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| 8-K - FORM 8-K - SMARTFINANCIAL INC. | v311563_8k.htm |
Cornerstone Reports Positive Earnings for Fifth Consecutive Quarter
CHATTANOOGA, Tenn.—(PR Newswire)—April 26, 2012—Cornerstone Bancshares, Inc. (OTC Bulletin Board: CSBQ; CSBQP) today announced the following:
Cornerstone Bancshares, Inc. (“Cornerstone”), parent company of Cornerstone Community Bank (“Bank”), reported positive net income of approximately $357,000 for the first quarter of 2012. This profit represents an increase of 41.7 percent compared to the first quarter of 2011’s net income of approximately $252,000, and marks the fifth consecutive quarter of positive earnings for Cornerstone.
Other financial highlights year-over-year for the quarter ended March 31, 2012 include:
| · | A 31.5 percent increase in shareholders’ equity, from $27,290,000 to $35,890,000 |
| · | A 66.7 percent increase in market value per common share, from $1.50 to $2.50 |
| · | An increase in net interest margin, from 3.44 percent to 3.59 percent |
| · | An 32.8 percent increase in the Bank’s Tier 1 leverage ratio, from 6.1 percent to 8.1 percent |
| · | A 24.2 percent increase in the Bank’s total risk-based capital ratio, from 10.5 percent to 13.0 percent |
“We are greatly encouraged by the continued progress we’ve made to raise capital, improve our underwriting and collection procedures, and produce positive earnings,” said Cornerstone President Frank Hughes. “Our goal is to stay focused on these three main areas, as we endeavor to deliver the best quality banking products, service and value to our customers, and the greatest return on investment to all of our shareholders.”
As of March 31, 2012, Cornerstone had raised in excess of $10.4 million in capital through its Preferred Stock Offering (“Offering”) launched in the third quarter of 2010. The Offering, which has been extended until June 30, 2012, features a Series A Convertible Preferred Stock with a 10 percent annual, cumulative dividend, payable in cash quarterly if, as and when declared. The Preferred dividend has been paid the last four consecutive quarters, based on positive earnings in the preceding quarters. Once the Offering is closed, the new security will trade on the Over-The-Counter (OTC) Bulletin Board under the ticker symbol “CSBQP.”
“Having this solid capital foundation will really help us build and grow for the future,” said Cornerstone Chairman Miller Welborn. “As our economy here in Chattanooga continues to strengthen and improve, and businesses continue to open and thrive in this market, Cornerstone should be ideally positioned to serve the local community for many years to come.”
Cornerstone is a single-bank holding company, with $417 million in assets, serving the Chattanooga, Tennessee MSA, with five branches throughout Chattanooga, Tennessee and one loan production office in Dalton, Georgia. Locally owned and locally operated, Cornerstone specializes in providing a comprehensive range of customized financial solutions for businesses and individuals.
Certain of the statements made in this release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements, including statements regarding the intent, belief or current expectations of Cornerstone and its management regarding the company’s strategic directions, prospects and future results, involve certain risks and uncertainties. Certain factors may cause actual results to differ materially from those contained in the forward-looking statements, including economic and other conditions in the markets in which Cornerstone operates, governmental regulations, the company’s competitive environment, cyclical and seasonal fluctuations in its operating results, and other risks discussed in Cornerstone’s Form 10-K and other filings with the Securities and Exchange Commission.
