Attached files
| file | filename |
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| 8-K - FORM 8-K - HomeTown Bankshares Corp | hmta20141029_8k.htm |
Exhibit 99.1
Friday, October 24, 2014
HomeTown Bankshares Corporation Reports Strong Operating Performance
YTD Earnings up 24% over 2013
• Continued Strong Operating Performance
| o | Net Income of $777,000 for the third quarter 2014 vs. $772,000 for 2013 | |
| o | EPS of $0.14 for the third quarter of 2014 up 56% over $.09 per share for the third quarter of 2013 (fully diluted) | |
|
o |
YTD Earnings of $2.41 million, up 24% from $1.94 million in 2013 | |
| o | Third quarter revenue of $4.7 million, up $395,000 over third quarter 2013 | |
| o | YTD revenue of $13.8 million, up $860,000 or 7% increase over 2013 |
| o | Noninterest Income for third quarter 2014 up 58% over prior year | |
|
o |
YTD Noninterest Income thru third quarter 2014 up 23% over prior year 2013 |
• Strong Loan and Deposit Growth
| o | Loans of $319 Million at September 30, 2014 |
• Up $21 million or 7% for the first three quarters of 2014, and
• Up $32 million or 11% since September 30, 2013
| o | Total Deposits of $351 Million at September 30, 2014 |
• Increased $11.7 million or 3% for the first three quarters of 2014
• Increased $26.1 million or 8% since September 30, 2013
• Credit Quality Remains Strong
| o | YTD net charge-offs of $401,000 remained low at .17% of average total loans and .11% of average total loans for 2013 | |
|
o |
Non-performing assets were 2.39% of total assets at September 30, 2014 vs. 2.39% at September 30, 2013 | |
| o |
Nonaccrual loans remained low at .41% of total loans at September 30, 2014 vs. .28% of total loans at September 30, 2013 | |
| o | Past due accruing loans decreased to historical lows of 0.12% of total loans at September 30, 2014 vs. 0.44% at September 30, 2013 |
• Well Capitalized with Solid Capital Ratios
| o | Total Risk-Based Capital amounted to 13.5% at September 30, 2014 | |
| o | Tier 1 Risk-Based Capital amounted to 12.4% at September 30, 2014 | |
| o | Tier 1 Leverage Ratio increased to 10.0% | |
|
o |
Return on Assets (ROA) of 0.78% for first nine months of 2014 vs. 0.68% for 2013 | |
| o | Return on Equity (ROE) of 7.81% for first nine months of 2014 vs. 6.28% for 2013 | |
| o | Efficiency Ratio of 69.09% for the first nine months vs. 69.16% for 2013 |
News Release
FOR IMMEDIATE RELEASE
For more information contact:
Susan K. Still, President and CEO, (540) 278-1705
Charles W. Maness, Jr., Executive Vice President & CPO, (540) 278-1702
HomeTown Bankshares Corporation Reports Strong
Operating Performance through the Third Quarter of 2014
Roanoke, VA (October 24, 2014) - HomeTown Bankshares Corporation, the parent company of HomeTown Bank, generated earnings of $777,000 for the third quarter ended September 30, 2014 contributing to a 24% increase in earnings for the first nine months of 2014 over the comparative period in 2013.
A net profit of $777,000 or $0.14 per diluted common share was realized for the third quarter of 2014 compared to a net profit of $772,000 or $0.09 per diluted common share for the third quarter of 2013. Net income for the first nine months of 2014, however, remained strong and grew 24% to $2.41 million or $0.44 per diluted common share vs. net income of $1.94 million or $0.33 per diluted common share earned during the first nine months of 2013.
Non-interest income increased 58% to $501,000 in the third quarter of 2014 and amounted to $1.34 million for the nine months ended September 30, 2014 vs. $318,000 and $1.09 million, respectively, during the same periods of 2013. The primary growth in non-interest income was from revenue generated from strong core checking account growth during 2014. Non-interest income also increased due to brokerage and a resurgence in mortgage lending during the third quarter and year-to-date.
"We are very pleased with the strong growth in our earnings for the first nine months of 2014, stated Susan Still, President and CEO. "Steady growth in the loan portfolio coupled with a significant increase in non-interest income and a strong interest margin contributed to the improvement in earnings." she continued.
