EAU CLAIRE, WI--(Marketwired - Jan 25, 2016) - Citizens Community Bancorp, Inc. (
Edward H. Schaefer, President and CEO, stated: "We were pleased to see our quarterly earnings increase 20% over the prior year's first quarter earnings and believe our results represent solid progress in an uncertain economic environment. Our steady asset quality improvement and controlled operating expenses were the primary drivers of earnings improvement for this quarter versus a year ago."
First Quarter Highlights
- Asset quality remained excellent. As of December 31, 2015, nonperforming assets were $2.4 million, or 0.42% of total assets, compared with nonperforming assets of $2.6 million, or 0.46% of total assets, as of December 31, 2014.
- Disciplined expense management. Non-interest expense was $4.1 million for the first quarter of fiscal 2016, compared with $4.5 million for the first quarter of fiscal 2015, primarily due to lower occupancy and professional services costs. "The reduction of non-interest expenses is the result of several years of efficiency improvements involving our branch network and staffing levels," commented Mark C. Oldenberg, Executive Vice President and CFO.
- Strong capital levels. As of December 31, 2015, the Company and the Bank exceeded all regulatory standards to be considered "well-capitalized". Book value per share increased to $11.71 at December 31, 2015 from $11.57 at September 30, 2015. "We believe our strong capital levels give us the ability to follow through on our strategic plan priorities that include in market and adjacent market acquisitions as demonstrated by our announced purchase of Central Bank loans and deposits in our Rice Lake and Barron County market." stated Schaefer.
- Investment portfolio growth. The investment portfolio increased by $7 million or 7.9% to $94.9 million as of December 31, 2015, from $87.9 million at September 30, 2015.
Income Statement and Balance Sheet Overview
Net interest income was $4.6 million for the quarter ended December 31, 2015, versus $4.8 million for the comparable prior year quarter. Prolonged low interest rates adversely affected the net interest margin which was 3.22%, 3.36%, and 3.47% for the three quarters ended December 31, 2015, September 30, 2015, and December 31, 2014, respectively.
Total interest and dividend income declined to $5.7 million for the quarter ended December 31, 2015, compared with $6.0 million for the quarter ended December 31, 2014. This decline resulted from a $12.6 million decrease in total average loans and a 26 basis point decline in the weighted average yield on interest-earning assets.
Total interest expense was relatively stable for the quarter ended December 31, 2015, similar to the quarter ended December 31, 2014, as the weighted average rate paid on interest-bearing liabilities was approximately 90 basis points for both periods. "Deposit runoff from the recent branch closures, along with competitive market rates, has required us to maintain higher rates in our other markets in order to accelerate deposit growth," explained Oldenberg.
As a result of our improved asset quality, the loan loss provision was $75,000 for the most recent quarter compared with $235,000 for the three month period ended December 31, 2014. Net loans charge-off during the quarter ended December 31, 2015 were $130,000, or 0.12% of total average loans, compared to $194,000, or 0.17% of total average loans, during the same period in the previous year. As of December 31, 2015, the Company's allowance for loan losses was $6.4 million and represented 1.42% of total loans, compared to 1.44% and 1.42% of total loans at September 30, 2015, and December 31, 2014, respectively.
Non-interest income decreased to $950,000 for the quarter ended December 31, 2015, compared with $1.0 million for the same period of the prior fiscal year, due to a loan sale premium received in the first quarter of the previous year in the amount of $89,000 and lower deposit fee income.
Total non-interest expense decreased $398,000 to $4.1 million for the quarter ended December 31, 2015, compared with the quarter ended December 31, 2014, as we continue to reduce expenses through operational efficiencies. The $251,000 decrease in occupancy expense reflects our branch rationalization program which, in turn, has resulted in branch closures. "During the first fiscal quarter of 2016, we closed one branch office and are closing two additional branch offices in January 2016," said Oldenberg.
Total assets increased $1.7 million to $581.8 million as of December 31, 2015 from $580.1 million as of September 30, 2015. Over the same time period, total loans increased $3.1 million, or 0.7%.
Non-accruing loans were $848,000 at December 31, 2015, compared with $748,000 at September 30, 2015. Non-performing assets as a percentage of total assets increased slightly to 0.42% as of December 31, 2015, from 0.37% as of September 30, 2015, mainly due to the increase in non-accruing loans.
At December 31, 2015, the Bank's total capital to risk weighted assets was 16.6%, tier 1 capital to risk weighted assets was 15.4% and the tier 1 leverage capital ratio to adjusted total assets was 10.5%.
About the Company
Citizens Community Federal N.A., a wholly owned subsidiary of Citizens Community Bancorp, Inc., is a full-service national bank based in Altoona, Wisconsin, serving more than 50,000 customers in Wisconsin, Minnesota and Michigan through 15 branch locations. The Company's stock trades on the NASDAQ Global Market under the symbol "CZWI."