Cornerstone Bancshares, Inc. and Subsidiary
First Quarter Financial Highlights
March 31, 2012 and 2011
(Unaudited)
| (Amounts in thousands, except per common share data) | 2012 | 2011 | % Change | |||||||||
| Balance Sheet Data at March 31 | ||||||||||||
| Total assets | $ | 417,475 | $ | 447,540 | (6.7 | ) | ||||||
| Interest-earning assets | 380,527 | 420,104 | (9.4 | ) | ||||||||
| Loans | 262,788 | 273,750 | (4.0 | ) | ||||||||
| Foreclosed assets | 18,957 | 20,464 | (7.4 | ) | ||||||||
| Deposits | 315,816 | 337,487 | (6.4 | ) | ||||||||
| Other interest-bearing liabilities | 64,055 | 81,270 | (21.2 | ) | ||||||||
| Shareholders' equity | 35,890 | 27,290 | 31.5 | |||||||||
| Loan to deposit ratio | 83.21 | % | 81.11 | % | 2.6 | |||||||
| Tier 1 leverage ratio (Bank) | 8.14 | % | 6.13 | % | 32.8 | |||||||
| Total risk-based capital ratio (Bank) | 12.99 | % | 10.46 | % | 24.2 | |||||||
| Outstanding common shares | 6,500 | 6,500 | - | |||||||||
| Book value per common share | $ | 3.91 | $ | 3.65 | 7.3 | |||||||
| Tangible book value per common share | $ | 3.91 | $ | 3.64 | 7.5 | |||||||
| Market value per common share as of March 31 | $ | 2.50 | $ | 1.50 | 66.7 | |||||||
| Loan Quality Data | ||||||||||||
| Nonaccruing loans | 10,766 | 13,633 | (21.0 | ) | ||||||||
| Loans past due 90 days – accruing | - | - | - | |||||||||
| Net charge-offs YTD | 1,376 | 1,269 | 8.5 | |||||||||
| Allowance for loan losses | 6,024 | 9,132 | (34.0 | ) | ||||||||
| Allowance for loan losses to total loans | 2.29 | % | 3.34 | % | ||||||||
| Nonperforming assets to total assets | 7.12 | % | 7.62 | % | ||||||||
| Performance Data for the Year | ||||||||||||
| Net income | $ | 357 | $ | 252 | 41.3 | |||||||
| Return on average assets | 0.35 | % | 0.23 | % | ||||||||
| Return on average equity | 4.01 | % | 3.78 | % | ||||||||
| Net interest margin | 3.59 | % | 3.44 | % | ||||||||
| Per common share data: | ||||||||||||
| Net income – basic | $ | 0.01 | $ | 0.02 | ||||||||
| Net income – diluted | $ | 0.01 | $ | 0.04 | ||||||||
| Common dividends | $ | - | $ | - | ||||||||
| Preferred dividends & accretion | $ | 280 | $ | 93 | ||||||||
| Average shares (000s): | ||||||||||||
| Basic common stock | 6,500 | 6,500 | ||||||||||
| Diluted common stock | 6,500 | 6,500 | ||||||||||
| Preferred stock | 425 | 149 | ||||||||||
Cornerstone Bancshares, Inc. and Subsidiary
Loan Loss Allowance and Asset Quality Review
| 2012 | 2011 | |||||||||||||||||||
| First | Fourth | Third | Second | First | ||||||||||||||||
| (Amounts in thousands) | Quarter | Quarter | Quarter | Quarter | Quarter | |||||||||||||||
| Allowance for loan losses | ||||||||||||||||||||
| Balance at beginning of period | $ | 7,400 | $ | 6,864 | $ | 6,814 | $ | 7,914 | $ | 9,132 | ||||||||||
| Provision for loan losses | - | 300 | 115 | 15 | 15 | |||||||||||||||
| Net charge-offs | (1,376 | ) | 236 | (65 | ) | (1,115 | ) | (1,233 | ) | |||||||||||
| Balance at end of period | $ | 6,024 | $ | 7,400 | $ | 6,864 | $ | 6,814 | $ | 7,914 | ||||||||||
| As a % of loans | 2.29 | % | 2.76 | % | 2.54 | % | 2.52 | % | 2.89 | % | ||||||||||
| As a % of nonperforming loans | 55.95 | % | 93.90 | % | 80.20 | % | 94.21 | % | 126.20 | % | ||||||||||
