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8-K - 8-K CURRENT REPORT - C1 Financial, Inc. | v399765_8k.htm |
Exhibit 99.1
C1 Financial Reports 2014 Fourth Quarter Results
St. Petersburg, FL, January 28, 2015 - C1 Financial, Inc. (NYSE:BNK) today reported net income of $1.3 million, or $0.08 per diluted common share for the fourth quarter of 2014 (“4Q14”), compared to $2.6 million, or $0.18 per diluted common share for the third quarter of 2014 (“3Q14”). On a non-GAAP basis, operating net income, which excludes real estate-related valuation allowances incurred in relation to the FDIC-assisted acquisition of First Community Bank of Southwest Florida in 2013, was $2.8 million, or $0.17 per diluted common share for 4Q14. Please refer to the last table in this release for the explanation of non-GAAP financial measures.
MESSAGE FROM PRESIDENT & CHIEF EXECUTIVE OFFICER
Trevor Burgess, President & Chief Executive Officer of C1 Financial, Inc. stated, “We originated $489 million in new loans in 2014, which allowed for C1 Bank’s originated loans outstanding to grow by nearly 37% in 2014. As a percentage of overall loans, C1 Bank’s originated loans grew to 71%, up from 58%, at the end of 2013. We are excited by the robust pipeline of new clients as we enter 2015.”
4Q14 showed seven positive trends in our operating figures:
1. | We originated $139 million in new loan relationships in the quarter resulting in 37% year-to-date growth in C1 Bank originated loans outstanding. C1 Bank originated loans outstanding grew by $83 million in the quarter and $226 million in the year. Overall loans outstanding ended the year at $1.189 billion (up 4.8% from the prior quarter and up 12.9% from the end of 2013 as our acquired bank loans rolled off); |
2. | Unfunded commitments ended the year at $189 million, up $8 million (+4.3%) during the quarter and present a clear opportunity for near-term loan funding; |
3. | The quarter saw $26 million growth in core deposits bringing 2014 core deposit growth to $159 million. Core deposits reached 73.2% of total deposits at the end of 2014 compared to 66.8% at the end of 2013. Noninterest-bearing deposits represented 23.9% of total deposits at the end of 2014, up from 18.7% at the end of 2013. Cost of deposits fell 2 basis points (“bps”) to 50 bps compared to 3Q14 and fell 4 bps compared to 4Q13; |
4. | Adjusted net interest margin (a non-GAAP measure which excludes the impact of purchase accounting) improved by 2 bps (from 4.03% to 4.05%). Strong loan funding took place late in the quarter, resulting in the modest improvement to adjusted net interest margin. We ended the year with excess cash of $51 million and had an average excess cash balance of $127 million during 4Q14; |
5. | Net interest income was up $0.9 million compared to 3Q14, driven mainly by an increase in loan interest income, and helped by improvement in the deposit mix; |
6. | In December 2014, we purchased $35 million in bank-owned life insurance (“BOLI”), which allowed for deployment of excess cash and which will enhance noninterest income once fully invested; |
7. | C1 Bank originated nonperforming assets accounted for less than 1% of our total nonperforming assets (with C1 Bank originated nonperforming loans below 0.1% of C1 Bank loans outstanding). Our Texas Ratio ended at 29.3%, down from 52.5% at the end of 2013. |
ASSETS
Total assets at the end of 2014 were $1.537 billion, slightly lower (-0.7%) than at the end of 3Q14, impacted by the repayment of $10.5 million in Federal Home Loan Bank (“FHLB”) advances and $3.0 million in subordinated debt. Total assets were $1.323 billion at the end of 2013.
LOANS
Total loans at the end of 2014 were $1.189 billion, up $54.2 million (+4.8%) from the end of 3Q14 and up $135.5 million (+12.9%) from the end of 2013. Loan growth in 4Q14 was mainly driven by strong loan originations of $139.0 million and funding of unfunded commitments, partially offset by selling small business administration (“SBA”) loans in the secondary market and by loans rolling off in the acquired portfolio, which decreased $28.6 million from $376.8 million to $348.2 million, or 7.6%, during 4Q14. The outstanding balance of C1 Bank originated loans grew $82.7 million, up 10.9% when compared to 3Q14. At the end of 2014, C1 Bank originated loans represented 71% of the loan portfolio, up from 67% at the end of 3Q14 and 58% at the end of 2013.
DEPOSITS
Total deposits at the end of 2014 were $1.168 billion, slightly higher (+0.2%) than at the end of 3Q14. Total deposits were $1.041 billion at the end of 2013. We continued our focus on improving deposit mix while we hold excess cash. The shift in the deposit mix provided for a 2 bps decline in the cost of deposits to 0.50% in 4Q14 from 0.52% in 3Q14, continuing to trend down from 0.54% in 4Q13.
ASSET QUALITY
Nonperforming assets totaled $55.8 million at the end of 2014, declining $2.8 million (-4.7%) compared to 3Q14 and down $9.0 million (-13.9%) from the end of 2013. The decline in 4Q14 was driven by a reduction of $3.0 million in other real estate owned (“OREO”) balances primarily from non-cash valuation allowance expense. This expense totaled $2.7 million, of which $2.1 million related to OREO acquired in the First Community Bank of Southwest Florida transaction, which took place in August 2013. The remaining reduction in OREO was due to OREO valuation allowance expense on previously acquired banks’ OREO ($0.6 million) and to the continued sale of properties. In 2014, we sold 60 properties and had approximately 90 remaining to sell at year end, with close to 30 loans remaining under foreclosure. As a percentage of total assets, nonperforming assets decreased to 3.63% at the end of 2014 compared to 3.78% at the end of 3Q14 and 4.90% at the end of 2013, and our Texas Ratio improved to 29.3% at the end of 2014 from 30.9% at the end of 3Q14 and 52.5% at the end of 2013. At the end of 2014, only $487 thousand, or less than 1.0% of total nonperforming assets, were related to loans originated by C1 Bank.
We had net charge-offs of $116 thousand in 4Q14 (0.04% of total average loans on an annualized basis), primarily related to charge-offs of classified acquired loans, which had been reserved for in previous periods. Total charge-offs of $552 thousand for 4Q14 included a $117 thousand charge-off related to a collateral-dependent purchased credit impaired loan from First Community Bank of Southwest Florida (based on a new appraisal). Strong recoveries of $436 thousand in 4Q14 allowed funding of the allowance for loan losses on net loan growth, resulting in a nominal reversal of provision for loan losses for 4Q14.
Our allowance for loan losses at the end of 2014 was $5.3 million (representing 0.45% of total loans), compared to $5.4 million (representing 0.48% of total loans) at the end of 3Q14 and $3.4 million (representing 0.32% of total loans) at the end of 2013. The reduction in 4Q14 compared to the previous quarter was mainly driven by the charge-offs of classified acquired loans which were previously reserved for. During 2014, our general reserves (per Accounting Standards Codification Topic 450) grew by $2.1 million, or 83%, from $2.6 million at the end of 2013 to $4.7 million at the end of 2014, and represented 89% of our total allowance for loan losses. This 83% growth compares to loan growth of 14% for loans covered by this reserve. On a non-GAAP basis (including remaining loan discount from acquired performing loans), the allowance plus discount amount totaled $8.9 million (representing 0.75% of total loans) at the end of 2014, compared to $8.2 million (representing 0.78% of total loans) at the end of 2013.
NET INTEREST INCOME AND MARGIN
Net interest income for 4Q14 totaled $14.9 million, up $0.9 million (+6.4%) from 3Q14, as we continue to grow our average loans balance.
Net interest margin for 4Q14 increased 6 bps to 4.24% from 4.18% in 3Q14, mainly driven by a 5 bps higher yield on loans (primarily due to higher accretion on acquired loans as a result of prepayments and despite the fact that loan funding took place late in the quarter) and an improvement in deposit mix. Adjusted net interest margin (which excludes the effect of purchase accounting) for 4Q14 was 4.05%, or 2 bps higher from 4.03% in 3Q14.
