ASHEVILLE,
N.C., Oct. 30, 2015
/PRNewswire/ -- ASB Bancorp, Inc. (the "Company") (NASDAQ GM:
ASBB), the holding company for Asheville Savings Bank, S.S.B. (the
"Bank"), announced today its operating results for the three- and
nine-month periods ended September 30,
2015. The Company reported net income of $1.1 million, or $0.28 per diluted common share, for the quarter
ended September 30, 2015 compared to
$502,000, or $0.12 per diluted common share, for the same
quarter of 2014. For the nine months ended September 30, 2015, the Company reported net
income of $2.6 million compared to
net income of $1.8 million for the
same period of 2014. For the year-to-date periods, net income per
share increased 51.2% to $0.65 per
diluted common share for the nine months ended September 30, 2015 from $0.43 per diluted common share for the nine
months ended September 30, 2014. The
nine-month period ended September 30,
2014 included a nonrecurring pre-tax earnings credit of
$1.3 million that was attributable to
the release of loan loss reserves, which distorted the comparisons
of the year-over-year loan loss provisions and earnings.
![ASB Bancorp Logo. ASB Bancorp Logo.](http://photos.prnewswire.com/prnvar/20111031/CL96775LOGO)
Suzanne DeFerie, President
and CEO, commented, "In the third quarter, we continued to see the
positive impact of our strategic plan to achieve
sustainable, superior performance. We have achieved
significant improvement in almost every key
performance metric by focusing on our commercial and small
business relationships, taking steps to grow mortgage
banking, and driving efficiencies and greater
productivity. When comparing the September 30 year-over-year periods, loan
balances have increased 16.6%, core deposits are up
12.8%, with commercial non-maturity deposits ― a focus area ―
increasing 32.1% over the period and we saw a 14
basis point improvement in the net interest margin."
DeFerie continued, "With the first nine months of 2015
completed and as we begin the fourth quarter, we are
well positioned to attain our full-year 2015 growth and performance
targets. As indicated in the table below that compares
our year-to-date actual performance to our full-year growth and
performance targets, we are achieving or very close to
achieving all of our targets. We remain resolutely focused on
growing the areas where we see the greatest potential,
while also taking steps to further reduce nonperforming
assets and improve our efficiency ratio. We are
pleased with the traction we have already established, and
are confident about the further opportunities we see
ahead."
2015 Third Quarter Highlights
- Net income for the third quarter of 2015 was $1.1 million, or $0.28 per diluted common share,
compared to $502,000, or
$0.12 per diluted common share, for
the third quarter of 2014.
- Net interest income increased 11.9% to $5.6 million for the three months ended September
30, 2015 from $5.0
million for the three months ended September 30, 2014. The net interest
margin improved to 3.00% for the third quarter of 2015
compared to 2.84% for the third quarter of
2014.
- Interest income from loans increased 11.5% in the third
quarter of 2015 compared to the third quarter of 2014,
which primarily reflected an $84.5
million increase in average loan balances when
comparing the two quarters.
- Provisions for loan losses were $191,000 in the third quarter of 2015 compared to
$240,000 in the third
quarter of 2014. The allowance for loan losses declined to 1.11% of
total loans at September 30,
2015 from 1.14% at December 31,
2014, although the allowance coverage of
nonperforming loans was 223.7% at September 30, 2015 compared to 221.3% at
December 31, 2014.
- Loan balances increased $16.1
million, or 2.9%, to $569.1
million from June 30, 2015.
Loans increased $47.3
million, or 9.1%, since December 31,
2014 and increased $81.2
million, or 16.6%, since September 30, 2014 as new loan originations
exceeded loan repayments, prepayments and
foreclosures. The 2015 increase in loan balances is net of a
decrease in the indirect auto lending portfolio due to
a strategic decision during the second quarter of 2015 to
cease production in this lending area.
- Noninterest income increased 26.9% to $2.1 million for the third quarter of 2015 from
$1.6 million for the third quarter of 2014, primarily
due to the increase in mortgage banking income and
gains realized from the sale of investment securities.
- Noninterest expenses increased 3.8% to $5.8 million for the third quarter of 2015 from
$5.6 million for the third quarter of 2014, primarily
due to increases in compensation and employee
benefits, which included increases of $174,000 for employee incentives and $61,000 for pension plan expenses in
2015.
- Delinquent and nonperforming loans were 0.45% and 0.49%,
respectively, of total loans at September 30, 2015, compared to 0.60% and 0.52%,
respectively, of total loans at December 31, 2014.
- Nonperforming assets, including foreclosed properties,
were 1.46% of total assets at September 30, 2015 compared to 1.51% of total
assets at December 31, 2014 and 1.68%
of total assets at September
30, 2014.
- Core deposits, which exclude certificates of deposit,
increased $40.2 million, or
9.0%, since December 31,
2014 and $55.5 million, or
12.8%, since September 30,
2014. Noninterest-bearing deposits increased
$25.3 million, or 25.9%, and
commercial non-maturity deposits increased
$31.9 million, or 26.2%, since
December 31, 2014.
- Book value per common share increased to $22.41 at September 30,
2015 from $21.56 at
December 31, 2014 and
$21.53 at September 30, 2014.
- Capital remained strong with consolidated regulatory
capital ratios of 18.33% common equity tier 1 capital,
13.09% tier 1 leverage capital, 18.33% tier 1 risk-based capital
and 19.44% total risk-based capital.
