Citizens First Corporation Announces First Quarter 2014 Results
BOWLING GREEN, Ky., April 17, 2014 /PRNewswire/ -- Citizens First Corporation (NASDAQ: CZFC) today reported results for the first quarter ending March 31, 2014, which include the following:
- For the quarter ended March 31, 2014, the Company reported net income of $691,000, which represents a decrease of $11,000 from the linked quarter ended December 31, 2013 and an increase of $576,000 from March 31, 2013. Earnings per diluted common share for the current quarter were $0.27, an increase of $0.02 from the linked quarter ended December 31, 2013 and an increase of $0.32 for the quarter ended March 31, 2013.
- The Company's net interest margin was 3.81% for the quarter ended March 31, 2014 compared to 4.03% for the linked quarter ended December 31, 2013 and 3.96% for the quarter ended March 31, 2013, a decrease of 22 basis points for the linked quarter and a decrease of 15 basis points from the prior year. The Company's net interest margin decreased from prior periods due to a decline in the yield on loans.
- Total loans increased 2.2% to $301.6 million at March 31, 2014 compared to $295.1 million at December 31, 2013. Total deposits increased 2.7% to $352.2 million at March 31, 2014 compared to $343.0 million at December 31, 2013. Todd Kanipe, President & CEO of Citizens First commented, "We are encouraged by the growth of loans on our balance sheet. Loan growth is vital to improve our net interest income while interest rates continue to remain at historically low levels. We have added to both our lending and credit administration staff to focus on loan growth while maintaining credit quality in our loan portfolio."
First Quarter 2014 Compared to Fourth Quarter 2013
Net interest income for the quarter ended March 31, 2014 declined $231,000 from the previous quarter as the yield on loans declined.
Non-interest income for the three months ended March 31, 2014 decreased $82,000, or 11.5%, compared to the previous quarter, primarily due to a decrease in service charges on deposits of $58,000. Non-interest expense for the three months ended March 31, 2014 increased $1,000, or .03%, compared to the previous quarter.
A $125,000 provision for loan losses was recorded for the first quarter of 2014, compared to a $450,000 provision in the previous quarter, a decrease of $325,000. The allowance for loan losses to total loans increased slightly from 1.58% to 1.60%. Net charge-offs (recoveries) were $(49,000) for the first quarter of 2014 compared to $617,000 in the fourth quarter of 2013.
First Quarter 2014 Compared to First Quarter 2013
Net interest income for the quarter ended March 31, 2014 decreased $168,000, or 4.6%, compared to the previous year. The decrease in net interest income was impacted by a reduction in interest expense of $79,000 combined with a decrease in interest income of $247,000. The decrease in interest income was created by a decline in the yield on loans from 5.50% in the first quarter of 2013 to 5.14% in the first quarter of 2014. Loan yields have declined as maturing loans were repriced at a lower rate.
Non-interest income for the three months ended March 31, 2014 decreased $90,000, or 12.5%, compared to the three months ended March 31, 2013, primarily due to a decline in gains on sale of mortgage loans of $58,000 from the prior year.
Non-interest expense for the three months ended March 31, 2014 decreased $20,000, or 0.6%, compared to the three months ended March 31, 2013, due to a decrease in legal and collection expenses.
A $125,000 provision for loan losses was recorded for the first quarter of 2014, a decrease of $1.1 million, from $1.3 million in the first quarter of 2013. The allowance for loan losses to total loans decreased from 2.21% of total loans at March 31, 2013 to 1.60% at March 31, 2014, primarily due to charge-offs of specific allocations which were included in the allowance at March 31, 2013. Net charge-offs (recoveries) were $(49,000) for the first quarter of 2014 compared to net charge-offs of $321,000 in the first quarter of 2013.
Balance Sheet
Total assets at March 31, 2014 were $420.1 million, an increase of $9.9 million from $410.2 million at December 31, 2013. Average assets during the first quarter were $414.1 million, a decrease of 0.9%, or $3.7 million, from $417.8 million in the first quarter of 2013. Average interest earning assets decreased 0.8%, or $3.1 million, from $384.6 million in the first quarter of 2013 to $381.5 million in the first quarter of 2014.
