$ 1,422,829 |
$ 1,468,893 |
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| Provision for loan losses |
907,000 |
140,000 |
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| Noninterest income |
202,585 |
207,056 |
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| Noninterest expense |
2,364,946 |
1,361,242 |
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| (Loss) income before income tax |
(1,646,532) |
174,707 |
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| Income tax (benefit) expense |
(575,529) |
39,510 |
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| Net (loss) income |
$ (1,071,003) |
$ 135,197 |
|||
| Less: Preferred dividends |
$ 10,000 |
$ 50,000 |
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| Net (loss) income available to common |
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| shareholders |
$ (1,081,003) |
$ 85,197 |
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| (Loss) income per share available to |
|||||
| common shareholders: |
|||||
| Basic |
($0.72) |
$0.06 |
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| Diluted |
($0.72) |
$0.06 |
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| Average shares outstanding, basic |
1,500,948 |
1,500,948 |
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| Average shares outstanding, diluted |
1,500,948 |
1,500,948 |
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| Citizens Community Bank |
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| Financial Highlights |
||||||
| (Actual dollars, except per share data) |
March 31, |
December 31, |
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| Balance Sheet Data: |
2013 |
2012 |
||||
| Total assets |
$ 160,976,633 |
$ 162,545,826 |
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| Loans, net |
127,673,395 |
130,118,523 |
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| Deposits |
138,310,495 |
138,637,742 |
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| Borrowings |
2,000,000 |
2,000,000 |
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| Preferred stock |
4,000,000 |
4,000,000 |
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| Total stockholders' equity |
20,427,108 |
21,533,801 |
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| Tangible stockholders' equity |
16,427,108 |
17,533,801 |
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| Tangible book value per share (1) |
$ 10.94 |
$ 11.68 |
||||
| Total shares outstanding |
1,500,948 |
1,500,948 |
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|
Three months ended March 31, |
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| Performance Ratios: |
2013 |
2012 |
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| (Loss) return on average assets |
(2.70%) |
0.22% |
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| (Loss) return on average common equity |
(24.83%) |
1.81% |
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| Net interest margin |
3.93% |
4.09% |
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| Overhead efficiency |
145.50% |
81.22% |
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| March 31, |
March 31, |
December 31, |
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| Asset Quality Data: |
2013 |
2012 |
2012 |
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| Allowance for loan loss |
$ 2,445,875 |
$ 2,758,687 |
$ 2,176,065 |
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| Nonperforming loans |
3,027,441 |
6,054,701 |
3,859,123 |
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| Other real estate owned |
2,116,184 |
2,500,009 |
2,517,634 |
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| Nonperforming assets |
5,143,625 |
8,554,710 |
6,376,757 |
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| Performing troubled debt restructurings |
620,344 |
1,120,096 |
722,663 |
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| Net charge-offs |
637,189 |
46,113 |
1,362,006 |
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| Classified loans |
5,519,427 |
13,418,373 |
8,425,795 |
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| Total adversely classified assets |
7,635,611 |
15,918,382 |
10,943,429 |
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| March 31, |
March 31, |
December 31, |
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| Asset Quality Ratios: |
2013 |
2012 |
2012 |
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| Allowance for loan loss to total loans |
1.88% |
2.20% |
1.64% |
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| Nonperforming loans to total loans |
2.33% |
4.83% |
2.92% |
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| Nonperforming assets to total assets |
3.20% |
5.26% |
3.96% |
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| Net charge-offs to average loans |
1.94% |
0.14% |
1.65% |
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| March 31, |
March 31, |
December 31, |
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| Capital Ratios: |
2013 |
2012 |
2012 |
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| Total risk-based capital |
15.76% |
18.44% |
16.67% |
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| Tier 1 risk-based capital |
14.50% |
17.18% |
15.42% |
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| Tier 1 leverage capital |
11.70% |
14.06% |
12.60% |
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| Note: (1) Book value excludes $4,000,0000 of preferred stock for March 31, 2013 and December 31, 2012, respectively. |
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SOURCE Citizens Community Bank
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