Attached files
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| 8-K - SECOND QUARTER 2011 CITIZENS FIRST 8K - CITIZENS FIRST CORP | secondqtr118k.htm |
Exhibit 99.1 Press Release dated July 21, 2011
Citizens First Corporation Announces Second Quarter 2011 Results
-- Continued Profitable Performance –
-- Branch Acquisition Announced --
--Nonperforming Assets Remain Below Peer Levels –
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NEWS
For Immediate Release
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Contact:
Todd Kanipe, CEO
tkanipe@citizensfirstbank.com
Steve Marcum, CFO
smarcum@citizensfirstbank.com
Citizens First Corporation
1065 Ashley Street, Suite 150
Bowling Green, KY 42103
270.393.0700
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BOWLING GREEN, KY, July 21, 2011 – Citizens First Corporation (NASDAQ: CZFC) today reported results for the second quarter ending June 30, 2011, which include the following:
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·
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Continued profitability – Net income was $728,000, or $0.25 per diluted common share, for the second quarter ended June 30, 2011. Compared to the quarter ended June 30 a year ago, net income increased $111,000 or $.07 per share, an increase of 18.0%. For the six months ended June 30, 2011, net income grew to $1.4 million, or $.46 per diluted common share. This represents an increase of $296,000, or $0.14 per share, from the net income of $1.1 million in the previous year.
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·
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Branch acquisition - As previously announced on June 2, 2011, the Company has entered into a definitive agreement to purchase a banking center located in Bowling Green, Kentucky from Republic Bank & Trust Company (Republic), a subsidiary of Republic Bancorp, Inc. (NASDAQ: RBCAA). The agreement provides that Citizens will purchase certain fixed assets and outstanding loans and assume all deposits of the banking center. The transaction includes approximately $35 million in deposits and approximately $14.5 million in loans. The transaction is subject to customary closing conditions, including regulatory approvals, and is anticipated to be completed during the third quarter of 2011.
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1
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·
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Nonperforming assets remain below peer levels - The Company’s nonperforming assets were $4.1 million at June 30, 2011 compared to $2.6 million at December 31, 2010, which represents an increase of $1.5 million, or 54.7%. Included in nonperforming assets is other real estate, which represents properties acquired through foreclosure, totaling $901,000, and nonperforming loans of $3.2 million at June 30, 2011. The Company’s nonperforming assets remain at relatively low levels compared to the banking industry as a whole. However, the Company continues to monitor the loan portfolio for borrowers who might be at risk of suffering adverse financial conditions impacting their ability to perform on their loan. Management believes that prolonged weak economic conditions could place additional pressure on credit quality.
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Second Quarter 2011 Compared to First Quarter 2011
For the quarter ended June 30, 2011, the Company reported net income of $728,000, or $.25 per diluted common share, which represents an increase of $12,000, or $.04 per share, for the linked quarter ended March 31, 2011.
Net interest income for the quarter ended June 30, 2011 increased $11,000, or 0.3%, compared to the previous quarter due to a decrease in interest expense on certificates of deposit. The Company’s net interest margin was 4.01% for the quarter ended June 30, 2011 compared to 4.11% for the quarter ended March 31, 2011, a decrease of 10 basis points. The Company’s net interest margin declined as loan and investment yields fell during the second quarter. The yield on average earning assets declined from the linked quarter, totaling 5.32% in the second quarter of 2011 compared to 5.47% in the first quarter of 2011. The cost of average interest bearing liabilities also declined to 1.54% in the second quarter of 2011 compared to 1.59% for the first quarter of 2011.
A $300,000 provision for loan losses was recorded for the second quarter of 2011, compared to a $225,000 provision in the previous quarter. Net charge-offs were $89,000 for the second quarter of 2011 compared to $223,000 in the first quarter of 2011, a decrease of 60.0%. Provision expense increased due to the increase in nonperforming assets during the second quarter of 2011.
Non-interest income for the three months ended June 30, 2011 increased $98,000, or 14.8%, compared to the previous quarter, primarily due to gains on the sale of investment securities of $61,000 and an increase in non-deposit brokerage fees of $32,000.
Non-interest expense for the three months ended June 30, 2011 increased $17,000, or 0.6%, compared to the previous quarter, primarily due to an increase in professional fees of $56,000.