Our excess cash at the end of 2014 was $51.0 million, substantially lower than the $128.0 million at the end of 3Q14. However, our average excess cash (defined as our average available cash above our target liquidity level – See explanation of non-GAAP financial measures), was $127.1 million for 4Q14 as we increased loan balances and funded the $35 million in BOLI late in 4Q14. Our excess cash continues to present an opportunity for future net interest margin expansion as we deploy these balances into loans.
NONINTEREST INCOME
Noninterest income for 4Q14 totaled $1.6 million, down $0.2 million (-13.5%) from 3Q14, primarily due to a $566 thousand decrease in gain on sale of SBA loans (due to a longer funding period of originated SBA loans as well as the overall volatility of SBA sales) partially offset by a $261 thousand increase in gains on sales of OREO ($329 thousand in 4Q14 compared to $68 thousand in 3Q14) and a $56 thousand increase in service charges and fees ($582 thousand in 4Q14 compared to $526 thousand in 3Q14).
NONINTEREST EXPENSE & TAXES
Noninterest expense totaled $14.0 million in 4Q14, up $2.7 million (+24.2%) from 3Q14, primarily due to a $2.7 million increase in OREO valuation allowance expense. As the FDIC-assisted acquisition of First Community Bank of Southwest Florida took place just over one year ago, management elected to re-appraise many properties despite improving market conditions, to ensure that they continued to be held at fair value at year-end 2014.
Our income tax expense for 4Q14 was $1.1 million compared to $1.7 million in 3Q14. Included in income tax expense for 4Q14 was a $77 thousand prior period adjustment relating to 2012. The effective tax rate for the year 2014 was unusually high at 40.9%, mainly due to our nondeductible expenses representing a larger share of pre-tax income (as a result of the one-time charge-off of our only Shared National Credit in 2Q14 and OREO valuation allowances in 4Q14, which lowered our pre-tax income), combined with the prior period adjustment mentioned above.
EFFICIENCY
Our efficiency ratio was 85.0% in 4Q14, compared with 71.3% in 3Q14, mainly as a result of $2.7 million valuation allowances on previously acquired banks’ OREO. Our operating efficiency ratio, which excludes $2.1 million of OREO valuation allowance expense related to the acquisition of First Community Bank of Southwest Florida in 2013, was 72.1% for 4Q14. We also track closely average assets per employee and annualized revenue per employee, as measures of efficiency. Average assets per employee were $6.4 million in 4Q14 compared to $5.8 million in 4Q13, which reflected our continued growth in the balance sheet, while annualized revenue per employee was $307 thousand in 4Q14 compared to $328 thousand in 4Q13, as growth in revenue was offset by a higher number of average employees as we expanded our branch network.
NET INCOME AND OPERATING INCOME
Net income was $1.3 million for 4Q14 compared to $2.6 million for 3Q14. This corresponded to a return on average assets of 0.34% and 0.70% for 4Q14 and 3Q14, respectively, and a return on average equity of 2.84% and 6.47% for 4Q14 and 3Q14, respectively. Operating net income was $2.8 million for 4Q14, corresponding to an operating return on average assets of 0.72% and an operating return on average equity of 5.96%.
CAPITAL
Our consolidated Tier 1 leverage ratio was 11.95% and total risk-based capital ratio was 14.74% as of the end of 2014, compared to 12.32% and 15.45%, respectively, at the end of 3Q14. Additional capital ratios are presented in the financial tables.
PERSONNEL & OTHER MATTERS
In 1Q15, we plan to close the Franklin Street branch in Tampa, which will be consolidated with the Hyde Park branch (located approximately 1 mile away). We expect to continue to serve our Tampa clients while lowering noninterest expense.
OTHER EXCITING EVENTS DURING 4Q14
C1 Bank was listed as the sixth fastest-growing bank in the U.S. in a report issued by SNL Financial. As of June 30, 2014, C1 Bank posted a 472.3% asset growth over the prior 5 years.
In December 2014, the American Banker magazine named our President & CEO, Trevor Burgess, the Community Banker of the year.
On November 17th, C1 Bank opened a temporary branch in Miami Beach (the permanent branch is scheduled to open in late 2015), its 30th banking center and third in Miami-Dade County.
WEBCAST AND CONFERENCE CALL INFORMATION
C1 Financial, Inc. will host a webcast and conference call at 8:00 a.m. (ET) on January 29, 2015 to discuss fourth quarter 2014 results and other matters. To access the conference call, please dial 1-855-209-8212. The live webcast audio can be heard at http://www.videonewswire.com/event.asp?id=101453. For those unable to participate in the webcast, it will be archived on C1 Financial’s website at www.c1bank.com/ir.
C1 Financial, Inc. Information
Our name expresses our ideals to put our Clients 1st and our Community 1st. We are focused on serving the needs of entrepreneurs, tailoring a wide range of relationship banking services to entrepreneurs and their families, including commercial loans and a full line of depository products. We are based in St. Petersburg, Florida and operate from 30 banking centers and one loan production office on the West Coast of Florida and in Miami-Dade and Orange Counties. Now the 18th largest bank headquartered in the state of Florida by assets and the 16th largest by equity, having grown both organically and through acquisitions, we are the sixth fastest-growing bank in the country as measured by asset growth. Additional information is available at www.c1bank.com.
Forward-Looking Statements
In addition to historical information, this earnings release contains forward-looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from management’s expectations. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or “may,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business. There are a number of potential factors, risks and uncertainties that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. These potential factors, risks and uncertainties are discussed in our Prospectus filed with the Securities and Exchange Commission on August 15, 2014.
Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, we do not assume responsibility for the accuracy and completeness of any of these forward-looking statements. We are under no duty to update any of these forward-looking statements after the date of this earnings release to conform our prior statements to actual results or revised expectations.
For further information contact: Trevor Burgess, President & Chief Executive Officer, 727-456-5808
Website: www.c1bank.com
C1 Financial, Inc.
Consolidated Balance Sheets - Unaudited
(Dollars in thousands, except per share data)
December 31, | September 30, | December 31, | ||||||||||
2014 | 2014 | 2013 (1) | ||||||||||
ASSETS | ||||||||||||
Cash and cash equivalents | $ | 185,703 | $ | 283,741 | $ | 143,452 | ||||||
Federal Home Loan Bank stock, at cost | 9,224 | 9,696 | 8,210 | |||||||||
Loans receivable, net | 1,179,056 | 1,125,151 | 1,046,737 | |||||||||
Premises and equipment, net | 64,075 | 63,592 | 57,284 | |||||||||
Other real estate owned, net | 34,916 | 37,956 | 41,049 | |||||||||
Bank-owned life insurance | 43,907 | 8,867 | 8,748 | |||||||||
Accrued interest receivable | 3,490 | 3,131 | 3,013 | |||||||||
Core deposit intangible | 987 | 1,074 | 1,485 | |||||||||
Prepaid expenses | 5,243 | 5,961 | 2,071 | |||||||||
Other assets | 9,982 | 8,876 | 11,322 | |||||||||
Total assets | $ | 1,536,583 | $ | 1,548,045 | $ | 1,323,371 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||
Deposits | ||||||||||||
Noninterest bearing | $ | 278,543 | $ | 294,144 | $ | 194,383 | ||||||
Interest bearing | 888,959 | 870,820 | 846,660 | |||||||||
Total deposits | 1,167,502 | 1,164,964 | 1,041,043 | |||||||||
Federal Home Loan Bank advances | 178,500 | 189,000 | 150,500 | |||||||||
Other borrowings | - | 3,000 | 3,000 | |||||||||
Other liabilities | 3,943 | 5,785 | 7,014 | |||||||||
Total liabilities | 1,349,945 | 1,362,749 | 1,201,557 | |||||||||
Stockholders’ equity | ||||||||||||
Common stock, par value $1.00; 100,000,000 shares authorized | 16,101 | 16,101 | 12,217 | |||||||||
Additional paid-in capital | 148,122 | 148,122 | 93,906 | |||||||||
Retained earnings | 22,415 | 21,073 | 15,691 | |||||||||
Accumulated other comprehensive income | - | - | - | |||||||||
Total stockholders’ equity | 186,638 | 185,296 | 121,814 | |||||||||
Total liabilities and stockholders’ equity | $ | 1,536,583 | $ | 1,548,045 | $ | 1,323,371 | ||||||
Period-end shares outstanding | 16,100,966 | 16,100,966 | 12,216,932 | |||||||||
Book value per share | $ | 11.59 | $ | 11.51 | $ | 9.97 |
(1) Share and per share amounts have been restated to reflect the 7-for-1 reverse stock split completed on August 13, 2014.