| As a % of nonperforming assets | 20.27 | % | 28.03 | % | 25.60 | % | 24.97 | % | 29.60 | % | ||||||||||
| Net charge-offs as a % of loans (a) | 2.10 | % | -0.35 | % | 0.10 | % | 1.65 | % | 1.80 | % | ||||||||||
| Risk element assets | ||||||||||||||||||||
| Accruing troubled debt restructured | $ | 2,418 | $ | 2,750 | $ | 2,535 | $ | 1,750 | $ | 1,650 | ||||||||||
| Loans past due 30-89 days | $ | 5,098 | $ | 8,090 | $ | 2,048 | $ | 1,957 | $ | 8,434 | ||||||||||
| Nonaccruing loans | $ | 10,766 | $ | 7,881 | $ | 8,559 | $ | 7,233 | $ | 6,271 | ||||||||||
| Loans past due 90 days – accruing | - | - | - | - | - | |||||||||||||||
| Total nonperforming loans | $ | 10,766 | $ | 7,881 | $ | 8,559 | $ | 7,233 | $ | 6,271 | ||||||||||
| Repossessed assets | - | - | - | - | - | |||||||||||||||
| Other real estate owned (b)(c) | $ | 18,957 | $ | 18,524 | $ | 18,255 | $ | 20,058 | $ | 20,464 | ||||||||||
| Total nonperforming assets | $ | 29,723 | $ | 26,405 | $ | 26,814 | $ | 27,291 | $ | 26,735 | ||||||||||
| Nonperforming loans as a % of loans | 4.10 | % | 2.94 | % | 3.17 | % | 2.68 | % | 2.29 | % | ||||||||||
| Nonperforming assets as a % of loans and other real estate owned | 10.55 | % | 9.22 | % | 9.29 | % | 9.40 | % | 9.09 | % | ||||||||||
| Total loans | 262,788 | 267,765 | 270,401 | 270,171 | 273,750 | |||||||||||||||
| (a) Annualized | ||||||||||||||||||||
| (b) Properties sold during 1st Q 2012 | $ | 1,778 | ||||||||||||||||||
| (c) Properties under contract to sell | $ | 4,225 | ||||||||||||||||||
Cornerstone Bancshares, Inc. and Subsidiary
Net Interest Margin Analysis
Taxable Equivalent Basis
| Three months ended | ||||||||||||||||||||||||
| March 31 | ||||||||||||||||||||||||
| 2012 | 2011 | |||||||||||||||||||||||
| Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||||||
| (Amounts in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | ||||||||||||||||||
| Assets | ||||||||||||||||||||||||
| Earning assets: | ||||||||||||||||||||||||
| Loans, net of unearned income | $ | 265,814 | $ | 4,144 | 6.27 | % | $ | 284,297 | $ | 4,639 | 6.62 | % | ||||||||||||
| Investment securities | 88,641 | 467 | 2.43 | % | 109,844 | 568 | 2.41 | % | ||||||||||||||||
| Other earning assets | 23,880 | 15 | 0.25 | % | 24,122 | 11 | 0.18 | % | ||||||||||||||||
| Total earning assets | 378,335 | $ | 4,626 | 4.99 | % | 418,263 | $ | 5,218 | 5.14 | % | ||||||||||||||
| Allowance for loan losses | (7,121 | ) | (9,071 | ) | ||||||||||||||||||||
| Cash and other assets | 37,497 | 28,629 | ||||||||||||||||||||||
| TOTAL ASSETS | $ | 408,711 | $ | 437,821 | ||||||||||||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||
| Interest-bearing demand deposits | $ | 24,891 | $ | 21 | 0.34 | % | $ | 27,590 | $ | 21 | 0.31 | % | ||||||||||||
| Savings deposits | 9,859 | 10 | 0.40 | % | 9,499 | 12 | 0.51 | % | ||||||||||||||||
| MMDA's | 39,373 | 90 | 0.92 | % | 24,437 | 60 | 1.00 | % | ||||||||||||||||
| Time deposits | 195,111 | 699 | 1.44 | % | 244,021 | 1,052 | 1.75 | % | ||||||||||||||||
| Federal funds purchased and securities sold under agreements to repurchase | 26,291 | 32 | 0.49 | % | 22,625 | 31 | 0.56 | % | ||||||||||||||||
| Other borrowings | 42,634 | 461 | 4.35 | % | 54,356 | 580 | 4.33 | % | ||||||||||||||||