2
Second Quarter 2011 Compared to Second Quarter 2010
Net interest income for the quarter ended June 30, 2011 increased $102,000, or 3.3%, compared to the previous year. The increase in net interest income was impacted by a reduction in interest expense of $239,000 partially offset by a decrease in interest income of $137,000. The Company’s net interest margin was 4.01% for the quarter ended June 30, 2011 compared to 4.08% for the quarter ended June 30, 2010, a decrease of 7 basis points.
A $300,000 provision for loan losses was recorded for the second quarter of 2011, compared to a $450,000 provision in the second quarter of 2010, a decrease of $150,000 or 33.3%. Net charge-offs were $89,000 for the second quarter of 2011 compared to $75,000 in the second quarter of 2010, an increase of 18.6%.
Non-interest income for the three months ended June 30, 2011 increased $16,000, or 2.1%, compared to the three months ended June 30, 2010, primarily due to an increase in gains from sale of investment securities of $61,000. Rental income increased $39,000 from the prior year, while services charges on deposit accounts declined $105,000.
Non-interest expense for the three months ended June 30, 2011 increased $94,000, or 3.5%, compared to the three months ended June 30, 2010, primarily due to an increase in salaries and benefit expenses totaling $80,000. Other real estate expenses increased $63,000 from the prior year.
Balance Sheet
Total assets at June 30, 2011 were $354.1 million, up $4.4 million, or 1.3%, from $349.7 million at December 31, 2010. Loans increased $1.4 million, or 0.5%, from $268.3 million at December 31, 2010 to $269.7 million at June 30, 2011. Total loans averaged $269.8 million for the second quarter of 2011, compared to $269.0 million for the first quarter of 2011, an increase of $0.8 million, or 0.3%. Deposits at June 30, 2011 were $293.3 million, an increase of $4.6 million, or 1.6%, compared to $288.7 million at December 31, 2010. Total deposits averaged $302.9 million for the second quarter of 2011, compared to $296.6 million for the first quarter of 2011, an increase of $6.3 million, or 2.1%. Brokered deposits were reduced by $4.9 million during the second quarter to $8.2 million.
Non-performing assets totaled $4.1 million at June 30, 2011 compared to $2.6 million at December 31, 2010, an increase of $1.5 million. Non-performing loans increased $2.0 million, primarily due to a $1.6 million relationship with an area small business which was placed on non-accrual during the second quarter of 2011. Other real estate owned decreased $479,000 during the second quarter to $901,000. Non-performing assets to total assets ratio was 1.15% and 0.75% at June 30, 2011 and December 31, 2010, respectively. The allowance for loan losses at June 30, 2011 was $5.2 million, or 1.93% of total loans, compared to $5.0 million, or 1.86% of total loans as of December 31, 2010.
3
At June 30, 2011, total shareholders’ equity was $37.9 million and total tangible shareholders’ equity was $34.4 million. In February, 2011 the Company repurchased 25% of the Series A preferred stock it issued under the U.S. Treasury’s Capital Purchase Program, which reduced shareholder’s equity by $2.2 million. As a result, the Company’s tangible equity ratio was 9.81% as of June 30, 2011 compared to 10.02% as of December 31, 2010. 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, retention of key personnel and the receipt of regulatory approval for the branch acquisition. 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.
