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8-K - FORM 8-K - MIDDLEFIELD BANC CORPd524663d8k.htm

Exhibit 99

 

LOGO

15985 East High Street

P. O. Box 35

Middlefield, Ohio 44062

Phone: 440/632-1666 FAX: 440/632-1700

www.middlefieldbank.com

 

PRESS RELEASE

 

Contact:  James R. Heslop, 2nd

                Executive Vice President/Chief Operating Officer

                (440) 632-1666 Ext. 3219

                jheslop@middlefieldbank.com

Middlefield Banc Corp. Reports First Quarter 2013 Net Income of $1.66 Million

MIDDLEFIELD, OHIO, April 23, 2013 ¿¿¿¿ Middlefield Banc Corp. (OTCQB: MBCN), reported net income of $1.66 million for the quarter ended March 31, 2013, compared to $1.52 million for the quarter ended March 31, 2012, an increase of 8.8%. On a per share basis, the Company’s diluted earnings were $0.82 for the 2013 first quarter, as compared to $0.86 for the comparable period of 2012.

Annualized returns on average equity (“ROE”) and average assets (“ROA”) for the 2013 quarter were 12.18% and 1.01%, respectively, compared with 12.81% and 0.94% for the first quarter of 2012.

“Our first quarter results continue the strong performance that we enjoyed in 2012. To be able to continue to post this level of success is even more remarkable given the economic and regulatory environment that continues to present a great challenge” stated Thomas G. Caldwell, President and Chief Executive Officer. “Our return on average assets of 1.01% and return on average equity of 12.18% reflect well on the effort put forth by our team.”

“As we move forward into 2013, we continue to believe that we are well positioned to address the threats of continued sluggish economy, historically low interest rates, and increased regulatory costs,” continued Caldwell. Our focus remains on delivering excellence in customer service, increasing value to our shareholders, and operating our company in accordance with safe and sound banking practices.”

Net Interest Income

For the first three months of 2013, net interest income increased $39,000, or 0.7% from the same period last year. While interest income experienced a decline of $218,000, or 3.0%, interest expense was $257,000, or 15.2%, lower in the 2013 quarter as compared to the same period of 2012. The net interest margin for the three months ended March 31, 2013 was 3.92%, compared to 3.89% for the same period of the prior year.


Noninterest Income and Operating Expenses

Noninterest income for the first quarter of 2013 was $898,000. This was a modest increase of 13.1% from the comparable period of 2012. The largest factor in the increase was the recognition of $185,000 due to gains on the sale of securities. A partial off-set was the gain recognized during the 2012 quarter of $85,000 from the sale of loans. Deposit service charges increased year-over-year, primarily due to increased debit card usage and a greater amount of overdraft fees.

Operating expense for the first quarter of 2013 totaled $4.0 million, an increase of $249,000, or 6.6% from the same period last year. Salaries and benefits, the company’s largest noninterest expense, contributed $121,000 to the increase. This increase is largely related to the growth of the company, including increased staffing levels in regulatory compliance. Higher data processing costs and equipment expense were directly related to the growth of the company since the first quarter of 2012. The increase in professional fees is, in part, attributable to the negotiation of a new data processing contract and increased regulatory compliance efforts, while the company also incurred increased expenses related to the maintenance of other real estate owned properties.

Balance Sheet

The company’s total assets as of March 31, 2013 stood at $667.0 million, an increase of 1.4% over the $657.9 million in total assets reported March 31, 2012. The March 31, 2013 total does reflect a decrease of 0.5% from the December 31, 2012 total. Net loans at March 31, 2013, were $399.3 million, up $2.3 million from the comparable 2012 quarter-end. Net loan totals were down 0.3% during the first three months of 2013. The investment portfolio, which is entirely classified as available for sale, stood at $190.7 million at March 31, 2013. This total reflects an increase of $6.9 million from the year-ago period and a decrease of $3.8 million from December 31, 2012. Total deposits at the end of the first quarter 2013 were $591.5 million. This represents an increase of $7.6 million from March 31, 2012 and a decrease of $1.8 million from year-end 2012.

Shareholders’ Equity and Dividends

At March 31, 2013, shareholders’ equity totaled $55.9 million, which was an increase of $7.4 million from the comparable 2012 quarter-end and $400,000 from December 31, 2012. Tangible book value per share as of March 31, 2013 was $25.35. During the first quarter of both 2013 and 2012, Middlefield paid cash dividends of $0.26 per share.

Asset Quality

For the three months ended March 31, 2013, management provided $313,000 to the allowance for loan losses, which compares to $600,000 for the same period of 2012. Net charge-offs for the 2013 first quarter were $360,000, or 0.09% of average loans. The allowance for loan losses at March 31, 2013 stood at $7.7 million, or 1.90% of total loans. At March 31, 2012, the allowance for loan losses was $7.3 million, representing 1.80% of total loans. Based on the evaluation of the adequacy of the allowance for loan losses, management believes that, at March 31, 2013, the allowance for loan losses was adequate and reflects probable losses in the loan portfolio.


