MCMINNVILLE, Tenn., Aug. 02, 2016 (GLOBE NEWSWIRE) -- Security Bancorp, Inc. (“Company”) (OTCBB: SCYT ), the holding company for Security Federal Savings Bank of McMinnville, Tennessee, today announced consolidated earnings for the second quarter of its fiscal year ended December 31, 2016.
Net income for the three months ended June 30, 2016 was $323,000, or $0.84 per share, compared to $268,000, or $0.69 per share, for the same quarter last year. For the six months ended June 30, 2016, the Company’s net income was $645,000, or $1.67 per share, compared to $628,000, or $1.63 per share, for the same period in 2015.
For the three months ended June 30, 2016 and 2015, net interest income remained unchanged at $1.4 million. For the six months ended June 30, 2016, net interest income increased $157,000, or 5.8%, to $2.9 million from $2.7 million for the same period in 2015. The increase in net interest income for the six months ended June 30, 2016 was primarily the result of an increase in interest income on loans and investments as well as a reduction in the interest expense on customer deposits. Net interest income after provision for loan losses for the three months ended June 30, 2016 was $1.4 million, an increase of $138,000, or 10.9%, from the same period in the previous year. For the six months ended June 30, 2016, net interest income after provision for loan losses increased $283,000, or 11.2%, to $2.8 million from $2.5 million for the same period in 2015. The primary reason for this increase during the three and six months ended June 30, 2016 was an increase in net interest income as well as a decrease in the provision for loan losses.
Non-interest income for the three months ended June 30, 2016 was $447,000 compared to $422,000 for the same quarter of 2015, an increase of $25,000, or 5.9%. For the six months ended June 30, 2016, non-interest income was $894,000, reflecting a decrease of $26,000, or 2.8%, compared to $920,000 for the same period in 2015. The decreases during the quarter and the six months ended June 30, 2016 were primarily attributable to a decrease in the income from financial services offset by an increase in the gains on sales of loans.
Non-interest expense for the three months ended June 30, 2016 was $1.4 million, an increase of $89,000, or 7.1%, from $1.3 million for the same period in 2015. For the six months ended June 30, 2016, non-interest expense was $2.7 million, an increase of $202,000, or 8.1%, from $2.5 million for the same period in 2015. The increases during the three and six months ended June 30, 2016 are attributable to increases in employee expense and occupancy expense.
Consolidated assets of the Company were $192.1 million at June 30, 2016, compared to $187.3 million at December 31, 2015. The $4.8 million, or 2.6%, increase in assets is primarily attributable to an increase in loans which were funded by deposit growth and an increase in repurchase agreements. Loans receivable, net, increased $2.7 million, or 2.1%, to $128.6 million at June 30, 2016 from $125.9 million at December 31, 2015. The increase in loans receivable was primarily attributable to an increase in commercial real estate loans.
The provision for loan losses decreased $63,000, or 65.0%, to $34,000 for the three months ended June 30, 2016 from $97,000 for the comparable period in 2015. The provision for loan losses was $68,000 for the six months ended June 30, 2016 compared to $194,000 in the comparable period in 2015, a decrease of $126,000, or 65.0%. The decrease in the provision during the three and six months ended June 30, 2016 is the result of improved asset quality.
Non-performing assets decreased $820,000, or 41.0%, to $1.2 million at June 30, 2016 from $2.0 million at December 31, 2015. The decrease is attributable to a reduction in non-accrual loans. Based on its analysis of delinquent loans, non-performing loans and classified loans, management believes that the Company’s allowance for loan losses of $1.3 million at June 30, 2016 was adequate to absorb known and inherent risks in the loan portfolio at that date. At June 30, 2016 the allowance for loan losses to non-performing assets was 113.72% compared to 64.96% at December 31, 2015.
Investment and mortgage-backed securities available-for-sale increased $544,000, or 1.4%, to $38.7 million at June 30, 2016, compared to $38.2 million at December 31, 2015. The increase is attributable to the purchase of investments funded by deposit growth. There were no investment and mortgage-backed securities held-to-maturity at June 30, 2016 and December 31, 2015.
Deposits increased $1.9 million, or 1.1%, to $164.5 million at June 30, 2016 from $162.7 million at December 31, 2015. The increase was primarily attributable to increases in NOW accounts and savings accounts offset by a decrease in certificates of deposit. The balance in repurchase agreements was $6.6 million at June 30, 2016 compared to $4.8 million at December 31, 2015, reflecting an increase of $1.8 million, or 37.2%.
Stockholders’ equity increased $995,000, or 5.4%, to $19.3 million, or 10.1% of total assets at June 30, 2016 compared to $18.3 million, or 9.8%, of total assets, at December 31, 2015.
Safe-Harbor Statement
Certain matters in this News Release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may relate to, among others, expectations of the business environment in which the Company operates and projections of future performance. These forward-looking statements are based upon current management expectations, and may, therefore, involve risks and uncertainties. The Company’s actual results, performance, or achievements may differ materially from those suggested, expressed, or implied by forward-looking statements as a result of a wide range of factors including, but not limited to, the general business environment, interest rates, competitive conditions, regulatory changes, and other risks.
| OPERATING DATA | Three months ended June 30, | Six months ended June 30, | ||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||
| Interest income | $ | 1,625 | $ | 1,555 | $ | 3,249 | $ | 3,101 | ||||
| Interest expense | 189 | 194 | 378 | 387 | ||||||||
| Net interest income | 1,436 | 1,361 | 2,871 | 2,714 | ||||||||
| Provision for loan losses | 34 | 97 | 68 | 194 | ||||||||
| Net interest income after provision for loan losses | 1,402 | 1,264 | 2,803 | 2,520 | ||||||||
| Non-interest income | 447 | 422 | 894 | 920 | ||||||||
| Non-interest expense | 1,350 | 1,261 | 2,700 | 2,498 | ||||||||
| Income before income tax expense | 499 | 425 | 997 | 942 | ||||||||
| Income tax expense | 176 | 157 | 352 | 314 | ||||||||
| Net income | $ | 323 | $ | 268 | $ | 645 | $ | 628 | ||||
| Net income per share | $ | 0.84 | $ | 0.69 | $ | 1.67 | $ | 1.63 | ||||
| FINANCIAL CONDITION DATA | At June 30, 2016 | At December 31, 2015 | ||||||||||
| Total assets | $ | 192,076 | $ | 187,256 | ||||||||
| Investment and mortgage backed securities available-for-sale | 38,725 | 38,181 | ||||||||||
| Loans receivable, net | 128,572 | 125,874 | ||||||||||
| Deposits | 164,515 | 162,653 | ||||||||||
| Repurchase agreements | 6,573 | 4,792 | ||||||||||
| Stockholders' equity | 19,339 | 18,344 | ||||||||||
| Non-performing assets | 1,181 | 2,001 | ||||||||||
| Non-performing assets to total assets | 0.61 | % | 1.07 | % | ||||||||
| Allowance for loan losses | 1,343 | 1,300 | ||||||||||
| Allowance for loan losses to total loans receivable | 1.03 | % | 1.02 | % | ||||||||
| Allowance for loan losses to non-performing assets | 113.72 | % | 64.96 | % | ||||||||
Contact: Joe Pugh President & Chief Executive Officer (931) 473-4483
