BEAUFORT, SC / ACCESSWIRE / February 16, 2017 / Coastal Banking Company Inc. (OTCQX: CBCO), the holding company of CBC National Bank, which operates branches in Beaufort and Port Royal, S.C., and in Fernandina Beach, Ocala, and The Villages, Fla., today reported net income of $6.96 million, or $2.05 diluted earnings per common share for the year ended Dec. 31, 2016. This compares to $5.05 million, or $1.85 in diluted earnings per common share in 2015, an increase of $1.91 million, or $0.20 per diluted earnings per common share. The 2015 earnings and diluted earnings per common share were net of preferred stock dividends.
For the fourth quarter of 2016, the Company reported net income of $2.21 million, or diluted earnings per common share of $0.59. This compares to net income of $1.32 million, or diluted earnings per common share of $0.48, for the fourth quarter of 2015 (net of preferred stock dividends), and represents a year-over-year increase of $884,000, or diluted earnings per common share of $0.11.
On a linked-quarter basis, the $2.21 million of net income in the fourth quarter of 2016 represents an increase of $219,000, or $0.05 diluted earnings per common share, from net income of $1.99 million, or diluted earnings per common share of $0.54, in the third quarter of 2016.
Key performance highlights for 2016 include:
- Completion of the acquisition of First Avenue National Bank ("FANB") in Ocala, Florida, in April 2016, and subsequent integration into CBC National Bank. FANB had assets of $112 million at the acquisition date.
- Continued strong profitability growth, with 2016 net income increasing by 37.7 percent over 2015, including more balanced net income for all three of the Company's operating segments: Mortgage Banking earned $5.59 million in 2016, up from $5.38 million in 2015; Community Banking earned $1.40 million in 2016, up from $98,000 in 2015, and SBA Lending earned $891,000 in 2016, comparable to the $963,000 earned in 2015.
- Driven by strong earnings over the last four quarters, common tangible book value has risen to $13.57 per share at Dec. 31, 2016, from $11.81 at Dec. 31, 2015, an increase of 14.9 percent. The CBCO closing market price on Dec. 31, 2016, was $15.01 per share.
- Continuation of robust mortgage banking funding and profitability, with more than $3.05 billion in residential mortgage loans originated and $18.2 million in total mortgage banking income during 2016, up from $2.81 billion and $15.7 million, respectively, for 2015. For the fourth quarter of 2016, $740.8 million in residential mortgage loans were originated and $5.9 million in total mortgage banking income generated, up from $596.4 million and $3.8 million, respectively, for the fourth quarter of 2015.
- Year-over-year growth in the balance sheet of $96.7 million, or 20.8 percent, with total assets of $561.4 million at Dec. 31, 2016. The asset growth was driven by rising portfolio loan balances and the FANB acquisition. SBA portfolio loans grew $25.3 million and Community Banking portfolio loans grew $104.3 million, of which $81.4 million were added as part of the acquisition. The growth in portfolio loans was offset by a decline in loans held for sale of $36.2 million from the end of 2015 to the end of 2016.
- Related to credit quality, the ratio of non-performing assets to assets increased slightly from 1.85 percent at Dec. 31, 2015, to 1.98 percent at Dec. 31, 2016. The allowance for loan losses was 1.84 percent of loans outstanding at the end of 2015, compared to 1.47 percent at the end of 2016. Other real estate owned (OREO) declined $1.05 million, or 17.2 percent, from Dec. 31, 2015, to Dec. 31, 2016. Net charge-offs were $714,000 in 2016 compared to net recoveries of $32,000 in 2015.
- Capital ratios for the Company remained strong, with a total risk-based capital ratio of 19.74 percent and a Tier 1 risk-based capital ratio of 18.47 percent at Dec. 31, 2016, closely comparable to the levels of both ratios at the end of 2015.
For the full text of the earnings release and complete audited financial results, click here.
For More Information Contact:
Thomas J. Flournoy
EVP & Chief Financial Officer
Coastal Banking Company Inc.