     Asset Quality History  
     (dollars in thousands)  
     3/31/2013     12/31/2012     3/31/2012     12/31/2011     12/31/2010  

Nonperforming loans

   $ 13,899      $ 14,194      $ 17,677      $ 24,546      $ 19,986   

Real estate owned

     2,155        1,846        2,125        2,196        2,302   

Nonperforming assets

   $ 16,054      $ 16,040      $ 19,802      $ 26,742      $ 22,288   

Allowance for loan losses

   $ 7,732      $ 7,779      $ 7,267      $ 6,819      $ 6,221   

Ratios:

          

Nonperforming loans to total loans

     3.41     3.48     4.37     6.12     5.37

Nonperforming assets to total assets

     2.41     2.39     3.01     4.09     3.52

Allowance for loan losses to total loans

     1.90     1.90     1.80     1.70     1.67

Allowance for loan losses to nonperforming loans

     55.63     54.80     41.11     27.78     31.13

Middlefield Banc Corp. headquartered in Middlefield, Ohio is a multi-bank holding company with total assets of $667.0 million. The company’s lead bank, The Middlefield Banking Company, operates full service banking centers and an LPL Financial® brokerage office serving Chardon, Cortland, Garrettsville, Mantua, Middlefield, Newbury, and Orwell. The company also serves the central Ohio market through its Emerald Bank subsidiary, with offices in Dublin and Westerville, Ohio. Additional information is available at www.middlefieldbank.com and www.emeraldbank.com

This press release of Middlefield Banc Corp. and the reports Middlefield Banc Corp. files with the Securities and Exchange Commission often contain “forward-looking statements” relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets and products of Middlefield Banc Corp. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Middlefield Banc Corp.’s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce interest margins; (3) changes in prepayment speeds, charge-offs and loan loss provisions; (4) less favorable than expected general economic conditions; (5) legislative or regulatory changes that may adversely affect businesses in which Middlefield Banc Corp. is engaged; (6) technological issues which may adversely affect Middlefield Banc Corp.’s financial operations or customers; (7) changes in the securities markets; or (8) risk factors mentioned in the reports and registration statements Middlefield Banc Corp. files with the Securities and Exchange Commission. Middlefield Banc Corp. undertakes no obligation to release revisions to these forward-looking statements or to reflect events or circumstances after the date of this press release.


Middlefield Banc Corp.

Consolidated Selected Financial Highlights

March 31, 2013 and 2012 and December 31, 2012

 

     (unaudited)     (audited)     (unaudited)  

Balance Sheet (period end)

   March 31,     December 31,     March 31,  
(Dollar amounts in thousands)    2013     2012     2012  
      

ASSETS

      

Cash and due from banks

   $ 32,426      $ 33,568      $ 22,022   

Federal funds sold

     13,204        11,778        23,587   
  

 

 

   

 

 

   

 

 

 

Cash and cash equivalents

     45,630        45,346        45,609   

Investment securities available for sale

     190,687        194,472        183,770   

Loans

     407,054        408,433        404,269   

Less allowance for loan losses

     7,732        7,779        7,267   
  

 

 

   

 

 

   

 

 

 

Net loans

     399,322        400,654        397,002   

Premises and equipment

     8,694        8,670        8,368   

Goodwill

     4,559        4,559        4,559   

Core deposit intangible

     184        195        225   

Bank-owned life insurance

     8,604        8,536        8,326   

Accrued interest and other assets

     9,294        7,856        10,090   
  

 

 

   

 

 

   

 

 

 

Total Assets

   $ 666,974      $ 670,288      $ 657,949   
  

 

 

   

 

 

   

 

 

 

LIABILITIES

      

Noninterest-bearing demand

   $ 73,354      $ 75,912      $ 64,517   

Interest-bearing demand

     68,060        63,915        63,509   

Money market

     80,051        81,349        71,047   

Savings

     181,872        175,406        172,236   

Time

     188,160        196,753        212,633   
  

 

 

   

 

 

   

 

 

 

Total deposits

     591,497        593,335        583,942   

Short-term borrowings

     5,240        6,538        7,365   

Other borrowings

     12,779        12,970        16,561   

Other liabilities

     1,608        2,008        1,622   
  

 

 

   

 

 

   

 

 

 

Total Liabilities

     611,124        614,851        609,490   
  

 

 

   

 

 

   

 

 

 

STOCKHOLDERS’ EQUITY

      

Common stock

     34,697        34,295        31,420   

Retained earnings

     23,622        22,485        19,272   

Accumulated other comprehensive income

     4,265        5,391        4,501   

Treasury stock

     (6,734     (6,734     (6,734
  

 

 

   

 

 

   

 

 

 

Total Stockholders’ Equity

     55,850        55,437        48,459   
  

 

 

   

 

 

   

 

 

 

Total Liabilities and Stockholders’ Equity

   $ 666,974      $ 670,288      $ 657,949   
  

 

 

   

 

 

   

 

 

 


MIDDLEFIELD BANC CORP.