C1 Financial, Inc.
Consolidated Income Statements - Unaudited
(Dollars in thousands, except per share data)
For the Three Months Ended | For the Twelve Months Ended | |||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
2014 | 2014 | 2013 (1) | 2014 | 2013 (1) | ||||||||||||||||
Interest income | ||||||||||||||||||||
Loans, including fees | $ | 16,870 | $ | 16,028 | $ | 15,408 | $ | 63,351 | $ | 47,362 | ||||||||||
Securities | 3 | 2 | 30 | 62 | 705 | |||||||||||||||
Federal funds sold and other | 285 | 215 | 137 | 897 | 432 | |||||||||||||||
Total interest income | 17,158 | 16,245 | 15,575 | 64,310 | 48,499 | |||||||||||||||
Interest expense | ||||||||||||||||||||
Savings and interest-bearing demand deposits | 582 | 546 | 525 | 2,154 | 1,889 | |||||||||||||||
Time deposits | 890 | 953 | 855 | 3,809 | 2,948 | |||||||||||||||
Federal Home Loan Bank advances | 755 | 709 | 504 | 2,607 | 1,753 | |||||||||||||||
Other borrowings | 12 | 15 | 15 | 56 | 60 | |||||||||||||||
Total interest expense | 2,239 | 2,223 | 1,899 | 8,626 | 6,650 | |||||||||||||||
Net interest income | 14,919 | 14,022 | 13,676 | 55,684 | 41,849 | |||||||||||||||
Provision (reversal of provision) for loan losses | (1 | ) | 207 | 1,371 | 4,814 | 1,218 | ||||||||||||||
Net interest income after provision for loan losses | 14,920 | 13,815 | 12,305 | 50,870 | 40,631 | |||||||||||||||
Noninterest income | ||||||||||||||||||||
Gain on sale of securities | - | - | - | 241 | 305 | |||||||||||||||
Gain on sale of loans | 209 | 775 | 483 | 2,532 | 1,169 | |||||||||||||||
Service charges and fees | 582 | 526 | 622 | 2,240 | 1,898 | |||||||||||||||
Bargain purchase gain | - | 37 | 893 | 48 | 13,462 | |||||||||||||||
Gain on sale of other real estate owned, net | 329 | 68 | 152 | 1,049 | 686 | |||||||||||||||
Bank-owned life insurance | 42 | 41 | 39 | 160 | 173 | |||||||||||||||
Mortgage banking fees | - | - | 84 | 47 | 590 | |||||||||||||||
Other noninterest income | 392 | 350 | 522 | 1,421 | 3,365 | |||||||||||||||
Total noninterest income | 1,554 | 1,797 | 2,795 | 7,738 | 21,648 | |||||||||||||||
Noninterest expense | ||||||||||||||||||||
Salaries and employee benefits | 4,834 | 4,777 | 4,527 | 18,360 | 17,015 | |||||||||||||||
Occupancy expense | 1,195 | 1,138 | 1,085 | 4,505 | 3,630 | |||||||||||||||
Furniture and equipment | 712 | 673 | 533 | 2,666 | 1,841 | |||||||||||||||
Regulatory assessments | 400 | 362 | 315 | 1,467 | 1,096 | |||||||||||||||
Network services and data processing | 995 | 1,033 | 935 | 3,819 | 3,402 | |||||||||||||||
Printing and office supplies | 119 | 77 | 145 | 389 | 481 | |||||||||||||||
Postage and delivery | 74 | 52 | 59 | 255 | 256 | |||||||||||||||
Advertising and promotion | 912 | 812 | 1,009 | 3,546 | 3,422 | |||||||||||||||
Other real estate owned related expense | 543 | 511 | 495 | 2,168 | 2,163 | |||||||||||||||
Other real estate owned - valuation allowance expense | 2,722 | 45 | 1,061 | 3,331 | 1,739 | |||||||||||||||
Amortization of intangible assets | 86 | 117 | 167 | 498 | 434 | |||||||||||||||
Professional fees | 746 | 750 | 832 | 2,920 | 2,785 | |||||||||||||||
Loan collection expenses | (5 | ) | 140 | (98 | ) | 458 | 710 | |||||||||||||
Merger related expense | - | - | (163 | ) | - | 1,010 | ||||||||||||||
Other noninterest expense | 672 | 793 | 733 | 2,850 | 2,653 | |||||||||||||||
Total noninterest expense | 14,005 | 11,280 | 11,635 | 47,232 | 42,637 | |||||||||||||||
Income before income taxes | 2,469 | 4,332 | 3,465 | 11,376 | 19,642 | |||||||||||||||
Income tax expense | 1,127 | 1,706 | 1,557 | 4,652 | 7,652 | |||||||||||||||
Net Income | $ | 1,342 | $ | 2,626 | $ | 1,908 | $ | 6,724 | $ | 11,990 | ||||||||||
Weighted average shares outstanding - basic | 16,100,966 | 14,572,140 | 11,611,641 | 14,112,443 | 11,108,040 | |||||||||||||||
Weighted average shares outstanding - diluted | 16,100,966 | 14,572,140 | 11,611,641 | 14,112,443 | 11,123,826 | |||||||||||||||
Basic net income per share | $ | 0.08 | $ | 0.18 | $ | 0.16 | $ | 0.48 | $ | 1.08 | ||||||||||
Diluted net income per share | 0.08 | 0.18 | 0.16 | 0.48 | 1.08 |
(1) Share and per share amounts have been restated to reflect the 7-for-1 reverse stock split completed on August 13, 2014.
C1 Financial, Inc.
