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8-K - CHOICEONE FORM 8-K - CHOICEONE FINANCIAL SERVICES INCchoice8k_072716.htm

EXHIBIT 99.1

 

 

News Release

 

Contact: Tom Lampen, ChoiceOne Bank
(616) 887-2337
tlampen@choiceone.com

 

ChoiceOne Financial Announces Earnings For Second Quarter of 2016

 

Sparta, Michigan – July 27, 2016 – ChoiceOne Financial Services, Inc. (OTC:COFS), the parent company for ChoiceOne Bank, reported net income of $1,445,000 for the second quarter of 2016 compared to $1,431,000 in the same period in 2015. Earnings per share were $0.43 in the second quarter of 2016 compared to $0.43 in the second quarter of the prior year. Net income for the first six months of 2016 was $2,719,000 or $0.82 per share, compared to $3,073,000 or $0.93 per share in the first half of 2015.

 

Upon the retirement of James Bosserd on June 1, 2016, Kelly Potes assumed the role of Chief Executive Officer of ChoiceOne Financial Services, Inc. and ChoiceOne Bank. Mr. Potes also remains President of both organizations.

 

“We are excited to announce our strongest second quarter ever just months after the opening of a new loan production office in downtown Grand Rapids,” said Mr. Potes. “We have also continued to grow earning assets and net interest margin year over year, along with achieving strong results in loan and security sales during the second quarter of 2016.”

 

Total assets as of June 30, 2016, increased to $590 million, compared to $568 million as of December 31, 2015. Securities grew $7.1 million and loans grew $5.7 million in the second quarter of 2016 as ChoiceOne emphasized growth in earning assets. Net loans increased $21.4 million from second quarter 2015 to second quarter 2016. Total deposits declined by $16.0 million in the second quarter of 2016; however, balances were up $41 million when compared to second quarter 2015. Borrowings increased $25.9 million in the second quarter of 2016 to offset the deposit decline and to provide funding for earning assets.

 

Growth in both loans and securities caused increases in interest income of $205,000 in the second quarter of 2016 and $380,000 in the first half of 2016 compared to the same periods in the prior year. Increased activity in sales of loans and securities caused noninterest income to grow $200,000 in the second quarter of 2016 compared to the same quarter in 2015. Noninterest income was down $251,000 in the first half of 2016 compared to the same period in the prior year as a result of a $304,000 death benefit recognized on a bank owned life insurance policy in the first quarter of 2015. Noninterest expense increased $416,000 in the second quarter and $653,000 in the first six months of 2016 compared to the same periods in the prior year. The expense growth was due in part to expansion and additional salary costs tied to the development of the new Grand Rapids loan production office. Other staffing increases also affected salaries and benefits in the first half of 2016 compared to the first half of 2015.

 

“I am pleased with the overall growth trends of ChoiceOne,” said Potes. “We believe that our commitment to community banking will continue to bring benefits to our customers, our staff and our shareholders.”

 

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About ChoiceOne

ChoiceOne Financial Services, Inc. is a financial holding company headquartered in Sparta, Michigan and the parent corporation of ChoiceOne Bank, Member FDIC. ChoiceOne Bank operates 12 full service offices and one loan production office in parts of Kent, Ottawa, Muskegon, and Newaygo Counties. ChoiceOne Bank offers insurance and investment products through its subsidiary, ChoiceOne Insurance Agencies, Inc. ChoiceOne Financial Services, Inc. common stock is quoted on the OTC under the symbol “COFS.” For more information, please visit Investor Relations at ChoiceOne’s website at www.choiceone.com.

 

Forward-Looking Statements
This press release contains forward-looking statements. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “is likely,” “plans,” “predicts,” “projects,” “may,” “could,” “look forward,” “continue” and variations of such words and similar expressions are intended to identify such forward-looking statements. Management’s determination of the provision and allowance for loan losses, the carrying value of goodwill and loan servicing rights, and the fair value of investment securities (including whether any impairment on any investment security is temporary or other than temporary and the amount of any impairment) and management’s assumptions concerning pension and other postretirement benefit plans involve judgments that are inherently forward-looking. These statements reflect management’s current beliefs as to the expected outcomes of future events and are not guarantees of future performance. These statements involve certain risks, uncertainties and assumptions (“risk factors”) that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed, implied or forecasted in such forward-looking statements. Furthermore, ChoiceOne undertakes no obligation to update, amend, or clarify forward-looking statements, whether as a result of new information, future events, or otherwise.