DeFerie concluded, "The results of the third quarter, and
of the first nine months of 2015, demonstrate the
positive impact of our strategic plan. We have achieved
year-over-year and year-to-date improvement on almost
every measure of performance, from core deposits and efficiency
ratio to earnings and book value per share. For the
remainder of the year and into 2016, we expect to continue
growing our core focus areas and looking for effective
ways to reduce costs, enhance productivity and increase
shareholders' returns."
Income Statement Analysis
Net Interest Income. Net interest income
increased by $595,000, or 11.9%, to
$5.6 million for the
three months ended September 30, 2015 compared to $5.0 million for the three months ended September
30, 2014. Total interest and dividend income increased
$586,000, or 10.0%, to $6.5 million for the three months
ended September 30, 2015 from
$5.9 million for the three months
ended September 30, 2014, primarily
as a result of an increase of $84.5 million in average loan balances, partially
offset by a 22 basis point decrease in the average
yield on loans. The average yield on mortgage-backed and other
investment securities increased 31 basis points for
the three months ended September 30,
2015 compared to the same period of 2014, which
was partially offset by a decrease of $13.2
million in average mortgage-backed and other
investment security balances. Interest expense
decreased $9,000, or 1.0%, to
$877,000 for the three months
ended September 30, 2015
from $886,000 for the three months
ended September 30, 2014, primarily
due to a $12.0 million
decrease in the average balances of certificates of deposit. When
comparing these same three-month periods, average
noninterest-bearing deposits grew $27.0
million, or 29.9%, which contributed to
minimizing deposit interest expense while deposit funding
grew.
Net interest income increased by $1.6 million, or 10.6%, to $16.3 million for the nine months ended
September 30, 2015 compared to
$14.7 million for the nine months
ended September 30, 2014.
Interest income on loans increased $1.8 million, primarily resulting from an
$85.1 million increase in the average
loan balances, partially offset by a 23 basis point
decrease in the average yield on loans. Interest on
securities decreased $260,000, attributable to a $22.5 million decrease in the average balance in
mortgage-backed and other investment securities,
partially offset by an 8 basis point increase in the average yield
earned on the investment portfolio. Interest expense
decreased $41,000, or 1.5%, for the
nine months ended September 30,
2015. The lower interest expense was primarily attributable
to lower average balances of certificates of deposit,
as well as average rate reductions of 1 basis point each on
certificates of deposit and savings accounts. The
decreases in interest expense were partially offset by higher
average balances of NOW, money market and savings
accounts. For the same nine-month periods, as was the case for
the comparable quarterly periods, average
noninterest-bearing deposits grew $4.8
million, or 19.1%, which contributed to
minimizing deposit interest expense while deposit funding
grew.
Noninterest Income. Noninterest income
increased $442,000, or 26.9%, to
$2.1 million for the
three months ended September 30, 2015 from $1.6 million for the three months ended
September 30, 2014.
Factors that contributed to the increase in noninterest
income during the 2015 period included increases of
$269,000 in mortgage banking
income, $202,000 in net gains from
the sale of investment securities, $79,000 in deposit and other service charge
income and $36,000 from debit card
services, which were partially offset by a decrease of
$98,000 in loan fees. The increase in
mortgage banking income was attributable to higher
volumes of residential mortgage loans originated and sold.
Increased transaction volume drove the rise in income
from debit card services.
Noninterest income increased $1.0
million, or 21.7%, to $5.7
million for the nine months ended September 30, 2015 from $4.7 million for the nine months ended
September 30, 2014. Factors
that contributed to the increase in noninterest income
during the 2015 period included increases of $686,000 in mortgage banking income,
$194,000 in net gains from the sale
of investment securities, $119,000 in
fees from debit card services, $68,000 in deposit and other service charge
income and $21,000 in income
from an investment in a Small Business Investment
Company. As was the case for the third quarter of 2015, the
increase in mortgage banking income was attributable to
higher volumes of residential mortgage loans
originated and sold, and increased transaction volume that
resulted in increased income from debit card
services.
Noninterest Expenses. Noninterest expenses
increased $213,000, or 3.8%, to
$5.8 million for the three
months ended September 30, 2015
from $5.6 million for the three
months ended September 30, 2014.
The increase for the third quarter of 2015 was
primarily attributable to increases of $326,000 in compensation and
employee benefits and $74,000 in data
processing fees, which were partially offset by decreases of
$77,000 in professional and
outside services and $74,000 in
advertising. The increase in compensation and employee
benefits included increases of $174,000 for employee incentives and $61,000 in pension plan
expenses.
Noninterest expenses decreased $215,000, or 1.2%, to $17.6 million for the nine months ended
September 30, 2015 from
$17.8 million for the nine months
ended September 30, 2014. The lower
2015 noninterest expenses primarily reflected
decreases of $248,000 in foreclosed
property expenses, $82,000 in
occupancy expenses, $76,000 in
advertising and $56,000 in
professional and outside services, which were
partially offset by increases of $195,000 in compensation and employee benefits,
$63,000 in consumer loan
expenses and $57,000 in
indirect auto expenses. The decrease in foreclosed property
expenses included a reduction of $119,000 in valuation write-downs of foreclosed
properties. Compensation and employee benefits for the
nine months ended September 30, 2015
included increases of $319,000 in
incentive compensation expenses and $183,000 in pension plan expenses, which were
partially offset by a decrease of $403,000 in equity incentive plan expenses
primarily due to additional expense of $380,000 in 2014 for accelerated
vesting related to the disability of a participant.
