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8-K - FORM 8-K - FNCB Bancorp, Inc.fncb20160129_8k.htm

EXHIBIT 99.1

 

  

 

 

 

 

 

FOR IMMEDIATE RELEASE

  

First National Community Bancorp, Inc.

Reports Record 2015 Earnings of $35.8 million

  

Dunmore, Pa., January 29, 2016—First National Community Bancorp, Inc. (OTCQX: FNCB), the parent company of Dunmore-based First National Community Bank (the “Bank”), today reported record net income of $35.8 million, or $2.17 per basic and diluted share, for the year ended December 31, 2015, an increase of $22.4 million, or 167.1%, compared to $13.4 million, or $0.81 per basic and diluted share, for the year ended December 31, 2014.

 

167% Earnings Increase Included Reversal of Deferred Tax Asset Valuation Allowance

 

The Company’s earnings performance was significantly impacted by the non-recurring reversal of a deferred tax asset (“DTA”) valuation allowance, which resulted in the Company recording a tax benefit of $27.8 million in the consolidated statement of income for the year ended December 31, 2015. The reversal of the DTA valuation allowance indicates that upon consideration of all objectively verifiable evidence, management determined that it is more likely than not that future taxable income will be available to utilize the benefit of the Company’s net deferred tax assets, excluding DTAs for charitable contribution carryforwards, going forward. Also impacting the Company’s earnings performance in 2015 were decreases in non-interest income and the credit for loan and lease losses of $7.1 million and $4.5 million, respectively, which were partially offset by a $5.1 million reduction in non-interest expense and a $0.9 million increase in net interest income. For the fourth quarter of 2015, the Company recorded net income of $29.2 million, or $1.77, per basic and diluted common share, compared to a net loss of $31 thousand or $0.00 per basic and diluted share, for the same quarter of 2014. The improvement in fourth quarter results primarily reflected the reversal of DTA valuation allowance, increases in net interest income and the credit for loan and lease losses, partially offset by a reduction in non-interest income.

 

With the reversal of the DTA valuation allowance, at December 31, 2015, shareholders’ equity increased $34.8 million, or 67.7%, to $86.2 million, or $5.22 per share, from $51.4 million, or $3.12 per share, at December 31, 2014. Return on average assets and return on average shareholders’ equity equaled 3.57% and 63.24%, respectively in 2015, compared to 1.38% and 29.50%, respectively, in 2014. For the three months ended December 31, 2015, return on average assets and return on average shareholders’ equity were 10.99% and 192.68%, respectively, compared to (0.01)% and (0.24)%, respectively, for the same three months of 2014.

 

Performance Highlights:

 

 

Earnings per share increased $1.36 to $2.17 in 2015 from $0.81 in 2014.

 

Net interest income before the credit for loan and lease losses grew by 3.3% over 2014.

 

Non-interest expense decreased $5.1 million, or 15.2% from 2014.

  

 
 

 

 

 

Strong growth in net loans for 2015 of $66.2 million, or 10.0%.

 

Asset quality improvement as evidenced by a 10.7% decline in nonperforming assets compared to December 31, 2014.

 

Tangible book value improved 68.1% to $5.21 per share at December 31, 2015 compared to $3.10 per share at December 31, 2014.

 

“2015 has proved to be pivotal for our Company as we achieved several significant milestones this year,” stated Dominick L. DeNaples, Chairman of the Board. “Our accomplishments in 2015, including the termination of all regulatory enforcement actions, reflected our continued resolve and commitment to strengthen the Company’s risk profile and profitability through the execution of sound balance sheet management strategies,” commented Steven R. Tokach, President and Chief Executive Officer. “The reversal of the DTA valuation allowance further reinforces our confidence in the Company’s ability to generate sustained profitability and enhance shareholder value going forward, and underscores our belief that the Company has regained its position as a premier community banking franchise in Northeastern Pennsylvania,” concluded Mr. Tokach.

