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EX-31.3 - EX-31.3 - FIRST CAPITAL BANCORP, INC.fcva-20150930ex313694834.htm
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EX-32 - EX-32 - FIRST CAPITAL BANCORP, INC.fcva-20150930xex32.htm

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________

Form 10-Q

________________________________________

   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015

   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

FIRST CAPITAL BANCORP, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Virginia

001-33543

11-3782033

(State or other jurisdiction of

(Commission File Number)

(I.R.S. Employer

incorporation or organization)

 

Identification No.)

 

4222 Cox Road, Glen Allen, Virginia 23060

(Address of principal executive offices)

804-273-1160

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes   No 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes   No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

 

Large accelerated filer 

Accelerated filer 

Non‑accelerated filer    (Do not check if a smaller reporting company)

Smaller reporting company 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes   No 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

12,996,691 shares of Common Stock, par value $.01 per share, were outstanding at October 28, 2015.


 

 

 

 

 

 

 

 

 

 

 

 

TABLE OF CONTENTS

 

Page

PART I – FINANCIAL INFORMATION 

 

 

 

 

Item 1 – Financial Statements

 

 

 

Consolidated Statements of Financial Condition

 

 

 

 

September 30, 2015 (unaudited) and December 31, 2014

3

 

 

Consolidated Statements of Operations

 

 

 

 

Three and Nine Months Ended September 30, 2015 and 2014 (unaudited)

4

 

 

Consolidated Statements of Comprehensive Income  

 

 

 

 

Three and Nine Months Ended September 30, 2015 and 2014 (unaudited)

5

 

 

Consolidated Statements of Stockholders’ Equity

 

 

 

 

Nine Months Ended September  30, 2015 and 2014 (unaudited)

6

 

 

Consolidated Statements of Cash Flows

 

 

 

 

For the Nine Months Ended September 30, 2015 and 2014 (unaudited)

7

 

 

Notes to Unaudited Consolidated Financial Statements

9

 

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations

32

 

Item 3 – Quantitative and Qualitative Disclosures About Market Risk – Not Applicable

40

 

Item 4 – Controls and Procedures

40

 

 

PART II – OTHER INFORMATION 

 

 

 

 

Item 1 – Legal Proceedings – None to Report

41

 

Item 1A – Risk Factors

41

 

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

42

 

Item 3 – Defaults Upon Senior Securities – None to Report

43

 

Item 4 – Mine Safety Disclosures – None to Report

43

 

Item 5 – Other Information – None to Report

43

 

Item 6 – Exhibits

43

 

 

SIGNATURES 

45

 

 

 

 

 

 

 

 


 

PART I – FINANCIAL INFORMATION

Item 1 – Financial Statements

 

First Capital Bancorp, Inc. and Subsidiary

Consolidated Statements of Financial Condition

September 30, 2015 (Unaudited) and December 31, 2014

(Dollars in Thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

December 31,

 

2015

 

2014

ASSETS

 

 

 

 

 

Cash and due from banks

$

15,772 

 

$

11,093 

Federal funds sold

 

3,695 

 

 

 -

Total cash and cash equivalents

 

19,467 

 

 

11,093 

Time deposits in other banks

 

2,250 

 

 

2,000 

Investment securities:

 

 

 

 

 

Available-for-sale, at fair value

 

78,032 

 

 

74,283 

Held-to-maturity, at amortized cost (fair value of $2,605 in 2015 and $2,638 in 2014)

 

2,368 

 

 

2,371 

Restricted, at cost

 

3,736 

 

 

4,228 

Loans, net of allowance for losses of $7,866 in 2015 and $7,874 in 2014

 

487,431 

 

 

473,789 

Other real estate owned (OREO)

 

495 

 

 

1,810 

Premises and equipment, net

 

11,935 

 

 

11,461 

Accrued interest receivable

 

1,849 

 

 

1,736 

Bank owned life insurance

 

10,138 

 

 

9,900 

Deferred tax asset

 

3,834 

 

 

4,115 

Other assets

 

1,718 

 

 

1,752 

Total assets

$

623,253 

 

$

598,538 

LIABILITIES

 

 

 

 

 

Deposits

 

 

 

 

 

Noninterest-bearing

$

97,922 

 