Balance Sheet
Total assets grew to $417.9 million at September 30, 2014 from $402.4 million at December 31, 2013. Annualized loan growth was 9.6% for the first nine months of 2014, and increased 11.2% from $287.3 million over the twelve months since September 30, 2013. Total Deposits also grew during the same period from $339.8 million at December 31, 2013 to $351.5 million at September 30, 2014. Over the past twelve months, total deposits increased 8% with non-interest bearing deposits increasing 8.8% from $43.4 million at September 30, 2013 to $47.2 million at September 30, 2014.
The capital ratios improved from the increase in earnings and remained well above regulatory standards for well-capitalized banks through September 30, 2014.
Asset Quality
Loan quality remained strong during the first nine months of 2014 with nonperforming loans, excluding performing, restructured loans, of $1.3 million or 0.41% of total loans at September 30, 2014 vs. $801,000 or 0.28% of Total Loans at September 30, 2013. Nonperforming assets to total assets, excluding performing, restructured loans, amounted to 2.39% at September 30, 2014 and at September 30, 2013.
In addition, net charge-offs to average loans outstanding at September 30, 2014 were 0.12% for the quarter and 0.17% for the first nine months of 2014. The Company's Allowance for Loan Losses dropped to $3.52 million or 1.10% of Total Loans at September 30,2014 vs. $3.72 million and 1.25% of Total Loans at December 31, 2013, and $3.68 million and 1.28% of Total Loans at September 30, 2013.
"Asset quality has improved significantly as we have proactively dealt with troubled loans." stated Still. "Our continued focus will remain on prudently reducing the level of bank owned real estate over the next quarter and into 2015," she said.
HomeTown Bank offers a full range of banking services to small and medium-size businesses, real estate investors and developers, private investors, professionals and individuals. The Bank serves the Roanoke and New River Valleys and Smith Mountain Lake through six full-service branches and seven ATM's. A high level of responsive and professional service coupled with local decision-making is the hallmark of its banking strategy.
* * *
Forward-Looking Statements:
Certain statements in this press release may be "forward-looking statements." Forward looking statements are statements that include projections, predictions, expectations or beliefs about future events or results that are not statements of historical fact and that involve significant risks and uncertainties. Although the Company believes that its expectations with regard to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual results will not differ materially from any future results implied by the forward-looking statements. Actual results may be materially different from past or anticipated results because of many factors, some of which may include changes in economic conditions, the interest rate environment, legislative and regulatory requirements, new products, competition, changes in the stock and bond markets and technology. The Company does not update any forward-looking statements that it may make.
(See Attached Financial Statements for quarter ending September 30, 2014)
HomeTown Bankshares Corporation
Consolidated Condensed Balance Sheets
September 30, 2014, December 31, 2013 and September 30, 2013
| September 30, | December 31, | September 30, | ||||||||||
| In Thousands | 2014 | 2013 | 2013 | |||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Assets | ||||||||||||
|
Cash and due from banks |
$ | 14,051 | $ | 19,537 | $ | 14,464 | ||||||
|
Federal funds sold |
111 | 738 | 1,420 | |||||||||
|
Securities available for sale, at fair value |