Balance Sheet Review
Assets. Total assets increased $37.8 million, or 5.0%, to $797.9 million at September 30, 2015 from $760.1
million at December 31, 2014.
Cash and cash equivalents decreased $1.1
million, or 1.9%, to $55.8
million at September 30,
2015 from $56.9 million at
December 31, 2014. Investment
securities decreased $7.0 million, or 4.8%, to
$138.5 million at September 30, 2015 from $145.5 million at December
31, 2014, primarily due to the sale of
investment securities to fund loan growth. Loans receivable, net of
deferred fees, increased $47.3
million, or 9.1%, to $569.1
million at September 30, 2015
from $521.8 million
at December 31,
2014 as new loan originations exceeded loan repayments,
prepayments and foreclosures.
Liabilities. Total deposits increased
$31.7 million, or 5.3%, to
$635.1 million at September 30, 2015
from $603.4 million
at December 31, 2014. During the nine
months ended September 30, 2015, we
continued our focus on core deposit growth, from which
we exclude certificates of deposit. Core deposits increased
$40.2 million, or 9.0%, to
$489.5 million at September 30, 2015 from $449.3 million at December
31, 2014.
Commercial checking and money market accounts increased
$31.9 million, or 26.2%, to
$153.5 million at
September 30, 2015 from
$121.6 million at December 31, 2014, reflecting expanded sources of
lower cost funding that included a $25.2 million increase in commercial
noninterest-bearing demand deposits. Our efforts to
obtain new commercial deposit relationships in conjunction with
making new commercial loans significantly contributed
to this increase and reflects our commitment to establishing
diversified relationships with business
clients.
Since December 31, 2014,
certificates of deposit decreased $8.5
million, or 5.5%, to $145.6
million at September 30,
2015 from $154.1 million at
December 31, 2014 as we continued our
focus on core deposit growth. Accounts payable and
other liabilities increased $2.3
million, or 19.8%, to $13.9
million at September 30,
2015 from $11.6 million at
December 31, 2014. The increase in
accounts payable and other liabilities at September 30, 2015 was primarily attributable to
a $1.0 million increase in escrowed
payments from mortgage borrowers, a $605,000 increase in pension plan liabilities and
a $513,000 increase in accrued
income taxes.
Asset Quality
Provision for Loan Losses. The provision for
loan losses was $191,000 for the
three months ended September 30, 2015 compared to $240,000 for the three months ended September 30, 2014. The decrease in
the provision for loan losses for the third quarter of 2015 was due
to improvement in loan delinquencies and the credit
quality of the loan portfolio, in addition to fewer charge-offs.
The allowance for loan losses totaled $6.3 million, or 1.11% of total loans, at
September 30, 2015 compared to
$5.9 million, or 1.14% of
total loans, at December 31,
2014. We charged off $46,000
in loans during the three months ended September 30, 2015 compared to $172,000 during the three months ended
September 30, 2014.
We recorded a provision for loan losses in the amount of
$450,000 for the nine months
ended September 30, 2015
compared to a recovery of loan losses of $(1.2) million for the nine months ended
September 30, 2014. Net
charge-offs were $102,000 for the
first nine months of 2015 compared to $237,000 for the first nine months of 2014. The
increase in the nine-month provision for loan losses
primarily resulted from a 2014 reduction in loan loss
reserves due to a modification of our loan loss
methodology for unimpaired commercial construction and land
development, unimpaired residential construction and
land development, and unimpaired commercial and industrial loans,
which resulted in a nonrecurring reduction of
approximately $1.3 million in the
reserves for loans not considered impaired. The
provision for loan losses for the nine-month period of 2015 was
primarily due to loan growth.
Nonperforming Assets. Nonperforming assets
totaled $11.7 million, or 1.46% of
total assets, at September 30,
2015 compared to $11.5
million, or 1.51% of total assets, at December 31, 2014. Nonperforming
assets included $2.8 million in
nonperforming loans and $8.9 million
in foreclosed real estate at September 30, 2015 compared to $2.7 million and $8.8
million, respectively, at December
31, 2014.
Nonperforming loans increased $127,000 to $2.8
million, or 0.49% of total loans, at September 30, 2015 from $2.7 million, or 0.52% of total loans, at
December 31, 2014. Of the
$127,000 increase in
nonperforming loans for the nine months, $187,000 related to additional nonperforming
residential mortgage loans and $24,000 related to commercial and industrial
loans, which were partially offset by decreases in
commercial mortgages, revolving mortgages and consumer loans.
Collateral on nonperforming loans in the amount of
$812,000 was moved into foreclosed
real estate, while performing troubled debt restructurings
("TDRs") decreased $74,000, or
1.5%, when comparing the same periods. Total performing TDRs
and nonperforming assets increased $110,000, or 0.7%, to $16.4 million, or 2.06% of total assets,
at September 30, 2015
compared to $16.3 million, or 2.15%
of total assets, at December 31,
2014.
At September 30, 2015,
nonperforming loans included eight residential mortgage loans that
totaled $1.5 million, two commercial mortgage loans
that totaled $824,000, four
commercial and industrial loans that totaled
$245,000 and three revolving home
equity loans that totaled $204,000.
As of September 30, 2015,
the nonperforming loans had specific reserves totaling
$111,000.