$

70,770 

Interest-bearing

 

422,606 

 

 

408,737 

Total deposits

 

520,528 

 

 

479,507 

Securities sold under repurchase agreements

 

 -

 

 

1,761 

Federal funds purchased

 

 -

 

 

6,318 

Subordinated debt and trust preferred

 

9,987 

 

 

11,559 

Federal Home Loan Bank advances

 

35,000 

 

 

45,000 

Accrued expenses and other liabilities

 

4,367 

 

 

4,741 

Total liabilities

 

569,882 

 

 

548,886 

STOCKHOLDERS' EQUITY

 

 

 

 

 

Preferred stock (Note 10)

 

 -

 

 

 -

Common stock (Note 11)

 

129 

 

 

128 

Additional paid-in capital

 

48,713 

 

 

48,569 

Retained earnings

 

4,269 

 

 

1,020 

Accumulated other comprehensive income (loss), net of tax

 

260 

 

 

(65)

Total stockholders' equity

 

53,371 

 

 

49,652 

Total liabilities and stockholders' equity

$

623,253 

 

$

598,538 

 

 

See notes to consolidated financial statements.

3

 


 

First Capital Bancorp, Inc. and Subsidiary

Consolidated Statements of Operations

(Unaudited)

(Dollars in Thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2015

 

2014

 

2015

 

2014

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income

 

 

 

 

 

 

 

 

 

 

 

Loans

$

6,148 

 

$

5,822 

 

$

18,065 

 

$

16,918 

Investments:

 

 

 

 

 

 

 

 

 

 

 

Taxable interest income

 

297 

 

 

341 

 

 

884 

 

 

1,064 

Tax exempt interest income

 

42 

 

 

28 

 

 

100 

 

 

103 

Dividends

 

53 

 

 

46 

 

 

151 

 

 

140 

Interest bearing deposits

 

17 

 

 

10 

 

 

52 

 

 

21 

Total interest and dividend income

 

6,557 

 

 

6,247 

 

 

19,252 

 

 

18,246 

Interest expense

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

998 

 

 

1,073 

 

 

2,945 

 

 

3,235 

FHLB advances

 

166 

 

 

113 

 

 

483 

 

 

315 

Subordinated debt and other borrowings

 

82 

 

 

124 

 

 

280 

 

 

369 

Total interest expense

 

1,246 

 

 

1,310 

 

 

3,708 

 

 

3,919 

Net interest income

 

5,311 

 

 

4,937 

 

 

15,544 

 

 

14,327 

Recovery of provision for loan losses

 

 -

 

 

(60)

 

 

(145)

 

 

(352)

Net interest income after

 

 

 

 

 

 

 

 

 

 

 

recovery of provision for loan losses

 

5,311 

 

 

4,997 

 

 

15,689 

 

 

14,679 

Noninterest income

 

 

 

 

 

 

 

 

 

 

 

Fees on deposits

 

78 

 

 

87 

 

 

226 

 

 

254 

Gain on sale of securities

 

48 

 

 

81 

 

 

120 

 

 

352 

Gain on sale of loans

 

 -

 

 

 -

 

 

 -

 

 

55 

Other

 

398 

 

 

263 

 

 

981 

 

 

719 

Total noninterest income

 

524 

 

 

431 

 

 

1,327 

 

 

1,380 

Noninterest expense

 

 

 

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

2,291 

 

 

2,171 

 

 

6,477 

 

 

6,584 

Occupancy expense

 

201 

 

 

217 

 

 

621 

 

 

635 

Data processing

 

240 

 

 

236 

 

 

771 

 

 

708 

Professional services

 

121 

 

 

99 

 

 

419 

 

 

357 

Advertising and marketing

 

130 

 

 

126 

 

 

360 

 

 

381 

FDIC assessment

 

93 

 

 

93 

 

 

275 

 

 

273 

Virginia franchise tax (benefit)

 

(57)

 

 

135 

 

 

197 

 

 

389 

(Gain) Loss on sale and write down of OREO, net

 

 -

 

 

(16)

 

 

140 

 

 

(93)

Depreciation

 

210 

 

 

161 

 

 

602 

 

 

444 

Other operating expenses

 

721 

 

 

499 

 