Loans increased $6.5 million, or 2.2%, from $295.1 million at December 31, 2013 to $301.6 million at March 31, 2014. Total loans averaged $303.4 million the first quarter of 2014, compared to $303.9 million the first quarter of 2013, a decrease of $0.5 million, or 0.2%.
Deposits at March 31, 2014 were $352.2 million, an increase of $9.2 million, or 2.7%, compared to $343.0 million at December 31, 2013. Total deposits averaged $346.1 million the first quarter of 2014, an increase of $3.6 million, or 1.1%, compared to $342.5 million during the first quarter of 2013. Average deposits increased during the year, but the cost of funds declined as higher cost deposits matured and were renewed at lower rates.
Non-performing assets totaled $2.6 million at March 31, 2014 compared to $2.0 million at December 31, 2013, an increase of $593,000. A summary of nonperforming assets is presented below:
| (In thousands) |
March 31, 2014 |
December 31, 2013 |
September 30, 2013 |
June 30, 2013 |
March 31, 2013 |
|
| Nonaccrual loans |
$1,104 |
$1,026 |
$3,784 |
$6,141 |
$7,097 |
|
| Loans 90+ days past due/accruing |
56 |
- |
19 |
- |
23 |
|
| Restructured loans |
815 |
154 |
2,041 |
3,340 |
3,528 |
|
| Total non-performing loans |
1,975 |
1,180 |
5,844 |
9,481 |
10,648 |
|
| Other real estate owned |
631 |
833 |
547 |
517 |
232 |
|
| Total non-performing assets |
$2,606 |
$2,013 |
$6,391 |
$9,998 |
$10,880 |
|
| Non-performing assets to total assets |
0.62% |
0.49% |
1.56% |
2.43% |
2.58% |
The allowance for loan losses at March 31, 2014 was $4.8 million, or 1.60% of total loans, compared to $4.7 million, or 1.58% of total loans as of December 31, 2013. The allowance increased due to an increase in nonperforming assets. A summary of the allowance for loan losses is presented below:
| (In thousands) |
March 31, 2014 |
December 31, 2013 |
September 30, 2013 |
June 30, 2013 |
March 31, 2013 |
|
| Balance at beginning of period |
$4,653 |
$4,820 |
$6,064 |
$6,650 |
$5,721 |
|
| Provision for loan losses |
125 |
450 |
900 |
50 |
1,250 |
|
| Charged-off loans |
22 |
788 |
2,198 |
678 |
358 |
|
| Recoveries of previously charged-off loans |
71 |
171 |
54 |
42 |
37 |
|
| Balance at end of period |
$4,827 |
$4,653 |
$4,820 |
$6,064 |
$6,650 |
|
| Allowance for loan losses to total loans |
1.60% |
1.58% |
1.60% |
1.98% |
2.21% |
At March 31, 2014, total shareholders' equity was $35.9 million compared to $38.3 million at December 31, 2013, a decrease of $2.4 million. During the first quarter of 2014, the Company paid $3.3 million to repurchase the remaining 93 shares of the Series A preferred stock that the Company had issued to the Treasury in 2008 under the TARP Capital Purchase Program.
The Company's tangible equity ratio declined to 7.51% as of March 31, 2014 compared to 8.28% at December 31, 2013 due to the repayment of the TARP Capital Purchase Program funds. The tangible book value per common share improved from $11.51 at December 31, 2013, to $11.97 at March 31, 2014. The Company and Citizens First Bank are categorized as "well capitalized" under regulatory guidelines.
About Citizens First Corporation
Citizens First Corporation is a bank holding company headquartered in Bowling Green, Kentucky and established in 1999. The Company has branch offices located in Barren, Hart, Simpson and Warren Counties in Kentucky.
