COLDWATER, Mich., April 21, 2014 /PRNewswire/ -- Southern Michigan Bancorp, Inc. (OTCQB: SOMC) reported net income of $1,102,000, or $0.46 per share, for the quarter ended March 31, 2014. This compared to net income of $1,055,000, or $0.44 per share, for the first quarter of 2013.
Total consolidated assets at March 31, 2014 were $583.3 million compared to $539.5 million at December 31, 2013. The increase in assets is in part due to $31.3 million deposited at the end of the quarter resulting in a temporary increase in cash and non-interest bearing deposits. This deposit is short term in nature and the money is expected to move out of the bank within 60 days.
No provision for loan losses was required during the first quarter of 2014. The allowance for loan losses was $5,098,000, or 1.34% of loans at March 31, 2014. This compared to $225,000 of provision for loan losses expense for the first quarter of 2013. Net charge-offs decreased 68.8%, totaling $140,000 for the first quarter of 2013, compared to $448,000 during the first quarter of 2013.Total delinquent loans decreased to 1.00% as of March 31, 2014 from 1.74% as of March 31, 2013.
The annualized return on average assets for the three month period ended March 31, 2014 was 0.80% compared to 0.79% for the first quarter of 2013. The annualized return on average equity was 7.65% for the first quarter of 2014 compared to 7.62% for the first quarter of 2013. The tax equivalent net interest margin for the three month period ending March 31, 2014 was 3.78% compared to 3.67% for the same period of 2013.
John H. Castle, Chairman and Chief Executive Officer of Southern Michigan Bancorp, Inc., stated, "We are pleased with our first quarter results including a 4.5% increase in earnings as compared to the first quarter of 2013, and significant reductions in net charge-offs, loan delinquencies and non-performing loans which resulted in reduced credit costs and overall improvement to credit quality."
Southern Michigan Bancorp, Inc. is a bank holding company and the parent company of Southern Michigan Bank & Trust. It operates 15 branches within Branch, Calhoun, Hillsdale and St. Joseph Counties, providing a broad range of consumer, business and wealth management services throughout the region.
This press release contains forward-looking statements that are based on management's beliefs, assumptions, current expectations, estimates and projections about the financial services industry, the economy, and Southern Michigan Bancorp, Inc. Forward-looking statements are identifiable by words or phrases such as "expected", "begin" and other similar words or expressions. All statements with reference to a future time period are forward-looking. Management's determination of the provision and allowance for loan losses and other accounting estimates, such as the carrying value of goodwill, other real estate owned and mortgage servicing rights and the fair value of investment securities (including whether any impairment on any investment security is temporary or other-than-temporary and the amount of any impairment), involves judgments that are inherently forward-looking. There can be no assurance that future loan losses will be limited to the amounts estimated. Our ability sell other real estate owned at its carrying value or at all, successfully implement new programs and initiatives, increase efficiencies, maintain our current level of deposits and other sources of funding, respond to declines in collateral values and credit quality, and improve profitability is not entirely within our control and is not assured. The future effect of changes in the financial and credit markets and the national and regional economy on the banking industry, generally, and Southern Michigan Bancorp, Inc., specifically, are also inherently uncertain. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("risk factors") that are difficult to predict with regard to timing, extend, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed in or implied by such forward-looking statements. Southern Michigan Bancorp, Inc. does not undertake to update forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.
SOUTHERN MICHIGAN BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands, except share data)
March 31, 2014
December 31, 2013
Cash and cash equivalents
Federal funds sold
Securities available for sale
Loans held for sale
Loans, net of allowance for loan losses of $5,098 - 2014 ($5,238 - 2013)
Premises and equipment, net
Accrued interest receivable
Net cash surrender value of life insurance
Other intangible assets, net
Securities sold under agreements to repurchase and overnight borrowings
Accrued expenses and other liabilities
Common stock subject to repurchase obligation in Employee
Stock Ownership Plan, shares outstanding – 123,564 in 2014
(126,931 shares in 2013)
Preferred stock, 100,000 shares authorized; none issued or outstanding
Common stock, $2.50 par value:
Authorized - 4,000,000 shares
Issued –2,406,519 shares in 2014 (2,392,630 shares in 2013)
Outstanding (other than ESOP shares) – 2,282,955 shares in 2014 (2,265,699 shares in 2013)
Additional paid-in capital
Accumulated other comprehensive income, net
Total shareholders' equity
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
SOUTHERN MICHIGAN BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share data)
Three Months Ended March 31,
Loans, including fees
Total interest income
Total interest expense
Net interest income
Provision for loan losses
Net interest income after provision for loan losses