 

Summary Results for 2015

 

Net interest income before the credit for loan and lease losses increased $874 thousand, or 3.3%, to $27.4 million in 2015 from $26.5 million in 2014. The improvement in net interest income reflected a $1.3 million, or 21.9%, decrease in interest expense, which was due primarily to a 19 basis point reduction in the Company’s cost of funds to 0.61% in 2015 from 0.80% in 2014. Having the greatest impact on funding costs was an $11.0 million principal payment and rate modification of the Company’s subordinated debentures decreasing the interest rate 450 basis points completed on June 30, 2015. As a result, interest expense on the subordinated debentures decreased $0.8 million. Overall, the cost of borrowed funds decreased 116 basis points to 2.01% in 2015 from 3.17% in 2014. Partially offsetting the decrease in interest expense was a $0.5 million, or 1.4%, decrease in interest income to $32.2 million in 2015 from $32.7 million in 2014. The reduction in interest income was primarily caused by a 25 basis point reduction in the tax-equivalent yield on earning assets to 3.50% in 2015 from 3.75% in 2014. The Company’s tax-equivalent margin decreased 9 basis points to 2.99% in 2015 from 3.08% in 2014. The margin contraction reflected repositioning of the Company’s investment securities portfolio from tax-free to taxable securities as part of tax planning strategies aimed at facilitating the reversal of the DTA valuation allowance, and a 17 basis point decrease in the tax-equivalent yield on the loan portfolio, partially offset by the positive effects of $26.8 million in growth in average earning assets.

 

Non-interest income decreased $7.1 million to $7.8 million in 2015 from $14.9 million in 2014. The 47.7% decrease was due largely to a decrease in net gains on the sale of investment securities of $4.3 million, coupled with non-recurring income earned in 2014. Net gains on the sale of investment securities were $2.3 million in 2015, a $4.3 million, or 65.4%, decrease compared to $6.6 million in 2014. In addition, non-interest income in 2014 included $2.1 million of non-recurring income received from the settlement of judgements filed pursuant to a large, previously charged-off, commercial credit relationship, and a $0.6 million net gain recorded on the divestiture of the Company’s retail banking operations in Monroe County, Pennsylvania.

 

Non-interest expense levels were positively impacted by continued improvement in the Company’s asset quality and risk profile, termination of regulatory enforcement actions and on-going cost containment initiatives. Non-interest expense decreased $5.1 million, or 15.2%, to $28.5 million in 2015 from $33.6 million in 2014. Specifically, the above factors contributed directly to reductions of $2.2 million, or 84.4%, in expense of other real estate owned, $1.4 million, or 75.7%, in legal expense, $0.9 million, or 47.3%, in regulatory assessments, $0.6 million, or 35.3% in professional fees and $0.3 million, or 30.7%, in insurance costs.

 

 
 

 

  

Improved Asset Quality

 

The Company’s asset quality continued to improve in 2015, which reflects the ongoing focus on sound problem credit resolutions and commitment to disciplined credit risk management. Total non-performing assets decreased $0.9 million, or 10.7%, to $6.9 million at December 31, 2015 from $7.8 million at December 31, 2014. A $1.7 million decrease in non-performing loans, including non-accruing troubled debt restructurings, was partially offset by a $0.9 million increase in other real estate owned (“OREO”). In the fourth quarter of 2015, the Company foreclosed upon a commercial property collateralizing a $3.5 million non-accrual commercial real estate loan. The property was transferred to OREO at its fair value less cost to sell of $1.5 million. The loan was supported by a governmental agency guarantee. Accordingly, the Company does not expect to incur any loss on the difference between the recorded investment of this loan and the fair value of the collateral less cost to sell.

 

The ratio of non-performing loans to total loans improved 30 basis points to 0.52% at December 31, 2015, compared to 0.82% at December 31, 2014. The allowance for loan and lease losses as a percentage of total loans was 1.21% at December 31, 2015 compared to 1.72% at the end of 2014. Net charge-offs as a percentage of average loans outstanding for the year ended December 31, 2015 was 0.20%. In comparison, the Company posted net recoveries as a percentage of average loans outstanding of 0.51% in 2014, which was largely due to the aforementioned favorable legal settlement.