Average Balance Sheets - Unaudited
(Dollars in thousands)
For the Three Months Ended | ||||||||||||||||||||||||||||||||||||
December 31, 2014 | September 30, 2014 | December 31, 2013 | ||||||||||||||||||||||||||||||||||
Average | Income/ | Yields/ | Average | Income/ | Yields/ | Average | Income/ | Yields/ | ||||||||||||||||||||||||||||
Balances (1) | Expense | Rates | Balances (1) | Expense | Rates | Balances (1) | Expense | Rates | ||||||||||||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||||||||||||||||
Loans receivable (2) | $ | 1,145,230 | $ | 16,870 | 5.84 | % | $ | 1,098,466 | $ | 16,028 | 5.79 | % | $ | 998,142 | $ | 15,408 | 6.12 | % | ||||||||||||||||||
Securities available for sale and other securities | 250 | 3 | 4.56 | % | 250 | 2 | 4.56 | % | 250 | 29 | 44.88 | % | ||||||||||||||||||||||||
Federal funds sold and balances at Federal Reserve Bank | 240,126 | 168 | 0.28 | % | 222,894 | 129 | 0.23 | % | 119,339 | 82 | 0.27 | % | ||||||||||||||||||||||||
Time deposits in other financial institutions | - | - | 0.00 | % | - | - | 0.00 | % | - | 1 | 0.00 | % | ||||||||||||||||||||||||
FHLB stock | 9,446 | 117 | 4.89 | % | 9,152 | 86 | 3.71 | % | 7,350 | 55 | 2.99 | % | ||||||||||||||||||||||||
Total interest-earning assets | 1,395,052 | 17,158 | 4.88 | % | 1,330,762 | 16,245 | 4.84 | % | 1,125,081 | 15,575 | 5.49 | % | ||||||||||||||||||||||||
Noninterest-earning assets | ||||||||||||||||||||||||||||||||||||
Cash and due from banks | 31,701 | 39,723 | 28,871 | |||||||||||||||||||||||||||||||||
Other assets (3) | 125,511 | 123,182 | 128,215 | |||||||||||||||||||||||||||||||||
Total noninterest-earning assets | 157,212 | 162,905 | 157,086 | |||||||||||||||||||||||||||||||||
Total assets | $ | 1,552,264 | $ | 1,493,667 | $ | 1,282,167 | ||||||||||||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||||||||||||||
Time deposits | $ | 324,347 | 890 | 1.09 | % | $ | 346,037 | 953 | 1.09 | % | $ | 314,354 | 855 | 1.08 | % | |||||||||||||||||||||
Money market | 378,393 | 423 | 0.44 | % | 354,146 | 390 | 0.44 | % | 329,818 | 357 | 0.43 | % | ||||||||||||||||||||||||
Negotiable order of withdrawal (NOW) accounts | 142,370 | 137 | 0.38 | % | 139,175 | 135 | 0.38 | % | 139,577 | 145 | 0.41 | % | ||||||||||||||||||||||||
Savings deposits | 38,263 | 22 | 0.22 | % | 38,130 | 21 | 0.22 | % | 40,315 | 23 | 0.22 | % | ||||||||||||||||||||||||
Total interest-bearing deposits | 883,373 | 1,472 | 0.66 | % | 877,488 | 1,499 | 0.68 | % | 824,064 | 1,380 | 0.66 | % | ||||||||||||||||||||||||
Other interest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||
FHLB advances | 183,860 | 755 | 1.63 | % | 176,964 | 709 | 1.59 | % | 132,235 | 504 | 1.51 | % | ||||||||||||||||||||||||
Other borrowings | 2,446 | 12 | 1.96 | % | 3,000 | 15 | 1.96 | % | 3,000 | 15 | 1.98 | % | ||||||||||||||||||||||||
Total interest-bearing liabilities | 1,069,679 | 2,239 | 0.83 | % | 1,057,452 | 2,223 | 0.83 | % | 959,299 | 1,899 | 0.79 | % | ||||||||||||||||||||||||
Noninterest-bearing liabilities and stockholders' equity: | ||||||||||||||||||||||||||||||||||||
Demand deposits | 290,628 | 270,328 | 197,189 | |||||||||||||||||||||||||||||||||
Other liabilities | 4,687 | 4,954 | 10,052 | |||||||||||||||||||||||||||||||||
Stockholders' equity | 187,270 | 160,933 | 115,627 | |||||||||||||||||||||||||||||||||
Total noninterest-bearing liabilities and stockholder's equity | 482,585 | 436,215 | 322,868 | |||||||||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 1,552,264 | $ | 1,493,667 | $ | 1,282,167 | ||||||||||||||||||||||||||||||
Interest rate spread (taxable-equivalent basis) | 4.05 | % | 4.01 | % | 4.70 | % | ||||||||||||||||||||||||||||||
Net interest income (taxable-equivalent basis) | $ | 14,919 | $ | 14,022 | $ | 13,676 | ||||||||||||||||||||||||||||||
Net interest margin (taxable-equivalent basis) | 4.24 | % | 4.18 | % | 4.82 | % | ||||||||||||||||||||||||||||||
Average interest-earning assets to interest-bearing liabilities | 130.42 | % | 125.85 | % | 117.28 | % |
(1) | Calculated using daily averages. |
(2) | Average loans are gross, including nonaccrual loans and overdrafts (net of deferred loan fees and before the allowance for loan losses). Interest on loans includes net deferred fees and costs of $748 thousand, $515 thousand and $781 thousand in the three months ended December 31, 2014, September 30, 2014 and December 31, 2013, respectively. |
(3) | Other assets include bank-owned life insurance, tax lien certificates, OREO, fixed assets, interest receivable, prepaid expense and others. |
C1 Financial, Inc.
Average Balance Sheets - Unaudited
(Dollars in thousands)
For the Twelve Months Ended December 31, | ||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||
Average | Income/ | Yields/ | Average | Income/ | Yields/ | |||||||||||||||||||
Balances (1) | Expense | Rates | Balances (1) | Expense | Rates | |||||||||||||||||||
Interest-earning assets | ||||||||||||||||||||||||
Loans receivable (2) | $ | 1,085,832 | $ | 63,351 | 5.83 | % | $ | 807,173 | $ | 47,362 | 5.87 | % | ||||||||||||
Securities available for sale and other securities | 452 | 62 | 13.76 | % | 45,379 | 698 | 1.54 | % | ||||||||||||||||
Federal funds sold and balances at Federal Reserve Bank | 207,010 | 523 | 0.25 | % | 105,944 | 268 | 0.25 | % | ||||||||||||||||
Time deposits in other financial institutions | - | - | 0.00 | % | 133 | 7 | 5.14 | % | ||||||||||||||||
FHLB stock | 8,779 | 374 | 4.26 | % | 6,305 | 164 | 2.60 | % | ||||||||||||||||
Total interest-earning assets | 1,302,073 | 64,310 | 4.94 | % | 964,934 | 48,499 | 5.03 | % | ||||||||||||||||
Noninterest-earning assets | ||||||||||||||||||||||||
Cash and due from banks | 39,209 | 37,940 | ||||||||||||||||||||||
Other assets (3) | 122,203 | 104,924 | ||||||||||||||||||||||
Total noninterest-earning assets | 161,412 | 142,864 | ||||||||||||||||||||||
Total assets | $ | 1,463,485 | $ | 1,107,798 | ||||||||||||||||||||
Interest-bearing liabilities | ||||||||||||||||||||||||
Interest-bearing deposits: | ||||||||||||||||||||||||
Time deposits | $ | 350,592 | 3,809 | 1.09 | % | $ | 262,140 | 2,948 | 1.12 | % | ||||||||||||||
Money market | 351,844 | 1,526 | 0.43 | % | 292,262 | 1,267 | 0.43 | % | ||||||||||||||||
NOW accounts | 142,588 | 542 | 0.38 | % | 139,331 | 544 | 0.39 | % | ||||||||||||||||
Savings deposits | 38,323 | 86 | 0.22 | % | 34,994 | 78 | 0.22 | % | ||||||||||||||||
Total interest-bearing deposits | 883,347 | 5,963 | 0.68 | % | 728,727 | 4,837 | 0.66 | % | ||||||||||||||||
Other interest-bearing liabilities: | ||||||||||||||||||||||||
FHLB advances | 167,884 | 2,607 | 1.55 | % | 112,097 | 1,753 | 1.56 | % | ||||||||||||||||
Other borrowings | 2,860 | 56 | 1.96 | % | 3,000 | 60 | 2.00 | % | ||||||||||||||||
Total interest-bearing liabilities | 1,054,091 | 8,626 | 0.82 | % | 843,824 | 6,650 | 0.79 | % | ||||||||||||||||
Noninterest-bearing liabilities and stockholders' equity: | ||||||||||||||||||||||||
Demand deposits | 250,268 | 153,276 | ||||||||||||||||||||||
Other liabilities | 4,847 | 5,779 | ||||||||||||||||||||||
Stockholders' equity | 154,279 | 104,919 | ||||||||||||||||||||||
Total noninterest-bearing liabilities and stockholder's equity | 409,394 | 263,974 | ||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 1,463,485 | $ | 1,107,798 | ||||||||||||||||||||
Interest rate spread (taxable-equivalent basis) | 4.12 | % | 4.24 | % | ||||||||||||||||||||
Net interest income (taxable-equivalent basis) | $ | 55,684 | $ | 41,849 | ||||||||||||||||||||
Net interest margin (taxable-equivalent basis) | 4.28 | % | 4.34 | % | ||||||||||||||||||||
Average interest-earning assets to interest-bearing liabilities | 123.53 | % | 114.35 | % |
(1) | Calculated using daily averages. |
(2) | Average loans are gross, including nonaccrual loans and overdrafts (net of deferred loan fees and before the allowance for loan losses). Interest on loans includes net deferred fees and costs of $2.4 million and $1.6 million in the twelve months ended December 31, 2014 and December 31, 2013, respectively. |
(3) | Other assets include bank-owned life insurance, tax lien certificates, OREO, fixed assets, interest receivable, prepaid expense and others. |
C1 Financial, Inc.