904-321-2917
Michael G. Sanchez
Chairman & Chief Executive Officer
Coastal Banking Company Inc.
904-321-0400
Coastal Banking Company
Consolidated Balance Sheet
December 31, 2016
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12/31/2016
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12/31/2015
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Consolidated
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Consolidated
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Assets
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Cash and due from banks
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$ | 7,956,004 | $ | 4,830,568 | ||||
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Federal funds sold
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387,123 | 82,642 | ||||||
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Investment securities
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24,760,056 | 27,406,568 | ||||||
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Loans held for sale
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92,009,241 | 128,181,623 | ||||||
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Loans, gross
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408,743,325 | 285,932,549 | ||||||
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Less allowance
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(5,990,733 | ) | (5,254,407 | ) | ||||
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Loans, net
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402,752,592 | 280,678,142 | ||||||
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Premises and equipment, net
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13,604,166 | 7,174,034 | ||||||
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Accrued interest receivable
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1,242,703 | 816,324 | ||||||
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Other real estate owned
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5,061,661 | 6,115,715 | ||||||
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Other assets
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13,615,180 | 9,381,356 | ||||||
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Total assets
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$ | 561,388,726 | $ | 464,666,972 | ||||
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Liabilities
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DDA - non interest bearing
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$ | 77,603,027 | $ | 42,156,742 | ||||
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Interest bearing dda
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174,112,178 | 118,889,345 | ||||||
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Savings
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15,618,336 | 5,179,736 | ||||||
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Time
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149,983,376 | 117,613,561 | ||||||
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Total deposits
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417,316,917 | 283,839,384 | ||||||
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FHLB Advances & other borrowings
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63,060,005 | 120,501,004 | ||||||
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Senior Note Payable
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8,916,667 | 9,916,667 | ||||||
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Junior subordinated debentures
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7,217,000 | 7,217,000 | ||||||
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Accrued interest payable
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198,018 | 196,863 | ||||||
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Other liabilities
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12,964,827 | 9,737,154 | ||||||
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Total liabilities
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509,673,434 | 431,408,072 | ||||||
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Stockholders' equity
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Common stock
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36,475 | 26,845 | ||||||
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Additional paid-in-capital
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53,354,381 | 41,764,823 | ||||||
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Retained earnings
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(1,870,202 | ) | (8,825,989 | ) | ||||
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Net unrealized gain (loss) - securities AFS
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194,638 | 293,221 | ||||||
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Total stockholders' equity
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51,715,292 | 33,258,900 | ||||||
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Total liabilities and stockholders' equity
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$ | 561,388,726 | $ | 464,666,972 | ||||
Coastal Banking Company
Consolidated Income Statement
December 31, 2016
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12/31/2016 QTD
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12/31/2015 QTD
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12/31/2016 YTD
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12/31/2015 YTD
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Consolidated
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Consolidated
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Consolidated
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Consolidated
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Interest Income:
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Loans
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$ | 6,110,030 | $ | 4,407,958 | $ | 22,709,121 | $ | 18,362,518 | ||||||||
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Securities
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208,478 | 186,409 | 805,347 | 789,306 | ||||||||||||
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Interest on Deposits
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786 | 2,526 | 14,771 | 8,361 | ||||||||||||
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Federal funds sold
