Attached files
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| 8-K - PRIMARY DOCUMENT - COMMUNITY BANCORP /VT | form8kearnings12312018.htm |
Exhibit
99.1
PRESS RELEASE
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Community
Bancorp. Reports Earnings and Dividend
|
January
22, 2019
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Derby,
Vermont
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For
immediate release
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For
more information, contact: Kathy Austin, President and CEO at (802)
334-7915
Community
Bancorp. has reported consolidated earnings for the fourth quarter
ended December 31, 2018, of $2,142,603 or $0.41 per share compared
to $1,524,619 or $0.29 per share for the fourth quarter of 2017.
The Company’s earnings of $8,397,532 or $1.61 per share for
the full year compares to $6,231,298 or $1.21 per share in
2017.
Total
assets for the Company at year-end 2018 were $720,347,498 compared
to $667,045,595 at year-end 2017, an increase of 7.99%. The
increase in assets was due to an increase in loans of $28.5 million
and an increase in overnight deposits of $21.1 million, with the
increase in loans continuing to be attributable to growth in
commercial loans. On December 31, 2018 loans totaled $531,383,494
compared to $502,864,651 on December 31, 2017, an increase of
5.67%. Funding for the increase in earning assets was from an
increase in deposits of $48.2 million.
The
increase in the loan portfolio, along with increases in interest
rates, resulted in an increase in interest income of $772,330, or
11.0%, for the fourth quarter and an increase of $2,673,654, or
10.1%, for the year. The increase in rates also had a significant
impact on the larger deposit base with an increase in interest
expense of $669,412, or 84.9% for the quarter and $1,416,698, or
46.2%, year to date. This resulted in an increase in net interest
income of 102,918, or 1.7% for the quarter and $1,256,956, or 5.4%,
year to date. Further contributing to the Company’s results
was an increase in noninterest income of $169,488, or 12.3%, for
the quarter and $596,916, or 10.7% year to date. The year to date
increase in noninterest income is partly attributable to a one-time
gain on sale of property of $263,118 which was directly related to
the sale of a condominium unit to the Company’s affiliate,
CFSG. Prior to the sale, CFSG rented this unit since its formation
in 2002.
Total
noninterest expense increased $485,082, or 10.3% for the quarter
and $728,703, or 3.8% year to date. These increase were mostly due
to increases in Salaries and wages of $238,866, or 14.0%, for the
fourth quarter and $430,628, or 6.4%, year over year. These
increases were mostly due to a one-time bonus paid to all
employees, except the executive officers, as well as a $0.25
increase per hour to all employees, other than the executive
officers. The bonus was paid, and the increase was effective, in
September 2018.
Also
contributing to the increase in noninterest expense was an increase
to Employee benefits, due to increases in the cost of the employee
health insurance plan, of $156,871, or 24.9%, for the quarter and
$231,988, or 8.8%, for the year when compared to the prior year
comparison periods.
Further
contributing to the Company’s financial performance was the
reduction in the federal corporate tax rate to 21% under the 2017
Tax Act resulting in a decrease in income tax expense of $840,660,
or 70.7% for the fourth quarter and $1,171,065, or 40.3%, for the
year compared to the same period in 2017.
Capital
grew to $62,603,711 with a book value of $11.72 per share on
December 31, 2018 compared to $57,935,854 with a book value of
$10.84 per share on December 31, 2017.
In
commenting on the Company’s earnings, Chief Executive Officer
Kathy Austin said “While the Company benefited from the
reduction in the tax rate and rising interest rates in 2018, our
good results are largely generated by fundamental community banking
activities. Our team’s commitment to supporting our
communities and meeting the needs of our customers drives continued
growth in both our loans and deposits. I am pleased to report a
Return on Average Assets of 1.36% for the year ended December 31,
2018, compared to 1.05% for the prior year. Kudos to our entire
team for these results.”
As
previously announced, the Company has declared a quarterly cash
dividend of $0.19 per share payable February 1, 2019 to
shareholders of record as of January 15, 2019.
Community
National Bank is an independent bank that has been serving its
communities since 1851, with offices located in Derby, Derby Line,
Island Pond, Barton, Newport, Troy, St. Johnsbury, Montpelier,
Barre, Lyndonville, Morrisville and Enosburg Falls.
Forward Looking Statements
This press release contains forward-looking statements, including,
without limitation, statements about the Company’s financial
condition, capital status, dividend payment practices, business
outlook and affairs. Although these statements are based on
management’s current expectations and estimates, actual
conditions, results, and events may differ materially from those
contemplated by such forward-looking statements, as they could be
influenced by numerous factors which are unpredictable and outside
the Company’s control. Factors that may cause actual results
to differ materially from such statements include, among others,
the following: (1) general economic or monetary conditions, either
nationally or regionally, continue to decline, resulting in a
deterioration in credit quality or diminished demand for the
Company’s products and services; (2) changes in laws or
government rules, or the way in which courts interpret those laws
or rules, adversely affect the financial industry generally or the
Company’s business in particular, or may impose additional
costs and regulatory requirements; (3) interest rates change in
such a way as to reduce the Company’s interest margins and
its funding sources; and (4) competitive pressures increase among
financial services providers in the Company’s northern New
England market area or in the financial services industry
generally, including pressures from nonbank financial service
providers, from increasing consolidation and integration of
financial service providers and from changes in technology and
delivery systems.