Selected Quarterly Financial Data - Unaudited
(Dollars in thousands, except per share data)
4Q14 | 3Q14 | 2Q14 (2) | 1Q14 (2) | 4Q13 (2) | ||||||||||||||||
Statement of Income Data | ||||||||||||||||||||
Interest income | $ | 17,158 | $ | 16,245 | $ | 15,712 | $ | 15,195 | $ | 15,575 | ||||||||||
Interest expense | 2,239 | 2,223 | 2,115 | 2,049 | 1,899 | |||||||||||||||
Net interest income | 14,919 | 14,022 | 13,597 | 13,146 | 13,676 | |||||||||||||||
Provision (reversal of provision) for loan losses | (1 | ) | 207 | 4,572 | 36 | 1,371 | ||||||||||||||
Gain on sale of securities | - | - | 241 | - | - | |||||||||||||||
Bargain purchase gain (loss) | - | 37 | (30 | ) | 41 | 893 | ||||||||||||||
Total noninterest income | 1,554 | 1,797 | 2,347 | 2,040 | 2,795 | |||||||||||||||
Total noninterest expense | 14,005 | 11,280 | 10,950 | 10,997 | 11,635 | |||||||||||||||
Income before income taxes | 2,469 | 4,332 | 422 | 4,153 | 3,465 | |||||||||||||||
Income tax expense | 1,127 | 1,706 | 192 | 1,627 | 1,557 | |||||||||||||||
Net income | 1,342 | 2,626 | 230 | 2,526 | 1,908 | |||||||||||||||
Operating net income (1) | 2,811 | 3,065 | - | - | - | |||||||||||||||
Selected Performance Metrics | ||||||||||||||||||||
Return on average assets | 0.34 | % | 0.70 | % | 0.06 | % | 0.74 | % | 0.59 | % | ||||||||||
Return on average equity | 2.84 | % | 6.47 | % | 0.66 | % | 8.03 | % | 6.55 | % | ||||||||||
Efficiency ratio (1) | 85.0 | % | 71.3 | % | 69.7 | % | 72.4 | % | 70.6 | % | ||||||||||
Operating return on average assets | 0.72 | % | 0.81 | % | - | - | - | |||||||||||||
Operating return on average equity | 5.96 | % | 7.56 | % | - | - | - | |||||||||||||
Operating efficiency ratio (1) | 72.1 | % | 70.2 | % | - | - | - | |||||||||||||
Full-time employees at period end | 238 | 246 | 221 | 215 | 219 | |||||||||||||||
Revenue per average number of employees (1) | $ | 307 | $ | 305 | $ | 343 | $ | 322 | $ | 328 | ||||||||||
Average assets per average number of employees (1) | 6,414 | 6,356 | 6,759 | 6,358 | 5,776 | |||||||||||||||
Per Share Outstanding Data | ||||||||||||||||||||
Net earnings per share | $ | 0.08 | $ | 0.18 | $ | 0.02 | $ | 0.20 | $ | 0.16 | ||||||||||
Diluted net earnings per share | 0.08 | 0.18 | 0.02 | 0.20 | 0.16 | |||||||||||||||
Net operating earnings per share | $ | 0.17 | $ | 0.21 | $ | - | $ | - | $ | - | ||||||||||
Diluted net operating earnings per share | 0.17 | 0.21 | - | - | - | |||||||||||||||
Weighted average shares | 16,101 | 14,572 | 13,232 | 12,500 | 11,612 | |||||||||||||||
Weighted average shares - diluted | 16,101 | 14,572 | 13,232 | 12,500 | 11,612 | |||||||||||||||
Book value per share | $ | 11.59 | $ | 11.51 | $ | 10.51 | $ | 10.49 | $ | 9.97 | ||||||||||
Tangible book value per share (1) | 11.51 | 11.43 | 10.40 | 10.37 | 9.83 | |||||||||||||||
Common shares outstanding at period end | 16,101 | 16,101 | 13,340 | 13,052 | 12,217 | |||||||||||||||
Market value at period end | $ | 18.29 | $ | 18.13 | N/A | N/A | N/A | |||||||||||||
Market range: | ||||||||||||||||||||
High | 19.70 | 18.77 | N/A | N/A | N/A | |||||||||||||||
Low | 15.98 | 16.66 | N/A | N/A | N/A | |||||||||||||||
Balance Sheet Data | ||||||||||||||||||||
Cash and due from banks | $ | 185,703 | $ | 283,741 | $ | 258,944 | $ | 240,261 | $ | 143,452 | ||||||||||
Securities available for sale | - | - | - | 938 | - | |||||||||||||||
Other securities (included in Other assets in consolidated balance sheet) | 250 | 250 | 250 | 250 | 250 | |||||||||||||||
Total loans | 1,188,522 | 1,134,351 | 1,062,701 | 1,044,786 | 1,053,029 | |||||||||||||||
Loans originated by C1 Bank (Nonacquired) | 840,275 | 757,529 | 665,615 | 629,616 | 614,613 | |||||||||||||||
Loans not originated by C1 Bank (Acquired) | 348,247 | 376,822 | 397,086 | 415,170 | 438,416 | |||||||||||||||
Net deferred loan fees | (4,142 | ) | (3,759 | ) | (3,323 | ) | (3,036 | ) | (2,880 | ) | ||||||||||
Loans receivable, gross (3) | 1,184,380 | 1,130,592 | 1,059,378 | 1,041,750 | 1,050,149 | |||||||||||||||
Allowance for loan losses | (5,324 | ) | (5,441 | ) | (4,593 | ) | (3,626 | ) | (3,412 | ) | ||||||||||
Loans receivable, net | 1,179,056 | 1,125,151 | 1,054,785 | 1,038,124 | 1,046,737 | |||||||||||||||
Total assets | 1,536,583 | 1,548,045 | 1,449,214 | 1,412,871 | 1,323,371 | |||||||||||||||
Total interest-bearing deposits | 888,959 | 870,820 | 882,303 | 889,717 | 846,660 | |||||||||||||||
Total deposits | 1,167,502 | 1,164,964 | 1,135,451 | 1,115,282 | 1,041,043 | |||||||||||||||
Borrowings | 178,500 | 192,000 | 168,500 | 153,500 | 153,500 |
Federal Home Loan Bank | 178,500 | 189,000 | 165,500 | 150,500 | 150,500 | |||||||||||||||
Other | - | 3,000 | 3,000 | 3,000 | 3,000 | |||||||||||||||
Total liabilities | 1,349,945 | 1,362,749 | 1,309,023 | 1,275,955 | 1,201,557 | |||||||||||||||
Total stockholders’ equity | 186,638 | 185,296 | 140,191 | 136,916 | 121,814 | |||||||||||||||
Tangible stockholders’ equity (1) | 185,402 | 183,973 | 138,752 | 135,336 | 120,080 | |||||||||||||||
Selected Average Balance Sheet Data | ||||||||||||||||||||
Loans receivable, gross (3) | $ | 1,145,230 | $ | 1,098,466 | $ | 1,056,231 | $ | 1,042,129 | $ | 998,142 | ||||||||||
Securities available for sale and other securities | 250 | 250 | 1,050 | 260 | 250 | |||||||||||||||
Earning assets | 1,395,052 | 1,330,762 | 1,271,290 | 1,208,825 | 1,125,081 | |||||||||||||||
Total assets | 1,552,264 | 1,493,667 | 1,426,124 | 1,379,656 | 1,282,167 | |||||||||||||||
Total interest-bearing deposits | 883,373 | 877,488 | 889,932 | 882,652 | 824,064 | |||||||||||||||
Total deposits | 1,174,001 | 1,147,816 | 1,118,423 | 1,093,175 | 1,021,253 | |||||||||||||||
Borrowings | 186,306 | 179,964 | 162,028 | 154,224 | 135,235 | |||||||||||||||
Total stockholders’ equity | 187,270 | 160,933 | 140,653 | 127,529 | 115,627 | |||||||||||||||
Yields Earned and Rates Paid | ||||||||||||||||||||
Loans receivable, gross (3) | 5.84 | % | 5.79 | % | 5.87 | % | 5.83 | % | 6.12 | % | ||||||||||
Adjusted loans receivable, gross (1),(4) | 5.65 | % | 5.65 | % | 5.72 | % | 5.59 | % | 5.82 | % | ||||||||||
Securities available for sale and other securities | 4.56 | % | 4.56 | % | 10.79 | % | 43.94 | % | 44.88 | % | ||||||||||
Earning assets | 4.88 | % | 4.84 | % | 4.96 | % | 5.10 | % | 5.49 | % | ||||||||||
Total interest-bearing deposits | 0.66 | % | 0.68 | % | 0.68 | % | 0.68 | % | 0.66 | % | ||||||||||