Forward-Looking Statements
Statements in this press release relating to Citizens First Corporation's plans, objectives, expectations or future performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based upon the Company's current expectations, but are subject to certain risks and uncertainties that may cause actual results to differ materially. Among the risks and uncertainties that could cause actual results to differ materially are economic conditions generally and in the market areas of the Company, a continuation or worsening of the current disruption in credit and other markets, goodwill impairment, overall loan demand, increased competition in the financial services industry which could negatively impact the Company's ability to increase total earning assets, and the retention of key personnel. Actions by the Department of the Treasury and federal and state bank regulators in response to changing economic conditions, changes in interest rates, loan prepayments by and the financial health of the Company's borrowers, and other factors described in the reports filed by the Company with the Securities and Exchange Commission could also impact current expectations.
| Consolidated Financial Highlights (Unaudited) |
|||||
| In thousands, except per share data and ratios |
|||||
| Consolidated Statement of Income: |
|||||
| Three Months Ended
|
|||||
| March 31 |
Dec 31 |
Sept 30 |
June 30 |
March 31 |
|
| 2014 |
2013 |
2013 |
2013 |
2013 |
|
| Interest income |
$4,181 |
$4,411 |
$4,381 |
$4,325 |
$4,428 |
| Interest expense |
683 |
682 |
747 |
770 |
762 |
| Net interest income |
3,498 |
3,729 |
3,634 |
3,555 |
3,666 |
| Provision for loan losses |
125 |
450 |
900 |
50 |
1,250 |
| Non-interest income: |
|||||
| Service charges on deposits |
261 |
319 |
341 |
321 |
291 |
| Other service charges and fees |
153 |
133 |
156 |
158 |
138 |
| Gain on sale of mortgage loans |
24 |
36 |
81 |
78 |
82 |
| Non-deposit brokerage fees |
69 |
72 |
91 |
78 |
65 |
| Lease income |
75 |
75 |
74 |
75 |
74 |
| BOLI income |
47 |
49 |
53 |
56 |
61 |
| Securities gains |
- |
27 |
- |
29 |
8 |
| Total |
629 |
711 |
796 |
795 |
719 |
| Non-interest expenses: |
|||||
| Personnel expense |
1,527 |
1,419 |
1,382 |
1,417 |
1,441 |
| Net occupancy expense |
482 |
485 |
499 |
465 |
461 |
| Advertising and public relations |
83 |
65 |
70 |
110 |
78 |
| Professional fees |
153 |
141 |
201 |
174 |
164 |
| Data processing services |
233 |
266 |
280 |
272 |
265 |
| Franchise shares and deposit tax |
146 |
145 |
146 |
141 |
141 |
| FDIC insurance |
77 |
119 |
150 |
26 |
85 |
| Core deposit intangible amortization |
84 |
79 |
84 |
85 |
84 |
| Postage and office supplies |
51 |
38 |
35 |
35 |
43 |
| Other real estate owned expenses |
10 |
46 |
7 |
20 |
11 |
| Other |
216 |
258 |
425 |
434 |
309 |
| Total |
3,062 |
3,061 |
3,279 |
3,179 |
3,082 |
| Income before income taxes |
940 |
929 |
251 |
1,121 |
53 |
| Provision for income taxes |
249 |
227 |
18 |
333 |
(62) |
| Net income |
691 |
702 |
233 |
788 |
115 |
| Preferred dividends and discount accretion |
132 |
184 |
178 |
176 |
217 |
| Net income (loss) available for common shareholders |
$559 |
$518 |
$55 |
$612 |
$(102) |
| Basic earnings (loss) per common share |
$0.28 |
$0.26 |
$0.03 |
$0.31 |
$(0.05) |