 

Risk factors include, but are not limited to, the risk factors described in Item 1A in ChoiceOne Financial Services, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2015. These and other factors are representative of the risk factors that could cause a difference between an ultimate actual outcome and a preceding forward-looking statement.

 

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EDITORS NOTE: Media interviews with ChoiceOne Bank executives are available by calling Tom Lampen at (616)887-2337 or tlampen@choiceone.com. Electronic versions of bank official headshots are also available.

 

 

 

 

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Condensed Balance Sheets
(Unaudited)

 

(In thousands) 6/30/2016   3/31/2016   12/31/2015   6/30/2015
Cash and Cash Equivalents $ 13,466   $ 12,572   $ 11,188   $ 15,391
Securities   178,360     171,238     163,323     153,860
Loans Held For Sale   2,734     1,507     4,957     2,833
Loans, Net of Allowance For Loan Losses   352,946     347,219     345,110     331,587
Premises and Equipment   11,872     12,008     12,119     11,811
Cash Surrender Value of Life Insurance Policies   12,438     12,348     12,261     12,084
Goodwill and Other Intangible Assets   13,883     13,969     14,108     14,280
Other Assets   4,724     7,997     4,680     5,138
                       
   Total Assets $ 590,423   $ 578,858   $ 567,746   $ 546,984
                       
Noninterest-bearing Deposits $ 124,134   $ 121,514   $ 122,937   $ 114,604
Interest-bearing Deposits   339,687     358,338     351,759     308,184
Borrowings   50,695     24,779     20,792     52,913
Other Liabilities   3,510     2,801     2,416     3,179
                       
   Total Liabilities   518,026     507,432     497,904     478,880
                       
Shareholders’ Equity   72,397     71,426     69,842     68,104
                       
   Total Liabilities and Shareholders’ Equity $ 590,423   $ 578,858   $ 567,746   $ 546,984

 

 

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Condensed Statements of Income
(Unaudited)

 

  Quarter Ended   Six Months Ended
(In Thousands, Except Per Share Data) 6/30/2016   6/30/2015   6/30/2016   6/30/2015
Interest Income                      
     Loans, including fees $ 4,087   $ 3,988   $ 8,083   $ 7,930
     Securities and other   950     844     1,875     1,648
Total Interest Income   5,037     4,832     9,958     9,578
                       
Interest Expense                      
     Deposits   199     215     408     440
     Borrowings   48     38     80     69
Total Interest Expense   247     253     488     509
                       
Net Interest Income   4,790     4,579     9,470     9,069
Provision for Loan Losses               100
                       
Net Interest Income After Provision
     for Loan Losses
 
4,790
   
4,579
   
9,470
   
8,969
                       
Noninterest Income                      
     Customer service charges   1,030     1,062     1,990     2,045
     Insurance and investment commissions   226     292     449     633
     Gains on sales of loans   419     309     838     812
     Gains on sales of securities   156     8     226     53
     Earnings on life insurance policies   89     87     177     475
     Other Income   131     93     214     127
Total Noninterest Income   2,051     1,851     3,894     4,145
                       
Noninterest Expense                      
     Salaries and benefits   2,565     2,214     4,976     4,513
     Occupancy and equipment   692     592     1,333     1,188
     Data processing   538     579     1,097     1,132
     Professional fees   232     236     468     513
     Other expenses   874     864     1,824     1,699
Total Noninterest Expense   4,901     4,485     9,698     9,045
                       
Income Before Income Tax   1,940     1,945     3,666     4,069
Income Tax Expense   495     514     947     996
                       
Net Income $ 1,445   $ 1,431   $ 2,719   $ 3,073
                       
Basic Earnings Per Share $ 0.43   $ 0.43   $ 0.82   $ 0.93
Diluted Earnings Per Share $ 0.43   $ 0.43   $ 0.82   $ 0.93

 

 

 

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