Foreclosed real estate at September
30, 2015 included nine properties with a total recorded
amount of $8.9 million compared to ten properties with
a total recorded amount of $8.8
million at December 31,
2014. During the nine months ended September 30, 2015, two new properties that
totaled $812,000 were added to
foreclosed real estate, while three properties that totaled
$119,000 were sold. In addition, the
Bank sold three of its 15 units in a mixed-use
condominium complex for net proceeds of $508,000 along with two residential
lots in a mixed-use lot subdivision and one parcel of land
which was a portion of a residential property for net
proceeds of $121,000. We recorded
$6,000 in loss provisions on
foreclosed real estate during the first nine months of
2015, and there were no capital additions during the
period.
The Bank's largest foreclosed property resulted from a
loan relationship that had an original purpose of
constructing a mixed-use retail, commercial office, and
residential condominium project located in Western
North Carolina. As a result
of this foreclosure, the Bank acquired 44 of the 48 condominium
units in the building. Following an additional
write-down of approximately $630,000
on the loans secured by this collateral in the fourth
quarter of 2012, the Bank recorded this foreclosed property in the
amount of $9.8 million. During 2013, the Bank recorded
additional write-downs totaling $1.6
million, which resulted in an adjusted recorded
amount of $8.2 million at
December 31, 2013. During the year
ended December 31, 2014, the Bank recorded an
additional write-down of $133,000 on
the property and sold 28 residential condominium units
and one office unit. During the first nine months of 2015, the Bank
sold one retail unit and two office units. At
September 30, 2015, the adjusted
recorded amount was $4.0 million for
the remaining seven retail units and five office
units.
Profile
The Bank is a North
Carolina chartered stock savings bank offering traditional
financial services through 13 full-service banking
centers located in Buncombe,
Madison, McDowell, Henderson and Transylvania counties in
Western North Carolina and a loan
production office in Mecklenburg
County. Originally chartered in 1936 and
headquartered in Asheville, North
Carolina, the Bank is locally managed with a focus
on fostering strong relationships with its customers, its
employees and the communities it serves. The Bank was
recognized as the 2015 #1 Best Bank Overall, #1 Best Bank for Small
Business Services and #1 Best Bank for Mortgages by
the readers of the Mountain Xpress newspaper in Western North Carolina.
This news release, as well as other written communications
made from time to time by the Company and its
subsidiaries and oral communications made from time to time
by authorized officers of the Company, may contain
statements relating to the future results of the Company (including
certain projections, performance and growth targets
and business trends) that are considered "forward-looking
statements" as defined in the Private Securities
Litigation Reform Act of 1995, Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of
1934. Such forward-looking statements may be identified by the use
of such words as "believe," "expect," "anticipate,"
"should," "planned," "estimated," "intend" and "potential,"
and are subject to the protections of the safe harbors
created by such acts.
The Company cautions you that a number of important
factors could cause actual results to differ materially
from those currently anticipated in any forward-looking
statement. Such factors include, but are not limited
to: prevailing economic and geopolitical conditions; changes
in interest rates, loan demand, real estate values and
competition; changes in accounting principles, policies, and
guidelines; changes in any applicable law, rule,
regulation or practice with respect to tax or legal issues; and
other economic, competitive, governmental, regulatory
and technological factors affecting the Company's operations,
pricing, products and services and other factors
described in the Company's filings with the Securities and
Exchange Commission, including its Annual Reports on
Form 10-K and Quarterly Reports on Form 10-Q. The
forward-looking statements are made as of the date of this
release, and, except as may be required by applicable
law or regulation, the Company assumes no obligation to update the
forward-looking statements or to update the reasons
why actual results could differ from those projected in the
forward-looking statements.
Contact:
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Suzanne S. DeFerie
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Chief Executive Officer
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(828) 254-7411
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Selected Financial
Condition Data
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|
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|
|
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|
|
|
|
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|
|
|
|
|
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September
30,
|
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December
31,
|
|
|
(Dollars in
thousands)
|
|
2015
|
|
2014 (1)
|
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% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$ 797,856
|
|
$ 760,050
|
|
5.0%
|
Cash and cash
equivalents
|
|
55,765
|
|
56,858
|
|
-1.9%
|
Investment
securities
|
|
138,459
|
|
145,461
|
|
-4.8%
|
Loans receivable, net
of deferred fees
|
|
569,085
|
|
521,820
|
|
9.1%
|
Allowance for loan
losses
|
|
(6,297)
|
|
(5,949)
|
|
-5.8%
|
Deposits
|
|
635,083
|
|
603,379
|
|
5.3%
|
Core deposits
(2)
|
|
489,519
|
|
449,286
|
|
9.0%
|
FHLB
advances
|
|
50,000
|
|
50,000
|
|
0.0%
|
Accounts payable and
other liabilities
|
|
13,911
|
|
11,614
|
|
19.8%
|
Total
equity
|
|
98,736
|
|
94,397
|
|
4.6%
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(1) Derived
from audited consolidated financial statements.
