Cardinal Bankshares Corporation Reports Results for the Quarter ended March 31, 2015
FLOYD, Va., April 21, 2015 /PRNewswire/ -- Cardinal Bankshares Corporation (OTC-QB: CDBK), parent company of Bank of Floyd, announced its consolidated financial results for the first quarter ended March 31, 2015. The Company reported consolidated net income of $71 thousand for the first quarter versus consolidated net income of $87 thousand for the same quarter in 2014. Capital ratios remain above those required by banking regulations to be considered well-capitalized.
Total loans were $172.7 million for the three-month period ending March 31, 2015, an increase of $2.7 million compared to December 31, 2014. The Company again realized an increase in net interest income reaching $2.0 million for the three-month period March 31, 2015, representing an increase of $104 thousand or 5.4% compared to the same period in 2014. Interest expense on deposits and borrowings for the three-month period ended March 31, 2015 was $437 thousand, representing a decrease of $56 thousand or 11.4% for the same comparable period in 2014. According to Mark A. Smith, Interim President & CEO, "The continued improvement in net interest income is driven by an increase in interest income associated with loan growth and a decrease in interest expense associated with the maturity and repricing of long-term high interest time deposits coupled with the acquisition of low cost deposits."
Mr. Smith continued, "We are encouraged to see the Bank's business development activities combining positively with the improvements in infrastructure put in place over the last three years. As a result, we are experiencing increases in revenue associated with our core operation. The Bank has engaged in a program to acquire new checking accounts and generated 138 net new checking accounts during the quarter ended March 31, 2015 compared to 31 for the same comparable period in 2014. Significant favorable progress continues to be made in reducing non-performing assets as evidenced by a reduction of $5.4 million or 63.6% to $3.1 million for the period ended March 31, 2015 versus $8.4 million for the same comparable period in 2014."
"The growth in new loans and new account acquisitions, combined with decreasing deposit interest expense and declining non-performing assets, gives us confidence that we are well-positioned to move beyond the legacy credit issues that have demanded our attention over the past three years. We appreciate our loyal customers, new and old, and look forward to earning the loyalty of those customers we have not yet met. Thank you to the dedicated employees and shareholders who understand the potential of their company. Our ultimate purpose is to create long-term economic rewards for our customers and shareholders by providing excellent customer service and products while continuing to support the communities in which we do business," said Smith.
Many changes have been made and more are on the way! We remain committed to our customers, both present and future – Good change is already here. More's on the way. We invite you to experience the difference at Bank of Floyd!
Mark A. Smith
Interim President & CEO/Chief Lending Officer
This letter contains forward-looking statements. Forward-looking statements involve inherent risks and uncertainties Management believes these forward-looking statements are reasonable; however undue reliance should not be placed on such forward-looking statements, which are based on current expectations. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. The future results and stockholder values of Cardinal may differ materially from those expressed in forward-looking statements contained in this report. Many factors that will determine these results and values are beyond the Company's ability to control or predict.
CONTACT: Alan Dickerson, CFO, 540-745-5207
Consolidated Balance Sheets |
||||||
(in thousands, except share data) |
||||||
March 31, |
December 31, |
|||||
2015 |
2014 |
|||||
Assets |
||||||
Cash and due from banks |
$ |
3,608 |
$ |
3,578 |
||
Interest-bearing deposits in banks |
7,444 |
6,034 |
||||
Investment securities, available for sale |
80,513 |
82,845 |
||||
Restricted equity securities |
1,570 |
1,535 |
||||
Total loans |
172,748 |
170,062 |
||||
Allowance for loan losses |
(2,567) |
(3,098) |
||||
Net loans |
170,181 |
166,964 |
||||
Bank premises and equipment, net |
5,673 |
5,776 |
||||
Accrued interest receivable |
681 |
669 |
||||
Foreclosed assets |
724 |
735 |
||||
Bank owned life insurance |
6,776 |
6,737 |
||||
Deferred tax asset |
5,296 |
5,487 |
||||
Reserve deferred tax asset |
(5,137) |
(5,139) |
||||
Prepaid assets |
580 |
490 |
||||
Other assets |
1,095 |
1,105 |
||||
Total assets |
$ |
