Citizens Community Bank Announces Second Quarter 2013 Financial Results
SOUTH HILL, Va., July 31, 2013 /PRNewswire/ -- Citizens Community Bank (OTCQB: CZYB) today announced its unaudited results of operations for the second quarter of 2013.
Earnings
Citizens Community Bank is pleased to announce net income to common shareholders of $227,056 after preferred stock dividends of $10,000 for the second quarter of 2013, compared to net income to common shareholders of $69,632 after preferred stock dividends of $49,823 for the second quarter of 2012. On a basic and diluted basis, this was equivalent to $0.15 per share compared to $0.05 per share for the second quarter of 2012.
President and CEO James R. Black stated, "The second quarter of 2013 was our first profitable quarter since the second quarter of 2012. During the quarter, we concluded our asset resolution strategy with a successful auction where we were able to rid ourselves of $1.1 million of other real estate owned. This, along with the continued efforts on reducing problematic loans, has significantly reduced our credit risk to a more manageable level. We are now better postured to focus on enhancing core earnings and building franchise value as we expand. We recently hired a new lending executive for the Virginia market and look forward to communicating further positive results, such as this, in our future."
In comparing the second quarter of 2013 to the same quarter in 2012, net interest revenue decreased by $86,883 or 5.9%. This resulted from a contracting net interest margin, which equaled 3.79%, down 25 basis points from the second quarter of 2012 and down 14 basis points from the first quarter of 2013. The earning asset yield was 4.82% for the second quarter of 2013, which was down 42 basis points from one year ago. For the same period, funding costs were 1.27%, down 21 basis points from the second quarter of 2012.
Noninterest income totaled $423,865 for the second quarter of 2013, more than double for the same period of 2012. For the six months ended June 30, 2013, noninterest income totaled $644,030 compared to $437,493 for the period ended June 30, 2012. This increase of 47.2% is attributed primarily to fee income related to origination of mortgages for the secondary market and net gains of $84,783 on the sale of other real estate owned. Noninterest expense decreased by $40,488 or 2.7% for the second quarter of 2013 compared to the same period of 2012. On a year-to-date basis, noninterest expense was $3,837,097, compared to $2,875,420 at June 30, 2012. This increase of $961,677 is due to aggressive write-downs of other real estate owned in the first quarter of 2013 as well as disposal of other real estate and resolution of problem assets continuing through the second quarter. While the increase of noninterest expense related to these issues has caused an increase in noninterest expense for 2013 of 33.4% over 2012, the resultant improvements in asset quality positions the Bank for opportunities for profitable growth and expansion.
Growth
At June 30, 2013, total assets were $161.2 million, down $1.3 million, or 0.8% from December 31, 2012. Gross loans were $123.7 million, a decrease of $8.6 million or 6.5% from December 31, 2012. The securities portfolio balance increased by $1.0 million or 7.4% from December 31, 2012. Deposits totaled $138.4 million, a decrease of $200 thousand or 0.2% from December 31, 2012. Over the same comparable period, noninterest bearing demand deposits increased $3.4 million or 18.8%. FHLB advance balances remained unchanged at $2.0 million as the Bank refinanced the borrowings at attractive lower rates during the second quarter of 2013.
Asset Quality
The Bank provided $10,000 to the loan loss reserve for the second quarter of 2013, compared to $25,000 for the second quarter of 2012, and $1.6 million for the full year 2012. The allowance for loan losses at June 30, 2013 was 1.91% compared to 2.21% at June 30, 2012 and 1.64% at December 31, 2012. For 2013, net charge-offs equaled $731,276, or 0.58% of average loans compared to net recoveries of $64,087 or (0.20)% one year ago. Nonperforming loans, which include performing troubled debt restructurings, equaled $3,426,779, or 2.77% of loans compared to $7,651,966 or 5.94% at June 30, 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. There were no loans 90 days past due and still accruing interest at June 30, 2013.
At June 30, 2013, other real estate owned totaled $1.0 million compared with $2.5 million at year end 2012 and $2.6 million at June 30, 2012. During the first three months of 2013, the bank wrote down its other real estate portfolio by $960,759; however no additional valuation write downs were necessary in the second quarter. During the second quarter of 2013 the Bank conducted an auction to reduce its holdings of other real estate owned. In aggregate, nonperforming assets equaled $4.4 million or 2.8% of total assets at June 30, 2013, compared to $10.3 million or 6.4% of total assets at June 30, 2012, a reduction of $5.8 million or 56.8%.
Capital
As of June 30, 2013, total risk-based capital was 16.7% compared to 18.1% one year ago, and significantly higher than the 10.0% minimum regulatory requirement for well capitalized institutions. Tier 1 leverage was 12.0%, 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.