4
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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Consolidated Statement of Income:
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Three Months Ended
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June
30
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March
31
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December
31
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September
30
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June
30
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2011
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2011
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2010
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2010
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2010
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Interest income
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$4,318
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$4,319
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$4,372
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$4,424
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$4,455
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Interest expense
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1,088
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1,100
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1,149
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1,260
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1,327
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Net interest income
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3,230
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3,219
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3,223
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3,164
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3,128
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Provision for loan losses
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300
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225
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350
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375
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450
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Net interest income after provision for loan losses
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2,930
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2,994
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2,873
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2,789
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2,678
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Non-interest income
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760
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662
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759
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781
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744
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Non-interest expense
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2,721
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2,704
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2,658
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2,705
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2,627
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Income before income taxes
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969
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952
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974
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865
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795
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Provision for income taxes
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241
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236
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241
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207
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178
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Net income
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728
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716
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733
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658
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617
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Preferred dividends and discount accretion
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223
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285
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257
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257
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256
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Net income available for common shareholders
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$505
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$431
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$476
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$401
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$361
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Basic earnings per common share
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$0.26
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$0.22
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$0.25
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$0.21
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$0.18
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Diluted earnings per common share
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$0.25
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$0.21
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$0.23
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$0.20
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$0.18
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Three Months Ended
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June
30
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March
31
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December
31
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September
30
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June
30
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2011
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2011
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2010
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2010
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2010
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Average assets
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$363,007
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$357,002
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$349,671
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$350,302
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$349,508
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Return on average assets
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0.80%
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0.81%
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0.83%
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0.75%
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0.71%
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Return on average equity
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7.80%
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7.71%
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7.49%
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6.84%
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6.55%
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Efficiency ratio
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66.62%
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68.06%
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65.19%
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66.97%
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66.22%
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Non-interest income to average assets
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0.84%
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0.75%
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0.86%
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0.88%
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0.85%
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Non-interest expenses to average assets
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(3.01)%
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(3.07)%
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(3.02)%
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(3.06)%
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(3.01)%
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Yield on average earning assets (tax equivalent)
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5.32%
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5.47%
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5.56%
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5.64%
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5.76%
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Cost of average interest bearing liabilities
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1.54%
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1.59%
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1.68%
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1.83%
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1.95%
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Net interest margin (tax equivalent)
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4.01%
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4.11%
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4.13%
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4.06%
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4.08%
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Number of full time equivalent employees
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88
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90
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89
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86
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91
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5
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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Consolidated Statement of Income:
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Six Months Ended
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June 30
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June 30
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2011
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2010
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Interest income
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$8,637
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$8,788
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Interest expense
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2,188
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2,664
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Net interest income
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6,449
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6,124
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Provision for loan losses
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525
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850
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Net interest income after provision for loan losses
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5,924
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5,274
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Non-interest income
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1,422
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1,334
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Non-interest expense
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5,425
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5,169
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Income before income taxes
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1,921
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1,439
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Provision for income taxes
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477
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291
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Net income
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1,444
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1,148
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Preferred dividends and discount accretion
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508
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510
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Net income available for common shareholders
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$ 936
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$ 638
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Basic earnings per common share
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$0.47
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$0.32
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Diluted earnings per common share
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$0.46
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$0.32
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June 30
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June 30
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2011
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2010
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Average assets
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$360,021
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$346,604
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Return on average assets
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0.81%
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0.67%
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Return on average equity
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7.76%