 

Financial Position

 

Total assets increased $120.6 million, or 12.4%, to $1.1 billion at December 31, 2015 from $970.0 million at December 31, 2014. Net loans grew $66.2 million, or 10.0%, which reflected strong demand for both commercial and consumer loan products. In addition, available-for-sale securities increased $34.8 million, or 15.9%. The balance sheet was also impacted by the reversal of the DTA valuation allowance, which was the primary factor causing a $28.7 million increase in other assets. Total deposits increased $26.2 million, or 3.3%, to $821.5 million at December 31, 2015 from $795.3 million at the end of 2014. Specifically, non-interest-bearing demand deposits increased $30.5 million, or 24.6%, while interest-bearing deposits decreased $4.3 million, or 0.6%. The increase in non-interest bearing demand deposits primarily reflected the positive balance fluctuations of several large commercial customer relationships. The decrease in interest-bearing deposits was largely related to lower deposit balances of the Company’s municipal customers due to a state budget impasse, and the planned runoff of higher-costing certificates of deposit generated through QwickRate®, a national deposits listing service. These decreases were partially offset by the attainment of a large commercial deposit relationship. Due to their lower cost, the Company increased its utilization of FHLB borrowings as an alternative funding source of liquidity by $74.6 million or 121.9%. This was the primary factor leading to a $63.6 million, or 65.9%, increase in total borrowed funds. Partially offsetting the increase in FHLB advances was the $11.0 million principal repayment of the Company’s subordinated debentures.

 

Impacted by the DTA valuation allowance reversal, total shareholders’ equity improved $34.8 million, or 67.7%, to $86.2 million at December 31, 2015 from $51.4 million at the end of 2014. Net income for 2015 of $35.8 million, which included an income tax benefit of $27.8 million related to the reversal of the DTA valuation allowance, was the primary factor leading to the Company’s improved capital position.

 

 
 

 

  

At December 31, 2015, the Company’s total risk-based capital ratio and the Tier 1 leverage ratio were 11.75% and 7.27%, respectively, at December 31, 2015. The respective ratios for the Bank at December 31, 2015 were 13.79% and 9.79%. The ratios for both the Company and the Bank exceeded the 10.00% and 5.00% required to be well capitalized under the prompt corrective action provisions of the Basel III capital framework for U.S. Banking organizations, which became effective for the Company and the Bank on January 1, 2015.

 

 

Availability of Filings

 

Copies of the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on for 10-Q will be provided upon request from: Shareholder Relations, First National Community Bancorp, Inc., 102 East Drinker Street, Dunmore, PA 18512 or by calling (570) 348-6419. The Company’s SEC filings including Annual Report on Form 10-K and Quarterly Reports on Form 10-Q are also available on the Investor Relations page of the Company’s website, www.fncb.com, and on the SEC website at: http://www.sec.gov/edgar/searchedgar/companysearch.html

 

About First National Community Bank:

First National Community Bancorp, Inc. is the bank holding company of First National Community Bank, which provides personal, small business and commercial banking services to individuals and businesses throughout Lackawanna, Luzerne, and Wayne Counties in Northeastern Pennsylvania. The institution was established as a National Banking Association in 1910 as The First National Bank of Dunmore, and has been operating under its current name since 1988. For more information about FNCB, visit www.fncb.com.

 

INVESTOR CONTACT:

James M. Bone, Jr., CPA

Executive Vice President and

Chief Financial Officer

First National Community Bank

(570) 348-6419

james.bone@fncb.com

 

The Company may from time to time make written or oral “forward-looking statements,” including statements contained in the Company’s filings with the Securities and Exchange Commission (“SEC”), in its reports to shareholders, and in other communications by the Company, which are made in good faith by the Company pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.

