RALEIGH, N.C., Nov. 21, 2011 /PRNewswire/ -- North State Bancorp (OTCBB: NSBC the "Company"), the holding company for North State Bank, reported net income for the quarter ended September 30, 2011 of $233,000, which is $106,000 less than the $339,000 earned in the period ended September 30, 2010. Lower gains on security sales which were $45,000 or $28,000 net of taxes for the quarter ended June 30, 2011 compared to $108,000 or $66,000 for the same period in 2010 contributed to lower earnings. Diluted earnings per share were $0.03 for the quarter ended September 30, 2011 compared to $0.05 for 2010. For the nine month period ended September 30, 2011, net income was $547,000, a decrease of $616,000 from net income of $1,163,000 reported for the nine month period ended September 30, 2010.
The Company also reported that core earnings (earnings before taxes, security gains and cost of credit), a non-GAAP measure, were $2.9 million and $6.5 million for the three and nine month periods ended September 30, 2011. These core earnings have enabled North State Bank to be one of only four (out of 25) North Carolina publicly traded banks that have remained profitable on a trailing twelve month earnings basis from June 2010 to June 2011.
Total assets for the Company as of September 30, 2011, were $632.6 million compared to $633.4 million as of September 30, 2010, a decrease of $812,000. Total deposits and total loans as of September 30, 2011, were $564.2 million and $483.5 million, respectively, compared to total deposits and total loans at September 30, 2010, of $559.5 million and $501.6 million, respectively. Core deposit growth over the same period was $40.7 million including non-interest deposits which grew $26.4 million or 24.6%.
The primary reason for the decrease in quarterly earnings was lower net interest income (a decrease of $270,000) which resulted from declines in loan volumes primarily related to the lengthy recession.
North State Bank remains well capitalized with capital ratios well in excess of regulatory minimums to be considered well capitalized.
"The longest and most resilient recession in our lifetimes remains a large obstacle in the path of economic recovery. At the same time, North State Bank and all banks are able and willing to help their customers take steps to improve the economy. In fact, we continue to reach out to assure our customers of our ability to fund their credit needs. We believe our recovery will begin as soon as the regulatory examination process begins to allow commercial banks more discretion as they help their customers. This is the key ingredient to our economic recovery," Larry D. Barbour, president and CEO, shared in remarks on the Company's financial results.
Mr. Barbour continued, "In the meantime, we are very pleased and thankful for remaining profitable in these difficult times. We remain a well capitalized bank with strong liquidity funded by a loyal base of core deposits, and we remain confident about our future as troubled loans and loan loss reserves decrease."
Founded in 2000, North State Bank is a full-service community bank, serving Wake and New Hanover Counties through seven full-service offices.
North State Bancorp is listed on the OTC electronic bulletin board under the symbol "NSBC."
www.northstatebank.com
This news release contains forward-looking statements. The actual results might differ materially from those projected in the forward-looking statements for various reasons, including changes in real estate values and the real estate market, economic conditions, regulatory changes, changes in interest rates, substantial changes in financial markets, our ability to manage growth, and loss of deposits and loan demand to other savings and financial institutions. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company's SEC filings, including its periodic reports under the Securities Exchange Act of 1934, as amended, copies of which are available upon request from the Company.
North State Bancorp | ||||||||||||
Selected Financial Information and Other Data (Unaudited) | ||||||||||||
As of or for the Three Months Ended | As of or for the Nine Months Ended | |||||||||||
September 30, | September 30, | |||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||
(Dollars in thousands, except per share) | ||||||||||||
Earnings Summary: | ||||||||||||
Total interest income | $7,102 | $7,853 | $20,916 | $23,242 | ||||||||
Total interest expense | 1,289 | 1,770 | 4,120 | 5,898 | ||||||||
Net interest income | 5,813 | 6,083 | 16,796 | 17,344 | ||||||||
Provision for loan losses | 2,137 | 2,166 | 4,570 | 5,028 | ||||||||
Net interest income after provision for loan losses | 3,676 | 3,917 | 12,226 | 12,316 | ||||||||
Noninterest income | 1,359 | 1,572 | 3,267 | 2,883 | ||||||||
Noninterest expense | 4,696 | 4,895 | 14,648 | 13,175 | ||||||||