| Citizens Community Bank |
||||||||
| Financial Highlights |
||||||||
| (Unaudited) |
||||||||
| (Actual dollars, except per share data) |
Three months ended June 30, |
Six months ended June 30, |
||||||
| Selected Operating Data: |
2013 |
2012 |
2013 |
2012 |
||||
| Net interest income |
$ 1,380,648 |
$ 1,465,677 |
$ 2,803,477 |
$ 2,934,570 |
||||
| Provision for loan losses |
10,000 |
25,000 |
917,000 |
165,000 |
||||
| Noninterest income |
423,865 |
211,319 |
644,030 |
437,493 |
||||
| Noninterest expense |
1,454,571 |
1,495,059 |
3,837,097 |
2,875,420 |
||||
| Income before income tax |
339,942 |
156,937 |
(1,306,590) |
331,643 |
||||
| Income tax expense |
102,886 |
37,481 |
(472,643) |
76,991 |
||||
| Net income |
$ 237,056 |
$ 119,456 |
$ (833,947) |
$ 254,652 |
||||
| Less: Preferred dividends |
$ 10,000 |
$ 49,823 |
$ 20,000 |
$ 99,823 |
||||
| Net income available to common |
||||||||
| shareholders |
$ 227,056 |
$ 69,632 |
$ (853,947) |
$ 154,829 |
||||
| Income per share available to |
||||||||
| common shareholders:(1) |
||||||||
| Basic |
$0.15 |
$0.05 |
($0.57) |
$0.10 |
||||
| Diluted |
$0.15 |
$0.05 |
($0.57) |
$0.10 |
||||
| Average shares outstanding, basic |
1,500,948 |
1,500,948 |
1,500,948 |
1,500,948 |
||||
| Average shares outstanding, diluted |
1,500,948 |
1,500,948 |
1,500,948 |
1,500,948 |
||||
| Note: (1) All per share amounts have been adjusted to reflect a 10% stock dividend paid by the Bank in July 2011. |
||||||||
| Citizens Community Bank |
|||||||||
| Financial Highlights |
|||||||||
| (Actual dollars, except per share data) |
June 30, |
December 31, |
June 30, |
||||||
| Balance Sheet Data: |
2013 |
2012 |
2012 |
||||||
| Total assets |
$ 161,223,561 |
$ 162,545,826 |
$ 159,040,564 |
||||||
| Investments |
$ 14,898,619 |
$ 13,866,847 |
$ 14,886,754 |
||||||
| Loans, gross |
$ 123,710,107 |
$ 132,363,875 |
$ 128,736,549 |
||||||
| Loans, net of ALLR |
121,348,318 |
130,187,810 |
125,888,776 |
||||||
| Deposits-Non-Interest |
21,568,742 |
18,150,160 |
16,355,228 |
||||||
| Deposits-Interest-Bearing |
116,887,672 |
120,487,582 |
117,737,503 |
||||||
| Deposits |
138,456,414 |
138,637,742 |
134,092,731 |
||||||
| Borrowings |
2,000,000 |
2,000,000 |
2,000,000 |
||||||
| Preferred stock |
4,000,000 |
4,000,000 |
4,000,000 |
||||||
| Stockholders' equity |
20,503,447 |
20,553,226 |
22,721,768 |
||||||
| Book value per share (1) |
$ 11.00 |
$ 11.03 |
$ 12.47 |
||||||
| Total shares outstanding |
1,500,948 |
1,500,948 |
1,500,948 |
||||||
| Three months ended June 30, |
Six months ended June 30, |
||||||||
| Performance Ratios: |
2013 |
2012 |
2013 |
2012 |
|||||
| Return on average assets |
0.57% |
0.18% |
-1.06% |
0.20% |
|||||
| Return on average common equity |
5.49% |
1.48% |
-10.13% |
1.64% |
|||||
| Net interest margin |
3.79% |
4.04% |
3.80% |
4.07% |
|||||
| Overhead efficiency |
80.61% |
89.10% |
89.15% |
89.10% |
|||||
| Asset Quality Data: |
|||||||||
| Allowance for loan loss |
$ 2,361,789 |
$ 2,847,773 |
n/a |
n/a |
|||||
| Nonperforming assets |
4,434,556 |
10,256,582 |
n/a |
n/a |
|||||
| Nonaccrual loans |
2,812,007 |
6,238,005 |
n/a |
n/a |
|||||
| Nonperforming loans (2) |
3,426,779 |
7,651,966 |
n/a |
n/a |
|||||
| Other real estate owned |
1,007,777 |
2,604,616 |
n/a |
n/a |
|||||
| Net charge-offs (recoveries) |
731,276 |
(64,087) |
731,276 |
(17,974) |
|||||
| June 30, |
June 30, |
December 31, |
|||||||
| Asset Quality Ratios: |
2013 |
2012 |
2012 |
||||||
| Allowance for loan loss to total loans |
1.91% |
2.21% |
1.64% |
||||||
| Nonperforming loans to total loans |
2.77% |
5.94% |
2.92% |
||||||
| Nonperforming assets to total assets |
2.75% |
6.45% |
3.92% |
||||||
| Net charge-offs (recoveries) to average loans (3) |
0.58% |
(0.20%) |
1.65% |
||||||
| Capital Ratios: |
|||||||||
| Total risk-based capital |
16.71% |
18.11% |
16.67% |
||||||
| Tier 1 risk-based capital |
15.45% |
16.85% |
15.42% |
||||||
| Tier 1 leverage capital |
11.96% |
14.03% |
12.60% |
||||||
| Note: (1) Book value excludes $4,000,0000 of preferred stock for all periods. |
|||||||||
| (2) Includes troubled debt restructurings of $2,552,485 and $1,413,961, for June 30, 2013 and 2012, respectively. |
|||||||||
| (3) Annualized rates for the quarter ended June 30, 2013 and 2012, respectively. |
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SOURCE Citizens Community Bank
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