 

These forward-looking statements include statements with respect to the Company’s beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, that are subject to significant risks and uncertainties, and are subject to change based on various factors (some of which are beyond the Company’s control). The words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan” and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause the Company’s financial performance to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements: the strength of the United States economy in general and the strength of the local economies in the Company’s markets; the effects of, and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market and monetary fluctuations; the timely development of and acceptance of new products and services; the ability of the Company to compete with other institutions for business; the composition and concentrations of the Company’s lending risk and the adequacy of the Company’s reserves to manage those risks; the valuation of the Company’s investment securities; the ability of the Company to pay dividends or repurchase common shares; the ability of the Company to retain key personnel; the impact of any pending or threatened litigation against the Company; the marketability of shares of the Company and fluctuations in the value of the Company’s share price; the impact of the Company’s ability to comply with its regulatory agreements and orders; the effectiveness of the Company’s system of internal controls; the ability of the Company to attract additional capital investment; the impact of changes in financial services’ laws and regulations (including laws concerning capital adequacy, taxes, banking, securities and insurance); the impact of technological changes and security risks upon the Company’s information technology systems; changes in consumer spending and saving habits; the nature, extent, and timing of governmental actions and reforms, and the success of the Company at managing the risks involved in the foregoing and other risks and uncertainties, including those detailed in the Company’s filings with the SEC.

 

 
 

 

  

The Company cautions that the foregoing list of important factors is not all inclusive. Readers are also cautioned not to place undue reliance on any forward-looking statements, which reflect management’s analysis only as of the date of this report, even if subsequently made available by the Company on its website or otherwise. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company to reflect events or circumstances occurring after the date of this report.

 

Readers should carefully review the risk factors described in the Annual Report and other documents that the Company periodically files with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2014.

 

[The Company provides tabular information as follows]

 

 
 

 

 

First National Community Bancorp, Inc.

Selected Financial Data

 

   

Dec 31,

2015

   

Sept 30,

2015

   

Jun 30,

2015

   

Mar 31,

2015

   

Dec 31,

2014

 

Per share data:

                                       

Net income (fully diluted)

  $ 1.77     $ 0.14     $ 0.05     $ 0.21     $ -  

Cash dividends declared

  $ -     $ -     $ -     $ -     $ -  

Book value

  $ 5.22     $ 3.61     $ 3.33     $ 3.38     $ 3.12  

Tangible book value

  $ 5.21     $ 3.60     $ 3.32     $ 3.36     $ 3.10  

Market value:

                                       

High

  $ 5.50     $ 6.05     $ 6.55     $ 5.40     $ 6.65  

Low

  $ 5.06     $ 5.02     $ 5.15     $ 5.25     $ 5.60  

Close

  $ 5.25     $ 5.19     $ 6.05     $ 5.26     $ 6.00  

Common shares outstanding

    16,514,245       16,500,945       16,500,945       16,500,945       16,484,419  
                                         

Selected ratios:

                                       

Annualized return on average assets

    10.99 %     0.91 %     0.34 %     1.45 %     (0.01 )%

Annualized return on average shareholders' equity

    192.68 %     16.38 %     5.89 %     26.34 %     (0.24 )%

Tier I leverage ratio

    7.27 %     6.57 %     6.64 %     6.57 %     6.05 %

Total risk-based capital to risk-adjusted assets

    11.79 %     11.20 %     11.60 %     12.96 %     13.67 %

Average shareholders' equity to average total assets

    5.70 %     5.55 %     5.73 %     5.52 %     5.22 %

Yield on earning assets (FTE)

    3.56 %     3.50 %     3.45 %     3.48 %     3.56 %

Cost of funds

    0.48 %     0.51 %     0.73 %     0.75 %     0.79 %

Net interest spread (FTE)

    3.08 %     2.98 %     2.72 %     2.73 %     2.77 %

Net interest margin (FTE)

    3.15 %     3.07 %     2.85 %     2.85 %     2.90 %

Total delinquent loans/total loans

    0.85 %     1.29 %     1.34 %     1.10 %     1.21 %

Allowance for loan and lease losses/total loans

    1.21 %     1.36 %     1.51 %     1.63 %     1.72 %

Non-performing loans/total loans

    0.52 %     0.93 %     0.84 %     0.77 %     0.82 %

Net charge-offs/average loans

    0.02 %     0.04 %     0.14 %     0.01 %     0.02 %

  

 
 

 

 

First National Community Bancorp, Inc.

