SPRINGFIELD, Ill., May 2, 2014 /PRNewswire/ -- Town and Country Financial Corporation (TWCF) reported first-quarter core net income of $561 thousand, up 7% compared with $524 thousand in the first quarter of 2013. Including income from the gain on sale of securities and dividend on preferred stock, net income available to common shareholders was $593 thousand, or $0.21 per share, compared with $0.24 per share in the year-ago period.
President and Chief Executive Officer, Micah R. Bartlett commented, "Core earnings were up 7% from the first quarter of 2013 due to foundations laid over the last several years. Nearly 17% average loan growth drove net interest income that was up 12% compared to the first quarter of 2013. Loan asset quality remained very strong with less than 1% of total loans that were 30 days or more past due, including nonperforming loans. And expenses, primarily compensation related, were down 6%. These results were sufficient to overcome a very slow start to the 2014 mortgage business with loans processed down 62% from the prior year's quarter and related fees down 52%. The resiliency of this quarter's earnings is a testament to our commitment to meeting the needs of our current and future customers and creating a revenue diverse company."
Net revenue was $5 million, down $0.5 million, or 9.3%, from the first quarter of 2013. Net interest income was up 12.1% driven by 17.0% average loan growth and a favorable mix change from term to non-maturity deposits. The net interest margin ratio improved to 3.31% compared to 3.11% in the first quarter of 2013. Non-interest income was $1.4 million and 40.2% below the year ago led by a 62% decline in mortgage loans processed and income from security gains that were $74 thousand in 2014 compared to $270 thousand in 2013.
There was no provision for loan loss compared to $50 thousand in the prior year. Net charge-offs were 0.05% of average loans compared with 0.01% in 2013. Non-interest expense declined 6.1%, most of the reduction related to greatly reduced mortgage banking refinance volumes that are expected to remain at these lower levels for the foreseeable future. Other non-mortgage expenses were up 1.6% due to 2013 investments in technology and facilities costs, some due to the inclement weather.
Loans that were past due 30 days or more, including non-accrual loans, totaled 0.98% of loans outstanding at March 31, 2014 compared with 0.77% at December 31, 2013. The allowance for loan loss was 392% of total non-performing loans and 1.04% of total loans compared with 286% and 1.04%, respectively, at the prior year-end.
At March 31, 2014 total assets were $487 million and total net loans were $330 million compared to $508 million and $344 million, respectively, on December 31, 2013. Total deposits were $414 million and common equity capital was $40.1 million. The reported book value was $14.37 per common share compared to $14.20 per share. Tier 1 capital was $52 million, or 10.7% of average assets, while total regulatory capital was $57 million, or 14.8% of risk-weighted assets.
Bartlett added, "The first quarter was challenging for our bank and the industry as we continued to ride out an economy that is slowly improving. Loan balances declined from year-end and the frigid weather discouraged home buying and other economic activity. Mortgage revenues were significantly reduced and regulatory challenges did not abate. Despite all of these factors, core earnings were up and capital and asset quality remain very strong. We believe, more than ever, that by connecting with our customers we will add more value to the company. In the quarter we increased our core deposit accounts by 2% as compared to year-end. And, we helped 14% more individuals to purchase their home this quarter as compared to the year ago quarter despite a 50% overall decline in mortgage loans originated. And through our connection filter, we earned business from other banks with our Community Mortgage Partner program and other businesses with our employee benefit services and PERKs financial wellness program."
The Board of Directors declared a $0.03 per share quarterly cash dividend payable on June 13, 2014 to stockholders of record June 2, 2014.
Town and Country Financial Corporation is the parent holding company for Town and Country Bank and Town & Country Banc Mortgage Services, Inc. with offices in Buffalo, Decatur, Forsyth, Lincoln, Mt. Zion, Quincy and Springfield. Town and Country Financial Corporation shares are quoted under the symbol TWCF.
SOURCE Town and Country Financial Corporation