| Total interest-bearing liabilities | 338,159 | 1,314 | 1.56 | % | 382,528 | 1,756 | 1.86 | % | ||||||||||||||||
| Net interest spread | $ | 3,312 | 3.43 | % | $ | 3,462 | 3.28 | % | ||||||||||||||||
| Noninterest-bearing demand deposits | 34,479 | 28,964 | ||||||||||||||||||||||
| Accrued expenses and other liabilities | 486 | (354 | ) | |||||||||||||||||||||
| Shareholders' equity | 35,587 | 26,683 | ||||||||||||||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 408,711 | $ | 437,821 | ||||||||||||||||||||
| Net yield on earning assets | 3.59 | % | 3.44 | % | ||||||||||||||||||||
| Taxable equivalent adjustment: | ||||||||||||||||||||||||
| Loans | 0 | - | ||||||||||||||||||||||
| Investment securities | 68 | 85 | ||||||||||||||||||||||
| Total adjustment | 68 | 85 | ||||||||||||||||||||||
Cornerstone Bancshares, Inc. and Subsidiary
Quarterly Earnings Summary
| (Unaudited) | ||||||||||||||||||||||||
| 2012 | 2011 | Q1-12 / | ||||||||||||||||||||||
| First | Fourth | Third | Second | First | Q1-11 | |||||||||||||||||||
| (Amounts in thousands) | Quarter | Quarter | Quarter | Quarter | Quarter | % Chg | ||||||||||||||||||
| Interest income | ||||||||||||||||||||||||
| Loans, including fees | $ | 4,144 | $ | 4,437 | $ | 4,531 | $ | 4,521 | $ | 4,639 | (10.7 | ) | ||||||||||||
| Investment securities and interest-bearing deposits | 467 | 548 | 574 | 621 | 568 | (17.8 | ) | |||||||||||||||||
| Other earning assets | 15 | 16 | 9 | 17 | 11 | 37.1 | ||||||||||||||||||
| Total interest income | 4,626 | 5,001 | 5,114 | 5,159 | 5,218 | (11.3 | ) | |||||||||||||||||
| Interest expense | ||||||||||||||||||||||||
| Deposits | 820 | 924 | 1,012 | 1,112 | 1,145 | (28.4 | ) | |||||||||||||||||
| Short-term borrowings | 32 | 28 | 33 | 34 | 31 | 4.0 | ||||||||||||||||||
| FHLB advances and other borrowing | 461 | 454 | 466 | 545 | 580 | (20.4 | ) | |||||||||||||||||
| Total interest expense | 1,314 | 1,405 | 1,510 | 1,691 | 1,756 | (25.2 | ) | |||||||||||||||||
| Net interest income | 3,312 | 3,595 | 3,604 | 3,468 | 3,462 | (4.3 | ) | |||||||||||||||||
| Provision for loan losses | 0 | 300 | 115 | 15 | 15 | (100.0 | ) | |||||||||||||||||
| Net interest income after the provision for loan losses | 3,312 | 3,295 | 3,489 | 3,453 | 3,447 | (3.9 | ) | |||||||||||||||||
| Noninterest income | ||||||||||||||||||||||||
| Customer service fees | 197 | 212 | 216 | 225 | 215 | (8.4 | ) | |||||||||||||||||
| Other noninterest income | 20 | 15 | 15 | 22 | 20 | 0.0 | ||||||||||||||||||
| Gain on sale of assets | 50 | 47 | 92 | 69 | 34 | 46.0 | ||||||||||||||||||
| Total noninterest income | 267 | 274 | 323 | 316 | 269 | (0.6 | ) | |||||||||||||||||
| Noninterest expense | ||||||||||||||||||||||||
| Salaries and employee benefits | 1,591 | 1,614 | 1,459 | 1,502 | 1,542 | 3.2 | ||||||||||||||||||
| Net occupancy and equipment | 336 | 314 | 362 | 350 | 406 | (17.4 | ) | |||||||||||||||||
| Depository insurance | 203 | 255 | 234 | 241 | 322 | (37.0 | ) | |||||||||||||||||
| Goodwill impairment | - | - | - | - | - | - | ||||||||||||||||||
| Foreclosed asset expense (1) | 150 | 538 | 306 | 716 | 362 | (58.4 | ) | |||||||||||||||||
| Other operating expense | 794 | 780 | 715 | 847 | 783 | 1.4 | ||||||||||||||||||
