EVANSVILLE, Ind., July 31 /PRNewswire-FirstCall/ -- American Community Bancorp, Inc. (the "Company") (BULLETIN BOARD: ACBP) , the holding company for Bank of Evansville, today reported consolidated net income for the second quarter of 2009 of $8,636, compared to net income of $472,995 for the same quarter in 2008. Diluted earnings per share, adjusted for the 5 percent stock dividend declared in April 2009, were $0.00 and $0.23 for the second quarter of 2009 and 2008, respectively.
The Company's earnings for the second quarter of 2009 were negatively impacted by two transactions. First, the Company expensed $133,215 in June on a pre-tax basis to record the Federal Deposit Insurance Corporation's ("FDIC") special deposit insurance assessment levied on all FDIC-insured financial institutions. The assessment amount is different for all banks, and is calculated by the FDIC based on a formula that considers levels of deposits, assets, and capital.
Second, as previously disclosed in the Company's 2008 annual report, the Company was involved in litigation over disputed ownership of certain certificates of deposit owned by loan customers of the Bank, and pledged to secure loans through the Bank and another creditor. The loan customer defaulted on the loans, and both the Company and the other creditor claimed rights to the certificates. The Company settled this lawsuit, which resulted in a charge-off of the loans secured by the certificates in the amount of $446,300. Potentially, the Company could recover part or all of this charge-off through a claim under one of the Company's insurance policies. The Company cannot offer any assurance as to when, if ever, such recovery may occur or as to the amount of such recovery, if any.
For the first six months of 2009, consolidated net income was $312,598, compared to $834,580 for the first six months of 2008, a decrease of 62.5 percent. Diluted earnings per share, adjusted for the 5 percent stock dividend declared in April 2009, for the first six months of 2009 were $0.15, compared to $0.41 for the same period in 2008.
Total assets at June 30, 2009, were $295,892,299, compared to $291,745,151 at the same date a year ago, an increase of $4,147,148 or 1.4 percent. Loans declined $5,627,536 or 2.2 percent and totaled $255,695,039 at June 30, 2009, compared to $261,322,575 reported at June 30, 2008. Total deposits at June 30, 2009, were $254,187,692, reflecting an increase of $2,143,715 or 0.9 percent over the corresponding total a year ago. At June 30, 2009, low cost demand deposit balances had increased $7,688,606, or 37.6 percent, over the same period a year ago. The Company remains "well capitalized" with a Tier I capital ratio of 10.1 percent at June 30, 2009.
Michael S. Sutton, President and Chief Executive Officer, commented, "Although we are disappointed with our quarterly earnings, there are a number of positives to report. We have seen improvement throughout the year in our net interest margin. The increase of our demand deposit portfolio, coupled with certificate of deposit repricing opportunities, have enabled us to offset the unprecedented rate action taken by the Federal Reserve Bank during the fourth quarter of 2008. We are pleased with the growth in our non interest income quarter over quarter. With the growth of our transaction accounts, we have been able to increase our service charge revenue. In addition, we have been very active in the residential refinancing business segment."
Total revenues, consisting of net interest income and non interest income, were $2,495,767 for the second quarter of 2009, which was $237,988 or 8.7 percent lower than the same period last year. Net interest income was $2,182,072 for the second quarter of 2009, decreasing $157,009 or 6.7 percent over the same quarter of 2008. The decrease in net interest income for the second quarter of 2009 over the same quarter in the prior year was attributable to the historically low interest rate environment that currently exists, the reduction in average loan balances outstanding during the current quarter compared to the same quarter last year, and an increase in non-performing loans.
Compared to the first quarter of 2009, net interest income for the current quarter grew by $166,126, or 33.1 percent on an annualized basis, primarily driven by an increase in the Company's net interest margin from 2.98 percent to 3.24 percent. The Company experienced increases in average balances for all transaction-based deposit product types, which allowed the Company to capitalize on re-pricing opportunities in the certificates of deposit portfolio while maintaining strong liquidity levels.
Non interest income was $313,695 for the second quarter of 2009. For the same quarter in 2008, non interest income totaled $394,674, of which $205,015 was attributable to merchant processing revenues. The Company sold its merchant processing line of business in the third quarter of 2008. Excluding the merchant processing fees from 2008, non interest income increased by $124,036, or 65.4 percent over the prior year, primarily driven by increased service charges on deposit accounts and increased originations by the Company's residential mortgage banking line of business and the corresponding gains on the sale of those loans.
