Atlantic Coast Financial Corporation (NASDAQ: ACFC):
- Earnings per diluted share more than tripled versus the same quarter last year.
- Earnings per diluted share of $0.42 for 2016.
- Deposit growth of 13% surpassed loan growth of 11% over the past 12 months.
- Interest rate sensitivity continues to be neutral as a result of investment securities and loan sales in 2016.
- Atlantic Coast Bank completes its conversion to a Florida state chartered bank.
Atlantic Coast Financial Corporation (Atlantic Coast or the Company, NASDAQ: ACFC), the holding company for Atlantic Coast Bank (the Bank), today reported earnings per diluted share of $0.13 for the fourth quarter of 2016 compared with earnings of $0.04 per diluted share in the same quarter last year. Earnings per diluted share for the year ended December 31, 2016, totaled $0.42 compared with $0.50 per diluted share for the year ended December 31, 2015.
Commenting on the Company’s results, John K. Stephens, Jr., President and Chief Executive Officer, said, “We are pleased with the Company’s performance in 2016, highlighted by strong growth in both loans and deposits – both of which increased more than 10% year over year. The effects of this growth can be seen in many aspects of our operations, from higher earnings throughout the year, to an improved loans-to-deposits ratio, and strengthened net interest margins. With 2016 in the record book, we look forward to capitalizing on the momentum we have achieved as we look ahead to the prospects of 2017.
“I also am pleased to note that, in December, we completed our conversion to a Florida charter for the Bank,” Stephens continued. “This conversion will allow us to work with regulators in Florida going forward in a more expedient and efficient way. In turn, we think this change will enable us to focus even greater attention on the needs of our customers, continue our efforts to make the Bank one of best places to work for our talented team members, and reward our stockholders with enhanced growth over the long term.”
Other significant highlights of the fourth quarter of 2016 and the full year included:
- Results for the fourth quarter of 2016 included a $0.4 million gain from the extinguishment of FHLB advances (the FHLB Gain) in October 2016, while results for the fourth quarter of 2015 were reduced by a $0.5 million write-down related to a contract to sell an other real estate owned (OREO) property (the OREO Write-down) in December 2015. Therefore, core earnings per diluted share, which excludes the impact of both transactions discussed above, increased 57% to $0.11 for the fourth quarter of 2016 from $0.07 for the fourth quarter of 2015. Core earnings per diluted share is a non-GAAP financial measure, and a reconciliation of GAAP to non-GAAP financial measures is presented on page five.
- Results for the year ended December 31, 2016, included the benefit of gains on the sale of investment securities totaling $1.3 million and the FHLB Gain. Results for the prior year included the benefit of the reversal of a valuation allowance against the Company’s deferred tax asset (the Valuation Allowance Reversal), which was partially offset by the impact of penalties associated with the early prepayment of some of the Company’s wholesale debt (the Debt Prepayment Penalties) and the OREO Write-down. Excluding the effects of all the transactions discussed above, core earnings per diluted share virtually doubled to $0.35 for the year ended December 31, 2016, from $0.18 for the year ended December 31, 2015.
- Net interest income improved to $7.1 million and $26.5 million for the three and twelve months ended December 31, 2016, respectively, from $5.9 million and $21.1 million for the three and twelve months ended December 31, 2015, respectively. Net interest margin was 3.30% and 3.12% for the three and twelve months ended December 31, 2016, respectively, up from 3.10% and 2.95% for the three and twelve months ended December 31, 2015, respectively.
- Total loans (including portfolio loans, loans held-for-sale, and warehouse loans held-for-investment) increased 11% to $727.0 million at December 31, 2016, from $654.2 million at December 31, 2015. Total loan growth primarily reflected originations in all lines of business, supplemented by selective loan acquisitions and net of loan sales during the year.
- Nonperforming assets, as a percentage of total assets, was 1.44% at December 31, 2016, compared with 0.87% at December 31, 2015, but improved versus the third quarter of 2016. With stable overall credit quality throughout 2016, reflecting a general slowing pace of loan reclassifications, the Company was able to reduce its loan loss provision in the fourth quarter while still maintaining an adequate ratio of allowance for portfolio loan losses to total portfolio loans.
- Total assets increased to $907.5 million at December 31, 2016, from $857.2 million at December 31, 2015, primarily due to an increase in loans.