| Total noninterest expense | 3,074 | 3,500 | 3,076 | 3,657 | 3,415 | (10.0 | ) | |||||||||||||||||
| Income before income taxes | 506 | 69 | 736 | 113 | 301 | 68.1 | ||||||||||||||||||
| Income tax (benefit) expense | 149 | (44 | ) | 212 | (28 | ) | 49 | 206.4 | ||||||||||||||||
| Net income (loss) | $ | 357 | $ | 113 | $ | 524 | $ | 141 | $ | 252 | 41.4 | |||||||||||||
| Preferred stock dividends & accretion on preferred stock discount | 280 | 267 | 201 | $ | 128 | $ | 93 | 201.4 | ||||||||||||||||
| Net income / loss available to common | 76 | (154 | ) | 323 | 13 | 159 | (52.1 | ) | ||||||||||||||||
| Net income (loss) per common share: | ||||||||||||||||||||||||
| Basic | $ | 0.01 | $ | (0.02 | ) | $ | 0.05 | $ | - | $ | 0.02 | (52.1 | ) | |||||||||||
| Diluted | $ | 0.01 | $ | (0.02 | ) | $ | 0.05 | $ | - | $ | 0.02 | (52.1 | ) | |||||||||||
| Average basic shares | 6,500 | 6,500 | 6,500 | 6,500 | 6,500 | - | ||||||||||||||||||
| Average common diluted shares | 6,500 | 6,500 | 6,500 | 6,500 | 6,500 | - | ||||||||||||||||||
| Performance Ratios | ||||||||||||||||||||||||
| Return on average equity | 4.01 | % | 1.37 | % | 6.64 | % | 2.04 | % | 3.78 | % | 6.0 | |||||||||||||
| Return on average assets | 0.35 | % | 0.11 | % | 0.49 | % | 0.13 | % | 0.23 | % | 51.5 | |||||||||||||
| Net interest margin | 3.59 | % | 3.72 | % | 3.69 | % | 3.42 | % | 3.44 | % | 4.5 | |||||||||||||
| Average equity | 35,587 | 32,912 | 31,569 | 27,712 | 26,683 | 33.4 | ||||||||||||||||||
| Average assets | 408,711 | 416,562 | 423,200 | 445,472 | 437,821 | (6.6 | ) | |||||||||||||||||
| Average interest-earning assets | 378,335 | 390,756 | 396,872 | 416,605 | 418,263 | (9.5 | ) | |||||||||||||||||
(1) Includes OREO adjustments to fair value
Cornerstone Bancshares, Inc. and Subsidiary
Loan Stratification
| 2012 | 2011 | |||||||||||||||||||
| First | % of | First | % of | % Dollar | ||||||||||||||||
| (Amounts in thousands) | Quarter | Total | Quarter | Total | Change | |||||||||||||||
| Non-residential real estate | ||||||||||||||||||||
| Owner occupied | $ | 61,830 | 23.5 | $ | 64,492 | 23.6 | (4.1 | ) | ||||||||||||
| Non-owner occupied | 61,295 | 23.3 | 59,336 | 21.7 | 3.3 | |||||||||||||||
| Multi-family real estate | 10,249 | 3.9 | 11,781 | 4.3 | (13.0 | ) | ||||||||||||||
| 1-4 family construction | 4,520 | 1.7 | 3,827 | 1.4 | 18.1 | |||||||||||||||
| Commercial land and lot development | 16,421 | 6.2 | 19,718 | 7.2 | (16.7 | ) | ||||||||||||||
| Total non-residential real estate | 154,315 | 58.7 | 159,154 | 58.1 | (3.0 | ) | ||||||||||||||
| Residential real estate | ||||||||||||||||||||
| First mortgage - 1-4 family | 43,372 | 16.5 | 42,835 | 15.6 | 1.3 | |||||||||||||||
| Second mortgage - 1-4 family | 3,528 | 1.3 | 4,639 | 1.7 | (23.9 | ) | ||||||||||||||
| Home equity lines | 15,288 | 5.8 | 11,005 | 4.0 | 38.9 | |||||||||||||||
| Total residential real estate | 62,188 | 23.7 | 58,479 | 21.4 | 6.3 | |||||||||||||||
| Total real estate loans | 216,503 | 82.4 | 217,633 | 79.5 | (0.5 | ) | ||||||||||||||
| Commercial | 34,970 | 13.3 | 44,592 | 16.3 | (21.6 | ) | ||||||||||||||
| Agricultural & other | 8,854 | 3.4 | 8,449 | 3.1 | 4.8 | |||||||||||||||