 

1,984 

 

 

1,767 

Total noninterest expense

 

3,950 

 

 

3,721 

 

 

11,846 

 

 

11,445 

Net income before income taxes

 

1,885 

 

 

1,707 

 

 

5,170 

 

 

4,614 

Income tax expense

 

606 

 

 

556 

 

 

1,662 

 

 

1,477 

Net income

 

1,279 

 

 

1,151 

 

 

3,508 

 

 

3,137 

Effective dividend on preferred stock

 

 -

 

 

 -

 

 

 -

 

 

24 

Net income available to common stockholders

$

1,279 

 

$

1,151 

 

$

3,508 

 

$

3,113 

Basic net income per common share (Note 3)

$

0.10 

 

$

0.09 

 

$

0.28 

 

$

0.25 

Diluted net income per common share (Note 3)

$

0.09 

 

$

0.08 

 

$

0.24 

 

$

0.21 

 

 

 

 

 

 

 

 

 

 

 

 

See notes to consolidated financial statements.

 

 

 

 

 

 

 

 

 

 

 

 

4

 


 

First Capital Bancorp, Inc. and Subsidiary

Consolidated Statements of Comprehensive Income

(Unaudited)

(Dollars in Thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2015

 

2014

 

2015

 

2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

1,279 

 

$

1,151 

 

$

3,508 

 

$

3,137 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

Investment securities:

 

 

 

 

 

 

 

 

 

 

 

Unrealized (losses) gains on investment securities

 

 

 

 

 

 

 

 

 

 

 

available for sale

 

442 

 

 

(207)

 

 

592 

 

 

802 

Tax effect

 

(152)

 

 

68 

 

 

(188)

 

 

(275)

Reclassification of gains recognized in net income

 

(48)

 

 

(81)

 

 

(120)

 

 

(352)

Tax effect

 

16 

 

 

27 

 

 

41 

 

 

119 

Total other comprehensive income (loss)

 

258 

 

 

(193)

 

 

325 

 

 

294 

Comprehensive income

$

1,537 

 

$

958 

 

$

3,833 

 

$

3,431 

 

 

See notes to consolidated financial statements

5

 


 

First Capital Bancorp, Inc. and Subsidiary

Consolidated Statements of Stockholders’ Equity

Nine Months Ended September 30, 2015 and 2014

(Unaudited)

(Dollars in Thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retained

 

 

Discount 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Earnings

 

 

on

 

 

Other

 

 

 

 

 

Preferred

 

 

Common

 

 

Paid-in

 

 

(Accumulated

 

 

Preferred

 

 

Comprehensive

 

 

 

 

 

Stock

 

 

Stock

 

 

Capital

 

 

Deficit)

 

 

Stock

 

 

Income (Loss)

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances December 31, 2013

$

22 

 

$

50,208 

 

$

4,448 

 

$

(4,590)

 

$

(16)

 

$

(390)

 

$

49,682 

Net income

 

 -

 

 

 -

 

 

 -

 

 

3,137 

 

 

 -

 

 

 -

 

 

3,137 

Other comprehensive income

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 

294 

 

 

294 

Preferred stock dividend

 

 -

 

 

 -

 

 

 -

 

 

(8)

 

 

 -

 

 

 -

 

 

(8)

Accretion of discount on

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   preferred stock

 

 -

 

 

 -

 

 

 -

 

 

(16)

 

 

16 

 

 

 -

 

 

 -

Stock based compensation

 

 -

 

 

 -

 

 

253 

 

 

 -

 

 

 -

 

 

 -

 

 

253 

Redemption of preferred stock

 

(22)

 

 

 -

 

 

(5,509)

 

 

 -

 

 

 -

 

 

 -

 

 

(5,531)

Change in par value

 

 

 

 

(50,083)

 

 

48,837 

 

 

1,246 

 

 

 

 

 

 

 

 

 

Exercise of warrants issued

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in connection with

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

rights offering

 

 -

 

 

 

 

427 

 

 

 -

 

 

 -

 

 

 -

 

 

429 

Issuance of 98 thousand shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

of restricted common stock

 

 -

 

 

 

 

(1)

 

 

 -

 

 

 -

 

 

 -

 

 