Cautionary Statement Regarding Forward-Looking Statements
Certain statements contained in this release are considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking words or phrases such as "anticipate," "believe," "could," "expect," "intend," "may," "planned," "potential," "should," "will," "would" or the negative of those terms or other words of similar meaning. Such forward-looking statements in this release are inherently subject to many uncertainties arising in the Company's operations and business environment. These uncertainties include general economic conditions, in particular, relating to consumer demand for the Bank's products and services; the Bank's ability to maintain current deposit and loan levels at current interest rates; competitive and technological developments; deteriorating credit quality, including changes in the interest rate environment reducing interest margins; prepayment speeds, loan origination and sale volumes, charge-offs and loan loss provisions; the Bank's ability to maintain required capital levels and adequate sources of funding and liquidity; maintaining capital requirements may limit the Bank's operations and potential growth; changes and trends in capital markets; competitive pressures among depository institutions; effects of critical accounting estimates and judgments; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board (FASB) or other regulatory agencies overseeing the Bank; the Bank's ability to implement its cost-savings and revenue enhancement initiatives, including costs associated with its branch consolidation and new market branch growth initiatives; legislative or regulatory changes or actions or significant litigation adversely affecting the Bank; fluctuation of the Company's stock price; the Bank's ability to attract and retain key personnel; the Bank's ability to secure confidential information through the use of computer systems and telecommunications networks; and the impact of reputational risk created by these developments on such matters as business generation and retention, funding and liquidity. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. Such uncertainties and other risks that may affect the Company's performance are discussed further in Part I, Item 1A, "Risk Factors," in the Company's Form 10-K, for the year ended September 30, 2015 filed with the Securities and Exchange Commission on December 7, 2015. The Company undertakes no obligation to make any revisions to the forward-looking statements contained in this news release or to update them to reflect events or circumstances occurring after the date of this release.
| CITIZENS COMMUNITY BANCORP, INC. | ||||||||
| Consolidated Balance Sheets | ||||||||
| December 31, 2015 (unaudited) and September 30, 2015 (derived from audited financial statements) | ||||||||
| (in thousands, except share data) | ||||||||
| December 31, 2015 | September 30, 2015 | |||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 15,230 | $ | 23,872 | ||||
| Other interest-bearing deposits | 3,242 | 2,992 | ||||||
| Investment securities (available for sale securities at fair value of $87,161 and $79,921, and held to maturity securities at cost of $7,724 and $8,012 at December 31, 2015 and September 30, 2015, respectively) | 94,885 | 87,933 | ||||||
| Non-marketable equity securities, at cost | 4,626 | 4,626 | ||||||
| Loans receivable | 453,649 | 450,510 | ||||||
| Allowance for loan losses | (6,441 | ) | (6,496 | ) | ||||
| Loans receivable, net | 447,208 | 444,014 | ||||||
| Office properties and equipment, net | 2,803 | 2,669 | ||||||
| Accrued interest receivable | 1,586 | 1,574 | ||||||
| Intangible assets | 90 | 104 | ||||||
| Foreclosed and repossessed assets, net | 804 | 902 | ||||||
| Other assets | 11,296 | 11,462 | ||||||
| TOTAL ASSETS | $ | 581,770 | $ | 580,148 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Liabilities: | ||||||||
| Deposits | $ | 457,732 | $ | 456,298 | ||||
| Federal Home Loan Bank advances | 58,891 | 58,891 | ||||||
| Other liabilities | 3,911 | 4,424 | ||||||
| Total liabilities | 520,534 | 519,613 | ||||||
| Stockholders' equity: | ||||||||
| Common stock-- $0.01 par value, authorized 30,000,000, 5,231,265 and 5,232,579 shares issued and outstanding, respectively | 52 | 52 | ||||||
| Additional paid-in capital | 54,744 | 54,740 | ||||||
| Retained earnings | 7,105 | 6,245 | ||||||
| Unearned deferred compensation | (261 | ) | (288 | ) | ||||
| Accumulated other comprehensive loss | (404 | ) | (214 | ) | ||||
| Total stockholders' equity | 61,236 | 60,535 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 581,770 | $ | 580,148 | ||||
| CITIZENS COMMUNITY BANCORP, INC. | ||||||
| Consolidated Statements of Operations (unaudited) | ||||||
| Three Months Ended December 31, 2015 and 2014 | ||||||
| (in thousands, except per share data) | ||||||
| Three Months Ended | ||||||
| December 31, 2015 | December 31, 2014 | |||||
| Interest and dividend income: | ||||||
| Interest and fees on loans | $ | 5,250 | $ | 5,596 | ||
| Interest on investments | 424 | 364 | ||||
| Total interest and dividend income | 5,674 | 5,960 | ||||
| Interest expense: | ||||||
| Interest on deposits | 956 | 952 | ||||
| Interest on borrowed funds | 165 | 167 | ||||
| Total interest expense | 1,121 | 1,119 | ||||
| Net interest income | 4,553 | 4,841 | ||||
| Provision for loan losses | 75 | 235 | ||||
| Net interest income after provision for loan losses | 4,478 | 4,606 | ||||
| Non-interest income: | ||||||
| Net gains (losses) on sale of available for sale securities | -- | 2 | ||||
| Net gains (losses) on available for sale securities | -- | 2 | ||||
| Service charges on deposit accounts | 423 | 472 | ||||
| Loan fees and service charges | 321 | 355 | ||||
| Other | 206 | 205 | ||||
| Total non-interest income | 950 | 1,034 | ||||
| Non-interest expense: | ||||||
| Salaries and related benefits | 2,218 | 2,175 | ||||
| Occupancy | 569 | 820 | ||||
| Office | 252 | 256 | ||||
| Data processing | 409 | 389 | ||||
| Amortization of core deposit intangible | 14 | 14 | ||||
| Advertising, marketing and public relations | 137 | 98 | ||||
| FDIC premium assessment | 85 | 104 | ||||
| Professional services | 151 | 319 | ||||
| Other | 259 | 317 | ||||
| Total non-interest expense | 4,094 | 4,492 | ||||
| Income before provision for income taxes | 1,334 | 1,148 | ||||
| Provision for income taxes | 474 | 433 | ||||
| Net income attributable to common stockholders | $ | 860 | $ | 715 | ||
| Per share information: | ||||||
| Basic earnings | $ | 0.16 | $ | 0.14 | ||
| Diluted earnings | $ | 0.16 | $ | 0.14 | ||
| Cash dividends paid | $ | -- | $ | -- | ||
Contact: Mark Oldenberg CFO 715-836-9994
