Attached files

file filename
8-K - CURRENT REPORT - MBT FINANCIAL CORPv300455_8k.htm

EXHIBIT 99

 

 

MBT Financial Corp. Announces Fourth Quarter 2011 Profit

 

MONROE, Mich., January 26, 2012 – MBT Financial Corp., (Nasdaq: MBTF), the parent company of Monroe Bank & Trust, reported a net profit of $431,000, or $0.02 per share, in the fourth quarter of 2011, compared to the loss of $7.5 million, or $0.44 per share in the fourth quarter of 2010. The Company also reported a full year loss of $3.8 million, or $0.22 per share for 2011, compared to the full year loss of $11.9 million, or $0.72 per share in 2010. The fourth quarter and full year 2011 results are preliminary and subject to adjustment following the completion of the Company’s annual independent audit.

 

The net interest margin increased from 3.12% in the fourth quarter of 2010 to 3.16% in the fourth quarter of 2011, but average earning assets decreased $11.9 million. As a result, the net interest income for the fourth quarter of 2011 was unchanged from the fourth quarter of 2010 at $8.8 million. Although average earning assets decreased 1.0%, average loans decreased $82.7 million, or 10.7% and investments increased $70.8 million, as loan demand remained low.

 

The provision for loan losses decreased from $7.1 million last year to $2.5 million in the fourth quarter of 2011 due to a decrease in the net charge offs from $6.6 million to $3.5 million, and due to a reduction in the allowance for loan losses to reflect recent historical loss rates and the decrease in the size of the loan portfolio.

 

Non interest income, excluding securities gains and life insurance proceeds, decreased 6.8% from $4.2 million in the fourth quarter of 2010 to $3.9 million in the fourth quarter of 2011. Declines in wealth management fees, origination fees from mortgage loans sold, and deposit service charges were the primary causes of this decrease. Bank Owned Life Insurance income increased $2.0 million due to death benefits received in the fourth quarter of 2012.

 

Total non interest expenses, excluding a death benefit obligation payment, decreased $133,000, or 1.3% compared to the fourth quarter of 2010, mainly due to lower marketing expenses, other real estate carrying costs, and deposit insurance premiums paid to the FDIC. Other expenses increased due to the payment of a $1.6 million death benefit obligation.

 

Total assets of the company decreased $21.4 million compared to December 31, 2010, mainly due to a planned decrease in non deposit funding. Deposit activity has been steady in 2011, with core, in market deposits increasing $13.4 million while brokered deposits decreased $23.0 million. The Company also reduced its repurchase agreement funding by $10.0 million and its Federal Home Loan Bank borrowings $6.5 million since the beginning of the year. Capital increased $1.7 million during the year, and with the decrease in assets, the ratio of equity to assets increased from 5.88% at December 31, 2010 to 6.12% at December 31, 2011. The bank remains adequately capitalized as measured by applicable regulatory standards. The company’s already strong liquidity position continued to improve, with cash and investments increasing from 31.7% of assets at the end of 2010 to 37.7% at the end of 2011.

 

Unemployment in southeast Michigan continues to improve, and this is having a positive impact on our asset quality. Non accrual loans decreased $16.9 million, or 24.9% compared to a year ago and are now at their lowest level since the first quarter of 2009. We are beginning to see an improvement in real estate sales activity and prices, and that has helped us reduce the amount of Other Real Estate Owned (OREO). Our total OREO decreased $3.1 million, or 15.7% compared to a year ago, and we have several closings scheduled for the first quarter of 2012. This will reduce the non performing assets further and provide an improvement to non interest expenses by reducing the costs of owning and maintaining OREO properties. Total problem assets, which include non performing assets and problem loans that are still performing, decreased to $136.8 million at the end of 2011, which is an improvement of 3.7% in the fourth quarter and 13.3% compared to a year ago. This marks the third consecutive quarterly decrease in problem assets.

 

 
 

 

In 2011, the IRS began an examination of the Company’s federal income tax return for the year ended December 31, 2009. Based on preliminary IRS reports, an estimated liability of $500,000 was recorded at December 31, 2011 related to the 2009 examination. This amount is included in other liabilities and federal income tax expense. The examination is still in process, and the final outcome is not known at this time. Based on current knowledge the Company believes the accrued liability is adequate to absorb the effect, if any, relating to the ultimate resolution of the uncertain tax position challenged by the IRS. The estimate recorded may be adjusted prior to the filing of our annual report on Form 10-K.

