Citizens First Corporation Announces First Quarter 2017 Results

News provided by

Citizens First Corporation

Apr 20, 2017, 14:00 ET

BOWLING GREEN, Ky., April 20, 2017 /PRNewswire/ -- Citizens First Corporation (NASDAQ: CZFC) today reported results for the first quarter ending March 31, 2017, which include the following:

For the quarter ended March 31, 2017, the Company reported net income of $907,000, or $0.36 per diluted common share.  This represents an increase of $2,000 from $905,000, or $0.36 per diluted common share, for the quarter ended March 31, 2016. 

"Increased non-performing loans in the quarter negatively impacted net interest margin, resulting in flat earnings compared to the first quarter of 2016," said Todd Kanipe, President and CEO.  "While our credit quality still compares favorably to peer and the industry, we did experience some deterioration in the agricultural portfolio.  We believe current reserves are adequate for these loans; however, we anticipate some increased collection expenses as the loans are resolved."  Kanipe added,  "Though net interest margin pressures persist, loan growth and operating efficiency improved over the first quarter of 2016.  We anticipate steady loan demand and deposit growth in our core markets, reflective of the economic growth in the region."

Income Statement

Net interest income decreased $83,000, or 2.1%, as the yield on loans decreased from the prior year.  During the first quarter, $95,000 of loan income was reversed as loans totaling $3.0 million were placed on non-accrual status.  The Company's net interest margin was 3.68% for the quarter ended March 31, 2017, compared to 3.94% for the quarter ended March 31, 2016, a decrease of 26 basis points.  The Company's net interest margin decreased primarily due to a decline in the yield on loans.

There was a $30,000 provision for loan losses in the first quarter of the current year compared to no provision for loan losses in the first quarter of the prior year due to the growth of the loan portfolio and an increase in non-performing assets.

Non-interest income decreased $47,000, or 5.5%, from the prior year primarily due to a decrease in service charges on deposit accounts of $47,000.

Non-interest expense decreased $163,000, or 4.7%, from the prior year primarily due to a reduction in professional fees of $50,000, and a decrease in personnel expense of $50,000.

Credit Quality

Non-performing assets totaled $3.0 million, or 0.65% of total assets, at March 31, 2017 compared to $23,000, or 0.01% of total assets at December 31, 2016, an increase of $3.0 million.   Two agricultural-related credits were moved to non-accrual status during the first quarter.

The allowance for loan losses at March 31, 2017 was $4.9 million, or 1.34% of total loans, compared to $4.9 million, or 1.35% of total loans as of December 31, 2016.  We consider the size, volume and credit quality of the loan portfolio as well as recent economic and other external influences to record the allowance for loan losses and provision for loan losses that is directionally consistent with our loan portfolio.

Balance Sheet

Total assets at March 31, 2017 were $464.4 million compared to $455.4 million at December 31, 2016.  Total assets increased $9.0 million, or 2.0%, from December 31, 2016 to March 31, 2017 due to a growth in loans and interest-bearing deposits in other financial institutions, partially offset by a decline in federal funds sold and available-for-sale securities.

Loans increased $6.2 million, or 1.7%, from December 31, 2016 to March 31, 2017.  Deposits increased $3.0 million, or 0.8%, from December 31, 2016 to March 31, 2017.  Borrowings from the Federal Home Loan Bank increased $6.0 million, or 17.1%, from December 31, 2016 to March 31, 2017.

Stockholders' equity increased to $43.4 million at March 31, 2017 from $42.4 million at December 31, 2016.  The common equity and tangible common equity ratios were 7.83% and 6.97%, respectively, as of March 31, 2017 compared to 7.71% and 6.83%, respectively, at December 31, 2016.  The book value and tangible book value per common share ratios were $18.01 and $15.90, respectively, at March 31, 2017 compared to $17.54 and $15.40, respectively, at December 31, 2016. 

Dividend to be paid May 17

On April 20, 2017, the Board of Directors declared a cash dividend of $.08 per common share payable May 17, 2017 to shareholders of record as of April 28, 2017. 

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, and a loan production office in Williamson County, Tennessee.  Additional information concerning our products and services is available at www.citizensfirstbank.com.