Consolidated Selected Financial Highlights

March 31, 2013 and 2012 (unaudited)

 

Income Statement

   For the Three Months Ended
March 31,
 
(Dollar amounts in thousands)    2013      2012  

INTEREST INCOME

     

Interest and fees on loans

   $ 5,572       $ 5,537   

Interest-bearing deposits in other institutions

     8         4   

Federal funds sold

     4         3   

Investment securities:

     

Taxable interest

     674         915   

Tax-exempt interest

     733         747   

Dividends on FHLB stock

     23         26   
  

 

 

    

 

 

 

Total interest income

     7,014         7,232   
  

 

 

    

 

 

 

INTEREST EXPENSE

     

Deposits

     1,297         1,497   

Short term borrowings

     52         59   

Other borrowings

     46         84   

Trust preferred securities

     34         46   
  

 

 

    

 

 

 

Total interest expense

     1,429         1,686   
  

 

 

    

 

 

 

NET INTEREST INCOME

     5,585         5,546   

Provision for loan losses

     313         600   
  

 

 

    

 

 

 

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES

     5,272         4,946   
  

 

 

    

 

 

 

NONINTEREST INCOME

     

Service charges on deposit accounts

     447         431   

Net securities gains

     185         —     

Earnings on bank-owned life insurance

     73         68   

Gain on sale of loans

     —           85   

Other income

     193         210   
  

 

 

    

 

 

 

Total noninterest income

     898         794   
  

 

 

    

 

 

 

NONINTEREST EXPENSE

     

Salaries and employee benefits

     1,871         1,750   

Occupancy expense

     274         248   

Equipment expense

     189         170   

Data processing costs

     213         199   

Ohio state franchise tax

     154         129   

Federal deposit insurance expense

     154         243   

Professional fees

     276         214   

(Gain) Loss on sale of other real estate owned

     8         18   

Advertising expense

     112         20   

Other real estate

     106         10   

Other expense

     674         781   
  

 

 

    

 

 

 

Total noninterest expense

     4,031         3,782   
  

 

 

    

 

 

 

Income before income taxes

     2,139         1,958   

Income taxes

     482         435   
  

 

 

    

 

 

 

NET INCOME

   $  1,657       $  1,523   
  

 

 

    

 

 

 


MIDDLEFIELD BANC CORP.

Consolidated Selected Financial Highlights

March 31, 2013 and 2012

(unaudited)

 

     For the Three Months Ended
March 31,
 
     2013     2012  

Per common share data

    

Net income per common share—basic

   $ 0.83      $ 0.86   

Net income per common share—diluted

   $ 0.82      $ 0.86   

Dividends declared

   $ 0.26      $ 0.26   

Book value per share (period end)

   $ 27.70      $ 27.35   

Tangible book value per share (period end)

   $ 25.35      $ 24.78   

Dividend payout ratio

     31.38     30.01

Average shares outstanding—basic

     1,999,612        1,763,982   

Average shares outstanding -diluted

     2,010,259        1,764,585   

Period ending shares outstanding

     2,016,284        1,771,687   

Selected ratios

    

Return on average assets

     1.01     0.94

Return on average equity

     12.18     12.81

Yield on earning assets

     4.86     4.99

Cost of interest bearing liabilities

     1.09     1.26

Net interest spread

     3.77     3.74

Net interest margin

     3.92     3.89

Efficiency (1)

     58.75     56.24

Equity to assets at period end

     8.37     7.37

 

(1) The efficiency ratio is calculated by dividing noninterest expense less amortization of intangibles by the sum of net interest income on a fully taxable equivalent basis plus non-interest income.


MIDDLEFIELD BANC CORP.

Consolidated Selected Financial Highlights

March 31, 2013 and 2012

(unaudited)

 

Asset quality data

   March 31,
2013
    March 31,
2012
 
(Dollar amounts in thousands)             

Non-accrual loans

   $ 9,730      $ 15,641   

Troubled debt restructuring

     3,808        926   

90 day past due and accruing

     361        1,110   
  

 

 

   

 

 

 

Nonperforming loans

     13,899        17,677   

Other real estate owned

     2,155        2,125   
  

 

 

   

 

 

 

Nonperforming assets

   $ 16,054      $ 19,802   
  

 

 

   

 

 

 

Allowance for loan losses

   $ 7,732      $ 7,267   

Allowance for loan losses/total loans

     1.90     1.80

Net charge-offs:

    

Quarter-to-date

   $ 360      $ 152   

Year-to-date

     360        152   

Net charge-offs to average loans

    

Quarter-to-date

     0.09     0.04

Year-to-date

     0.09     0.04

Nonperforming loans/total loans

     3.41     4.37

Allowance for loan losses/non-performing loans

     55.63     41.11

 

Loans

   March 31,
2013
     March 31,
2012
 
(Dollar amounts in thousands)              

Commercial and industrial

   $ 55,401       $ 60,924   

Real estate—construction

     22,817         21,444   

Real estate—mortgage

     

Residential

     199,063         207,735   

Commercial

     125,799         109,941   

Consumer installment

     3,974         4,225   
  

 

 

    

 

 

 

Total Loans

   $ 407,054       $ 404,269