 

H. Douglas Chaffin, President and CEO, commented, “We are pleased to report a second consecutive profit this quarter, especially since the profitability is the direct result of the continued improvement in our asset quality. As the economic conditions continue to slowly improve, we will continue to see improvements in our asset quality and earnings. Loan demand is still slow, and the decrease in the loan portfolio caused a slight decrease in the net interest income compared to last year. We continue to have a solid deposit base, a very liquid balance sheet, and adequate capital, so when the eventual increase in loan demand occurs, we will be well positioned to participate in the growth.”

 

Mr. Chaffin concluded, “Local economic indicators continued to improve this quarter, and we remain optimistic. Improvements in employment are reflected in improvements in past dues. We will continue to focus our efforts on improving asset quality, maintaining liquidity, seeking new sources of revenue and capital, and controlling expenses. We still have much work ahead of us given our current environment, but we remain confident in our ability to maintain our position as the premier independent provider of financial services in the communities we serve.”

 

Conference Call

MBT Financial Corp. will hold a conference call to discuss the fourth quarter results on Friday, January 27, 2012, at 10:00 a.m. Eastern Time. The call will be webcast and can be accessed at the Investor Relations/Corporate Profile page of MBT Financial Corp.’s web site www.mbandt.com. The call can also be accessed in the United States by calling toll free (877) 317-6789. The toll free number for callers in Canada is (866) 605-3852 and international callers can access the call at (412) 317-6789. The event will be archived on the Company’s web site and available for twelve months following the call.

 

About the Company

MBT Financial Corp. (NASDAQ: MBTF), a single bank holding company headquartered in Monroe, Michigan, is the parent company of Monroe Bank & Trust (MBT).

 

Founded in 1858, MBT is one of the largest community banks in Southeast Michigan. MBT is a full-service bank, offering a complete range of business and personal accounts, credit options, and phone and online banking services. MBT’s Wealth Management Group is one of the largest and most respected in Southeastern Michigan. With 24 offices, 40 ATMs, and a comprehensive array of products and services, MBT prides itself in offering an incomparable banking experience for its customers. Visit MBT’s web site at www.mbandt.com.

 

Forward-Looking Statements

Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of Section 21A of the Securities Exchange Act of 1934. Forward-looking statements which are based on various assumptions (some of which are beyond the Company's control), may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of these terms. Actual results could differ materially from those set forth in forward-looking statements, due to a variety of factors, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset/liability management, change in the financial and securities markets, including changes with respect to the market value of our financial assets, the availability of and costs associated with sources of liquidity, and the ability of the Company to resolve or dispose of problem loans. The Company undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.

 

 
 

 

MBT FINANCIAL CORP.

CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED

 

   Quarterly   Year to Date 
   2011   2011   2011   2011   2010         
(dollars in thousands except per share data)  4th Qtr   3rd Qtr   2nd Qtr   1st Qtr   4th Qtr   2011   2010 
                             
EARNINGS                                   
Net interest income  $8,824   $8,956   $8,578   $8,769   $8,814   $35,127   $36,828 
FTE Net interest income  $8,981   $9,113   $8,737   $8,937   $8,985   $35,768   $37,654 
Provision for loan and lease losses  $2,500   $2,700   $2,850   $5,750   $7,086   $13,800   $20,500 
Non interest income  $6,390   $4,319   $3,858   $3,663   $4,195   $18,230   $19,436 
Non interest expense  $11,783   $9,943   $10,369   $10,724   $10,277   $42,819   $44,480 
Net income (loss)  $431   $632   $(783)  $(4,042)  $(7,537)  $(3,762)  $(11,899)
Basic earnings (loss) per share  $0.02   $0.04   $(0.05)  $(0.23)  $(0.44)  $(0.22)  $(0.72)
Diluted earnings (loss) per share  $0.02   $0.04   $(0.05)  $(0.23)  $(0.44)  $(0.22)  $(0.72)
Average shares outstanding   17,285,762    17,274,436    17,265,075    17,256,472    17,214,768    17,270,528    16,498,734 
Average diluted shares outstanding   17,285,762    17,274,436    17,265,075    17,256,472    17,214,768    17,270,528    16,498,734 
                                    
PERFORMANCE RATIOS                                   
Return on average assets   0.14%   0.20%   -0.25%   -1.29%   -2.39%   -0.30%   -0.92%
Return on average common equity   2.26%   3.39%   -4.46%   -22.04%   -35.55%   -5.11%   -14.06%
                                    
Base Margin   3.07%   3.06%   2.97%   3.02%   3.03%   3.03%   3.07%
FTE Adjustment   0.06%   0.05%   0.06%   0.06%   0.06%   0.06%   0.07%
Loan Fees   0.03%   0.05%   0.03%   0.03%   0.03%   0.04%   0.03%
FTE Net Interest Margin   3.16%   3.16%   3.06%   3.11%   3.12%   3.13%   3.17%
                                    