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 current and future economic and business conditions; possible changes in trade, monetary, and fiscal policies, as well as legislative and regulatory changes; changes in the interest rate environment and our ability to effectively manage interest rate risk and other market risk, credit risk and operational risk; changes in the quality or composition of our loan or investment portfolios; increases in our nonperforming assets, or our inability to recover or absorb losses created by such nonperforming assets; 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)

Consolidated Statement of Condition













(In Thousands, Except Share Data and ratios)


March 31, 

December 31, 

December 31, 


2017

2016

2015

Assets









Cash and due from financial institutions


$

6,715

$

8,542

$

8,865

Federal funds sold

—

—

6,390

Interest-bearing deposits in other financial institutions

22,537

11,018

2,728

Available-for-sale securities



47,125

53,547

60,200

Loans held for sale



221

264

—

Loans

365,562

359,391

330,782

Allowance for loan losses

(4,906)

(4,854)

(4,916)

Premises and equipment, net



9,310

9,390

9,998

Bank owned life insurance (BOLI)



8,394

8,351

8,174

Federal Home Loan Bank (FHLB) stock, at cost



2,025

2,025

2,025

Accrued interest receivable



1,386

1,622

1,680

Deferred income taxes



1,353

1,464

1,328

Goodwill and other intangible assets

4,274

4,291

4,362

Other real estate owned



—

—

100

Other assets



458

371

465

Total Assets

$

464,454

$

455,422

$

432,181

Liabilities









Deposits









Noninterest bearing


$

48,598

$

52,322

$

48,522

Savings, NOW and money market



174,726

173,620

168,335

Time



150,072

144,497

153,531

Total deposits

373,396

370,439

370,388

FHLB advances and other borrowings

41,000

35,000

15,000

Subordinated debentures



5,000

5,000

5,000

Accrued interest payable



235

220

213

Other liabilities



1,436

2,399

2,056

Total Liabilities

421,067

413,058

392,657

Stockholders' Equity









6.5% Cumulative convertible preferred stock

7,016

7,261

7,659

Common stock

26,186

25,920

25,406

Retained earnings



10,493

9,706

6,304

Accumulated other comprehensive income (loss)

(308)

(523)

155

Total stockholders' equity

43,387

42,364

39,524

Total liabilities and stockholders' equity

$

464,454

$

455,422

$

432,181

Consolidated Financial Highlights (Unaudited)

Consolidated Statement of Income



















Three months ended


(In Thousands, Except Per Share Data and ratios)


March 31, 

December 31, 

September 30, 

June 30, 

March 31, 


2017

2016

2016

2016

2016

Interest and dividend income

$

4,457

$

4,572

$

4,557

$

4,536

$

4,476

Interest expense

677

652

639

624

613

   Net interest income

3,780

3,920

3,918

3,912

3,863

















Provision (credit) for loan losses

30

—

—

(85)

—

















Non-interest income















Service charges on deposit accounts

278

371

361

339

325

Other service charges and fees

264

245

262

272

248

Gain on sale of mortgage loans

68

97

110

91

77

Non-deposit brokerage fees

87

85

83

75

72

Lease income

52

52

61

49

45

BOLI income

43

44

45

44

44

Gain on sale of securities

23

—

20

55

51

Total non-interest income

815

894

942

925

862

















Non-interest expenses:















Personnel expense

1,734

1,741

1,674

1,676

1,784

Net occupancy expense

461

471

481

492

483

Advertising and public relations

71

75

86

98

61

Professional fees

130

50

98

137

180

Data processing services

253

256

262

263

256

Franchise shares and deposit tax

132

132

132

132

132

FDIC insurance



49

47

58

59

59

Other real estate owned expenses

—

1

(8)

23

1

Other

461

457

452

510

498

Total non-interest expenses

3,291

3,230

3,235

3,390

3,454

















Income before income taxes



1,274

1,584

1,625

1,532

1,271

Income taxes

367

481

490

458

366

Net income

907

1,103

1,135

1,074

905

Dividends on preferred stock



119

124

124

123

124

Net income available for common stockholders

$

788

$

979

$

1,011

$

951

$

781

Basic earnings per common share

$

0.39

$

0.49

$

0.50

$

0.48

$

0.39

Diluted earnings per common share


$

0.36

$

0.43

$

0.45

$

0.42

$

0.36

Consolidated Financial Highlights (Unaudited)

Key Operating Statistics



















Three months ended




(In Thousands, Except Per Share Data and ratios)


March 31, 

December 31, 

September 30, 

June 30, 

March 31, 


2017

2016

2016

2016

2016

Average:















Assets

$

452,265

$

444,168

$

442,042

$

439,081

$

433,143

Earning Assets

424,349

417,161

414,569

409,722

402,638

Loans

363,824

347,046

344,733

338,456

333,000

Interest-bearing deposits

314,939

310,336

304,473

311,084

320,363

Deposits

364,227

360,816

354,953

360,209

367,397

Borrowed funds

43,078

38,429

42,490

35,868

23,394

Equity

42,827

42,652

42,002

40,912

40,156

Common equity

35,718

35,391

34,741

33,651

32,831

















Return on average assets

0.81

%

0.99

%

1.02

%

0.98

%

0.84

%

Return on average equity

8.59

%

10.29

%

10.75

%

10.56

%

9.06

%

















Efficiency ratio

70.96

%

66.20

%

65.86

%

69.74

%

72.64

%

Non-interest income to average assets

0.73

%

0.80

%

0.85

%

0.85

%

0.80

%

Non-interest expenses to average assets

2.95

%

2.89

%

2.91

%

3.11

%

3.21

%

Net overhead to average assets

2.22

%

2.09

%

2.06

%

2.26

%

2.41

%

Yield on loans

4.60

%

4.86

%

4.86

%

4.95

%

4.96

%

Yield on investment securities (TE)

2.87

%

2.58

%

2.66

%

2.77

%

2.77

%

Yield on average earning assets (TE)

4.32

%

4.42

%

4.44

%

4.53

%

4.55

%

Cost of average interest bearing liabilities

0.77

%

0.74

%

0.73

%

0.72

%

0.72

%

Net interest margin (TE)

3.68

%

3.80

%

3.83

%

3.92

%

3.94

%

Number of FTE employees

94

95

94

96

98

















Asset Quality Indicators:















Non-performing loans to total loans

0.83

%

0.01

%

0.05

%

0.06

%

0.18

%

Non-performing assets to total assets

0.65

%

0.01

%

0.04

%

0.06

%

0.16

%

Allowance for loan losses to total loans

1.34

%

1.35

%

1.45

%

1.43

%

1.53

%

YTD net charge-offs (recoveries) to average loans, annualized

(0.02)

%

(0.01)

%

(0.05)

%

(0.07)

%

(0.15)

%

YTD net charge-offs (recoveries)

(22)

(23)

(130)

(119)

(128)

Consolidated Financial Highlights (Unaudited)













(In Thousands, Except Share Data and ratios)


March 31, 

December 31, 

December 31, 

Consolidated Capital Ratios

2017

2016

2015











Total shareholders' equity to total assets ratio

9.34

%

9.30

%

9.15

%

Tangible equity ratio (1)

8.50

%

8.44

%

8.22

%

Tangible common equity ratio (1)

6.97

%

6.83

%

6.43

%

Book value per common share

$

18.01

$

17.54

$

16.18

Tangible book value per common share (1)

$

15.90

$

15.40

$

13.97

End of period common share closing price

$

18.05

$

18.00

$

13.74








(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.













(In Thousands, Except Share Data and ratios)


March 31, 

December 31, 

December 31, 

Regulation G Non-GAAP Reconciliation:

2017

2016

2015











Total shareholders' equity (a)

$

43,387

$

42,364

$

39,524

Less:









Preferred stock

(7,016)

(7,261)

(7,659)

Common equity (b)

36,371

35,103

31,865

Goodwill

(4,097)

(4,097)

(4,097)

Intangible assets

(177)

(194)

(265)

Tangible common equity (c)

32,097

30,812

27,503

Add:









Preferred stock

7,016

7,261

7,659

Tangible equity (d)

39,113

38,073

35,162











Total assets (e)

464,454

455,422

432,181

Less:









Goodwill

(4,097)

(4,097)

(4,097)

Intangible assets

(177)

(194)

(265)

Tangible assets (f)

$

460,180

$

451,131

$

427,819

Shares outstanding (in thousands) (g)

2,019

2,001

1,969











Book value per common share (b/g)

$

18.01

$

17.54

$

16.18

Tangible book value per common share (c/g)

$

15.90

$

15.40

$

13.97

Equity to assets ratio (a/e)

9.34

%

9.30

%

9.15

%

Tangible equity ratio (d/f)

8.50

%

8.44

%

8.22

%

Common equity ratio (b/e)

7.83

%

7.71

%

7.37

%

Tangible common equity ratio (c/f)

6.97

%

6.83

%

6.43

%

SOURCE Citizens First Corporation

Related Links

http://www.citizensfirstbank.com

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