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7,247 | 57 | 12,764 | 188 | ||||||||||||
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Total interest income
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6,326,541 | 4,596,950 | 23,542,003 | 19,160,373 | ||||||||||||
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Interest Expense:
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Deposits
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698,597 | 380,796 | 2,422,894 | 1,603,573 | ||||||||||||
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Other
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494,029 | 288,550 | 1,625,529 | 904,767 | ||||||||||||
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Total interest expense
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1,192,626 | 669,346 | 4,048,423 | 2,508,340 | ||||||||||||
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Net interest income before provision for loan losses
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5,133,915 | 3,927,604 | 19,493,580 | 16,652,033 | ||||||||||||
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Provision for loan losses
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1,001,356 | 43,508 | 1,450,061 | 393,863 | ||||||||||||
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Net interest income after provision for loan losses
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4,132,559 | 3,884,096 | 18,043,519 | 16,258,170 | ||||||||||||
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Operating income:
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Service charges on deposits
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236,739 | 139,582 | 860,338 | 209,486 | ||||||||||||
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Mortgage banking income
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5,872,234 | 3,824,953 | 18,225,244 | 15,686,148 | ||||||||||||
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SBA loan income
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177,990 | 992,979 | 1,962,023 | 1,414,020 | ||||||||||||
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Gain on sale of securities
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18,373 | - | 18,373 | - | ||||||||||||
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Increase in cash surrender value of life insurance
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19,990 | 21,877 | 83,584 | 84,594 | ||||||||||||
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Other income
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1,009,635 | 40,420 | 1,536,287 | 476,460 | ||||||||||||
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Total operating income
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7,334,961 | 5,019,811 | 22,685,849 | 17,870,708 | ||||||||||||
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Operating expenses:
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Salaries and benefits
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4,860,789 | 3,746,341 | 17,373,369 | 14,971,769 | ||||||||||||
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Net occupancy and equipment expense
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884,657 | 627,008 | 3,147,188 | 2,204,884 | ||||||||||||
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Other operating expense
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2,610,508 | 2,453,792 | 9,222,448 | 7,353,376 | ||||||||||||
| 8,355,954 | 6,827,141 | 29,743,005 | 24,530,029 | |||||||||||||
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Income before provision for income taxes
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3,111,566 | 2,076,766 | 10,986,363 | 9,598,849 | ||||||||||||
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Provision for income taxes
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906,201 | 644,041 | 4,030,577 | 3,763,628 | ||||||||||||
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Net income
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$ | 2,205,365 | $ | 1,432,725 | $ | 6,955,786 | $ | 5,835,221 | ||||||||
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Preferred stock dividends
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- | 111,938 | - | 783,563 | ||||||||||||
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Net earnings available to common shareholders
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$ | 2,205,365 | $ | 1,320,787 | $ | 6,955,786 | $ | 5,051,658 | ||||||||
Coastal Banking Company
Consolidated Financial Highlights
December 31, 2016
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12/31/2016 QTD
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12/31/2015 QTD
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12/31/2016 YTD
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12/31/2015 YTD
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Consolidated
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Consolidated
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Consolidated
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Consolidated
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Earnings
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Net interest income
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$ | 5,133,915 | $ | 3,927,604 | $ | 19,493,580 | $ | 16,652,033 | ||||||||
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Provision for loan loss
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1,001,356 | 43,508 | 1,450,061 | 393,863 | ||||||||||||
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Other income
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7,334,961 | 5,019,811 | 22,685,849 | 17,870,708 | ||||||||||||
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Other expense
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8,355,954 | 6,827,141 | 29,743,005 | 24,530,029 | ||||||||||||
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Pre-tax income
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3,111,566 | 2,076,766 | 10,986,363 | 9,598,849 | ||||||||||||
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Taxes
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906,201 | 644,041 | 4,030,577 | 3,763,628 | ||||||||||||
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Net income
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2,205,365 | 1,432,725 | 6,955,786 | 5,835,221 | ||||||||||||