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(2) Core deposits are
defined as total deposits excluding certificates of
deposit.
|
Selected Operating
Data
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|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
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(Dollars in
thousands,
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
except per share
data)
|
|
September
30,
|
|
September
30,
|
|
|
|
|
2015
|
|
2014
|
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% Change
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|
2015
|
|
2014
|
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% Change
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Interest
and
|
|
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|
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|
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dividend
income
|
|
$ 6,459
|
|
$ 5,873
|
|
10.0%
|
|
$ 18,902
|
|
$ 17,385
|
|
8.7%
|
Interest
expense
|
|
877
|
|
886
|
|
-1.0%
|
|
2,618
|
|
2,659
|
|
-1.5%
|
Net interest
income
|
|
5,582
|
|
4,987
|
|
11.9%
|
|
16,284
|
|
14,726
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|
10.6%
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Provision
for
|
|
|
|
|
|
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|
|
|
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(recovery of)
loan losses
|
|
191
|
|
240
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-20.4%
|
|
450
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|
(1,218)
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|
136.9%
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Net interest
income
|
|
|
|
|
|
|
|
|
|
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after
provision for
|
|
|
|
|
|
|
|
|
|
|
|
|
(recovery of)
loan losses
|
|
5,391
|
|
4,747
|
|
13.6%
|
|
15,834
|
|
15,944
|
|
-0.7%
|
Noninterest
income
|
|
2,084
|
|
1,642
|
|
26.9%
|
|
5,662
|
|
4,652
|
|
21.7%
|
Noninterest
expenses
|
|
5,837
|
|
5,624
|
|
3.8%
|
|
17,619
|
|
17,834
|
|
-1.2%
|
Income
before
|
|
|
|
|
|
|
|
|
|
|
|
|
income
tax
|
|
|
|
|
|
|
|
|
|
|
|
|
provision
|
|
1,638
|
|
765
|
|
114.1%
|
|
3,877
|
|
2,762
|
|
40.4%
|
Income tax
|
|
|
|
|
|
|
|
|
|
|
|
|
provision
|
|
496
|
|
263
|
|
88.6%
|
|
1,248
|
|
915
|
|
36.4%
|
Net income
|
|
$ 1,142
|
|
$ 502
|
|
127.5%
|
|
$ 2,629
|
|
$ 1,847
|
|
42.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
per
|
|
|
|
|
|
|
|
|
|
|
|
|
common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ 0.29
|
|
$ 0.13
|
|
123.1%
|
|
$ 0.67
|
|
$ 0.43
|
|
55.8%
|
Diluted
|
|
$ 0.28
|
|
$ 0.12
|
|
133.3%
|
|
$ 0.65
|
|
$ 0.43
|
|
51.2%
|
Average shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
3,947,445
|
|
3,940,229
|
|
0.2%
|
|
3,923,531
|
|
4,246,213
|
|
-7.6%
|
Diluted
|
|
4,079,029
|
|
4,018,945
|
|
1.5%
|
|
4,025,431
|
|
4,290,201
|
|
-6.2%
|
Ending shares
outstanding
|
4,405,266
|
|
4,378,411
|
|
0.6%
|
|
4,405,266
|
|
4,378,411
|
|
0.6%
|
Selected Average
Balances and Yields/Costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three Months
Ended September 30,
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Average
|
|
Yield/
|
|
Average
|
|
Yield/
|
(Dollars in
thousands)
|
|
Balance
|
|
Cost
|
|
Balance
|
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
receivable
|
|
$ 564,562
|
|
4.05%
|
|
$ 480,074
|
|
4.27%
|
Investment
securities, including tax-exempt (1)
|
|
138,923
|
|
2.19%
|
|
152,142
|
|
1.88%
|
Other
interest-earning assets
|
|
52,843
|
|
0.49%
|
|
78,551
|
|
0.39%
|
Total
interest-earning assets (1)
|
|
756,328
|
|
3.46%
|
|
710,767
|
|
3.33%
|
Interest-bearing
deposits
|
|
513,519
|
|
0.30%
|
|
501,698
|
|
0.31%
|
Federal Home Loan
Bank advances
|
|
50,000
|
|
3.93%
|
|
50,000
|
|
3.93%
|
Total
interest-bearing liabilities
|
|
563,678
|
|
0.62%
|
|
551,969
|
|
0.64%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread
(1)
|
|
|
|
2.84%
|
|
|
|
2.69%
|
Net interest margin
(1)
|
|
|
|
3.00%
|
|
|
|
2.84%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Nine Months
Ended September 30,
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Average
|
|
Yield/
|
|
Average
|
|
Yield/
|
(Dollars in
thousands)
|
|
Balance
|
|
Cost
|
|
Balance
|
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
receivable
|
|
$ 551,179
|
|
4.11%
|
|
$ 466,076
|
|
4.34%
|
Investment
securities, including tax-exempt (1)
|
|
136,537
|
|
2.05%
|
|
159,057
|
|
1.97%
|
Other
interest-earning assets
|
|
55,000
|
|
0.48%
|
|
80,110
|
|
0.42%
|
Total
interest-earning assets (1)
|
|
742,716
|
|
3.46%
|
|
705,243
|
|
3.36%
|
Interest-bearing
deposits
|
|
510,645
|
|
0.30%
|
|
500,979
|
|
0.32%
|
Federal Home Loan
Bank advances
|
|
50,000
|
|
3.93%
|
|
50,000
|
|
3.93%
|
Total
interest-bearing liabilities
|
|
561,230
|
|
0.62%
|
|
551,570
|
|
0.64%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate spread
(1)
|
|
|
|
2.84%
|
|
|
|
2.72%
|
Net interest margin
(1)
|
|
|
|
2.99%
|
|
|
|
2.85%
|
(1) Yields on
tax-exempt securities have been included on a tax-equivalent basis
using a 34% federal marginal tax rate.