Total deposits | 0.50 | % | 0.52 | % | 0.54 | % | 0.55 | % | 0.54 | % | ||||||||||
Adjusted total deposits (1),(5) | 0.50 | % | 0.53 | % | 0.55 | % | 0.57 | % | 0.55 | % | ||||||||||
Borrowings | 1.63 | % | 1.59 | % | 1.52 | % | 1.47 | % | 1.52 | % | ||||||||||
Total interest-bearing liabilities | 0.83 | % | 0.83 | % | 0.81 | % | 0.80 | % | 0.79 | % | ||||||||||
Net interest margin (NIM) | 4.24 | % | 4.18 | % | 4.29 | % | 4.41 | % | 4.82 | % | ||||||||||
Adjusted NIM (1),(6) | 4.05 | % | 4.03 | % | 4.12 | % | 4.15 | % | 4.49 | % | ||||||||||
Capital Ratios | ||||||||||||||||||||
Total capital to risk-weighted assets | 14.74 | % | 15.45 | % | 12.42 | % | 12.48 | % | 10.97 | % | ||||||||||
Tier 1 capital to risk-weighted assets | 14.33 | % | 14.96 | % | 11.98 | % | 12.10 | % | 10.62 | % | ||||||||||
Tier 1 leverage ratio | 11.95 | % | 12.32 | % | 9.73 | % | 9.80 | % | 9.36 | % | ||||||||||
Tangible Equity / Tangible Assets (1) | 12.08 | % | 11.89 | % | 9.58 | % | 9.59 | % | 9.09 | % | ||||||||||
Equity / Assets | 12.15 | % | 11.97 | % | 9.67 | % | 9.69 | % | 9.20 | % | ||||||||||
Average Equity / Average Assets | 12.06 | % | 10.77 | % | 9.86 | % | 9.24 | % | 9.02 | % | ||||||||||
Asset Quality Ratios | ||||||||||||||||||||
Total nonperforming loans to loans receivable | 1.76 | % | 1.82 | % | 2.02 | % | 2.08 | % | 2.26 | % | ||||||||||
Total nonperforming assets to total assets | 3.63 | % | 3.78 | % | 3.98 | % | 4.24 | % | 4.90 | % | ||||||||||
Allowance for loan losses to nonperforming loans | 25.48 | % | 26.39 | % | 21.41 | % | 16.71 | % | 14.35 | % | ||||||||||
Annualized net charge-offs (recoveries) to total average loans | 0.04 | % | (0.23 | )% | 1.37 | % | (0.07 | )% | 0.42 | % | ||||||||||
Nonacquired net charge-offs (recoveries) to average nonacquired loans | 0.00 | % | (0.08 | )% | 2.46 | % | 0.00 | % | 0.01 | % | ||||||||||
Allowance for loan losses to total loans receivable | 0.45 | % | 0.48 | % | 0.43 | % | 0.35 | % | 0.32 | % | ||||||||||
Allowance for loan losses to nonacquired loans | 0.63 | % | 0.72 | % | 0.69 | % | 0.58 | % | 0.56 | % | ||||||||||
Texas ratio (7) | 29.3 | % | 30.9 | % | 40.3 | % | 43.1 | % | 52.5 | % | ||||||||||
Asset Quality Data | ||||||||||||||||||||
Nonacquired nonperforming assets | $ | 487 | $ | 567 | $ | 507 | $ | 144 | $ | 737 | ||||||||||
Nonaccrual loans | 443 | 523 | 463 | 100 | 693 | |||||||||||||||
Other real estate owned (OREO) | 44 | 44 | 44 | 44 | 44 | |||||||||||||||
Nonacquired restructured loans (8) | - | - | - | - | 64 | |||||||||||||||
Nonacquired nonperforming assets to nonacquired loans plus OREO | 0.06 | % | 0.07 | % | 0.08 | % | 0.02 | % | 0.12 | % | ||||||||||
Acquired nonperforming assets | $ | 55,323 | $ | 58,005 | $ | 57,224 | $ | 59,797 | $ | 64,094 | ||||||||||
Nonaccrual loans | 20,451 | 20,092 | 20,990 | 21,604 | 23,089 |
OREO | 34,872 | 37,912 | 36,234 | 38,193 | 41,005 | |||||||||||||||
Acquired restructured loans | 906 | 913 | 921 | 927 | 916 | |||||||||||||||
Acquired nonperforming assets to acquired loans plus OREO | 14.44 | % | 13.99 | % | 13.21 | % | 13.19 | % | 13.37 | % | ||||||||||
Total nonperforming assets | $ | 55,810 | $ | 58,571 | $ | 57,731 | $ | 59,941 | $ | 64,831 | ||||||||||
Nonaccrual loans | 20,894 | 20,615 | 21,453 | 21,704 | 23,782 | |||||||||||||||
OREO | 34,916 | 37,956 | 36,278 | 38,237 | 41,049 | |||||||||||||||
Total restructured loans | 906 | 913 | 921 | 927 | 980 | |||||||||||||||
Total nonperforming assets to total loans plus OREO | 4.56 | % | 5.00 | % | 5.25 | % | 5.53 | % | 5.93 | % | ||||||||||
Net charge-offs (recoveries) | $ | 116 | $ | (641 | ) | $ | 3,605 | $ | (178 | ) | $ | 1,056 | ||||||||
Charge-offs | 552 | 157 | 4,418 | 168 | 1,713 | |||||||||||||||
Recoveries | (436 | ) | (798 | ) | (813 | ) | (346 | ) | (657 | ) | ||||||||||
Loan Composition | ||||||||||||||||||||
Nonacquired loans by type | ||||||||||||||||||||
Owner occupied commercial real estate | $ | 124,067 | $ | 107,530 | $ | 97,458 | $ | 68,222 | $ | 71,662 | ||||||||||
Nonowner occupied commercial real estate | 311,239 | 275,598 | 240,886 | 204,725 | 201,225 | |||||||||||||||
Commercial | 58,809 | 58,450 | 55,031 | 50,433 | 55,804 | |||||||||||||||
Construction | 88,072 | 75,126 | 52,238 | 71,144 | 66,925 | |||||||||||||||
1-4 family residential real estate | 123,421 | 116,244 | 94,675 | 86,877 | 76,392 | |||||||||||||||
Multifamily commercial real estate | 27,385 | 26,256 | 26,295 | 51,125 | 46,829 | |||||||||||||||
Secured by farmland commercial real estate | 57,825 | 59,009 | 60,179 | 61,338 | 62,487 | |||||||||||||||
Consumer | 49,457 | 39,316 | 38,853 | 35,752 | 33,289 | |||||||||||||||
Acquired loans by type | ||||||||||||||||||||
Owner occupied commercial real estate | $ | 107,169 | $ | 113,957 | $ | 118,854 | $ | 123,677 | $ | 132,834 | ||||||||||
Nonowner occupied commercial real estate | 88,363 | 95,549 | 98,705 | 100,592 | 104,130 | |||||||||||||||
Commercial | 16,551 | 24,423 | 26,840 | 30,243 | 29,707 | |||||||||||||||
Construction | 19,364 | 20,069 | 21,092 | 21,745 | 24,049 | |||||||||||||||
1-4 family residential real estate | 100,995 | 105,083 | 110,548 | 114,420 | 119,846 | |||||||||||||||
Multifamily commercial real estate | 5,516 | 5,941 | 6,437 | 8,673 | 9,212 | |||||||||||||||
Secured by farmland commercial real estate | 2,013 | 3,242 | 5,584 | 5,658 | 7,859 | |||||||||||||||
Consumer | 8,276 | 8,558 | 9,026 | 10,162 | 10,779 | |||||||||||||||
New loan originations (9) | $ | 139,009 | $ | 141,436 | $ | 163,611 | $ | 44,611 | $ | 129,936 | ||||||||||
Unfunded commitments (includes loans, unused lines and standby letters of credit) | 189,049 | 181,224 | 158,557 | 111,954 | 111,086 | |||||||||||||||
Deposit Composition | ||||||||||||||||||||
Noninterest-bearing demand | $ | 278,543 | $ | 294,144 | $ | 253,148 | $ | 225,565 | $ | 194,383 | ||||||||||
Interest-bearing demand/NOW | 140,598 | 135,623 | 140,939 | 144,648 | 138,765 | |||||||||||||||
Money market and savings | 435,105 | 398,000 | 383,259 | 379,303 | 362,591 | |||||||||||||||
Retail time | 286,979 | 310,243 | 330,832 | 336,358 | 319,780 | |||||||||||||||
Jumbo time (10) | 26,277 | 26,954 | 27,273 | 29,408 | 25,524 |
(1) See below for the Generally Accepted Accounting Principles (GAAP) reconciliation and explanation of non-GAAP financial measures.