| Consumer | 2,461 | 0.9 | 3,076 | 1.1 | (20.0 | ) | ||||||||||||||
| Total loans, net of unearned fees | $ | 262,788 | 100.0 | $ | 273,750 | 100.0 | (4.0 | ) | ||||||||||||
Cornerstone Bancshares, Inc. and Subsidiary
Consolidated Balance Sheets
| Unaudited | ||||||||
| March 31, | December 31, | |||||||
| 2012 | 2011 | |||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 34,884,877 | $ | 38,882,691 | ||||
| Securities available for sale | 88,249,596 | 86,057,437 | ||||||
| Securities held to maturity | 63,410 | 68,643 | ||||||
| Federal Home Loan Bank stock, at cost | 2,322,900 | 2,322,900 | ||||||
| Loans, net of allowance for loan losses of $6,024,351 at March 31, 2012 and $7,400,049 at December 31, 2011 | 256,763,922 | 260,364,569 | ||||||
| Bank premises and equipment, net | 5,649,662 | 5,712,003 | ||||||
| Accrued interest receivable | 1,334,003 | 1,327,458 | ||||||
| Foreclosed assets | 18,956,631 | 18,523,960 | ||||||
| Other assets | 9,250,307 | 9,395,721 | ||||||
| Total assets | $ | 417,475,308 | $ | 422,655,382 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Deposits: | ||||||||
| Noninterest-bearing demand deposits | $ | 47,499,843 | $ | 43,989,943 | ||||
| Interest-bearing demand deposits | 26,851,857 | 22,353,384 | ||||||
| Savings deposits and money market accounts | 52,066,221 | 46,857,118 | ||||||
| Time deposits | 189,397,737 | 200,841,499 | ||||||
| Total deposits | 315,815,658 | 314,041,944 | ||||||
| Federal funds purchased and securities sold under agreements to repurchase | 21,445,300 | 29,390,810 | ||||||
| Federal Home Loan Bank advances and other borrowings | 42,610,000 | 43,045,000 | ||||||
| Accrued interest payable | 110,398 | 110,703 | ||||||
| Other liabilities | 1,604,009 | 858,620 | ||||||
| Total liabilities | 381,585,365 | 387,447,077 | ||||||
| Stockholders' equity | ||||||||
| Preferred stock - no par value; 2,000,000 shares 425,369 and 403,989 shares issued and outstanding in 2012 and 2011, respectively | 10,446,139 | 9,899,544 | ||||||
| Common stock - $1.00 par value; 20,000,000 shares authorized; 6,709,199 shares issued in 2012 and 2011; 6,500,396 shares outstanding in 2012 and 2011 | 6,500,396 | 6,500,396 | ||||||
| Additional paid-in capital | 21,334,950 | 21,316,438 | ||||||
| Retained (deficit) | (3,472,697 | ) | (3,627,208 | ) | ||||
| Accumulated other comprehensive income | 1,081,155 | 1,119,135 | ||||||
| Total stockholders' equity | 35,889,943 | 35,208,305 | ||||||
| Total liabilities and stockholders' equity | $ | 417,475,308 | $ | 422,655,382 | ||||
Cornerstone Bancshares, Inc. and Subsidiary
Consolidated Statements of Income
| Unaudited | ||||||||
| Three months ended | ||||||||
| March 31 | ||||||||
| 2012 | 2011 | |||||||
| INTEREST INCOME | ||||||||
| Loans, including fees | $ | 4,143,944 | $ | 4,638,805 | ||||
| Securities | 467,006 | 568,672 | ||||||
| Federal funds sold & other earning assets | 15,087 | 11,003 | ||||||
| Total interest income | 4,626,037 | 5,218,480 | ||||||
| INTEREST EXPENSE | ||||||||
| Time deposits | 699,094 | 1,052,449 | ||||||
| Other deposits | 121,243 | 92,612 | ||||||
| Federal funds purchased and securities sold under agreements to repurchase | 32,230 | 31,003 | ||||||
| FHLB advances and other borrowings | 461,207 | 579,658 | ||||||