|
Selected Asset
Quality Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
Nine Months
Ended
|
Allowance for Loan
Losses
|
|
September
30,
|
|
September
30,
|
(Dollars in
thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses, beginning of period
|
|
$ 6,124
|
|
$ 5,770
|
|
$ 5,949
|
|
$ 7,307
|
Provision for
(recovery of) loan losses
|
|
191
|
|
240
|
|
450
|
|
(1,218)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge-offs
|
|
(46)
|
|
(172)
|
|
(435)
|
|
(322)
|
Recoveries
|
|
28
|
|
14
|
|
333
|
|
85
|
Net
charge-offs
|
|
(18)
|
|
(158)
|
|
(102)
|
|
(237)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses, end of period
|
|
$ 6,297
|
|
$ 5,852
|
|
$ 6,297
|
|
$ 5,852
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan
losses as a percent of:
|
|
|
|
|
|
|
|
|
Total
loans
|
|
1.11%
|
|
1.20%
|
|
1.11%
|
|
1.20%
|
Total
nonperforming loans
|
|
223.69%
|
|
170.91%
|
|
223.69%
|
|
170.91%
|
Nonperforming
Assets
|
|
September
30,
|
|
December
31,
|
|
|
(Dollars in
thousands)
|
|
2015
|
|
2014
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming
loans:
|
|
|
|
|
|
|
Nonaccruing loans
(1)
|
|
|
|
|
|
|
Commercial:
|
|
|
|
|
|
|
Commercial
mortgage
|
|
$ 824
|
|
$ 881
|
|
-6.5%
|
Commercial and
industrial
|
|
245
|
|
221
|
|
10.9%
|
Total
commercial
|
|
1,069
|
|
1,102
|
|
-3.0%
|
Non-commercial:
|
|
|
|
|
|
|
Residential
mortgage
|
|
1,541
|
|
1,354
|
|
13.8%
|
Revolving
mortgage
|
|
204
|
|
230
|
|
-11.3%
|
Consumer
|
|
1
|
|
2
|
|
-50.0%
|
Total
non-commercial
|
|
1,746
|
|
1,586
|
|
10.1%
|
Total nonaccruing
loans (1)
|
2,815
|
|
2,688
|
|
4.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans past due
90 or more days
|
|
|
|
|
|
|
and still accruing
|
|
-
|
|
-
|
|
0.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total nonperforming
loans
|
|
2,815
|
|
2,688
|
|
4.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreclosed real
estate
|
|
8,871
|
|
8,814
|
|
0.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total nonperforming
assets
|
|
11,686
|
|
11,502
|
|
1.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performing troubled
debt restructurings (2)
|
|
4,730
|
|
4,804
|
|
-1.5%
|
Performing troubled
debt restructurings and
|
|
|
|
|
|
|
total
nonperforming assets
|
|
$ 16,416
|
|
$ 16,306
|
|
0.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming loans
as a percent of total loans
|
|
0.49%
|
|
0.52%
|
|
|
Nonperforming assets
as a percent of total assets
|
|
1.46%
|
|
1.51%
|
|
|
Performing troubled
debt restructurings and
|
|
|
|
|
|
|
total
nonperforming assets to total assets
|
|
2.06%
|
|
2.15%
|
|
|
(1) Nonaccruing loans
include nonaccruing troubled debt restructurings.
|
(2) Performing
troubled debt restructurings exclude nonaccruing troubled debt
restructurings.
|
|
|
Foreclosed Real
Estate by Loan Type
|
|
September 30,
2015
|
|
December 31,
2014
|
(Dollars in
thousands)
|
|
Number
|
|
Amount
|
|
Number
|
|
Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
construction and land development
|
|
7
|
|
$ 8,102
|
|
8
|
|
$ 8,706
|
Residential
mortgage
|
|
2
|
|
769
|
|
2
|
|
108
|
Total
|
|
9
|
|
$ 8,871
|
|
10
|
|
$ 8,814
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreclosed Real
Estate
|
|
|
Nine Months
Ended
|
|
|
|
(Dollars in
thousands)
|
|
|
September 30,
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning
balance
|
|
|
|
$ 8,814
|
|
|
|
|
Transfers from
loans
|
|
|
|
812
|
|
|
|
|
Loss
provisions
|
|
|
|
(6)
|
|
|
|
|
Loss on sale of
foreclosed properties
|
|
|
|
(1)
|
|
|
|
|
Net proceeds from
sales of foreclosed properties
|
|
|
|
(748)
|
|
|
|
|
Ending
balance
|
|
|
|
$ 8,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Average
Balances and Performance Ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
|
|
|
|
|
September
30,
|
|
September
30,
|
(Dollars in
thousands)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Average
Balances
|
|
|
|
|
|
|
|
|
Average total
loans
|
|
$ 564,562
|
|
$ 480,074
|
|
$ 551,179
|
|
$ 466,076
|
Average total
interest-earning assets
|
|
756,328
|
|
710,767
|
|
742,716
|
|
705,243
|
Average total
assets
|
|
792,225
|
|
747,794
|
|
778,555
|
|
745,015
|
Average total
interest-bearing deposits
|
|
513,519
|
|
501,698
|
|
510,645
|
|
500,979
|
Average total
deposits
|
|
630,733
|
|
591,883
|
|
617,479
|
|
584,905
|
Average total
interest-bearing liabilities
|
|
563,678
|
|
551,969
|
|
561,230
|
|
551,570
|
Average total
shareholders' equity
|
|
97,813
|
|
95,756
|
|
96,850
|
|
100,106
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected
Performance Ratios
|
|
|
|
|
|
|
|
|
Return on average
assets (1)
|
|
0.57%
|
|
0.27%
|
|
0.45%
|
|
0.33%
|
Return on average
equity (1)
|
|
4.63%
|
|
2.08%
|
|
3.63%
|
|
2.47%
|
Interest rate spread
(1) (2)
|
|
2.84%
|
|
2.69%
|
|
2.84%
|
|
2.72%
|
Net interest margin
(1) (3)
|
|
3.00%
|
|
2.84%
|
|
2.99%
|
|
2.85%
|
Noninterest expense
to average assets (1)
|
|
2.92%
|
|
2.98%
|
|
3.03%
|
|
3.20%
|
Efficiency ratio
(4)
|
|
74.81%
|
|
83.68%
|
|
79.09%
|
|
90.53%
|
(1) Ratios are
annualized.