| Diluted earnings (loss) per common share |
$0.27 |
$0.25 |
$0.02 |
$0.30 |
$(0.05) |
| Consolidated Financial Highlights (Unaudited) |
||||||
| In thousands, except per share data and ratios |
||||||
| Key Operating Statistics: |
||||||
| Three Months Ended
|
||||||
| March 31 |
December 31 |
September 30 |
June 30 |
March 31 |
||
| 2014 |
2013 |
2013 |
2013 |
2013 |
||
| Average assets |
$414,089 |
$408,792 |
$413,293 |
$419,240 |
$417,804 |
|
| Average earning assets |
381,485 |
375,658 |
380,154 |
387,663 |
384,614 |
|
| Average loans |
303,438 |
298,833 |
307,618 |
305,532 |
303,942 |
|
| Average deposits |
346,089 |
340,938 |
340,067 |
345,738 |
342,475 |
|
| Average equity |
36,213 |
38,469 |
37,937 |
38,353 |
40,164 |
|
| Average common equity |
28,046 |
27,548 |
27,023 |
27,445 |
27,695 |
|
| Return on average assets |
0.68% |
0.68% |
0.22% |
0.75% |
0.11% |
|
| Return on average equity |
7.74% |
7.24% |
2.44% |
8.24% |
1.16% |
|
| Efficiency ratio |
72.73% |
68.07% |
72.66% |
72.17% |
68.96% |
|
| Non-interest income to average assets |
0.62% |
0.69% |
0.77% |
0.76% |
0.70% |
|
| Non-interest expenses to average assets |
3.00% |
2.97% |
3.15% |
3.04% |
2.99% |
|
| Net overhead to average assets |
2.38% |
2.28% |
2.38% |
2.28% |
2.29% |
|
| Yield on loans |
5.14% |
5.42% |
5.26% |
5.28% |
5.50% |
|
| Yield on investment securities (TE) |
3.02% |
2.97% |
2.87% |
2.78% |
2.97% |
|
| Yield on average earning assets (TE) |
4.53% |
4.75% |
4.66% |
4.56% |
4.76% |
|
| Cost of average interest bearing liabilities |
0.83% |
0.83% |
0.89% |
0.92% |
0.93% |
|
| Net interest margin (tax equivalent) |
3.81% |
4.03% |
3.88% |
3.77% |
3.96% |
|
| Number of FTE employees |
98 |
100 |
100 |
98 |
99 |
|
| Asset Quality Ratios: |
||||||
| Non-performing loans to total loans |
0.65% |
0.40% |
1.94% |
3.09% |
3.54% |
|
| Non-performing assets to total assets |
0.62% |
0.49% |
1.56% |
2.43% |
2.58% |
|
| Allowance for loan losses to total loans |
1.60% |
1.58% |
1.60% |
1.98% |
2.21% |
|
| YTD net charge-offs (recoveries) to average loans, annualized |
(0.06)% |
1.22% |
1.36% |
0.63% |
0.43% |
|
| Consolidated Financial Highlights (Unaudited) |
|||
| In thousands, except per share data and ratios |
|||
| Consolidated Statement of Condition: |
As of |
As of |
As of |
| March 31, |
December 31, |
December 31, |
|
| 2014 |
2013 |
2012 |
|
| Cash and due from financial institutions |
$ 8,166 |
$ 8,572 |
$9,549 |
| Federal funds sold |
30,095 |
28,490 |
25,250 |
| Available for sale securities |
54,675 |
51,633 |
46,639 |
| Loans held for sale |
85 |
- |
61 |
| Loans |
301,598 |
295,068 |
298,754 |
| Allowance for loan losses |
(4,827) |
(4,653) |
(5,721) |
| Premises and equipment, net |
10,970 |
11,054 |
11,568 |
| Bank owned life insurance (BOLI) |
7,853 |
7,806 |
7,587 |
| Federal Home Loan Bank Stock, at cost |
2,025 |
2,025 |
2,025 |
| Accrued interest receivable |
1,444 |
1,554 |
1,660 |
| Deferred income taxes |
1,759 |
2,279 |
2,180 |
| Intangible assets |
4,678 |
4,762 |
5,094 |
| Other real estate owned |
631 |
833 |
191 |
| Other assets |
976 |
752 |
1,719 |
| Total Assets |
$420,128 |
$410,175 |
$406,556 |
| Deposits: |
|||
| Noninterest bearing |
$ 41,653 |
$ 39,967 |
$ 41,725 |
| Savings, NOW and money market |
146,130 |
143,602 |
111,194 |