- The Bank’s ratios of total risk-based capital to risk-weighted assets and Tier 1 (core) capital to adjusted total assets were 14.83% and 9.44%, respectively, at December 31, 2016, and each continued to exceed the levels – 10% and 5%, respectively – currently required for the Bank to be considered well-capitalized.
Tracy L. Keegan, Executive Vice President and Chief Financial Officer, added, “To echo John’s comment about the Bank’s deposit growth over the past year, it reflects the success of a focused retail deposit strategy designed to attract new commercial and personal relationships. This resulted in generally higher balances in most deposit categories, including noninterest-bearing demand accounts, which underscored the improvement in our loan-to-deposits ratio to 103% at December 31, 2016, from 110% at December 31, 2015. Moreover, these results have had a direct, positive impact on our net interest margin, reducing our reliance on wholesale debt by funding more loans through lower-cost deposits and resulting in a 17 basis-point improvement in net interest margin during 2016. Combine these achievements with the benefits of restructuring our investment securities during the past year, to reduce volatility and prepare for a rising-rate environment, and you can understand why we remain enthusiastic about the way we have positioned the Bank for the opportunities we see ahead.”
| Bank Regulatory Capital | At | |||||||||||||||||||
Key Capital Measures | Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | |||||||||||||||
Total risk-based capital ratio (to risk-weighted assets) | 14.83 | % | 13.42 | % | 12.49 | % | 13.08 | % | 13.91 | % | ||||||||||
Common equity tier 1 (core) risk-based capital ratio (to risk-weighted assets) | 13.58 | % | 12.21 | % | 11.36 | % | 11.91 | % | 12.66 | % | ||||||||||
Tier 1 (core) risk-based capital ratio (to risk-weighted assets) | 13.58 | % | 12.21 | % | 11.36 | % | 11.91 | % | 12.66 | % | ||||||||||
Tier 1 (core) capital ratio (to adjusted total assets) | 9.44 | % | 9.09 | % | 9.06 | % | 9.20 | % | 9.49 | % | ||||||||||
The increase in capital ratios at December 31, 2016, primarily reflected an increase in cash and cash equivalents, which resulted in a decrease in risk-weighted assets and adjusted total assets; however, the Bank expects to utilize these funds to fund loans during the first quarter of 2017. Additionally, the increase in capital ratios at December 31, 2016, reflected an increase in capital. Prior to the increase at December 31, 2016, the general decline in capital ratios during 2016 primarily reflected growth in the Bank’s portfolio loans, which resulted in an increase in risk-weighted assets and adjusted total assets.
| Credit Quality | At | ||||||||||||||||||||||||
Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | |||||||||||||||||||||
| (Dollars in millions) | |||||||||||||||||||||||||
| Nonperforming loans | $ | 10.1 | $ | 10.9 | $ | 3.4 | $ | 4.5 | $ | 4.2 | |||||||||||||||
| Nonperforming loans to total portfolio loans | 1.57 | % | 1.66 | % | 0.51 | % | 0.69 | % | 0.69 | % | |||||||||||||||
| Other real estate owned | $ | 2.9 | $ | 2.8 | $ | 2.7 | $ | 3.2 | $ | 3.2 | |||||||||||||||
| Nonperforming assets | $ | 13.0 | $ | 13.7 | $ | 6.1 | $ | 7.7 | $ | 7.4 | |||||||||||||||
| Nonperforming assets to total assets | 1.44 | % | 1.46 | % | 0.67 | % | 0.86 | % | 0.87 | % | |||||||||||||||
Troubled debt restructurings performing for less than 12 months under terms of modification | $ | 14.6 | $ | 14.8 | $ | 5.1 | $ | 4.5 | $ | 4.5 | |||||||||||||||
Total nonperforming assets and troubled debt restructurings performing for less than 12 months under terms of modification | $ | 27.6 | $ | 28.5 | $ | 11.2 | $ | 12.2 | $ | 11.9 | |||||||||||||||
Troubled debt restructurings performing for more than 12 months under terms of modification | $ | 20.3 | $ | 20.2 | $ | 29.8 | $ | 31.2 | $ | 30.5 | |||||||||||||||
Although nonperforming assets were higher at the end of the fourth quarter of 2016, coming off of an exceptionally low base at the end of the year-earlier quarter, the Company’s overall credit quality remains stable. Aside from the reclassification of two specific loans to nonperforming during the third quarter of 2016, the general pace of loans reclassified to nonperforming and OREO continued to slow.