|
|
|
|
|
|
|
|
|
(2) Represents the
difference between the weighted average yield on average
interest-earning assets and the
|
weighted average cost
of average interest-bearing liabilities. Yields on tax-exempt
securities have been
|
included on a
tax-equivalent basis using a 34% federal marginal tax
rate.
|
(3) Represents net
interest income as a percent of average interest-earning assets.
Yields on tax-exempt
|
securities have been
included on a tax-equivalent basis using a 34% federal marginal tax
rate.
|
(4) Represents
noninterest expenses divided by the sum of net interest income, on
a tax-equivalent basis
|
using a 34% federal
marginal tax rate, and noninterest income.
|
Quarterly Earnings
Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Month
Periods Ended
|
(Dollars in
thousands,
|
|
September
30,
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
|
September
30,
|
except per share
data)
|
|
2015
|
|
2015
|
|
2015
|
|
2014
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Statement
Data:
|
|
|
|
|
|
|
|
|
|
|
Interest and dividend
income
|
|
$ 6,459
|
|
$ 6,289
|
|
$ 6,154
|
|
$ 6,117
|
|
$ 5,873
|
Interest
expense
|
|
877
|
|
880
|
|
861
|
|
877
|
|
886
|
Net interest
income
|
|
5,582
|
|
5,409
|
|
5,293
|
|
5,240
|
|
4,987
|
Provision for loan
losses
|
|
191
|
|
65
|
|
194
|
|
220
|
|
240
|
Net interest income
after provision for
|
|
|
|
|
|
|
|
|
|
|
loan
losses
|
|
5,391
|
|
5,344
|
|
5,099
|
|
5,020
|
|
4,747
|
Noninterest
income
|
|
2,084
|
|
1,968
|
|
1,610
|
|
1,681
|
|
1,642
|
Noninterest
expenses
|
|
5,837
|
|
6,010
|
|
5,772
|
|
5,714
|
|
5,624
|
Income before
income
|
|
|
|
|
|
|
|
|
|
|
tax
provision
|
|
1,638
|
|
1,302
|
|
937
|
|
987
|
|
765
|
Income tax
provision
|
|
496
|
|
437
|
|
315
|
|
345
|
|
263
|
Net income
|
|
$ 1,142
|
|
$ 865
|
|
$ 622
|
|
$ 642
|
|
$ 502
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data Per Common
Share:
|
|
|
|
|
|
|
|
|
|
|
Net income per share
– Basic
|
|
$ 0.29
|
|
$ 0.22
|
|
$ 0.16
|
|
$ 0.17
|
|
$ 0.13
|
Net income per share
– Diluted
|
|
$ 0.28
|
|
$ 0.22
|
|
$ 0.16
|
|
$ 0.16
|
|
$ 0.12
|
Book value per
share
|
|
$ 22.41
|
|
$ 21.96
|
|
$ 21.93
|
|
$ 21.56
|
|
$ 21.53
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
3,947,445
|
|
3,923,199
|
|
3,899,419
|
|
3,867,296
|
|
3,940,229
|
Diluted
|
|
4,079,029
|
|
4,013,332
|
|
3,975,886
|
|
3,952,660
|
|
4,018,945
|
Ending shares
outstanding
|
|
4,405,266
|
|
4,378,411
|
|
4,378,411
|
|
4,378,411
|
|
4,378,411
|
Quarterly
Financial Condition Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Of
|
|
As
Of
|
|
As
Of
|
|
As
Of
|
|
As
Of
|
|
|
|
|
|
|
September
30,
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
|
September
30,
|
(Dollars in
thousands)
|
|
2015
|
|
2015
|
|
2015
|
|
2014 (1)
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Balance
Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$ 797,856
|
|
$ 783,299
|
|
$ 774,420
|
|
$ 760,050
|
|
$ 749,033
|
Cash and cash
equivalents
|
|
55,765
|
|
52,990
|
|
60,061
|
|
56,858
|
|
78,412
|
Investment
securities
|
|
138,459
|
|
138,712
|
|
133,118
|
|
145,461
|
|
149,530
|
Loans receivable, net
of deferred fees
|
|
569,085
|
|
552,999
|
|
541,706
|
|
521,820
|
|
487,904
|
Allowance for loan
losses
|
|
(6,297)
|
|
(6,124)
|
|
(6,042)
|
|
(5,949)
|
|
(5,852)
|
Deposits
|
|
635,083
|
|
623,963
|
|
612,287
|
|
603,379
|
|
594,798
|
Core deposits
(2)
|
|
489,519
|
|
473,674
|
|
458,465
|
|
449,286
|
|
433,983
|
FHLB
advances
|
|
50,000
|
|
50,000
|
|
50,000
|
|
50,000
|
|
50,000
|
Total
equity
|
|
98,736
|
|
96,163
|
|
96,008
|
|
94,397
|
|
94,285
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory Capital
Ratios(3):
|
|
|
|
|
|
|
|
|
|
|
Common equity tier 1
capital
|
|
18.33%
|
|
18.40%
|
|
18.42%
|
|
n/a
|
|
n/a
|
Tier 1 leverage
capital
|
|
13.09%
|
|
13.02%
|
|
13.16%
|
|
13.17%
|
|
13.17%
|
Tier 1 risk-based
capital
|
|
