LAKE HAVASU CITY, Ariz., April 30, 2015 (GLOBE NEWSWIRE) -- State Bank Corp. (OTCQB:SBAZ) ("Company"), the holding company for Mohave State Bank ("Bank"), today announced net income increased 44.9% to $681,000, or $0.12 per diluted share, for the first quarter ended March 31, 2015, as compared to net income of $470,000, or $0.08 per diluted share, for the first quarter of 2014.
"2015 is starting off ahead of our expectations," commented Brian M. Riley, President & CEO. "Our financial results for the quarter show strong profitability, improving asset quality trends and year-over-year loan and deposit growth. By focusing on our customers' needs and delivering the banking services that make them more productive, we look to sustain our loan and deposit growth momentum into the year."
First Quarter 2015 Highlights:
- First quarter net income increased 44.9% to $681,000, or $0.12 per diluted share, compared to $470,000, or $0.08 per diluted share, in the first quarter a year ago.
- Pre-tax income increased 120.0% to $1.03 million in the first quarter, compared to $470,000 in the first quarter 2014.
- The net interest margin remained healthy at 4.09%.
- The Bank reported $654,000 in gains from the sale of SBA and mortgage loans in the first quarter, up from $168,000 in the first quarter of 2014.
- Loans held for investment increased 2.8% to $214.9 million during the first quarter compared to three months earlier.
- OREO decreased to $7.5 million at March 31, 2015 on the sale of two properties.
- Tangible book value increased 18.0% to $6.04 per share compared from $5.12 per share a year earlier.
- Declared an annual cash dividend of $0.07 per share, which represents a dividend yield of 1.40% based on the recent stock price.
The Company's net interest margin continued to remain strong at 4.09% in the first quarter 2015 as the average cost of funds declined modestly and the earning asset mix improved.
The Company provided $110,000 to its loss reserves in the first quarter against net credit losses of $30,000. The allowance for loan losses totaled $3.0 million at March 31, 2015, or 1.41% of loans held for investment. "We continue to carefully monitor our level of loss reserves and proactively make additions as necessary to protect against an uncertain economic environment," noted Riley.
Total assets were $328.3 million at March 31, 2015, an increase of $11.1 million, or 3.4% from $317.2 million at December 31, 2014 and an increase of $36.9 million, or 12.7%, compared to $291.4 million a year ago. Total loans held for investment were $214.9 million as compared to $209.0 million at December 31, 2014 and $194.1 million at March 31, 2014. Total deposits were $287.2 million, an increase of $9.7 million, or 3.5%, from $277.5 million at December 31, 2014 and an increase of $31.5 million, or 12.3%, compared to $255.7 million a year ago. Core deposits, defined as noninterest bearing demand, money market, NOW and savings accounts, increased 5.1% compared to three months earlier and increased 14.3% compared to a year earlier to $225.9 million at March 31, 2015. Core deposits now comprise 78.6% of total deposits.
Nonperforming assets were $14.0 million at March 31, 2015, a 5.4% decrease compared to $14.8 million at December 31, 2014 and a 32.5% decrease compared to $20.8 million at March 31, 2014. Nonperforming assets represented 4.28% of total assets at March 31, 2015, down from 4.67% at December 31, 2014 and 7.14% a year ago.
Shareholder equity increased to $35.5 million at March 31, 2015, from $35.1 million at December 31, 2014 and $30.1 million a year earlier. At March 31, 2015 tangible book value per share improved to $6.04 per share compared to $5.99 per share three months earlier and $5.12 a year earlier.
Recent Developments
On March 5 th the Company declared a $0.07 per share annual cash dividend which represents the first dividend declared since 2008. Additionally State Bank Corp recently announced that it has entered into a purchase agreement to sell its Yuma branch facility to 1st Bank Yuma in a transaction valued at approximately $750,000 (deposit premium of 4.45%) plus the purchase price of the real estate and equipment. The transaction incorporates the transfer of approximately $17 million in deposits along with the sale of approximately $18 million in loans. The branch sale is expected to close during the third quarter of 2015.