 -

Balances September 30, 2014

$

 -

 

$

128 

 

$

48,455 

 

$

(231)

 

$

 -

 

$

(96)

 

$

48,256 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances December 31, 2014

$

 -

 

$

128 

 

$

48,569 

 

$

1,020 

 

$

 -

 

$

(65)

 

$

49,652 

Net income

 

 -

 

 

 -

 

 

 -

 

 

3,508 

 

 

 -

 

 

 -

 

 

3,508 

Other comprehensive income

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 

325 

 

 

325 

Stock based compensation

 

 -

 

 

 -

 

 

304 

 

 

 -

 

 

 -

 

 

 -

 

 

304 

Repurchase of common stock

 

 -

 

 

 -

 

 

(182)

 

 

 -

 

 

 -

 

 

 -

 

 

(182)

Exercise of rights offering warrants

 

 -

 

 

 -

 

 

23 

 

 

 -

 

 

 -

 

 

 -

 

 

23 

Payments of dividends

 

 -

 

 

 -

 

 

 -

 

 

(259)

 

 

 -

 

 

 -

 

 

(259)

Issuance of 94 thousand shares of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

restricted common stock

 

 -

 

 

 

 

(1)

 

 

 -

 

 

 -

 

 

 -

 

 

 -

Balances September 30, 2015

$

 -

 

$

129 

 

$

48,713 

 

$

4,269 

 

$

 -

 

$

260 

 

$

53,371 

 

 

See notes to consolidated financial statements

6

 


 

First Capital Bancorp, Inc. and Subsidiary

Consolidated Statements of Cash Flows

For the Nine Months Ended September 30, 2015 and 2014

(Unaudited)

(Dollars in Thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2014

Cash flows from operating activities

 

 

Net income

$

3,508 

 

$

3,137 

Adjustments to reconcile net income to net cash

 

 

 

 

 

provided by operating activities:

 

 

 

 

 

Recovery of provision for loan losses

 

(145)

 

 

(352)

Depreciation of premises and equipment

 

602 

 

 

444 

Net amortization of bond premiums/discounts

 

537 

 

 

481 

Stock based compensation expense

 

304 

 

 

253 

Deferred income tax expense

 

134 

 

 

1,062 

Gain on sale of securities

 

(120)

 

 

(352)

Gain on loans sold

 

 -

 

 

(55)

Loss (gain) on sale and write down of OREO, net

 

140 

 

 

(93)

Increase in cash surrender value of bank owned life insurance

 

(238)

 

 

(242)

Proceeds from sale of loans held for sale

 

 -

 

 

7,167 

Origination of loans held for sale

 

 -

 

 

(6,120)

Decrease (increase) in other assets

 

34 

 

 

(322)

Increase in accrued interest receivable

 

(113)

 

 

(70)

Decrease in accrued expenses and other liabilities

 

(374)

 

 

(500)

Net cash provided by operating activities

 

4,269 

 

 

4,438 

Cash flows from investing activities

 

 

 

 

 

Proceeds from paydowns of securities available-for-sale

 

9,327 

 

 

8,592 

Purchase of securities available-for-sale

 

(26,271)

 

 

(31,319)

Proceeds from sale of securities available-for-sale

 

13,253 

 

 

18,513 

Proceeds from sale of OREO

 

1,275 

 

 

1,013 

Improvements in OREO

 

(100)

 

 

(256)

Proceeds from sale of equipment

 

51 

 

 

 -

Redemption (purchase) of Federal Home Loan Bank (FHLB) Stock, net

 

492 

 

 

(291)

Purchase of Federal Reserve Stock

 

 -

 

 

(158)

Purchase of time deposits in other banks

 

(250)

 

 

 -

Payment of stock dividend

 

(259)

 

 

 -

Purchases of premises and equipment

 

(1,127)

 

 

(693)

Net increase in loans

 

(13,497)

 

 

(37,361)

Net cash used in investing activities

 

(17,106)

 

 

(41,960)

Cash flows from financing activities

 

 

 

 

 

Net increase in deposits

 

41,021 

 

 

32,216 

FHLB advances

 

32,000 

 

 

20,000 

FHLB advance repayments

 

(42,000)

 

 

(10,000)

Federal funds purchased, net

 