Year-to-Date Consolidated Statements of Income

 

   

Year Ended

December 31,

 

(in thousands, except share data)

 

2015

   

2014

 

Interest income

               

Interest and fees on loans

  $ 26,672     $ 26,629  

Interest and dividends on securities

               

U.S. government agencies

    4,036       3,494  

State and political subdivisions, tax-free

    109       1,883  

State and political subdivisions, taxable

    905       324  

Other securities

    433       272  

Total interest and dividends on securities

    5,483       5,973  

Interest on interest-bearing deposits in other banks

    46       71  

Total interest income

    32,201       32,673  

Interest expense

               

Interest on deposits

    2,631       3,180  

Interest on borrowed funds

               

Interest on Federal Home Loan Bank of Pittsburgh advances

    514       450  

Interest on subordinated debentures

    1,450       2,281  

Interest on junior subordinated debentures

    206       236  

Total interest on borrowed funds

    2,170       2,967  

Total interest expense

    4,801       6,147  

Net interest income before credit for loan and lease losses

    27,400       26,526  

Credit for loan and lease losses

    (1,345 )     (5,869 )

Net interest income after credit for loan and lease losses

    28,745       32,395  

Non-interest income

               

Deposit service charges

    2,960       2,975  

Net gain on the sale of securities

    2,296       6,640  

Net gain on the sale of mortgage loans held for sale

    292       292  

Net loss on the sale of education loans

    -       (13 )

Net gain on the sale of other real estate owned

    162       209  

Gain on branch divestitures

    -       607  

Loan-related fees

    442       440  

Income from bank-owned life insurance

    564       650  

Legal settlements

    184       2,127  

Other

    900       993  

Total non-interest income

    7,800       14,920  

Non-interest expense

               

Salaries and employee benefits

    13,810       13,111  

Occupancy expense

    2,284       2,088  

Equipment expense

    1,657       1,471  

Data processing expense

    1,976       2,088  

Regulatory assessments

    950       1,801  

Bank shares tax

    705       522  

Expense of other real estate owned

    400       2,569  

Legal expense

    437       1,799  

Professional fees

    1,014       1,567  

Insurance expense

    659       951  

Legal/regulatory settlements

    777       1,500  

Other operating expenses

    3,795       4,102  

Total non-interest expense

    28,464       33,569  

Income before income taxes

    8,081       13,746  

Income tax (benefit) expense

    (27,759 )     326  

Net income

  $ 35,840     $ 13,420  
                 

Income per share

               

Basic

  $ 2.17     $ 0.81  

Diluted

  $ 2.17     $ 0.81  
                 

Cash dividends declared per common share

  $ -     $ -  

Weighted average number of shares outstanding:

               

Basic

    16,499,622       16,472,660  

Diluted

    16,499,622       16,472,871  

 

 
 

 

 

First National Community Bancorp, Inc.

Quarter-to-Date Consolidated Statements of Income

 

   

Three Months Ended

 

(in thousands, except share data)

 

Dec 31,

2015

   

Sept 30,

2015

   

Jun 30,

2015

   

Mar 31,

2015

   

Dec 31,

2014

 

Interest income

                                       

Interest and fees on loans

  $ 7,032     $ 6,693     $ 6,475     $ 6,472     $ 6,671  

Interest and dividends on securities

                                       

U.S. government agencies

    992       1,061       1,012       971       998  

State and political subdivisions, tax-free

    18       19       22       50       204  

State and political subdivisions, taxable

    458       324       97       26       53  

Other securities

    102       92       82       157       66  

Total interest and dividends on securities

    1,570       1,496       1,213       1,204       1,321  

Interest on interest-bearing deposits in other banks

    4       10       11       21       27  

Total interest income

    8,606       8,199       7,699       7,697       8,019  

Interest expense

                                       

Interest on deposits

    628       677       643       683       745  

Interest on borrowed funds

                                       