Efficiency ratio   68.80%   66.26%   70.89%   73.07%   67.61%   69.74%   66.13%
Full-time equivalent employees   349    352    349    344    342    349    350 
                                    
CAPITAL                                   
Average equity to average assets   6.14%   5.93%   5.64%   5.85%   6.73%   5.89%   6.54%
Book value per share  $4.38   $4.34   $4.23   $4.08   $4.29   $4.38   $4.29 
Cash dividend per share  $-   $-   $-   $-   $-   $-   $- 
                                    
ASSET QUALITY                                   
Loan Charge-Offs  $3,733   $4,105   $3,970   $4,064   $7,217   $15,872   $24,556 
Loan Recoveries  $229   $645   $322   $518   $607   $1,714   $1,215 
Net Charge-Offs  $3,504   $3,460   $3,648   $3,546   $6,610   $14,158   $23,341 
                                    
Allowance for loan and lease losses  $20,865   $21,869   $22,629   $23,427   $21,223   $20,865   $21,223 
                                    
Nonaccrual Loans  $50,717   $57,673   $66,433   $65,597   $67,581   $50,717   $67,581 
Loans 90 days past due  $20   $29   $240   $364   $4   $20   $4 
Restructured loans  $24,774   $16,023   $11,595   $14,775   $14,098   $24,774   $14,098 
Total non performing loans  $75,511   $73,725   $78,268   $80,736   $81,683   $75,511   $81,683 
Other real estate owned & other assets  $16,711   $18,739   $21,365   $22,640   $19,815   $16,711   $19,815 
Nonaccrual Investment Securities  $2,984   $2,749   $2,810   $2,694   $2,568   $2,984   $2,568 
Total non performing assets  $95,206   $95,213   $102,443   $106,070   $104,066   $95,206   $104,066 
Problem Loans Still Performing  $41,558   $46,869   $43,220   $53,598   $53,726   $41,558   $53,726 
Total Problem Assets  $136,764   $142,082   $145,663   $159,668   $157,792   $136,764   $157,792 
                                    
Net loan charge-offs to average loans   2.01%   1.92%   2.02%   1.93%   3.39%   1.97%   2.89%
Allowance for losses to total loans   3.07%   3.11%   3.15%   3.21%   2.82%   3.07%   2.82%
Non performing loans to gross loans   11.10%   10.48%   10.91%   11.07%   10.84%   11.10%   10.84%
Non performing assets to total assets   7.69%   7.65%   8.31%   8.35%   8.26%   7.69%   8.26%
Allowance to non performing loans   27.63%   29.66%   28.91%   29.02%   25.98%   27.63%   25.98%
                                    
END OF PERIOD BALANCES                                   
Loans and leases  $680,510   $703,430   $717,488   $729,503   $753,860   $680,510   $753,860 
Total earning assets  $1,139,172   $1,139,469   $1,126,022   $1,163,939   $1,151,371   $1,139,172   $1,151,371 
Total assets  $1,238,027   $1,245,401   $1,232,438   $1,269,615   $1,259,377   $1,238,027   $1,259,377 
Deposits  $1,022,310   $1,029,647   $1,018,304   $1,045,141   $1,031,893   $1,022,310   $1,031,893 
Interest Bearing Liabilities  $984,593   $995,463   $996,239   $1,041,039   $1,027,320   $984,593   $1,027,320 
Shareholders' equity  $75,711   $74,930   $72,975   $70,415   $73,998   $75,711   $73,998 
Total Shares Outstanding   17,291,729    17,279,696    17,269,225    17,260,748    17,252,329    17,291,729    17,252,329 
                                    
AVERAGE BALANCES                                   
Loans and leases  $690,569   $713,433   $723,146   $744,579   $773,269   $717,772   $806,594 
Total earning assets  $1,129,960   $1,143,238   $1,145,448   $1,163,506   $1,141,829   $1,145,439   $1,187,067 
Total assets  $1,231,959   $1,245,574   $1,247,979   $1,270,234   $1,249,543   $1,248,822   $1,294,414 
Deposits  $1,015,703   $1,031,682   $1,031,232   $1,044,556   $1,015,740   $1,030,717   $1,020,871 
Interest Bearing Liabilities  $977,956   $1,004,620   $1,020,396   $1,040,463   $1,009,619   $1,010,671   $1,069,124 
Shareholders' equity  $75,673   $73,881   $70,401   $74,363   $84,123   $73,584   $84,653 

  

 
 

 

MBT FINANCIAL CORP.