56,662 | 57,922 | 59,609 | |||||||||
|
Restricted equity securities, at cost |
2,577 | 2,564 | 2,414 | |||||||||
|
Loans held for sale |
317 | |||||||||||
|
Total loans |
319,364 | 297,933 | 287,324 | |||||||||
|
Allowance for loan losses |
(3,522 | ) | (3,721 | ) | (3,684 | ) | ||||||
| Net loans | 315,842 | 294,212 | 283,640 | |||||||||
|
Property and equipment, net |
13,536 | 12,155 | 11,371 | |||||||||
|
Other real estate owned |
8,686 | 8,143 | 8,400 | |||||||||
|
Other assets |
6,131 | 7,166 | 3,734 | |||||||||
|
Total assets |
$ | 417,913 | $ | 402,437 | $ | 385,052 | ||||||
| Liabilities and Stockholders' Equity | ||||||||||||
| Deposits: | ||||||||||||
|
Noninterest-bearing |
$ | 47,179 | $ | 46,232 | $ | 43,363 | ||||||
|
Interest-bearing |
304,298 | 293,538 | 282,005 | |||||||||
|
Total deposits |
351,477 | 339,770 | 325,368 | |||||||||
|
Short term borrowings |
469 | 258 | 522 | |||||||||
|
Federal Home Loan Bank borrowings |
22,250 | 22,000 | 19,000 | |||||||||
|
Other liabilities |
1,469 | 871 | 924 | |||||||||
| Total liabilities | 375,665 | 362,899 | 345,814 | |||||||||
|
Stockholders' Equity: |
||||||||||||
|
Preferred stock |
13,293 | 13,293 | 13,300 | |||||||||
|
Common stock |
16,438 | 16,351 | 16,351 | |||||||||
|
Surplus |
15,293 | 15,339 | 15,330 | |||||||||
|
Retained deficit |
(3,063 | ) | (4,846 | ) | (5,427 | ) | ||||||
|
Accumulated other comprehensive income (loss) |
287 | (599 | ) | (316 | ) | |||||||
|
Total stockholders' equity |
42,248 | 39,538 | 39,238 | |||||||||
|
Total liabilities and stockholders' equity |
$ | 417,913 | $ | 402,437 | $ | 385,052 | ||||||
HomeTown Bankshares Corporation
Consolidated Condensed Statements of Income
For the Three Months and Nine Months Ended September 30, 2014 and 2013
|
For the Three Months Ended September 30, |
For the Nine Months Ended September 30, |
|||||||||||||||
| In Thousands, Except Share and Per Share Data | 2014 | 2013 | 2014 | 2013 | ||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
|
Interest income: |
||||||||||||||||
|
Loans and fees on loans |
$ | 3,845 | $ | 3,637 | $ | 11,314 | $ | 10,687 | ||||||||
|
Taxable investment securities |
240 | 288 | 770 | 979 | ||||||||||||
|
Nontaxable investment securities |
106 | 58 | 293 | 121 | ||||||||||||
|
Other interest income |
41 | 37 | 124 | 106 | ||||||||||||
|
Total interest income |
4,232 | 4,020 | 12,501 | 11,893 | ||||||||||||
|
Interest expense: |
||||||||||||||||
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Deposits |
426 | 459 | 1,308 | 1,402 | ||||||||||||
|
Other borrowed funds |
94 | 94 | 286 | 281 | ||||||||||||
|
Total interest expense |
520 | 553 | 1,594 | 1,683 | ||||||||||||
|
Net interest income |
3,712 | 3,467 | 10,907 | 10,210 | ||||||||||||
|
Provision for loan losses |
202 | 125 | ||||||||||||||
| Net interest income after provision for loan losses | 3,712 | 3,467 | 10,705 | 10,085 | ||||||||||||
|
Noninterest income: |
||||||||||||||||
|
Service charges on deposit accounts |
118 | 77 | 326 | 227 | ||||||||||||
|
ATM and interchange income |
113 | 84 | 316 | 245 | ||||||||||||
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Mortgage loan brokerage fees |
102 | 62 | 149 | 225 | ||||||||||||
|
Gains on sales of investment securities |
8 | 108 | 116 | |||||||||||||
|
Other income |
168 | 87 | 441 | 275 | ||||||||||||
|
Total noninterest income |
501 | 318 | 1,340 | 1,088 | ||||||||||||
|
Noninterest expense: |
||||||||||||||||
|
Salaries and employee benefits |
1,510 | 1,355 | 4,303 | 4,072 | ||||||||||||
|
Occupancy and equipment expense |
398 | 331 | 1,128 | 972 | ||||||||||||
|
Advertising and marketing expense |
196 | 99 | 431 | 364 | ||||||||||||
|
Professional fees |
245 | 88 | 432 | 385 | ||||||||||||
|