Non interest expense for the second quarter of 2009 was $1,937,031, compared to $1,672,660 for the second quarter of 2008, an increase of 15.8 percent. The increase in non interest expense for 2009 is attributable to the FDIC insurance assessment and ongoing professional and miscellaneous expenses related to the work-out and resolution of the Company's non-performing loans.
Total revenues for the first six months of 2009 were $4,791,827, decreasing $406,972 or 7.8 percent compared to the same period in the prior year. After adjusting for the sold merchant processing line of business, the decrease was only $12,087, or 0.3 percent. Net interest income for the first six months of 2009 was $4,198,018, which was $210,421 or 4.8 percent lower than the $4,408,439 reported for the first six months of 2008. Non interest income for the first six months of 2009 decreased $196,551 or 24.9 percent. Non interest expense for the first six months of 2009 was $3,505,729 compared to $3,292,474 for the same period in 2008.
The provision for loan losses for the first six months of 2009 was $740,000 compared to $497,345 in 2008. The increased provision was related to the Company's net charge-offs of $579,343 in 2009 compared to $116,655 in 2008, and an increase in non-performing loans of approximately $4.2 million. The ratio of the allowance for loan losses to total loans was 1.76 percent at June 30, 2009, and 1.34 percent at June 30, 2008.
Mr. Sutton concluded, "The banking industry continues to operate in a very challenging environment. As we navigate through the current downturn, the Company continues to focus on managing risk and preserving capital. During the second quarter, we increased our capital ratios when compared to regulatory benchmarks. In addition, we continued to build our loan loss reserve. While this impacts earnings in the short run, we believe this is prudent given today's difficult times. Over 95 percent of our non-performing loans in dollars are made up of five relationships. We continue to work closely with these borrowers as we seek resolution of these credits."
American Community Bancorp, Inc., through its wholly-owned subsidiary, Bank of Evansville, provides a full range of commercial and consumer banking services in the Evansville, Indiana, area.
This news release contains certain forward-looking statements. These forward-looking statements may be identified by the use of such forward-looking terminology as "expect," "believe," "plan," "anticipate," "may," "will," or similar statements or variations of such terms or otherwise express views concerning trends and the future. Forward-looking statements involve risks and uncertainties which could cause our results to differ materially from such forward-looking statements. We assume no obligation for updating any such forward-looking statement at any time.
AMERICAN COMMUNITY BANCORP, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) (Unaudited) June 30, December 31, June 30, 2009 2008 2008 ------------ ------------ ------------ ASSETS Cash and due from banks $22,157,486 $10,566,834 $3,756,119 Interest bearing balances with banks 2,133,581 67,729 37,922 Federal funds sold - - 4,014,000 ------------ ------------ ------------ Total cash and cash equivalents 24,291,067 10,634,563 7,808,041 Securities available for sale, at fair value 7,662,136 12,540,576 12,598,959 Nonmarketable equity securities 1,364,850 1,269,450 1,269,450 Loans, net of deferred fees 255,695,039 263,454,211 261,322,575 Allowance for loan losses (4,511,356) (4,350,699) (3,497,457) ------------ ------------ ------------ Net loans 251,183,683 259,103,512 257,825,118 Premises and equipment 7,318,487 7,498,177 7,026,209 Other real estate owned 80,000 268,600 - Other assets 3,992,076 3,689,315 5,217,374 ------------ ------------ ------------ Total assets $295,892,299 $295,004,193 $291,745,151 ============ ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Deposits Non interest bearing $28,120,706 $25,961,237 $20,432,100 NOW, MMDA and Savings 129,771,520 94,865,418 97,741,670 