Interest on Federal Home Loan Bank of Pittsburgh advances

    147       128       119       120       116  

Interest on subordinated debentures

    160       162       565       563       575  

Interest on junior subordinated debentures

    56       50       51       49       87  

Total interest on borrowed funds

    363       340       735       732       778  

Total interest expense

    991       1,017       1,378       1,415       1,523  

Net interest income before (credit) provision for loan and lease losses

    7,615       7,182       6,321       6,282       6,496  

(Credit) provision for loan and lease losses

    (1,005 )     (191 )     345       (494 )     (240 )

Net interest income after (credit) provision for loan and lease losses

    8,620       7,373       5,976       6,776       6,736  

Non-interest income

                                       

Deposit service charges

    742       799       745       674       758  

Net (loss) gain on the sale of securities

    (6 )     4       74       2,224       634  

Net gain on the sale of mortgage loans held for sale

    223       13       16       40       69  

Net gain on the sale of other real estate owned

    17       129       11       5       106  

Loan-related fees

    152       94       106       90       148  

Income from bank-owned life insurance

    149       145       135       135       154  

Legal settlements

    -       -       184       -       -  

Other

    180       195       274       251       194  

Total non-interest income

    1,457       1,379       1,545       3,419       2,063  

Non-interest expense

                                       

Salaries and employee benefits

    4,228       3,240       3,203       3,139       3,302  

Occupancy expense

    619       500       532       633       534  

Equipment expense

    423       408       442       384       403  

Data processing expense

    556       471       501       448       532  

Regulatory assessments

    239       203       99       409       412  

Bank shares tax

    53       217       218       217       150  

Expense of other real estate owned

    62       91       147       100       74  

Legal expense

    106       80       88       163       371  

Professional fees

    234       193       286       301       327  

Insurance expense

    131       128       202       198       194  

Legal settlement

    777       -       -       -       1,500  

Other operating expenses

    1,159       884       962       790       1,031  

Total non-interest expense

    8,587       6,415       6,680       6,782       8,830  

Income (loss) before income taxes

    1,490       2,337       841       3,413       (31 )

Income tax (benefit) expense

    (27,719 )     -       22       (62 )     -  

Net income (loss)

  $ 29,209     $ 2,337     $ 819     $ 3,475     $ (31 )
                                         

Income per share

                                       

Basic

  $ 1.77     $ 0.14     $ 0.05     $ 0.21     $ -  

Diluted

  $ 1.77     $ 0.14     $ 0.05     $ 0.21     $ -  
                                         

Cash dividends declared per common share

  $ -     $ -     $ -     $ -     $ -  

Weighted average number of shares outstanding:

                                       

Basic

    16,506,294       16,500,945       16,500,945       16,490,111       16,475,899  

Diluted

    16,506,294       16,500,945       16,500,945       16,490,111       16,475,899  

 

 
 

 

 

First National Community Bancorp, Inc.

Consolidated Balance Sheets

 

 

(in thousands)

 

Dec 31,

2015

   

Sept 30,

2015

   

Jun 30,

2015

   

Mar 31,

2015

   

Dec 31,

2014

 

Assets

                                       

Cash and cash equivalents:

                                       

Cash and due from banks

  $ 19,544     $ 20,631     $ 22,443     $ 19,985     $ 22,657  

Interest-bearing deposits in other banks

    1,539       10,383       49,872       17,390       13,010  

Total cash and cash equivalents

    21,083       31,014       72,315       37,375       35,667  

Securities available for sale, at fair value

    253,773       249,228       226,539       204,635       218,989  

Stock in Federal Home Loan Bank of Pittsburgh at cost

    6,344       4,298       2,684       3,061       2,803  

Loans held for sale

    683       4,634       138       -       603  

Loans, net of net deferred costs and unearned income

    733,716       723,166       683,588       672,165       670,267  

Allowance for loan and lease losses

    (8,790 )     (9,825 )     (10,328 )     (10,944 )     (11,520 )