(Gains), losses on sales, writedowns of other real estate owned, net |
(5 | ) | 351 | |||||||||||||
|
Other real estate owned expense |
50 | 91 | 173 | 192 | ||||||||||||
|
Other expense |
693 | 673 | 2,084 | 1,940 | ||||||||||||
|
Total noninterest expense |
3,092 | 2,637 | 8,546 | 8,276 | ||||||||||||
|
Net income before income taxes |
1,121 | 1,148 | 3,499 | 2,897 | ||||||||||||
|
Income tax expense |
344 | 376 | 1,086 | 958 | ||||||||||||
|
Net income |
777 | 772 | 2,413 | 1,939 | ||||||||||||
|
Effective dividends on preferred stock |
210 | 372 | 630 | 639 | ||||||||||||
|
Accretion of discount on preferred stock |
102 | 142 | ||||||||||||||
|
Net income available to common stockholders |
$ | 567 | $ | 298 | $ | 1,783 | $ | 1,158 | ||||||||
|
Basic earnings per common share |
$ | 0.17 | $ | 0.09 | $ | 0.54 | $ | 0.35 | ||||||||
|
Diluted earnings per common share |
$ | 0.14 | $ | 0.09 | $ | 0.44 | $ | 0.33 | ||||||||
|
Weighted average common shares outstanding |
3,287,567 | 3,270,299 | 3,283,962 | 3,268,646 | ||||||||||||
|
Diluted average common shares outstanding |
5,527,567 | 5,510,299 | 5,523,962 | 4,048,133 | ||||||||||||
HomeTown Bankshares Corporation
Financial Highlights
(Unaudited)
|
Three Months Ended Sept 30 |
Three Months Ended Sept 30 |
Nine Months Ended Sept30 |
Nine Months Ended Sept 30 |
|||||||||||||
|
2014 |
2013 |
2014 |
2013 |
|||||||||||||
| PER SHARE INFORMATION | ||||||||||||||||
|
Book value |
$ | 8.81 | $ | 7.93 | $ | 8.81 | $ | 7.93 | ||||||||
|
Earnings per share, basic |
$ | 0.17 | $ | 0.09 | $ | 0.54 | $ | 0.35 | ||||||||
|
Earnings per share, diluted |
$ | 0.14 | $ | 0.09 | $ | 0.44 | $ | 0.33 | ||||||||
| PROFITABILITY | ||||||||||||||||
|
Return on average assets |
0.73 | % | 0.78 | % | 0.78 | % | 0.68 | % | ||||||||
|
Return on average shareholders' equity |
7.33 | % | 6.27 | % | 7.81 | % | 6.28 | % | ||||||||
|
Net interest margin |
3.88 | % | 3.91 | % | 3.89 | % | 3.91 | % | ||||||||
|
Efficiency |
72.20 | % | 67.38 | % | 69.09 | % | 69.16 | % | ||||||||
| BALANCE SHEET RATIOS | ||||||||||||||||
|
Total loans to deposits |
90.86 | % | 88.31 | % | 90.86 | % | 88.31 | % | ||||||||
|
Securities to total assets |
14.18 | % | 16.11 | % | 14.18 | % | 16.11 | % | ||||||||
|
Tier I leverage ratio |
10.0 | % | 10.1 | % | 10.0 | % | 10.1 | % | ||||||||
| ASSET QUALITY | ||||||||||||||||
|
Nonperforming assets to total assets |
2.39 | % | 2.39 | % | 2.39 | % | 2.39 | % | ||||||||
|
Nonperforming assets, including restructured loans, to total assets |
3.86 | % | 4.03 | % | 3.86 | % | 4.03 | % | ||||||||
|
Net charge-offs to average loans (annualized) |
0.12 | % | (0.03 | )% | 0.17 | % | 0.11 | % | ||||||||
| Composition of risk assets: (in thousands) | ||||||||||||||||
|
Nonperforming assets: |
||||||||||||||||
|
Nonaccrual loans |
$ | 1,298 | $ | 801 | $ | 1,298 | $ | 801 | ||||||||
|
Other real estate owned |
8,686 | 8,400 | 8,686 | 8,400 | ||||||||||||
|
Total nonperforming assets, excluding performing restructured loans |
$ | 9,984 | $ | 9,201 | $ | 9,984 | $ | 9,201 | ||||||||
|
Restructured loans, performing in accordance with their modified terms |
6,132 | 6,309 | 6,132 | 6,309 | ||||||||||||
|
Total nonperforming assets, including performing restructured loans |
$ | 16,116 | $ | 15,510 | $ | 16,116 | $ | 15,510 | ||||||||
| Allowance for loan losses: (in thousands) | ||||||||||||||||
|
Beginning balance |
$ | 3,616 | $ | 3,660 | $ | 3,721 | $ | 3,790 | ||||||||
|
Provision for loan losses |
202 | 125 | ||||||||||||||
|
Charge-offs |
(103 | ) | (1 | ) | (445 | ) | (564 | ) | ||||||||
|
Recoveries |
9 | 25 | 44 | 333 | ||||||||||||
|
Ending balance |
$ | 3,522 | $ | 3,684 | $ | 3,522 | $ | 3,684 | ||||||||
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