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6.17%
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Efficiency ratio
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67.33%
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67.59%
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Non-interest income to average assets
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0.80%
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0.78%
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Non-interest expenses to average assets
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(3.04)%
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(3.02)%
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Yield on average earning assets (tax equivalent)
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5.40%
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5.77%
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Cost of average interest bearing liabilities
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1.57%
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1.98%
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Net interest margin (tax equivalent)
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4.06%
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4.06%
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6
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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Consolidated Statement of Condition:
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As of
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As of
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As of
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As of
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June
30,
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March
31,
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December
31,
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June
30,
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|
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2011
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2011
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2010
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2010
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Cash and cash equivalents
|
$16,321
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$23,033
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$14,811
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$10,233
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Available for sale securities
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42,806
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41,539
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39,531
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41,782
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Loans held for sale
|
94
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0
|
151
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1,127
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Loans
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269,669
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269,627
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268,303
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265,387
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Allowance for loan losses
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(5,215)
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(5,003)
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(5,001)
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(4,458)
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Premises and equipment, net
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10,068
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10,236
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10,352
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10,584
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Bank owned life insurance (BOLI)
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7,186
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7,118
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7,051
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6,907
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Intangible assets
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3,474
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3,539
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3,604
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3,736
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Other real estate owned
|
901
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1,380
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1,368
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1,365
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Other assets
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8,756
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9,494
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9,561
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10,255
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Total Assets
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$354,060
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$360,963
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$349,731
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$346,925
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Deposits:
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Noninterest bearing
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$ 38,174
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$ 39,481
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$ 36,250
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$ 37,056
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Savings, NOW and money market
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78,629
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78,489
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72,612
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70,455
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Time
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176,491
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183,361
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179,878
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185,125
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Total deposits
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$293,294
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$301,331
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$288,740
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$292,636
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Securities sold under repurchase agreements
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957
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547
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712
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810
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FHLB advances
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15,000
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15,000
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15,000
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8,500
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Subordinated debentures
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5,000
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5,000
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5,000
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5,000
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Other liabilities
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1,949
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2,179
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1,970
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2,089
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Total Liabilities
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316,200
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324,057
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311,422
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309,035
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6.5% Cumulative preferred stock
|
7,659
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7,659
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7,659
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7,659
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Series A preferred stock
|
6,447
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6,435
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8,586
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8,555
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Common stock
|
27,072
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27,072
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27,072
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27,072
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Retained (deficit)
|
(3,421)
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(3,926)
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(4,357)
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(5,235)
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Accumulated other comprehensive income (loss)
|
103
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(334)
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(651)
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(161)
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Total Stockholders’ Equity
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37,860
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36,906
|
38,309
|
37,890
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Total Liabilities and Stockholders’ Equity
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$354,060
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$360,963
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$349,731
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$346,925
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|
June
30
2011
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March
31
2011
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December
31
2010
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June
30
2010
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Asset Quality Ratios:
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Non-performing loans to total loans
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1.18%
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0.42%
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0.47%
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0.17%
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Non-performing assets to total assets
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1.15%
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0.70%
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0.75%
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0.53%
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Allowance for loan losses to total loans
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1.93%
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1.86%
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1.86%
|
1.68%
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Net charge-offs to average loans, annualized
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0.13%
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0.34%
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0.21%
|
0.29%
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7
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
|
June 30, 2011
|
December 31, 2010
|
December 31, 2009
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Capital Ratios:
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Tier 1 leverage
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10.55%
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10.98%
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10.52%
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Tier 1 risk-based capital
|
13.28%
|
13.31%
|
12.54%
|
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|
Total risk based capital
|
14.53%
|
14.57%
|
13.79%
|
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|
Tangible equity to tangible assets ratio (1)
|
9.81%
|
10.02%
|
9.69%
|
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|
Book value per common share
|
$12.06
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$11.21
|
$10.50
|
|
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Tangible book value per common share (1)
|
$10.30
|
$9.37
|
$8.53
|
|
|
Shares outstanding (in thousands)
|
1,969
|
1,969
|
1,969
|
|
|
_____________
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(1)
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The tangible equity to tangible assets 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.
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Regulation G Non-GAAP Reconciliation:
|
June 30, 2011
|
December 31, 2010
|
December 31, 2009
|
|
|
Total shareholders’ equity (a)
|
$37,860
|
$38,309
|
$36,858
|
|
|
Less:
|
||||
|
Preferred stock
|
(14,106)
|
(16,245)
|
(16,182)
|
|
|
Common equity (b)
|
23,754
|
22,064
|
20,676
|
|
|
Goodwill
|
(2,575)
|
(2,575)
|
(2,575)
|
|
|
Intangible assets
|
(899)
|
(1,029)
|
(1,293)
|
|
|
Tangible common equity (c)
|
20,280
|
18,460
|
16,808
|
|
|
Add:
|
||||
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Preferred stock
|
14,106
|
16,245
|
16,182
|
|
|
Tangible equity (d)
|
$34,386
|
$34,705
|
$32,990
|
|
|
Total assets (e)
|
$354,060
|
$349,890
|
$344,231
|
|
|
Less:
|
||||
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Goodwill
|
(2,575)
|
(2,575)
|
(2,575)
|
|
|
Intangible assets
|
(899)
|
(1,029)
|
(1,293)
|
|
|
Tangible assets (f)
|
$350,586
|
$346,286
|
$340,363
|
|
|
Shares outstanding (in thousands) (g)
|
1,969
|
1,969
|
1,969
|
|
|
Book value per common share (b/g)
|
$12.06
|
$11.21
|
$10.50
|
|
|
Tangible book value per common share (c/g)
|
$10.30
|
$9.37
|
$8.53
|
|
|
Total shareholders’ equity to total assets ratio (a/e)
|
10.69%
|
10.95%
|
10.71%
|
|
|
Tangible equity ratio (d/f)
|
9.81%
|
10.02%
|
9.69%
|
8