(2) Share and per share amounts have been restated to reflect the 7-for-1 reverse stock split completed on August 13, 2014.
(3) Total loans, net of deferred loan fees and before the allowance for loan losses. Yield on gross loans is calculated on a 365-day basis and may differ from regulatory “Uniform Bank Performance Report” (UBPR) yield, which annualizes quarterly data by a factor of 4 (Section II, UBPR User’s Guide).
(4) Adjusted yield earned on loans receivable excludes loan accretion from the acquired loan portfolio.
(5) Adjusted rate paid on total deposits excludes amortization of premium for acquired time deposits.
(6) Adjusted net interest margin excludes loan accretion from the acquired loan portfolio, and amortization of premiums for acquired time deposits and Federal Home Loan Bank advances.
(7) Calculated as nonperforming assets divided by tangible stockholders’ equity plus allowance for loan losses.
(8) Restructured loans include accruing and nonaccrual troubled debt restructurings. Nonaccrual restructured loans are included in nonaccrual loans.
(9) New loan originations represent new loan commitments during the periods presented.
(10) Jumbo time deposits are deposits over $250 thousand.
C1 Financial, Inc.
Generally Accepted Accounting Principles (GAAP) Reconciliation and
Explanation of Non-GAAP Financial Measures
(In thousands, except per share and employee data)
Some of the financial measures included in this earnings release are not measures of financial performance recognized by GAAP. We believe these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition and results of operations computed in accordance with GAAP; however, we acknowledge that our non-GAAP financial measures have a number of limitations. As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP measures that other companies use. The following tables provide a more detailed analysis of these non-GAAP financial measures.
4Q14 | 3Q14 | 2Q14 (1) | 1Q14 (1) | 4Q13 (1) | ||||||||||||||||
Operating net income | ||||||||||||||||||||
Net income | $ | 1,342 | $ | 2,626 | $ | - | $ | - | $ | - | ||||||||||
Addition to allowance for loan losses | 117 | 533 | - | - | - | |||||||||||||||
Nonrecurring noninterest expense | 2,127 | 182 | - | - | - | |||||||||||||||
Taxes on nonoperating items | (852 | ) | (276 | ) | - | - | - | |||||||||||||
Prior period tax adjustment | 77 | |||||||||||||||||||
Operating net income | $ | 2,811 | $ | 3,065 | $ | - | $ | - | $ | - | ||||||||||
Loan loss reserves | ||||||||||||||||||||
Allowance for loan losses | $ | 5,324 | $ | 5,441 | $ | 4,593 | $ | 3,626 | $ | 3,412 | ||||||||||
Acquired performing loans discount | 3,532 | 3,811 | 4,093 | 4,461 | 4,831 | |||||||||||||||
Total | $ | 8,856 | $ | 9,252 | $ | 8,686 | $ | 8,087 | $ | 8,243 | ||||||||||
Loans receivable, gross | $ | 1,188,522 | $ | 1,134,351 | $ | 1,062,701 | $ | 1,044,786 | $ | 1,053,029 | ||||||||||
Allowance for loan losses to total loans receivable | 0.45 | % | 0.48 | % | 0.43 | % | 0.35 | % | 0.32 | % | ||||||||||
Allowance plus performing loans discount to total loans receivable | 0.75 | % | 0.82 | % | 0.82 | % | 0.77 | % | 0.78 | % | ||||||||||
Efficiency ratio | ||||||||||||||||||||
Noninterest expense | $ | 14,005 | $ | 11,280 | $ | 10,950 | $ | 10,997 | $ | 11,635 | ||||||||||
Nonrecurring noninterest expense | (2,127 | ) | (182 | ) | - | - | - | |||||||||||||
Adjusted noninterest expense | $ | 11,878 | $ | 11,098 | $ | 10,950 | $ | 10,997 | $ | 11,635 | ||||||||||
Taxable-equivalent net interest income | $ | 14,919 | $ | 14,022 | $ | 13,597 | $ | 13,146 | $ | 13,676 | ||||||||||
Noninterest income | $ | 1,554 | $ | 1,797 | $ | 2,347 | $ | 2,040 | $ | 2,795 | ||||||||||
Gain on sale of securities | - | - | (241 | ) | - | - | ||||||||||||||
Adjusted noninterest income | $ | 1,554 | $ | 1,797 | $ | 2,106 | $ | 2,040 | $ | 2,795 | ||||||||||
Efficiency ratio | 85.0 | % | 71.3 | % | 69.7 | % | 72.4 | % | 70.6 | % | ||||||||||
Operating efficiency ratio | 72.1 | % | 70.2 | % | - | - | - | |||||||||||||
Revenue and average assets per average number of employees | ||||||||||||||||||||
Interest income | $ | 17,158 | $ | 16,245 | $ | 15,712 | $ | 15,195 | $ | 15,575 | ||||||||||
Noninterest income | 1,554 | 1,797 | 2,347 | 2,040 | 2,795 | |||||||||||||||
Total revenue | $ | 18,712 | $ | 18,042 | $ | 18,059 | $ | 17,235 | $ | 18,370 | ||||||||||
Total revenue annualized | $ | 74,238 | $ | 71,580 | $ | 72,434 | $ | 69,898 | $ | 72,879 | ||||||||||
Total average assets | $ | 1,552,264 | $ | 1,493,667 | $ | 1,426,124 | $ | 1,379,656 | $ | 1,282,167 | ||||||||||
Average number of employees | 242 | 235 | 211 | 217 | 222 | |||||||||||||||
Revenue per average number of employees | $ | 307 | $ | 305 | $ | 343 | $ | 322 | $ | 328 | ||||||||||
Average assets per average number of employees | $ | 6,414 | $ | 6,356 | $ | 6,759 | $ | 6,358 | $ | 5,776 | ||||||||||
Tangible stockholders' equity and Tangible book value per share | ||||||||||||||||||||
Total stockholders' equity | $ | 186,638 | $ | 185,296 | $ | 140,191 | $ | 136,916 | $ | 121,814 | ||||||||||
Less: Goodwill | (249 | ) | (249 | ) | (249 | ) | (249 | ) | (249 | ) | ||||||||||
Other intangible assets | (987 | ) | (1,074 | ) | (1,190 | ) | (1,331 | ) | (1,485 | ) | ||||||||||
Tangible stockholders' equity | $ | 185,402 | $ | 183,973 | $ | 138,752 | $ | 135,336 | $ | 120,080 | ||||||||||
Common shares outstanding | 16,101 | 16,101 | 13,340 | 13,052 | 12,217 | |||||||||||||||
Book value per share | $ | 11.59 | $ | 11.51 | $ | 10.51 | $ | 10.49 | $ | 9.97 | ||||||||||
Tangible book value per share | 11.51 | 11.43 | 10.40 | 10.37 | 9.83 | |||||||||||||||
Adjusted yield earned on loans | ||||||||||||||||||||
Reported yield on loans | 5.84 | % | 5.79 | % | 5.87 | % | 5.83 | % | 6.12 | % | ||||||||||
Effect of accretion income on acquired loans | (0.19 | )% | (0.14 | )% | (0.15 | )% | (0.24 | )% | (0.30 | )% | ||||||||||
Adjusted yield on loans | 5.65 | % | 5.65 | % | 5.72 | % | 5.59 | % | 5.82 | % | ||||||||||
Adjusted rate paid on total deposits | ||||||||||||||||||||
Reported rate paid on deposits | 0.50 | % | 0.52 | % | 0.54 | % | 0.55 | % | 0.54 | % | ||||||||||
Effect of premium amortization on acquired deposits | 0.00 | % | 0.01 | % | 0.01 | % | 0.02 | % | 0.01 | % | ||||||||||
Adjusted rate paid on deposits | 0.50 | % | 0.53 | % | 0.55 | % | 0.57 | % | 0.55 | % | ||||||||||