| Time |
164,414 |
159,382 |
178,814 |
| Total deposits |
$352,197 |
$342,951 |
$331,733 |
| FHLB advances and other borrowings |
25,300 |
22,000 |
26,000 |
| Subordinated debentures |
5,000 |
5,000 |
5,000 |
| Accrued interest payable |
241 |
243 |
238 |
| Other liabilities |
1,477 |
1,634 |
2,019 |
| Total Liabilities |
384,215 |
371,828 |
364,990 |
| 6.5% Cumulative preferred stock |
7,659 |
7,659 |
7,659 |
| Series A preferred stock |
- |
3,266 |
6,519 |
| Common stock |
27,072 |
27,072 |
27,072 |
| Retained earnings (deficit) |
1,212 |
653 |
(430) |
| Accumulated other comprehensive income (loss) |
(30) |
(303) |
746 |
| Total Stockholders' Equity |
35,913 |
38,347 |
41,566 |
| Total Liabilities and Stockholders' Equity |
$420,128 |
$410,175 |
$406,556 |
| Consolidated Financial Highlights (Unaudited) |
||||
| In thousands, except per share data and ratios |
||||
| March 31, 2014 |
December 31, 2013 |
December 31, 2012 |
||
| Capital Ratios: |
||||
| Tier 1 leverage |
8.86% |
9.57% |
10.20% |
|
| Tier 1 risk-based capital |
11.48% |
12.56% |
13.16% |
|
| Total risk based capital |
12.73% |
13.81% |
14.41% |
|
| Tangible equity ratio (1) |
7.51% |
8.28% |
9.08% |
|
| Tangible common equity ratio (1) |
5.67% |
5.59% |
5.55% |
|
| Book value per common share |
$14.35 |
$13.93 |
$13.91 |
|
| Tangible book value per common share (1) |
$11.97 |
$11.51 |
$11.32 |
|
| Shares outstanding (in thousands) |
1,969 |
1,969 |
1,969 |
|
| _____________ |
||||
| (1) |
The tangible equity ratio, tangible common equity ratio and tangible book value per common share, while not required by accounting principles generally accepted in the United States of America (GAAP), are considered critical metrics with which to analyze banks. The ratio and per share amount have been included to facilitate a greater understanding of the Company's capital structure and financial condition. See the Regulation G Non-GAAP Reconciliation table for reconciliation of this ratio and per share amount to GAAP. |
| Regulation G Non-GAAP Reconciliation: |
March 31, 2014 |
December 31, 2013 |
December 31, 2012 |
|
| Total shareholders' equity (a) |
$35,913 |
$38,348 |
$41,566 |
|
| Less: |
||||
| Preferred stock |
(7,659) |
(10,925) |
(14,178) |
|
| Common equity (b) |
28,254 |
27,423 |
27,388 |
|
| Goodwill |
(4,097) |
(4,097) |
(4,097) |
|
| Intangible assets |
(581) |
(665) |
(997) |
|
| Tangible common equity (c) |
23,576 |
22,661 |
22,294 |
|
| Add: |
||||
| Preferred stock |
7,659 |
10,925 |
14,178 |
|
| Tangible equity (d) |
$31,235 |
$33,586 |
$36,472 |
|
| Total assets (e) |
$420,435 |
$410,175 |
$406,556 |
|
| Less: |
||||
| Goodwill |
(4,097) |
(4,097) |
(4,097) |
|
| Intangible assets |
(581) |
(665) |
(997) |
|
| Tangible assets (f) |
$415,757 |
$405,413 |
$401,462 |
|
| Shares outstanding (in thousands) (g) |
1,969 |
1,969 |
1,969 |
|
| Book value per common share (b/g) |
$14.35 |
$13.93 |
$13.91 |
|
| Tangible book value per common share (c/g) |
$11.97 |
$11.51 |
$11.32 |
|
| Total shareholders' equity to total assets ratio (a/e) |
8.54% |
9.35% |
10.22% |
|
| Tangible equity ratio (d/f) |
7.51% |
8.28% |
9.08% |
|
| Tangible common equity ratio (c/f) |
5.67% |
5.59% |
5.55% |
SOURCE Citizens First Corporation
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