Time deposits 96,295,466 133,455,253 133,870,207 ------------ ------------ ------------ Total deposits 254,187,692 254,281,908 252,043,977 Long term debt 18,248,000 18,248,000 18,248,000 Accrued expenses and other liabilities 1,649,049 1,072,135 758,428 ------------ ------------ ------------ Total liabilities 274,084,741 273,602,043 271,050,405 SHAREHOLDERS' EQUITY Common stock, no par value, 3,000,000 shares authorized; issued and outstanding 2,021,335 2,001,462, and 1,972,477 21,766,400 20,556,955 20,500,264 Undivided profits 5,980 750,568 287,894 Accumulated other comprehensive income (loss) 35,178 94,627 (93,412) ------------ ------------ ------------ Total shareholders' equity 21,807,558 21,402,150 20,694,746 ------------ ------------ ------------ Total liabilities and shareholders' equity $295,892,299 $295,004,193 $291,745,151 ============ ============ ============ AMERICAN COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three months ended Six months ended June 30, June 30, Interest income: 2009 2008 2009 2008 ---------- ---------- ---------- ---------- Interest and fees on loans $3,323,317 $3,956,686 $6,643,593 $7,974,359 Securities: U. S. government agencies and corp. 78,352 93,438 180,775 176,081 State, County, Municipal bonds 9,833 11,465 Other securities 14,543 18,407 29,618 34,494 Federal funds sold - 27,535 - 159,577 Deposits with other banks 4,086 145 7,894 337 ---------- ---------- ---------- ---------- Total interest income 3,430,131 4,096,211 6,873,345 8,344,848 Interest expense: Deposits 1,118,755 1,591,764 2,412,211 3,603,347 Fed funds purchased 3,123 6,166 3,369 6,250 Borrowings 126,181 159,200 259,747 326,812 ---------- ---------- ---------- ---------- Total interest expense 1,248,059 1,757,130 2,675,327 3,936,409 ---------- ---------- ---------- ---------- Net interest income 2,182,072 2,339,081 4,198,018 4,408,439 Provision for loan losses 530,000 267,000 740,000 497,345 ---------- ---------- ---------- ---------- Net interest income after provision for loan losses 1,652,072 2,072,081 3,458,018 3,911,094 Non interest income: Service charges on deposit accounts 94,259 63,310 158,993 115,474 Gain on sale of loans 165,437 64,576 334,158 149,498 Merchant processing fees - 205,015 - 394,885 Other 53,999 61,773 100,658 130,503 ---------- ---------- ---------- ---------- Total non interest income 313,695 394,674 593,809 790,360 Non interest expense: Salaries and benefits 933,514 874,416 1,805,977 1,752,576 Occupancy and equipment, net 163,755 105,799 338,063 272,244 Marketing 23,326 7,662 29,167 32,979 Data processing 114,094 104,844 224,501 205,697 Supplies, postage and printing 18,635 17,412 31,021 24,690 Legal and professional 130,190 93,388 268,749 176,464 Merchant processing expense - 177,050 - 347,007 Other 553,517 292,089 808,251 480,817 ---------- ---------- ---------- ---------- Total non interest expense 1,937,031 1,672,660 3,505,729 3,292,474 ---------- ---------- ---------- ---------- Income before income taxes 28,736 794,095 546,098 1,408,980 Income taxes 20,100 321,100 233,500 574,400 ---------- ---------- ---------- ---------- Net income $8,636 $472,995 $312,598 $834,580 ========== ========== ========== ========== Basic earnings per common share* $0.00 $0.24 $0.16 $0.42 Diluted earnings per common share* $0.00 $0.23 $0.15 $0.41 Average common shares outstanding* 2,003,518 1,975,117 2,003,214 1,965,280 Average diluted shares outstanding* 2,063,187 2,038,815 2,046,990 2,027,354 * Adjusted for 5 percent stock dividends paid on June 6, 2008 and June 11, 2009 AMERICAN COMMUNITY BANCORP, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited) (dollars in thousands except per share 2009 2009 2008 2008 2008 data) 2nd Qtr 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr ------- ------- ------- ------- ------- EARNINGS Net interest income $2,182 $2,016 $2,082 $2,320 $2,339 Provision for loan losses $530 $210 $870 $345 $267 Non interest income $314 $280 $147 $1,085 $395 Non interest expense $1,937 $1,569 $1,642 $1,965 $1,673 Income taxes $20 $213 $(102) $451 $321 Net income $9 $304 $(181) $644 $473 Basic earnings per share* $0.00 $0.16 $(0.10) $0.34 $0.25 Diluted earnings per share* $0.00 $0.16 $(0.09) $0.34 $0.24 Average shares outstanding* 2,003,518 2,002,922 1,994,440 1,994,440 1,975,117 Average diluted shares outstanding* 2,063,187 2,030,806 2,012,865 2,014,292 2,038,804 PERFORMANCE RATIOS Return on average assets 0.01% 0.42% -0.25% 0.87% 0.67% Return on average common equity 0.16% 5.65% -3.32% 12.13% 9.27% Net interest margin (fully tax equivalent) 3.24% 2.98% 2.95% 3.28% 3.45% Efficiency ratio 77.61% 68.32% 88.17% 57.72% 61.19% Full time equivalent employees 50 49 48 48 49 CAPITAL Average equity to average assets 7.71% 7.47% 7.39% 7.20% 7.21% Tier 1 leverage capital ratio 10.09% 9.93% 9.70% 9.76% 9.75% Tier 1 risk based capital ratio 11.45% 11.35% 11.26% 11.37% 10.93% Total risk based capital ratio 13.00% 12.90% 12.87% 12.96% 12.61% Book value per share* $10.79 $11.34 $11.23 $11.27 $10.86 Cash dividend per share - - - - - ASSET QUALITY Gross loan charge- offs $450 $162 $260 $119 $117 Net loan charge-offs $438 $141 $247 $115 $114 Net loan charge-offs to average loans 0.17% 0.05% 0.09% 0.04% 0.04% Allowance for loan losses $4,511 $4,420 $4,351 $3,728 $3,497 Allowance for losses to total loans 1.76% 1.71% 1.65% 1.42% 1.34% Non-performing loans $6,376 $5,005 $5,328 $2,095 $2,147 Other real estate and repossessed assets $80 $109 $269 $604 $909 Non-performing assets to total assets 2.18% 1.74% 1.90% 0.92% 1.05% END OF PERIOD BALANCES Loans $255,695 $257,814 $263,454 $262,098 $261,323 Total earning assets $266,797 $272,786 $277,175 $283,448 $279,398 Total assets $295,892 $294,243 $295,004 $292,240 $291,745 Deposits $254,188 $253,249 $254,282 $251,438 $252,044 Shareholders' equity $21,808 $21,831 $21,402 $21,474 $20,695 AVERAGE BALANCES Loans $257,429 $258,888 $260,959 $261,598 $256,828 Total earning assets $269,875 $274,509 $280,354 $281,152 $272,993 Total assets $287,793 $292,042 $292,931 $293,197 $284,314 Deposits $245,551 $251,223 $251,768 $252,297 $243,747 Shareholders' equity $22,182 $21,803 $21,657 $21,106 $20,513 Years ended December 31 (dollars in thousands except per share data) 2008 2007 ---- ---- EARNINGS Net interest income $8,810 $8,150 Provision for loan losses $1,712 $2,607 Non interest income $2,022 $1,499 Non interest expense $6,900 $6,133 Income taxes $923 $405 Net income $1,297 $504 Basic earnings per share* $0.69 $0.26 Diluted earnings per share* $0.67 $0.25 Average shares outstanding* 1,979,939 1,958,235 Average diluted shares outstanding* 2,021,574 2,054,852 PERFORMANCE RATIOS Return on average assets 0.45% 0.20% Return on average common equity 6.23% 2.52% Net interest margin (fully tax equivalent) 3.20% 3.38% Efficiency ratio 63.70% 63.56% Full time equivalent employees 48 46 CAPITAL Average equity to average assets 7.24% 7.95% Tier 1 leverage capital ratio 9.70% 9.97% Tier 1 risk based capital ratio 11.26% 11.17% Total risk based capital ratio 12.87% 13.05% Book value per share* $11.23 $10.44 Cash dividend per share - - ASSET QUALITY Gross loan charge-offs $509 $2,554 Net loan charge-offs $478 $2,554 Net loan charge-offs to average loans 0.19% 1.15% Allowance for loan losses $4,351 $3,117 Allowance for losses to total loans 1.65% 1.30% Non-performing loans $5,328 $2,243 Other real estate and repossessed assets $269 $- Non-performing assets to total assets 1.90% 0.84% END OF PERIOD BALANCES Loans $263,454 $239,392 Total earning assets $277,175 $254,321 Total assets $295,004 $267,829 Deposits $254,282 $239,183 Shareholders' equity $21,402 $19,527 AVERAGE BALANCES Loans $255,114 $222,114 Total earning assets $275,325 $241,036 Total assets $287,266 $251,136 Deposits $248,185 $221,913 Shareholders' equity $20,812 $19,960 * Adjusted for 5 percent stock dividends paid June 6, 2008 and June 11, 2009 Contact: Michael S. Sutton John M. Schenk Phone: (812) 962-2265
American Community Bancorp, Inc.
CONTACT: Michael S. Sutton or John M. Schenk of American Community
Bancorp, Inc., +1-812-962-2265
Web Site: http://www.bankevansville.com/