Capital Management
Community banking organizations, including State Bank Corp. and Mohave State Bank, became subject to new capital requirements on January 1, 2015, and certain provisions of the new rules will be phased in from 2015 through 2019. The Company's consolidated capital ratios and the Bank's capital ratios exceeded the regulatory guidelines for a well-capitalized financial institution under the Basel III and Dodd Frank Wall Street Reform requirements at March 31, 2015. The Bank reported the following capital ratios at March 31, 2015:
| Common Equity Tier 1 Capital Ratio | 13.36% |
| Tier 1 Leverage Ratio | 10.92% |
| Tier 1 Capital Ratio | 13.36% |
| Total Capital Ratio | 14.52% |
About the Company
State Bank Corp., headquartered in Lake Havasu City, Arizona, is the parent company of Mohave State Bank, the largest locally-owned bank in Mohave County. Mohave State Bank is a full-service bank providing deposit and loan products, and convenient on-line banking to individuals, businesses and professionals. The Bank was established in October 1991, and the holding company was formed in 2004. The Bank has six full-service branches: two in Lake Havasu City, two in Kingman, one in Bullhead City, and one in Yuma, Arizona. The Company is traded over-the-counter as SBAZ. For further information, please visit the web site: www.mohavestbank.com .
Forward-looking Statements
This press release may include forward-looking statements about State Bank Corp. and its subsidiary, Mohave State Bank, for which the Company claims the protection of safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management's knowledge and belief as of today and include information concerning the Company's possible or assumed future financial condition, and its results of operations and business. Forward-looking statements are subject to risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, government policies and regulations (including monetary and fiscal policies), legislation, economic conditions, borrower capacity to repay, operational factors and competition in the geographic and business areas in which the Company conducts its operations. All forward-looking statements included in this press release are based on information available at the time of the release, and the Company assumes no obligation to update any forward-looking statement.
UNAUDITED FINANCIAL STATEMENTS FOLLOW
| State Bank Corp. | |||||
| Five-Quarter Performance Summary | |||||
| For the Quarter Ended | |||||
| Dollars in thousands - Unaudited | 3/31/2015 | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 |
| Performance Highlights | |||||
| Earnings: | |||||
| Total revenue (Net int. income + nonint. income) | $ 3,965 | $ 3,740 | $ 3,668 | $ 3,286 | $ 3,278 |
| Net interest income | $ 2,864 | $ 2,837 | $ 2,793 | $ 2,720 | $ 2,781 |
| Provision for loan losses | $ 110 | $ 75 | $ 250 | $ 250 | $ 120 |
| Noninterest income | $ 1,101 | $ 903 | $ 875 | $ 566 | $ 497 |
| Noninterest expense | $ 2,821 | $ 3,068 | $ 2,471 | $ 2,478 | $ 2,688 |
| Net income (loss) | $ 681 | $ 517 | $ 612 | $ 3,798 | $ 470 |
| Per Share Data: | |||||
| Net income (loss), basic | $ 0.12 | $ 0.09 | $ 0.10 | $ 0.65 | $ 0.08 |
| Net income (loss), diluted | $ 0.12 | $ 0.09 | $ 0.10 | $ 0.65 | $ 0.08 |
| Cash dividends declared | $ 0.07 | $ -- | $ -- | $ -- | $ -- |
| Book value | $ 6.04 | $ 5.99 | $ 5.89 | $ 5.79 | $ 5.12 |
| Tangible book value | $ 6.04 | $ 5.99 | $ 5.89 | $ 5.79 | $ 5.12 |
| Performance Ratios: | |||||
| Return on average assets | 0.85% | 0.65% | 0.79% | 5.16% | 0.65% |
| Return on average equity | 7.68% | 5.91% | 7.12% | 48.09% | 6.28% |