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

 

   Quarter Ended December 31,   Year Ended December 31, 
Dollars in thousands (except per share data)  2011   2010   2011   2010 
Interest Income                    
Interest and fees on loans  $9,342   $10,832   $39,712   $46,010 
Interest on investment securities-                    
Tax-exempt   346    396    1,415    1,936 
Taxable   2,071    1,724    8,282    8,508 
Interest on balances due from banks   39    32    151    132 
Total interest income   11,798    12,984    49,560    56,586 
                     
Interest Expense                    
Interest on deposits   2,077    3,126    10,698    13,094 
Interest on borrowed funds   897    1,044    3,735    6,664 
Total interest expense   2,974    4,170    14,433    19,758 
                     
Net Interest Income   8,824    8,814    35,127    36,828 
Provision For Loan Losses   2,500    7,086    13,800    20,500 
                     
Net Interest Income After                    
Provision For Loan Losses   6,324    1,728    21,327    16,328 
                     
Other Income                    
Income from wealth management services   964    1,010    3,919    4,049 
Service charges and other fees   1,172    1,312    4,694    5,297 
Net gain (loss) on sales of securities   433    (9)   1,084    3,260 
Origination fees on mortgage loans sold   211    259    482    717 
Bank Owned Life Insurance income   2,400    412    3,607    1,944 
Other   1,210    1,211    4,444    4,169 
Total other income   6,390    4,195    18,230    19,436 
                     
Other Expenses                    
Salaries and employee benefits   4,864    4,668    19,475    19,106 
Occupancy expense   857    673    3,103    2,867 
Equipment expense   777    753    2,941    3,170 
Marketing expense   154    257    849    991 
Professional fees   644    618    2,477    2,155 
Collection expense   52    114    233    377 
Net loss on other real estate owned   618    634    3,561    3,700 
Other real estate owned expense   650    714    2,108    2,630 
FDIC deposit insurance assessment   693    859    2,947    3,130 
Debt prepayment penalties   -    -    -    2,492 
Death benefit expense   1,639    -    -    - 
Other   835    987    5,125    3,862 
Total other expenses   11,783    10,277    42,819    44,480 
                     
Profit (Loss) Before Income Taxes   931    (4,354)   (3,262)   (8,716)
Income Tax Expense   500    3,183    500    3,183 
Net Profit (Loss)  $431   $(7,537)  $(3,762)  $(11,899)
                     
Basic Earnings (Loss) Per Common Share  $0.02   $(0.44)  $(0.22)  $(0.72)
                     
Diluted Earnings (Loss) Per Common Share  $0.02   $(0.44)  $(0.22)  $(0.72)
                     
Dividends Declared Per Common Share  $-   $-   $-   $- 

 

 
 

 

MBT FINANCIAL CORP.

CONSOLIDATED BALANCE SHEETS

 

   December 31, 2011   December 31, 
Dollars in thousands  (Unaudited)   2010 
Assets          
Cash and Cash Equivalents          
Cash and due from banks          
Non-interest bearing  $18,201   $13,789 
Interest bearing   57,794    72,511 
Total cash and cash equivalents   75,995    86,300 
           
Securities - Held to Maturity   35,364    23,804 
Securities - Available for Sale   354,899    289,365 
Federal Home Loan Bank stock - at cost   10,605    11,831 
Loans held for sale   1,035    973 
           
Loans   679,475    752,887 
Allowance for Loan Losses   (20,865)   (21,223)
Loans - Net   658,610    731,664 
           
Accrued interest receivable and other assets   24,350    34,207 
Bank Owned Life Insurance   47,653    50,664 
Premises and Equipment - Net   29,516    30,569 
Total assets  $1,238,027   $1,259,377 
           
Liabilities          
Deposits:          
Non-interest bearing  $164,852   $148,208 
Interest-bearing   857,458    883,685 
Total deposits   1,022,310    1,031,893 
           
Federal Home Loan Bank advances   107,000    113,500 
Repurchase agreements   20,000    30,000 
Notes Payable   135    135 
Accrued interest payable and other liabilities   12,871    9,851 
Total liabilities   1,162,316    1,185,379 
           
Shareholders' Equity          
Common stock (no par value)   2,099    2,146 
Retained Earnings   72,735    76,497 
Unearned Compensation   (87)   (187)
Accumulated other comprehensive income (loss)   964    (4,458)
Total shareholders' equity   75,711    73,998 
Total liabilities and shareholders' equity  $1,238,027   $1,259,377 

  

FOR FURTHER INFORMATION:

H. Douglas Chaffin John L. Skibski Mary Jane Town
Chief Executive Officer Chief Financial Officer Marketing Officer
(734) 384-8123 (734) 242-1879 (734) 240-2510
doug.chaffin@mbandt.com john.skibski@mbandt.com

maryjane.town@mbandt.com