(6,318)

 

 

 -

Dividends on preferred stock

 

 -

 

 

(8)

Cash paid for redemption of common stock warrants and preferred stock, net of expenses

 

 -

 

 

(5,531)

Proceeds from issuance of subordinated debt

 

 -

 

 

6,500 

Repurchase of common stock

 

(182)

 

 

 -

Repayment of subordinated debt

 

(1,572)

 

 

(2,072)

Warrants exercised in connection with the rights offering

 

23 

 

 

429 

Net (decrease) increase in repurchase agreements

 

(1,761)

 

 

7,555 

Net cash provided by financing activities

 

21,211 

 

 

49,089 

Net increase in cash and cash equivalents

 

8,374 

 

 

11,567 

Cash and cash equivalents, beginning of period

 

11,093 

 

 

14,187 

Cash and cash equivalents, end of period

$

19,467 

 

$

25,754 

 

7

 


 

 

First Capital Bancorp, Inc. and Subsidiary

Consolidated Statements of Cash Flows

For the Nine Months Ended September 30,  2015 and 2014

(Dollars in Thousands)

(Unaudited)

(Continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

 

2014

 

 

 

 

 

 

 

(Unaudited)

 

(Dollars in thousands)

Supplemental disclosure of cash flow information

 

 

Interest paid during the period

$

3,705 

 

$

3,919 

Taxes paid during the period

$

1,470 

 

$

410 

 

 

See notes to consolidated financial statements

 

 

8

 


 

First Capital Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

September 30, 2015

Note 1 – Basis of Presentation

First Capital Bancorp, Inc. (the Company) is the holding company of and successor to First Capital Bank (the Bank).  In 2006, the Company acquired all of the outstanding stock of the Bank in a statutory share exchange transaction pursuant to an Agreement and Plan of Reorganization dated September 5, 2006, between the Company and the Bank (the Agreement).  Under the terms of the Agreement, the shares of the Bank’s common stock were exchanged for shares of the Company’s common stock on a one-for-one basis.  As a result, the Bank became a wholly owned subsidiary of the Company, the Company became the holding company of the Bank and the stockholders of the Bank became stockholders of the Company. 

The Company conducts all of its business activities through the branch offices of the  Bank.  The Bank created RE1, LLC, and RE2, LLC, wholly owned Virginia limited liability companies, for the sole purpose of taking title to property acquired in lieu of foreclosure.  RE1, LLC, and RE2, LLC have been consolidated with the Bank.  The Company exists primarily for the purpose of holding the stock of its subsidiary, the Bank, and such other subsidiaries that it may acquire or establish.

The Company has one other wholly owned subsidiary, FCRV Statutory Trust 1 (the Trust), a Delaware Business Trust that was formed in connection with the issuance of trust preferred debt in 2006.  Pursuant to current accounting standards, the Company does not consolidate the Trust.

The consolidated financial statements include the accounts of First Capital Bancorp, Inc. and its wholly owned subsidiary, First Capital Bank.  All material intercompany balances and transactions have been eliminated.

In management’s opinion, the accompanying unaudited consolidated financial statements reflect all adjustments, consisting solely of normal recurring accruals, necessary for a fair presentation of the financial information as of September 30, 2015, and December 31, 2014, and for the three and nine months ended September 30, 2015 and 2014, in conformity with accounting principles generally accepted in the United States of America (GAAP).  Results for the three and nine-month periods ended September 30, 2015, are not necessarily indicative of the results that may be expected for the full year ending December 31, 2015.  

The organization and business of the Company, accounting policies followed, and other related information are contained in the notes to the consolidated financial statements of the Company as of and for the year ended December 31, 2014, filed as part of the Company’s annual report on Form 10-K.  These interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements.

Certain reclassifications have been made to amounts presented in the prior period consolidated financial statements to conform to the current period presentation.

 

 

Note 2 – Use of Estimates

To prepare financial statements in conformity with GAAP, management makes estimates and assumptions based on available information.  These estimates and assumptions affect the amounts reported in the consolidated financial statements and the disclosures provided, and actual results may be different.  In particular, the allowance for loan losses, valuation of other real estate owned, income taxes, and fair values of financial instruments are subject to change.