Net loans

    724,926       713,341       673,260       661,221       658,747  

Bank premises and equipment, net

    11,193       11,258       11,059       11,221       11,003  

Accrued interest receivable

    2,475       2,618       2,174       2,118       2,075  

Intangible assets

    137       179       220       261       302  

Bank-owned life insurance

    29,381       29,232       29,087       28,952       28,817  

Other real estate owned

    3,154       1,618       1,740       2,369       2,255  

Other assets

    37,469       7,799       8,455       9,028       8,768  

Total assets

  $ 1,090,618     $ 1,055,219     $ 1,027,671     $ 960,241     $ 970,029  
                                         

Liabilities

                                       

Deposits:

                                       

Demand (non-interest-bearing)

  $ 154,531     $ 152,038     $ 144,075     $ 134,993     $ 124,064  

Interest-bearing

    667,015       700,004       721,293       640,118       671,272  

Total deposits

    821,546       852,042       865,368       775,111       795,336  

Borrowed funds:

                                       

Federal Home Loan Bank of Pittsburgh advances

    135,802       93,058       57,771       67,612       61,194  

Subordinated debentures

    14,000       14,000       14,000       25,000       25,000  

Junior subordinated debentures

    10,310       10,310       10,310       10,310       10,310  

Total borrowed funds

    160,112       117,368       82,081       102,922       96,504  

Accrued interest payable

    11,165       11,187       11,344       10,788       10,262  

Other liabilities

    11,617       14,989       13,935       15,678       16,529  

Total liabilities

    1,004,440       995,586       972,728       904,499       918,631  
                                         

Shareholders' equity

                                       

Preferred stock

    -       -       -       -       -  

Common stock

    20,643       20,626       20,626       20,626       20,605  

Additional paid-in capital

    62,059       61,939       61,870       61,801       61,781  

Retained earnings (accumulated deficit)

    3,714       (25,495 )     (27,832 )     (28,651 )     (32,126 )

Accumulated other comprehensive (loss) income

    (238 )     2,563       279       1,966       1,138  

Total shareholders' equity

    86,178       59,633       54,943       55,742       51,398  

Total liabilities and shareholders’ equity

  $ 1,090,618     $ 1,055,219     $ 1,027,671     $ 960,241     $ 970,029  

 

 
 

 

 

First National Community Bancorp, Inc.

Summary Tax-equivalent Net Interest Income

 

 

   

Three Months Ended

 

(dollars in thousands)

 

Dec 31,

2015

   

Sept 30,

2015

   

Jun 30,

2015

   

Mar 31,

2015

   

Dec 31,

2014

 

Interest income

                                       

Loans:

                                       

Loans - taxable

  $ 6,694     $ 6,371     $ 6,148     $ 6,148     $ 6,340  

Loans - tax-free

    512       488       495       491       501  

Total loans

    7,206       6,859       6,643       6,639       6,841  

Securities:

                                       

Securities, taxable

    1,552       1,477       1,191       1,154       1,117  

Securities, tax-free

    27       29       33       76       309  

Total interest and dividends on securities

    1,579       1,506       1,224       1,230       1,426  

Interest-bearing deposits in other banks

    4       10       11       21       27  

Total interest income

    8,789       8,375       7,878       7,890       8,294  

Interest expense

                                       

Deposits

    628       677       643       683       745  

Borrowed funds

    363       340       735       732       778  

Total interest expense

    991       1,017       1,378       1,415       1,523  

Net interest income

  $ 7,798     $ 7,358     $ 6,500     $ 6,475     $ 6,771  
                                         

Average balances

                                       

Earning assets:

                                       

Loans:

                                       

Loans - taxable

  $ 685,795     $ 660,709     $ 637,005     $ 633,731     $ 635,146  

Loans - tax-free

    43,429       41,746       42,225       41,125       40,477  

Total loans

    729,224       702,455       679,230       674,856       675,623  

Securities:

                                       

Securities, taxable

    251,108       241,799       211,833       194,268       196,351  

Securities, tax-free

    1,713       1,707       2,007       4,283       17,055  

Total interest and dividends on securities

    252,821       243,506       213,840       198,551       213,406  

Interest-bearing deposits in other banks

    6,797       12,185       18,984       34,708       43,618  

Total interest-earning assets

    988,842       958,146       912,054       908,115       932,647  

Non-earning assets

    65,633       62,063       62,254       61,476       58,826  

Total assets

  $ 1,054,475     $ 1,020,209     $ 974,308     $ 969,591     $ 991,473  

Interest-bearing liabilities:

                                       

Deposits

  $ 702,783     $ 690,039     $ 646,656     $ 658,193     $ 675,901  

Borrowed funds

    119,281       105,109       108,234       99,046       99,251  

Total interest-bearing liabilities

    822,064       795,148       754,890       757,239       775,152  

Demand deposits

    146,457       143,140       137,674       132,316       139,336  

Other liabilities

    25,811       25,303       25,964       26,525       25,278  

Shareholders' equity

    60,143       56,618       55,780       53,511       51,707  

Total liabilities and shareholders' equity

  $ 1,054,475     $ 1,020,209     $ 974,308     $ 969,591     $ 991,473  
                                         

Yield/Cost

                                       

Earning assets:

                                       

Loans:

                                       

Interest and fees on loans - taxable

    3.90 %     3.86 %     3.86 %     3.88 %     3.99 %

Interest and fees on loans - tax-free

    4.72 %     4.67 %     4.69 %     4.78 %     4.95 %

Total loans

    3.95 %     3.91 %     3.91 %     3.94 %     4.05 %

Securities:

                                       

Securities, taxable

    2.47 %     2.44 %     2.25 %     2.38 %     2.28 %

Securities, tax-free

    6.37 %     6.75 %     6.64 %     7.10 %     7.25 %

Total interest and dividends on securities

    2.50 %     2.47 %     2.29 %     2.48 %     2.67 %

Interest on interest-bearing deposits in other banks

    0.24 %     0.33 %     0.23 %     0.24 %     0.25 %

Total earning assets

    3.56 %     3.50 %     3.45 %     3.48 %     3.56 %

Interest-bearing liabilities:

                                       

Interest on deposits

    0.36 %     0.39 %     0.40 %     0.42 %     0.44 %

Interest on borrowed funds

    1.22 %     1.29 %     2.72 %     2.96 %     3.14 %

Total interest-bearing liabilities

    0.48 %     0.51 %     0.73 %     0.75 %     0.79 %

Net interest spread

    3.08 %     2.98 %     2.72 %     2.73 %     2.77 %

Net interest margin

    3.15 %     3.07 %     2.85 %     2.85 %     2.90 %

 

 
 

 

 

First National Community Bancorp, Inc.

Asset Quality Data

 

 

   

 

   

 

   

 

   

 

   

 

 

(in thousands)

 

Dec 31,

2015

   

Sept 30,

2015

   

Jun 30,

2015

   

Mar 31,

2015

   

Dec 31,

2014

 

At period end

                                       

Non-accrual loans, including non-accruing troubled debt restructured loans (TDRs)

  $ 3,788     $ 6,741     $ 5,757     $ 5,184     $ 5,522  

Loans past due 90 days or more and still accruing

    -       -       -       -       -  

Total non-performing loans

    3,788       6,741       5,757       5,184       5,522  

Other real estate owned (OREO)

    3,154       1,618       1,740       2,369       2,255  

Total non-performing loans and OREO

  $ 6,942     $ 8,359     $ 7,497     $ 7,553     $ 7,777  
                                         

Accruing TDRs

  $ 4,982     $ 5,065     $ 5,289     $ 5,807     $ 5,282  
                                         
                                         

For the three months ended

                                       

Allowance for loan and lease losses

                                       

Beginning balance

  $ 9,825     $ 10,328     $ 10,944     $ 11,520     $ 11,898  

Loans charged-off

    198       968       1,192       277       427  

Recoveries of charged-off loans

    168       656       231       195       289  

Net charge-offs

    30       312       961       82       138  

(Credit) provision for loan and lease losses

    (1,005 )     (191 )     345       (494 )     (240 )

Ending balance

  $ 8,790     $ 9,825     $ 10,328     $ 10,944     $ 11,520