Southern Michigan Bancorp, Inc. Announces Fourth Quarter And Full Year 2015 Earnings

COLDWATER, Mich., Feb. 15, 2016 /PRNewswire/ -- Southern Michigan Bancorp, Inc. (OTC Pink: SOMC) reported record net income of $5,806,000 for 2015 compared to $4,792,000 for 2014, an increase of $1,014,000, or 21.2%.  Earnings per share were $2.42 for 2015 compared to $1.99 in 2014.  Fourth quarter 2015 net income was $1,194,000, or $0.50 per share, compared to $1,252,000, or $0.51 per share in the fourth quarter of 2014.

"We are pleased to deliver the fourth consecutive year of record earnings," said John H. Castle, Chairman and Chief Executive Officer of Southern Michigan Bancorp, Inc. "Positive contributions to income came from balance sheet and loan growth, and improvement in credit quality metrics including net charge-offs and past due loans."

Total consolidated assets at December 31, 2015 were $582.8 million compared to $543.3 million at December 31, 2014.   Total loans reached a record high of $422.0 million as of December 31, 2015, an increase of $11.9 million or 2.9%, as compared to $410.1 million at year end 2014.

Southern provided $250,000 for loan losses in 2015, with an allowance for loan losses at December 31, 2015 of $5,273,000, or 1.25% of loans.  This compared to a provision for loan losses of $400,000 for 2014, with an allowance for loan losses at December 31, 2014 of $5,177,000, or 1.26% of loans.   The decrease in the provision for loan losses resulted from a reduction in net charge-offs offset by loan growth in the commercial loan portfolio.  Net charge-offs for 2015 totaled $154,000, or .04% of loans, down from $461,000, or .11% of loans in 2014.

The annualized return on average assets for 2015 was 1.02% compared to 0.87% for 2014.  The annualized return on average equity was 8.82% for 2015 compared to 7.79% for 2014.

Chairman Castle continued "After months of planning and preparation, our new Portage Branch office opened February 1, 2016.  Growth of small and medium-sized business relationships remains favorable, and our pipeline of approved commercial loans from across all the markets that we serve, suggests that we will continue to experience loan growth in 2016."

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, Kalamazoo and St. Joseph Counties, and a loan production office in Steuben County, 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 "continue", "look ahead", "long term", "strategic", "objectives", "trends", "planned" 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 to meet the challenges presented by economic and regulatory conditions, realize our long term strategic objectives, 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.  Risk factors may emerge and could cause a difference between an ultimate actual outcome and a preceding forward-looking statement.

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SOURCE Southern Michigan Bancorp, Inc.

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