Income before income taxes | 339 | 594 | 845 | 2,024 | ||||||||
Income taxes | 106 | 255 | 298 | 861 | ||||||||
Net income | $ 233 | $ 339 | $ 547 | $1,163 | ||||||||
Share and Per Share Data: | ||||||||||||
Earnings per share - basic | $ 0.03 | $ 0.05 | $0.07 | $0.16 | ||||||||
Earnings per share - diluted | $ 0.03 | $ 0.05 | $0.07 | $0.16 | ||||||||
Tangible book value per share | $ 5.16 | $ 5.09 | $5.16 | $5.09 | ||||||||
Weighted average shares outstanding: | ||||||||||||
Basic | 7,427,976 | 7,427,967 | 7,427,976 | 7,340,889 | ||||||||
Diluted | 7,429,568 | 7,434,933 | 7,431,199 | 7,374,736 | ||||||||
Financial Condition Period End: | ||||||||||||
Cash, federal funds sold and due from banks | $ 54,687 | $ 44,204 | $54,687 | $44,204 | ||||||||
Investment securities | 14,467 | 20,360 | 14,467 | 20,360 | ||||||||
Loans - held for sale | 50,023 | 44,204 | 50,023 | 44,204 | ||||||||
Loans | 483,537 | 501,597 | 483,537 | 501,597 | ||||||||
Less allowance for loan losses | 9,711 | 8,237 | 9,711 | 8,237 | ||||||||
Other assets | 39,614 | 31,301 | 39,614 | 31,301 | ||||||||
Total assets | $ 632,617 | $ 633,429 | $632,617 | $633,429 | ||||||||
Deposits | $ 564,154 | $ 559,455 | $564,154 | $559,455 | ||||||||
Other borrowings | 27,279 | 32,667 | 27,279 | 32,667 | ||||||||
Other liabilities | 2,730 | 3,348 | 2,730 | 3,348 | ||||||||
Shareholders' equity | 38,454 | 37,959 | 38,454 | 37,959 | ||||||||
Total liabilities and shareholders' equity | $ 632,617 | $ 633,429 | $632,617 | $633,429 | ||||||||
Financial Condition Average Balances: | ||||||||||||
Cash, federal funds sold and due from banks | $ 61,527 | $ 54,032 | $76,181 | $84,825 | ||||||||
Investment securities | 15,866 | 21,286 | 20,881 | 22,614 | ||||||||
Loans - held for sale | 45,853 | 33,983 | 33,474 | 20,467 | ||||||||
Loans | 484,892 | 504,516 | 485,204 | 513,208 | ||||||||
Less allowance for loan losses | 9,809 | 8,424 | 9,647 | 8,326 | ||||||||
Other assets | 34,973 | 30,943 | 32,404 | 31,140 | ||||||||
Total assets | $ 633,302 | $ 636,336 | $638,497 | $663,928 | ||||||||
Deposits | $ 564,104 | $ 562,346 | $567,456 | $589,996 | ||||||||
Other borrowings | 28,110 | 32,787 | 30,510 | 33,247 | ||||||||
Other liabilities | 2,706 | 2,904 | 2,389 | 2,921 | ||||||||
Shareholders' equity | 38,382 | 38,299 | 38,142 | 37,764 | ||||||||
Total liabilities and shareholders' equity | $ 633,302 | $ 636,336 | $638,497 | $663,928 | ||||||||
Performance Ratios: | ||||||||||||
Return on average assets | 0.15% | 0.21% | 0.11% | 0.23% | ||||||||
Return on average equity | 2.41% | 3.51% | 1.92% | 4.12% | ||||||||
Net interest margin (1) | 3.99% | 4.05% | 3.82% | 3.74% | ||||||||
Efficiency ratio | 65.48% | 63.95% | 73.01% | 65.14% | ||||||||
Asset Quality Ratios: | ||||||||||||
Net loan charge-offs to average loans | 0.49% | 0.48% | 0.99% | 1.05% | ||||||||
Nonaccrual loans to period-end loans | 4.92% | 2.69% | 4.92% | 2.69% | ||||||||
Nonperforming assets to total assets | 4.19% | 2.69% | 4.19% | 2.69% | ||||||||
Ratio of allowance for loan losses to nonaccrual loans | 0.41 | x | 0.61 | 0.41 | x | 0.61 | x | |||||
Allowance for loan losses to period-end loans | 2.01% | 1.64% | 2.01% | 1.64% | ||||||||
Other Data: | ||||||||||||
Average equity to average assets | 6.06% | 6.02% | 5.97% | 5.69% | ||||||||
Total shareholders' equity to assets | 6.08% | 5.99% | 6.08% | 5.99% | ||||||||
Number of offices: | ||||||||||||
Full service banking offices | 7 | 7 | 7 | 7 | ||||||||
Loan production offices | - | - | - | - | ||||||||
Number of employees (FTEs) | 113 | 114 | 113 | 114 | ||||||||
Core Earnings (2): | ||||||||||||
GAAP stated earnings | $ 233 | $ 339 | $ 547 | $1,163 | ||||||||
Net gains on sale of investment securities | 45 | 108 | 374 | 340 | ||||||||
Provision for loan losses | 2,137 | 2,166 | 4,570 | 5,028 | ||||||||
Foreclosed asset expense net of rental income | 431 | 577 | 1,483 | 1,368 | ||||||||
Taxes | 106 | 255 | 298 | 861 | ||||||||
Non-GAAP core earnings before tax | $ 2,862 | $ 3,229 | $6,524 | $8,080 | ||||||||
(1) | Excludes nonaccrual loans | |||||||||||
(2) | We define core earnings as operating income before securities gains (losses); loan loss reserves; foreclosed asset valuation write-downs and expense net of rental income; and taxes. Core earnings is considered a non-GAAP financial measure. Core earnings do not represent, and should not be considered as, an alternative to net income, as determined in accordance with GAAP. Our definition of core earnings might not be comparable to similarly titled measures by other companies. We believe that the presentation of core earnings is useful to investors because it provides important information of our operating performance exclusive of non-recurring expenses of loan loss reserves and foreclosed asset expense and write-downs as well as taxes. | |||||||||||
SOURCE North State Bancorp