Provision / Allowance for Loan Losses | At and for the | At and for the | |||||||||||||||||||||||
Dec. 31, | Sept. 30, | Dec. 31, | Dec. 31, | Dec. 31, | |||||||||||||||||||||
| (Dollars in millions) | |||||||||||||||||||||||||
| Provision for portfolio loan losses | $ | 0.1 | $ | 0.2 | $ | 0.2 | $ | 0.6 | $ | 0.8 | |||||||||||||||
| Allowance for portfolio loan losses | $ | 8.2 | $ | 8.2 | $ | 7.7 | $ | 8.2 | $ | 7.7 | |||||||||||||||
Allowance for portfolio loan losses to total portfolio loans | 1.26 | % | 1.24 | % | 1.27 | % | 1.26 | % | 1.27 | % | |||||||||||||||
| Allowance for portfolio loan losses to nonperforming loans | 80.38 | % | 74.92 | % | 183.31 | % | 80.38 | % | 183.31 | % | |||||||||||||||
| Net charge-offs (recoveries) | $ | 0.0 | $ | 0.1 | $ | 0.1 | $ | 0.2 | $ | 0.2 | |||||||||||||||
| Net charge-offs (recoveries) to average outstanding portfolio loans (annualized) | 0.02 | % | 0.06 | % | 0.08 | % | 0.03 | % | 0.04 | % | |||||||||||||||
The provision for portfolio loan losses was lower in the fourth quarter and full year 2016 compared with the fourth quarter and full year 2015, reflecting solid economic conditions in the Company’s markets during 2016, which has led to continued low levels of net charge-offs over the past 12 months. The increase in the allowance for portfolio loan losses at December 31, 2016, compared with that as of December 31, 2015, was primarily attributable to loan growth, which reflected significant organic growth, supplemented by strategic loan purchases, and partially offset by principal amortization and increased prepayments of one- to four-family residential mortgages and home equity loans. Management believes the allowance for portfolio loan losses as of December 31, 2016, is sufficient to absorb losses in portfolio loans as of the end of the period.
Net charge-offs were lower in the fourth quarter of 2016 compared with those in the same period in 2015, reflecting a decrease in charge-offs in certain consumer loans, including auto loans and manufactured home loans, partially offset by an increase in net charge-offs in one- to four-family residential loans and home equity loans. Net charge-offs were virtually flat during the full year 2016 compared with those in the same period in 2015, reflecting an increase in charge-offs in one- to four-family residential loans and home equity loans, commercial real estate loans, and both an increase in charge-offs and a decrease in recoveries on commercial business loans. These changes were offset by an increase in recoveries in one- to four-family residential loans and home equity loans and a decrease in charge-offs in unsecured consumer loans.
| Net Interest Income | Three Months Ended | Year Ended | |||||||||||||||||||||||
Dec. 31, | Sept. 30, | Dec. 31, | Dec. 31, | Dec. 31, | |||||||||||||||||||||
| (Dollars in millions) | |||||||||||||||||||||||||
| Net interest income | $ | 7.1 | $ | 6.9 | $ | 5.9 | $ | 26.5 | $ | 21.1 | |||||||||||||||
| Net interest margin | 3.30 | % | 3.19 | % | 3.10 | % | 3.12 | % | 2.95 | % | |||||||||||||||
| Yield on investment securities | 2.29 | % | 2.12 | % | 2.13 | % | 2.11 | % | 2.07 | % | |||||||||||||||
| Yield on loans | 4.40 | % | 4.24 | % | 4.62 | % | 4.37 | % | 4.83 | % | |||||||||||||||
| Total cost of funds | 0.78 | % | 0.79 | % | 1.08 | % | 0.92 | % | 1.26 | % | |||||||||||||||
| Average cost of deposits | 0.66 | % | 0.64 | % | 0.53 | % | 0.62 | % | 0.51 | % | |||||||||||||||
| Rates paid on borrowed funds | 1.14 | % | 1.21 | % | 2.25 | % | 1.70 | % | 2.99 | % | |||||||||||||||
The increase in net interest margin during the full year of 2016 compared with net interest margin for the full year of 2015 primarily reflected a decrease in rates paid on borrowed funds, as the Company continued to benefit from the prepayment and restructuring of some of its high-cost wholesale debt late in the second quarter of 2015, the effect of which was partially offset by the loss of interest income due to the sale of investment securities this year. Also, contributing to the increase in net interest margin was an increase in higher-margin interest-earning assets outstanding, reflecting the Company’s ongoing redeployment of excess liquidity to grow its portfolio loans, loans held-for-sale, and warehouse loans held-for-investment.