18.33%
|
|
18.40%
|
|
18.42%
|
|
19.83%
|
|
21.17%
|
Total risk-based
capital
|
|
19.44%
|
|
19.49%
|
|
19.53%
|
|
21.01%
|
|
22.42%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
Quality:
|
|
|
|
|
|
|
|
|
|
|
Nonperforming
loans
|
|
$ 2,815
|
|
$ 2,912
|
|
$ 3,059
|
|
$ 2,688
|
|
$ 3,424
|
Nonperforming
assets
|
|
11,686
|
|
12,293
|
|
12,442
|
|
11,502
|
|
12,593
|
Nonperforming loans
to total loans
|
|
0.49%
|
|
0.53%
|
|
0.56%
|
|
0.52%
|
|
0.70%
|
Nonperforming assets
to total assets
|
|
1.46%
|
|
1.57%
|
|
1.61%
|
|
1.51%
|
|
1.68%
|
Allowance for loan
losses
|
|
$ 6,297
|
|
$ 6,124
|
|
$ 6,042
|
|
$ 5,949
|
|
$ 5,852
|
Allowance for loan
losses to total loans
|
|
1.11%
|
|
1.11%
|
|
1.12%
|
|
1.14%
|
|
1.20%
|
Allowance for loan
losses to
|
|
|
|
|
|
|
|
|
|
|
nonperforming
loans
|
|
223.69%
|
|
210.30%
|
|
197.52%
|
|
221.32%
|
|
170.91%
|
(1) Derived
from audited consolidated financial statements.
|
(2) Core
deposits are defined as total deposits excluding certificates of
deposit.
|
(3) Regulatory
capital ratios are based on BASEL III capital standards for 2015
quarters and BASEL I capital
|
standards for
2014 quarters.
|
Comparison of
Actual Performance to Key Performance Indicator (KPI)
Targets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Key
|
|
2013
|
|
2014
|
|
2015
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
Performance
|
|
Full-
Year
|
|
Full
-Year
|
|
Nine-Month
|
|
Full-Year
|
|
Full-Year
|
|
Full-Year
|
|
Full-Year
|
Indicator
|
|
Actual
|
|
Actual
|
|
Actual
|
|
Target
|
|
Target
|
|
Target
|
|
Target
|
|
|
|
|
|
|
September
30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
growth
|
|
68.7%
|
|
71.2%
|
|
42.3%
|
|
40%-50%
|
|
60%-70%
|
|
25%-35%
|
|
15%-25%
|
Return on
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
average
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
equity
|
|
1.37%
|
|
2.51%
|
|
3.63%(1)
|
|
3.7%-4.2%
|
|
5.8%-6.5%
|
|
7.2%-8.0%
|
|
8.1%-9.0%
|
Return on
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
average
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
assets
|
|
0.19%
|
|
0.33%
|
|
0.45%(1)
|
|
0.4%-0.5%
|
|
0.6%-0.8%
|
|
0.8%-1.0%
|
|
1.0%-1.1%
|
Efficiency
(2)
|
93.16%
|
|
88.17%
|
|
79.09%
|
|
72%-82%
|
|
63%-73%
|
|
58%-68%
|
|
54%-64%
|
Net
interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
margin
(3)
|
|
2.72%
|
|
2.87%
|
|
2.99%(1)
|
|
2.9%-3.1%
|
|
3.1%-3.3%
|
|
3.4%-3.5%
|
|
3.5%-3.6%
|
Loan
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
growth
|
|
15.9%
|
|
16.2%
|
|
12.1%(1)
|
|
9%-13%
|
|
8%-12%
|
|
5%-9%
|
|
2%-7%
|
Asset
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
growth
|
|
-2.2%
|
|
3.7%
|
|
6.7%(1)
|
|
5%-9%
|
|
4%-8%
|
|
0%-4%
|
|
3%-7%
|
Deposit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
growth
|
|
-1.0%
|
|
5.3%
|
|
7.0%(1)
|
|
6%-10%
|
|
4%-8%
|
|
4%-8%
|
|
4%-8%
|
Core
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
deposit
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
growth
|
|
4.3%
|
|
10.7%
|
|
12.0%(1)
|
|
10%-14%
|
|
5%-9%
|
|
5%-9%
|
|
5%-9%
|
(1) Ratios are
annualized.
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Represents
noninterest expenses divided by the sum of net interest income, on
a tax-equivalent basis
|
using a 34%
federal marginal tax rate, and noninterest
income.
|
|
|
|
|
|
|
(3) Represents
net interest income as a percent of average interest-earning
assets. Yields on tax-exempt
|
securities have
been included on a tax-equivalent basis using a 34% federal
marginal tax rate.
|
|
|
(4) Core
deposits are defined as total deposits excluding certificates of
deposit.
|
|
|
|
|
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To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/asb-bancorp-inc-reports-financial-results-for-the-third-quarter-and-nine-months-ended-september-30-2015-300169008.html
SOURCE ASB Bancorp, Inc.