 

 

 

9

 


 

First Capital Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

September 30, 2015

 

Note 3 – Earnings per common share

Basic earnings per share (EPS) excludes potential dilution and is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the period.  Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock that have a dilutive impact on shares outstanding were exercised or converted into common stock, or resulted in the issuance of common stock that then shared in the earnings of the Company.  

The basic and diluted EPS calculations are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

September 30,

 

 

September 30,

 

 

(in thousands,

 

 

(in thousands,

 

 

except per share amounts)

 

 

except per share amounts)

 

2015

 

2014

 

2015

 

2014

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common stockholders

$

1,279 

 

$

1,151 

 

$

3,508 

 

$

3,113 

Weighted average number of shares outstanding

 

12,636 

 

 

12,568 

 

 

12,638 

 

 

12,513 

Net income per common share - basic

$

0.10 

 

$

0.09 

 

$

0.28 

 

$

0.25 

 

 

 

 

 

 

 

 

 

 

 

 

Effect of dilutive securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding

 

12,636 

 

 

12,568 

 

 

12,638 

 

 

12,513 

Effect of stock options, warrants and restricted stock

 

2,340 

 

 

2,442 

 

 

2,227 

 

 

2,415 

Diluted average common shares outstanding

 

14,976 

 

 

15,010 

 

 

14,865 

 

 

14,928 

Net income per common share - diluted

$

0.09 

 

$

0.08 

 

$

0.24 

 

$

0.21 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the three and nine months ended September 30, 2015,  the Company has excluded options convertible into 2 and 29 thousand shares of common stock, respectively, from the calculation of diluted earnings per share because they were anti-dilutive.

For the three and nine months ended September 30, 2014, the Company excluded options convertible into 31 thousand shares of common stock from the calculation of diluted earnings per share because they were anti-dilutive. 

 

 

Note 4 – Stock-Based Compensation

 

Accounting standards require the Company to measure compensation cost for the type of stock-based awards the Company issues at fair value on the date of grant and recognize compensation expense in the consolidated statements of operations over the service period that the awards are expected to vest.

Stock-based compensation expense during the three and nine months ended September 30, 2015 was $110  thousand and $304 thousand, respectively, and the amount expensed during the three and nine months ended September 30, 2014, was $95 thousand and $253 thousand, respectively.   Stock-based compensation is included in salaries and employee benefits in the accompanying consolidated statements of operations.

 

 

10

 


 

First Capital Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

September 30, 2015

Note 5 – Investment Securities

The amortized costs, gross unrealized gains, gross unrealized losses, and fair values for securities are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2015

 

Amortized

 

Gross Unrealized

 

Fair

 

Cost

 

Gains

 

Losses

 

Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

Available-for-sale

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

$

26,636 

 

$

213 

 

$

28 

 

$

26,821 

Corporate bonds

 

2,501 

 

 

 -

 

 

38 

 

 

2,463 

Collateralized mortgage obligation (CMO) securities

 

21,876 

 

 

202 

 

 

14 

 

 

22,064 

State and political subdivisions - taxable

 

16,024 

 

 

123 

 

 

60 

 

 

16,087 

State and political subdivisions - tax exempt

 

4,059 

 

 

13 

 

 

14 

 

 

4,058 

SBA pools

 

6,552 

 

 

15 

 

 

28 

 

 

6,539 

 

$

77,648 

 

$

566 

 

$

182 

 

$

78,032 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2014

 

Amortized

 

Gross Unrealized

 

Fair

 

Cost

 

Gains

 

Losses

 

Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

Available-for-sale

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

$

29,447 

 

$

190 

 

$

73 

 

$

29,564 

Corporate bonds

 

3,502 

 

 

 

 

12 

 

 

3,498 

Collateralized mortgage obligation (CMO) securities

 

19,686 

 

 

196 

 

 

91 

 

 

19,791 

State and political subdivisions - taxable

 

18,046 

 

 

37 

 

 

329 

 

 

17,754 

State and political subdivisions - tax exempt

 

 -

 

 

 -

 

 

 -

 

 

 -

SBA pools

 

3,690 

 

 

 

 

17 

 

 

3,676 

 

$

74,371 

 

$

434 

 

$

522 

 

$

74,283