| Net interest margin, taxable equivalent | 4.09% | 4.07% | 4.15% | 4.18% | 4.35% |
| Average cost of funds | 0.21% | 0.22% | 0.22% | 0.22% | 0.24% |
| Average yield on loans | 5.18% | 5.33% | 5.31% | 5.18% | 5.50% |
| Efficiency ratio | 71.15% | 82.03% | 67.37% | 75.41% | 82.00% |
| Non-interest income to total revenue | 27.77% | 24.14% | 23.85% | 17.22% | 15.16% |
| Capital & Liquidity: | |||||
| Total equity to total assets (EOP) | 10.80% | 11.08% | 10.88% | 11.25% | 10.32% |
| Tangible equity to tangible assets | 10.80% | 11.08% | 10.88% | 11.25% | 10.32% |
| Total loans to total deposits | 74.50% | 75.01% | 73.44% | 77.36% | 76.17% |
| Mohave State Bank | |||||
| Common equity tier 1 ratio | 13.36% | ||||
| Tier 1 leverage ratio | 10.92% | 10.39% | 10.34% | 10.72% | 10.52% |
| Tier 1 capital ratio | 13.36% | 13.70% | 13.49% | 13.23% | 13.66% |
| Total capital ratio | 14.52% | 14.93% | 14.75% | 14.47% | 14.91% |
| Asset Quality: | |||||
| Gross charge-offs | $ 124 | $ 351 | $ -- | $ 1,045 | $ 110 |
| Net charge-offs (NCOs) | $ 30 | $ 313 | $ (19) | $ 1,025 | $ 45 |
| NCO to average loans, annualized | 0.06% | 0.60% | -0.04% | 2.01% | 0.09% |
| Non-accrual assets | $ 6,444 | $ 5,522 | $ 5,975 | $ 6,147 | $ 8,617 |
| Other real estate owned | $ 7,595 | $ 9,307 | $ 11,268 | $ 11,693 | $ 12,196 |
| Repossessed assets | $ -- | $ -- | $ -- | $ -- | $ -- |
| Non-performing assets (NPAs) | $ 14,039 | $ 14,829 | $ 17,243 | $ 17,840 | $ 20,813 |
| NPAs to total assets | 4.28% | 4.67% | 5.43% | 5.91% | 7.14% |
| Loans >90 days past due | $ -- | $ -- | $ -- | $ -- | $ -- |
| NPAs + 90 days past due | $ 14,039 | $ 14,829 | $ 17,243 | $ 17,840 | $ 20,813 |
| NPAs + loans 90 days past due to total assets | 4.28% | 4.67% | 5.43% | 5.91% | 7.14% |
| Allowance for loan losses to total loans | 1.42% | 1.42% | 1.57% | 1.44% | 1.90% |
| Allowance for loan losses to NPAs | 21.61% | 19.92% | 18.52% | 16.39% | 17.77% |
| Period End Balances: | |||||
| Assets | $ 328,302 | $ 317,215 | $ 317,648 | $ 301,877 | $ 291,419 |
| Total Loans (before reserves) | $ 213,990 | $ 208,152 | $ 203,209 | $ 202,897 | $ 194,789 |
| Deposits | $ 287,237 | $ 277,493 | $ 276,716 | $ 262,275 | $ 255,722 |
| Stockholders' equity | $ 35,470 | $ 35,137 | $ 34,575 | $ 33,961 | $ 30,065 |
| Common stock market capitalization | $ 29,575 | $ 29,340 | $ 27,991 | $ 30,396 | $ 32,274 |
| Full-time equivalent employees | 85 | 80 | 80 | 76 | 75 |
| Shares outstanding | 5,868,038 | 5,868,038 | 5,868,038 | 5,868,038 | 5,868,038 |
| Average Balances: | |||||
| Assets | $ 319,817 | $ 318,835 | $ 309,367 | $ 294,282 | $ 288,913 |
| Earning assets | $ 285,722 | $ 283,657 | $ 273,449 | $ 260,383 | $ 255,530 |
| Total Loans (before reserves) | $ 214,992 | $ 207,130 | $ 205,025 | $ 203,858 | $ 198,953 |
| Deposits | $ 279,305 | $ 277,947 | $ 269,083 | $ 257,282 | $ 252,563 |
| Other borrowings | $ 4,481 | $ 4,481 | $ 4,737 | $ 4,547 | $ 5,584 |
| Stockholders' equity | $ 35,454 | $ 34,975 | $ 34,365 | $ 31,592 | $ 29,951 |
| Shares outstanding, basic - wtd | 5,868,038 | 5,868,038 | 5,868,038 | 5,868,038 | 5,868,038 |
| Shares outstanding, diluted - wtd | 5,868,038 | 5,868,038 | 5,868,038 | 5,868,038 | 5,868,038 |
| State Bank Corp. | |||
| Balance Sheets | |||
| Dollars in thousands - Unaudited | 3/31/2015 | 12/31/2014 | 3/31/2014 |
| Consolidated Balance Sheets | |||
| Assets | |||
| Cash and cash equivalents | $ 2,105 | $ 1,679 | $ 2,222 |
| Interest bearing deposits | 3,908 | 3,459 | 4,521 |
| Overnight Funds | 29,520 | 31,740 | 22,180 |
| Held for maturity securities | 25 | 27 | 35 |
| Available for sale securities | 48,039 | 39,814 | 37,073 |