Adjusted net interest margin | ||||||||||||||||||||
Reported net interest margin | 4.24 | % | 4.18 | % | 4.29 | % | 4.41 | % | 4.82 | % | ||||||||||
Effect of accretion income on acquired loans | (0.16 | )% | (0.11 | )% | (0.13 | )% | (0.21 | )% | (0.27 | )% | ||||||||||
Effect of premium amortization on acquired deposits and borrowings | (0.03 | )% | (0.04 | )% | (0.04 | )% | (0.05 | )% | (0.06 | )% | ||||||||||
Adjusted net interest margin | 4.05 | % | 4.03 | % | 4.12 | % | 4.15 | % | 4.49 | % | ||||||||||
Average excess cash | ||||||||||||||||||||
Average total deposits | $ | 1,174,001 | $ | 1,147,816 | $ | 1,118,423 | $ | 1,093,175 | $ | 1,021,253 | ||||||||||
Borrowings due in one year or less | 28,940 | 34,753 | 33,750 | 26,311 | 13,250 | |||||||||||||||
Total base for liquidity | $ | 1,202,941 | $ | 1,182,569 | $ | 1,152,173 | $ | 1,119,486 | $ | 1,034,503 | ||||||||||
Minimum liquidity level (10% of base) (a) | $ | 120,294 | $ | 118,257 | $ | 115,217 | $ | 111,949 | $ | 103,450 | ||||||||||
Average cash and cash equivalents (b) | 271,827 | 262,617 | 239,171 | 210,403 | 148,210 | |||||||||||||||
Cash above liquidity level (b)-(a) | 151,533 | 144,360 | 123,954 | 98,454 | 44,760 | |||||||||||||||
Less estimated short-term deposits | (24,421 | ) | (28,440 | ) | (24,662 | ) | (22,260 | ) | (9,054 | ) | ||||||||||
Average excess cash | $ | 127,112 | $ | 115,920 | $ | 99,292 | $ | 76,194 | $ | 35,706 |
Tangible equity to tangible assets | ||||||||||||||||||||
Total stockholders' equity | $ | 186,638 | $ | 185,296 | $ | 140,191 | $ | 136,916 | $ | 121,814 | ||||||||||
Less: Goodwill | (249 | ) | (249 | ) | (249 | ) | (249 | ) | (249 | ) | ||||||||||
Other intangible assets | (987 | ) | (1,074 | ) | (1,190 | ) | (1,331 | ) | (1,485 | ) | ||||||||||
Tangible stockholders' equity | $ | 185,402 | $ | 183,973 | $ | 138,752 | $ | 135,336 | $ | 120,080 | ||||||||||
Total assets | $ | 1,536,583 | $ | 1,548,045 | $ | 1,449,214 | $ | 1,412,871 | $ | 1,323,371 | ||||||||||
Less: Goodwill | (249 | ) | (249 | ) | (249 | ) | (249 | ) | (249 | ) | ||||||||||
Other intangible assets | (987 | ) | (1,074 | ) | (1,190 | ) | (1,331 | ) | (1,485 | ) | ||||||||||
Tangible assets | $ | 1,535,347 | $ | 1,546,722 | $ | 1,447,775 | $ | 1,411,291 | $ | 1,321,637 | ||||||||||
Equity/Assets | 12.15 | % | 11.97 | % | 9.67 | % | 9.69 | % | 9.20 | % | ||||||||||
Tangible Equity/Tangible Assets | 12.08 | % | 11.89 | % | 9.58 | % | 9.59 | % | 9.09 | % |
(1) Share and per share amounts have been restated to reflect the 7-for-1 reverse stock split completed on August 13, 2014.
Definitions of Non-GAAP financial measures
Operating net income excludes certain expense items. Management believes that operating net income is important for investors looking to compare the Company’s operations over time.
Allowance for loan losses plus performing loan discount to total loans receivable adds the remaining discount on acquired performing loans to the allowance for loan losses to determine the total reserves and loan discounts established against our loans. Our management believes this metric provides useful information for investors to analyze the overall level of reserves in banks that have completed acquisitions with no allowance carryover.
Efficiency ratio is defined as total noninterest expense divided by the sum of taxable-equivalent net interest income and noninterest income. Noninterest income is adjusted for nonrecurring gains and losses on sales of securities. This ratio is important to investors looking for a measure of efficiency in the Company's productivity measured by the amount of revenue generated for each dollar spent.
Revenue per average number of employees is annualized total interest income and total noninterest income divided by the average number of employees during the period and measures the Company's productivity by calculating the average amount of revenue generated per employee. Average assets per average number of employees is average assets divided by the average number of employees during the period and measures the average value of assets per employee.
Tangible stockholders' equity is defined as total equity reduced by goodwill and other intangible assets. Tangible book value per share is tangible stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets. We have not considered loan servicing rights as an intangible asset for purposes of this calculation.
Adjusted yield earned on loans is our yield on loans after excluding loan accretion from our acquired loan portfolio. Our management uses this metric to better assess the impact of purchase accounting on yield on loans, as the effect of loan discounts accretion is expected to decrease as the acquired loans mature or roll off of our balance sheet.
Adjusted rate paid on deposits is our cost of deposits after excluding amortization of premium for acquired time deposits. Our management uses this metric to better assess the impact of purchase accounting on cost of deposits, as the effect of amortization of premium related to deposits is expected to decrease as the acquired deposits mature or roll off of our balance sheet.
Adjusted net interest margin is net interest margin after excluding loan accretion from the acquired loan portfolio and amortization of premiums for acquired time deposits and Federal Home Loan Bank advances. Our management uses this metric to better assess the impact of purchase accounting on net interest margin, as the effect of loan discounts accretion and amortization of premium related to deposits or borrowings is expected to decrease as the acquired loans and deposits mature or roll off of our balance sheet.
Average excess cash represents the cash and cash equivalents in excess of our minimum liquidity level (defined as 10% of average total deposits plus borrowings due in one year or less), minus Company estimated short-term deposits.
Tangible equity to tangible assets is defined as total equity reduced by goodwill and other intangible assets, divided by total assets reduced by goodwill and other intangible assets. This measure is important to investors interested in relative changes from period-to-period in equity and total assets, each exclusive of changes in intangible assets. We have not considered loan servicing rights as an intangible asset for purposes of this calculation.