279,004 |
$ |
276,816 |
||
Liabilities and Stockholders' Equity |
||||||
Liabilities |
||||||
Noninterest-bearing deposits |
$ |
39,407 |
$ |
39,785 |
||
Interest-bearing deposits |
195,361 |
195,325 |
||||
Total deposits |
234,768 |
235,110 |
||||
FHLB advances |
22,000 |
20,000 |
||||
Accrued interest payable |
58 |
57 |
||||
Bank owned life insurance SERP |
720 |
727 |
||||
Other liabilities |
686 |
589 |
||||
Total liabilities |
258,232 |
256,483 |
||||
Stockholders' Equity |
||||||
Common stock, $10 par value; 5,000,000 |
||||||
Shares authorized; 1,535,733 shares issued |
||||||
Issued and outstanding |
15,357 |
15,357 |
||||
Additional paid-in capital |
2,925 |
2,925 |
||||
Retained earnings |
2,797 |
2,726 |
||||
Accumulated other comprehensive income |
(307) |
(675) |
||||
Total stockholders' equity |
20,772 |
20,333 |
||||
Total liabilities and stockholders' equity |
$ |
279,004 |
$ |
276,816 |
Consolidated Statements of Operations |
||||||||||
(in thousands, except share data) |
||||||||||
Three Months Ended March 31, |
||||||||||
2015 |
2014 |
|||||||||
Interest and dividend income |
||||||||||
Loans and fees on loans |
$ |
2,022 |
$ |
1,845 |
||||||
Investment securities |
||||||||||
Taxable |
367 |
485 |
||||||||
Exempt from federal income tax |
64 |
81 |
||||||||
Dividend income |
11 |
5 |
||||||||
Deposits with banks |
3 |
3 |
||||||||
Total interest income |
2,467 |
2,419 |
||||||||
Interest expense |
||||||||||
Deposits |
427 |
489 |
||||||||
Borrowings |
10 |
4 |
||||||||
Total interest expense |
437 |
493 |
||||||||
Net interest income |
2,030 |
1,926 |
||||||||
Provision for loan losses |
33 |
22 |
||||||||
Net interest income after provision |
||||||||||
for loan losses |
1,997 |
1,904 |
||||||||
Noninterest income |
||||||||||
Service charges on deposit accounts |
68 |
38 |
||||||||
Other service charges and fees |
79 |
24 |
||||||||
Net realized gains on sales of securities |
3 |
(1) |
||||||||
Income on bank owned life insurance |
39 |
40 |
||||||||
Other income |
37 |
99 |
||||||||
Total noninterest income |
226 |
200 |
||||||||
Noninterest expense |
||||||||||
Salaries and employee benefits |
1,128 |
1,122 |
||||||||
Occupancy and equipment |
343 |
287 |
||||||||
Legal and professional |
66 |
68 |
||||||||
Bank franchise tax |
32 |
42 |
||||||||
Data processing services |
164 |
124 |
||||||||
FDIC insurance premiums |
92 |
91 |
||||||||
Foreclosed assets, net |
12 |
19 |
||||||||
Other operating expense |
315 |
265 |
||||||||
Total noninterest expense |
2,152 |
2,018 |
||||||||
Income (loss) before income taxes |
71 |
86 |
||||||||
Income tax expense (benefit) |
- |
(1) |
||||||||
Net income (loss) |
$ |
71 |
$ |
87 |
||||||
Basic earnings (loss) per share |
$ |
0.05 |
$ |
0.06 |
Cardinal Bankshares Corporation |
||||
Financial Highlights (Unaudited) |
||||
(in thousands) |
||||
Three Months Ended |
||||
March 31, |
March 31, |
|||
Per Share |
||||
Earnings per share, basic and diluted |
$ 0.05 |
$ 0.06 |
||
Book value |
$ 13.53 |
$ 12.02 |
||
Financial Ratios |
||||
Annualized Return on Average Assets |
0.10% |
0.13% |
||
Annualized Return on Average Equity |
1.39% |
1.93% |
||
Annualized Net Interest Margin for the quarter ended1 |
3.14% |
3.08% |
||
Efficiency Ratio2 |
94.98% |
94.03% |
||
Capital Ratios |
||||
Tier 1 risk-based capital - Bank only |
10.14% |
11.15% |
||
Total risk-based capital - Bank only |
11.39% |
12.40% |
||
Tier 1 risk-based capital - consolidated |
11.21% |
12.25% |
||
Total risk-based capital - consolidated |
12.46% |
13.50% |
||
Allowance for Loan Losses at Beginning of Period |
$ 3,098 |
$ 2,862 |
||
Loans Charged-off, net of Recoveries |
(564) |
156 |
||
Provision for Loan Losses |
33 |
22 |
||
Allowance for Loan Losses at End of Period |
$ 2,567 |
$ 3,040 |
||
Credit Quality Ratios |
||||
Nonperforming Assets as a % of Total Assets |
1.10% |
3.10% |
||
Total Allowance for Loan Losses as a % of Total Loans |
1.49% |
2.08% |
||
Total Allowance for Loan Losses as a % of Nonperforming Loans |
109.61% |
48.97% |
||
Annualized Net Charge-offs as a % of Average Loans |
1.34% |
-0.43% |
||
Nonperforming Assets |
||||
Nonaccrual Loans |
$ 2,342 |
$ 6,192 |
||
Loans Past Due 90 Days+, still accruing |
- |
16 |
||
Total Nonperforming Loans |
2,342 |
6,208 |
||
Other Real Estate Owned |
725 |
2,209 |
||
Total Nonperforming Assets |
$ 3,067 |
$ 8,417 |
||
1 Net interest margin equals net interest income divided by interest-earning average assets. |
||||
2 Efficiency ratio equals noninterest expense (excluding OREO valuations and OREO operating expenses) divided by net interest income plus noninterest income (excluding net realized gains on sales of securities). |
SOURCE Cardinal Bankshares Corporation
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