| Total cash and securities | 83,597 | 76,719 | 66,031 |
| Loans held for sale, before reserves | 2,304 | 1,300 | 2,773 |
| Gross loans held for investment | 214,941 | 209,012 | 194,018 |
| Loan loss reserve | (3,034) | (2,954) | (3,699) |
| Total net loans | 214,211 | 207,358 | 193,092 |
| Premises and equipment, net | 9,898 | 9,892 | 10,016 |
| Other real estate owned | 7,594 | 9,307 | 12,196 |
| Federal Home Loan Bank and other stock | 1,917 | 1,917 | 1,268 |
| Company owned life insurance | 5,911 | 5,871 | 5,747 |
| Other assets | 5,174 | 6,151 | 3,069 |
| Total Assets | $ 328,302 | $ 317,215 | $ 291,419 |
| Liabilities | |||
| Non interest bearing demand | $ 65,596 | $ 62,612 | $ 60,453 |
| Money market, NOW and savings | 160,306 | 152,308 | 137,236 |
| Time deposits <$100K | 27,304 | 25,929 | 26,735 |
| Time deposits >$100K | 34,031 | 36,644 | 31,298 |
| Total Deposits | 287,237 | 277,493 | 255,722 |
| Securities sold under repurchase agreements | 3,581 | 2,734 | 4,173 |
| Federal Home Loan Bank advances | -- | -- | -- |
| Subordinated debt | 675 | 675 | 675 |
| Total Debt | 4,256 | 3,409 | 4,848 |
| Other Liabilities | 1,339 | 1,176 | 784 |
| Total Liabilities | 292,832 | 282,078 | 261,354 |
| Shareholders' Equity | |||
| Common stock | 25,037 | 25,037 | 25,037 |
| Accumulated retained earnings | 10,136 | 9,866 | 4,940 |
| Accumulated other comprehensive income | 297 | 234 | 88 |
| Total shareholders equity | 35,470 | 35,137 | 30,065 |
| Total liabilities and shareholders' equity | $ 328,302 | $ 317,215 | $ 291,419 |
| State Bank Corp. | |||
| Statement of Operations | |||
| For the Quarter Ended | |||
| Dollars in thousands - Unaudited | 3/31/2015 | 12/31/2014 | 3/31/2014 |
| Statements of Operations | |||
| Interest income | |||
| Loans, including fees | $ 2,783 | $ 2,759 | $ 2,735 |
| Securities | 213 | 207 | 188 |
| Fed funds and other | 15 | 26 | 14 |
| Total interest income | 3,011 | 2,992 | 2,937 |
| Interest expense | |||
| Deposits | 133 | 141 | 142 |
| Borrowings | 14 | 14 | 14 |
| Total interest expense | 147 | 155 | 156 |
| Net interest income | 2,864 | 2,837 | 2,781 |
| Provision for loan losses | 110 | 75 | 120 |
| Net interest income after loan loss provision | 2,754 | 2,762 | 2,661 |
| Noninterest income | |||
| Service charges on deposits | 96 | 118 | 103 |
| Mortgage loan fees | 193 | 150 | 79 |
| Gain on sale of loans | 654 | 426 | 168 |
| (Loss)/Gain on securities | (8) | -- | (42) |
| Other income | 166 | 209 | 189 |
| Total noninterest income | 1,101 | 903 | 497 |
| Noninterest expense | |||
| Salaries and employee benefits | 1,525 | 1,387 | 1,308 |
| Net occupancy expense | 80 | 94 | 93 |
| Equipment expense | 42 | 37 | 38 |
| Data processing | 288 | 281 | 268 |
| Director fees & expenses | 48 | 62 | 45 |
| Insurance | 26 | 26 | 30 |
| Marketing & promotion | 126 | 82 | 108 |
| Professional fees | 91 | 85 | 195 |
| Office expense | 35 | 28 | 27 |
| Regulatory assessments | 114 | 113 | 154 |
| OREO and repossessed assets | 286 | 791 | 291 |
| Other expenses | 160 | 82 | 131 |
| Total noninterest expense | 2,821 | 3,068 | 2,688 |
| Income (loss) before provision (benefit) for income taxes | 1,034 | 597 | 470 |
| Provision (benefit) for income taxes | 353 | 80 | -- |
| Net Income | $ 681 | $ 517 | $ 470 |
| Per Share Data | |||
| Basic EPS | $ 0.12 | $ 0.09 | $ 0.08 |
| Diluted EPS | $ 0.12 | $ 0.09 | $ 0.08 |
| Average shares outstanding | |||
| Basic | 5,868,038 | 5,868,038 | 5,868,038 |
| Effect of dilutive shares | -- | -- | -- |
| Diluted | 5,868,038 | 5,868,038 | 5,868,038 |
Brian M. Riley, President & CEO Craig Wenner, EVP & CFO 928 855 0000 www.mohavestbank.com