| Total interest expense | 1,313,774 | 1,755,722 | ||||||
| Net interest income before provision for loan losses | 3,312,263 | 3,462,758 | ||||||
| Provision for loan losses | - | 15,000 | ||||||
| Net interest income after the provision for loan losses | 3,312,263 | 3,447,758 | ||||||
| NONINTEREST INCOME | ||||||||
| Customer service fees | 197,434 | 215,451 | ||||||
| Other noninterest income | 20,288 | 20,279 | ||||||
| Net gains from sale of loans and other assets | 49,664 | 34,027 | ||||||
| Total noninterest income | 267,386 | 269,757 | ||||||
| NONINTEREST EXPENSE | ||||||||
| Salaries and employee benefits | 1,591,135 | 1,542,702 | ||||||
| Net occupancy and equipment expense | 335,813 | 406,334 | ||||||
| Depository insurance | 202,783 | 322,655 | ||||||
| Foreclosed assets, net | 150,320 | 361,570 | ||||||
| Other operating expense | 794,081 | 783,354 | ||||||
| Total noninterest expense | 3,074,132 | 3,416,615 | ||||||
| Income before provision for income taxes | 505,517 | 300,900 | ||||||
| Provision for income taxes | 149,000 | 48,625 | ||||||
| NET INCOME | $ | 356,517 | $ | 252,275 | ||||
| Preferred stock dividend requirement | 265,856 | 93,075 | ||||||
| Accretion on preferred stock discount | 14,468 | - | ||||||
| Net income available to common stockholders | $ | 76,193 | $ | 159,200 | ||||
| EARNINGS PER COMMON SHARE | ||||||||
| Basic net income per common share | $ | 0.01 | $ | 0.02 | ||||
| Diluted net income per common share | $ | 0.01 | $ | 0.02 | ||||
| DIVIDENDS DECLARED PER COMMON SHARE | $ | - | $ | - | ||||
Cornerstone Bancshares, Inc. and Subsidiary
Consolidated Statement of Changes in Stockholders' Equity - Unaudited
For the three months ended March 31, 2012
| Accumulated | ||||||||||||||||||||||||||||
| Additional | Other | Total | ||||||||||||||||||||||||||
| Comprehensive | Preferred | Common | Paid-in | Retained | Comprehensive | Stockholders' | ||||||||||||||||||||||
| Income | Stock | Stock | Capital | (Deficit) | Income | Equity | ||||||||||||||||||||||
| BALANCE, December 31, 2011 | $ | 9,899,544 | $ | 6,500,396 | $ | 21,316,438 | $ | (3,627,208 | ) | $ | 1,119,135 | $ | 35,208,305 | |||||||||||||||
| Employee compensation stock option expense | - | - | 18,512 | - | - | 18,512 | ||||||||||||||||||||||
| Issuance of Series A Convertible Preferred Stock | 532,127 | - | - | - | - | 532,127 | ||||||||||||||||||||||
| Preferred stock dividends paid | - | - | - | (187,538 | ) | - | (187,538 | ) | ||||||||||||||||||||
| Accretion on preferred stock discount | 14,468 | - | - | (14,468 | ) | - | - | |||||||||||||||||||||
| Comprehensive income: | ||||||||||||||||||||||||||||
| Net income | $ | 356,517 | - | - | - | 356,517 | - | 356,517 | ||||||||||||||||||||
| Other comprehensive income, net of tax: | ||||||||||||||||||||||||||||
| Unrealized holding gains on securities available for sale, net of reclassification adjustment | (37,980 | ) | - | - | - | - | (37,980 | ) | (37,980 | ) | ||||||||||||||||||
| Total comprehensive income | $ | 318,537 | ||||||||||||||||||||||||||
| BALANCE, March 31, 2012 | $ | 10,446,139 | $ | 6,500,396 | $ | 21,334,950 | $ | (3,472,697 | ) | $ | 1,081,155 | $ | 35,889,943 | |||||||||||||||