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Preferred stock dividends
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- | 111,938 | - | 783,563 | ||||||||||||
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Net earnings available to common shareholders
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$ | 2,205,365 | $ | 1,320,787 | $ | 6,955,786 | $ | 5,051,658 | ||||||||
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Earnings per share (basic)
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$ | 0.61 | $ | 0.49 | $ | 2.10 | $ | 1.89 | ||||||||
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Earnings per share (diluted)
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$ | 0.59 | $ | 0.48 | $ | 2.05 | $ | 1.85 | ||||||||
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Performance Ratios
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ROAA
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1.53 | % | 1.25 | % | 1.29 | % | 1.12 | % | ||||||||
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ROAE
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17.47 | % | 14.07 | % | 16.07 | % | 13.14 | % | ||||||||
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Net Interest Margin
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3.80 | % | 3.90 | % | 3.85 | % | 3.89 | % | ||||||||
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Efficiency Ratio
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67.01 | % | 76.30 | % | 70.52 | % | 71.05 | % | ||||||||
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Capital
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Tier 1 leverage capital ratio
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10.01 | % | 9.54 | % | 10.01 | % | 9.54 | % | ||||||||
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Common equity risk-based capital ratio
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18.47 | % | 18.60 | % | 18.47 | % | 18.60 | % | ||||||||
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Tier 1 risk-based capital ratio
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18.47 | % | 18.60 | % | 18.47 | % | 18.60 | % | ||||||||
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Total risk-based capital ratio
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19.74 | % | 19.89 | % | 19.74 | % | 19.89 | % | ||||||||
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Book value per share
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$ | 14.18 | $ | 12.39 | $ | 14.18 | $ | 12.39 | ||||||||
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Tangible book value per share
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$ | 13.57 | $ | 11.81 | $ | 13.57 | $ | 11.81 | ||||||||
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Asset Quality
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Other real estate owned
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$ | 5,061,661 | $ | 6,115,715 | $ | 5,061,661 | $ | 6,115,715 | ||||||||
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Net Charge-offs (recoveries)
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$ | (69,652 | ) | $ | 15,460 | $ | 713,736 | $ | (31,645 | ) | ||||||
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Net Charge-offs (recoveries) to average loans
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-0.07 | % | 0.02 | % | 0.20 | % | -0.01 | % | ||||||||
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Allowance to total loans, net of LHFS
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1.47 | % | 1.84 | % | 1.47 | % | 1.84 | % | ||||||||
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Nonperforming assets to total assets
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1.98 | % | 1.85 | % | 1.98 | % | 1.85 | % | ||||||||
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End of Period Balances
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Assets
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$ | 561,388,726 | $ | 464,666,972 | $ | 561,388,726 | $ | 464,666,972 | ||||||||
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Portfolio Loans
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408,743,325 | 285,932,549 | 408,743,325 | 285,932,549 | ||||||||||||
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Loans Held for Sale
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92,009,241 | 128,181,623 | 92,009,241 | 128,181,623 | ||||||||||||
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Deposits
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417,316,917 | 283,839,384 | 417,316,917 | 283,839,384 | ||||||||||||
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Borrowings
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63,060,005 | 120,501,004 | 63,060,005 | 120,501,004 | ||||||||||||
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Shareholders' Equity
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$ | 51,715,292 | $ | 33,258,900 | $ | 51,715,292 | $ | 33,258,900 | ||||||||
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Average Balances
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Assets
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$ | 575,143,290 | $ | 421,963,201 | $ | 540,550,612 | $ | 450,222,835 | ||||||||
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Portfolio Loans
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399,748,183 | 274,670,443 | 364,242,751 | 269,032,510 | ||||||||||||
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Loans Held for Sale
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107,037,715 | 95,875,166 | 111,509,816 | 126,942,524 | ||||||||||||
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Deposits
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420,196,540 | 291,394,253 | 385,102,055 | 303,727,269 | ||||||||||||
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Borrowings
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73,222,407 | 71,548,227 | 83,230,853 | 89,623,123 | ||||||||||||
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Shareholders' Equity
|
$ | 50,499,485 | $ | 37,553,433 | $ | 43,270,921 | $ | 38,443,305 | ||||||||
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Average Shares
|
3,620,000 | 2,681,375 | 3,307,965 | 2,667,940 | ||||||||||||
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Stock Valuation
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Closing Market Price (OTCQX)
|
$ | 15.01 | $ | 12.00 | $ | 15.01 | $ | 12.00 | ||||||||
SOURCE: Coastal Banking Company Inc.