Bank reports steady earnings, controlled growth, and low loan losses
- $3.00 million in net income for 2019
- Annual growth of 5% for loans, 2% for assets and deposits, and 8% for shareholders' equity
- Low loan charge-offs compared to other banks
PEMBROKE, NC / ACCESSWIRE / February 7, 2020 / For the year ended December 31, 2019, Lumbee Guaranty Bank (OTCQX:LUMB)("Lumbee" or "Bank"), reported net income of $3.0 million, or earnings per share of $0.88, compared to net income of $3.1 million, or earnings per share of $0.91, for the year ended December 31, 2018. Net income declined by 3.20%, while earnings per share decreased by 3.30%. For the three-month period ended as of the same date, Lumbee reported net income of $726,000, compared to net income of $753,000 for the three months ended December 31, 2018.
As of December 31, 2019, Lumbee reported assets of $343.8 million, an increase of 2.40% over assets of $335.7 million as of December 31, 2018. Loans were up over 4.71% to $192.0 million, compared to loans of $183.4 million reported December 31, 2018. Deposits grew to $296.1 million at year-end, an increase of 2.32% over December 31, 2018 deposits of $289.4 million. Capital levels remained strong, as shareholders equity totaled $40.9 million, or 11.9% of assets at December 31, 2019, versus $38.0 million, or 11.3% of assets at the year-ago date. For the three-month period ended December 31, 2019, assets fell by $2.4 million, loans grew by $1.7 million, and deposits decreased by $3.4 million.
Loan losses for 2019 were 0.02% of average loans, compared to 0.03% for all banks in NC. Lumbee's strong performance in this area allowed the Bank to reverse $100,000 of its allowance for loan losses, which augmented net income. in the fourth quarter of 2019 and for the year. The Bank's capital position remains very strong, as all capital ratios exceed the regulatory minimums to be considered "Well Capitalized". Finally, nonperforming assets decreased by 20% from the fourth quarter of 2019.
"Declining interest rates in 2019 presented challenges to our Bank, as our interest margin was compressed." said Kyle R. Chavis, Chief Executive Officer of Lumbee. "As we managed through the lower rate environment, we also incurred over $110,000 in one-time expenses related to the Bank's deregistration from the SEC and reclassification of certain shares of our common stock. Despite those headwinds, we were able to grow our loan portfolio and enjoy historically low loss rates as well. With the cost savings from deregistration and the pending opening of a new office in Fayetteville, we are well-positioned to continue to create shareholder value and serve our markets in southeastern NC."
Lumbee Guaranty Bank is a community bank headquartered in Pembroke, NC and serves Robeson, Cumberland, and Hoke Counties. Established in 1971, the Bank offers a full array of financial services through its network of thirteen strategically located branch offices over the three-county area. The Bank's common stock is traded on the OTC-QX under the stock symbol LUMB.
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The information as of and for the quarter ended December 31, 2019, as presented is unaudited. This news release contains forward-looking statements. Actual results may differ materially from those projected, for various reasons, including our ability to manage growth, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other savings and financial institutions, and changes in real estate values and the real estate market.
LUMBEE GUARANTY BANK
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Balance Sheets (unaudited) December 31,
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2019 | 2018 | ||||||
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(Dollars in thousands) | |||||||
Assets
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Cash and due from banks
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$ | 4,829 | $ | 5,563 | ||||
Interest-earning deposits with banks
|
26,243 | 21,174 | ||||||
Total cash and cash equivalents
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31,072 | 26,737 | ||||||
Net Investments
|
99,294 | 104,600 | ||||||
Loans receivable
|
191,622 | 183,009 | ||||||
Allowance for loan losses
|
2,067 | 2,172 | ||||||
Net loans receivable
|
189,555 | 180,837 | ||||||
Bank premises & equipment, net
|
9,056 | 8,564 | ||||||
Other assets
|
14,776 | 16,032 | ||||||
Total assets
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$ | 343,753 | $ | 336,770 | ||||
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Liabilities and Shareholders' Equity
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Deposits:
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Demand deposits, Money market & NOW
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$ | 184,058 | $ | 179,144 | ||||
Savings
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26,384 | 25,453 | ||||||
Time deposits
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85,652 | 84,781 | ||||||
Total deposits
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296,094 | 289,378 | ||||||
Securities Sold under Agreement to Repurchase
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1,096 | 1,432 | ||||||
Other borrowed money
|
825 | 2,965 | ||||||
Accrued interest payable and other liabilities
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4,811 | 5,022 | ||||||
Total liabilities
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302,826 | 298,797 | ||||||
Total shareholders' equity
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40,927 | 37,973 | ||||||
Total liabilities and shareholders' equity
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$ | 343,753 | $ | 336,770 | ||||
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Book value per share
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$ | 11.99 | $ | 11.11 | ||||
LUMBEE GUARANTY BANK
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Statement of Operations (unaudited) Twelve Months Ended, December 31,
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2019 | 2018 | ||||||||
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(Dollars in thousands, except per share data) | |||||||||
Interest Income
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14,436 | 13,436 | ||||||||
Interest Expense
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1,754 | 1,054 | ||||||||
Net Interest Income
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12,652 | 12,382 | ||||||||
Provision for loan losses
|
(100) | 167 | ||||||||
Net Interest Income after provision
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12,752 | 12,215 | ||||||||
Service charges on deposit accounts
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1,350 | 1,408 | ||||||||
Other
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686 | 726 | ||||||||
Total noninterest Income
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2,036 | 2,133 | ||||||||
Realized gains on AFS securities
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25 | - | ||||||||
Personnel costs
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6,327 | 6,168 | ||||||||
Occupancy and equipment
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1,273 | 1,268 | ||||||||
Data processing fees
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1,400 | 1,157 | ||||||||
Other
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2,322 | 2,137 | ||||||||
Total noninterest expense
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11,322 | 10,730 | ||||||||
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Net Income before income taxes
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3,491 | 3,619 | ||||||||
Income taxes
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487 | 516 | ||||||||
Net Income
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3,004 | 3,103 | ||||||||
Net income per common share
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$ | 0.88 | $ | 0.91 | ||||||
LUMBEE GUARANTY BANK
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Statement of Operations (unaudited) Three Months Ended, December 31,
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2019 | 2018 | ||||||||
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(Dollars in thousands, except per share data) | |||||||||
Interest Income
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3,547 | 3,567 | ||||||||
Interest Expense
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471 | 366 | ||||||||
Net Interest Income
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3,076 | 3,201 | ||||||||
Provision for loan losses
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(100) | 68 | ||||||||
Net Interest Income after provision
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3,176 | 3,133 | ||||||||
Service charges on deposit accounts
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340 | 339 | ||||||||
Other
|
157 | 162 | ||||||||
Total noninterest Income
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497 | 501 | ||||||||
Personnel costs
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1,613 | 1,536 | ||||||||
Occupancy and equipment
|
302 | 317 | ||||||||
Data processing fees
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364 | 294 | ||||||||
Other
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573 | 583 | ||||||||
Total noninterest expense
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2,852 | 2,730 | ||||||||
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Net Income before income taxes
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846 | 904 | ||||||||
Income taxes
|
120 | 151 | ||||||||
Net Income
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726 | 753 | ||||||||
Contact:
Kyle R. Chavis, Chief Executive Officer
Lumbee Guaranty Bank
(910) 521-9707; [email protected]; www.lumbeeguarantybank.com
SOURCE: Lumbee Guaranty Bank