| Noninterest Income / Noninterest Expense / Income Tax Expense | Three Months Ended | Year Ended | |||||||||||||||||||
Dec. 31, | Sept. 30, | Dec. 31, | Dec. 31, | Dec. 31, | |||||||||||||||||
| (Dollars in millions) | |||||||||||||||||||||
| Noninterest income | $ | 1.9 | $ | 2.2 | $ | 1.6 | $ | 9.2 | $ | 6.8 | |||||||||||
| Noninterest expense | $ | 6.0 | $ | 6.4 | $ | 6.2 | $ | 25.1 | $ | 28.9 | |||||||||||
| Income tax expense (benefit) | $ | 1.0 | $ | 0.9 | $ | 0.4 | $ | 3.6 | $ | (9.5 | ) | ||||||||||
The increase in noninterest income for the fourth quarter of 2016 compared with that of the fourth quarter of 2015 primarily reflected the FHLB Gain, partially offset by a decrease in service charges and fees. The increase in noninterest income for the full year 2016 compared with the full year 2015 primarily reflected higher gains on the sale of investment securities, as well as higher gains on the sale of both loans held-for-sale and portfolio loans, and the FHLB Gain, partially offset by a decrease in service charges and fees.
The decrease in noninterest expense during the fourth quarter of 2016 compared with that of the fourth quarter of 2015 primarily reflected the OREO Write-down, partially offset by increased expenses for outside professional services. The decrease in noninterest expense during the full year 2016 compared with that of the full year 2015 primarily reflected the Debt Prepayment Penalties, as well as the OREO Write-down, partially offset by increased incentive compensation costs associated with the Company’s continuing growth strategies and increased expenses for data processing.
The increase in income tax expense for the fourth quarter of 2016 compared with that of the fourth quarter of 2015 reflected the increase in income before income tax expense. The increase in income tax expense for the full year 2016 compared with that of the full year 2015 reflected the aforementioned benefit of the Valuation Allowance Reversal, as well as the increase in income before income tax expense.
Use of Non-GAAP Financial Measures
This press release includes a discussion of “non-GAAP financial measures:” core earnings and core earnings per diluted share. A non-GAAP financial measure is generally defined as a numerical measure of a company’s historical or future financial performance, financial position, or cash flows that either excludes or includes amounts, or is subject to adjustments, so as to be different from the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles (GAAP). Core earnings and core earnings per diluted share exclude the effects of certain transactions that occurred during the period, as detailed in the following reconciliation of these measures.
| Three Months Ended | Year Ended | |||||||||||||||||||||||
Dec. 31, | Sept. 30, | Dec. 31, | Dec. 31, | Dec. 31, | ||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||||||
| Net income, as reported | $ | 2,002 | $ | 1,556 | $ | 689 | $ | 6,418 | $ | 7,718 | ||||||||||||||
| Less the gain on the sale of investment securities (1) | -- | (310 | ) | -- | (831 | ) | -- | |||||||||||||||||
| Less the FHLB Gain (2) | (255 | ) | -- | -- | (255 | ) | -- | |||||||||||||||||
| Less the Valuation Allowance Reversal | -- | -- | -- | -- | (8,476 | ) | ||||||||||||||||||
| Plus the Debt Prepayment Penalties (3) | -- | -- | -- | -- | 3,217 | |||||||||||||||||||
| Plus the OREO Write-down (4) | -- | -- | 342 | -- | 342 | |||||||||||||||||||
| Adjusted net income (core earnings) | $ | 1,747 | $ | 1,246 | $ | 1,031 | $ | 5,332 | $ | 2,801 | ||||||||||||||
| Income per diluted share, as reported | $ | 0.13 | $ | 0.10 | $ | 0.04 | $ | 0.42 | $ | 0.50 | ||||||||||||||
| Less the gain on the sale of investment securities | -- | (0.02 | ) | -- | (0.05 | ) | -- | |||||||||||||||||
| Less the FHLB Gain | (0.02 | ) | -- | -- | (0.02 | ) | -- | |||||||||||||||||
| Less the Valuation Allowance Reversal | -- | -- | -- | -- | (0.55 | ) | ||||||||||||||||||
| Plus the Debt Prepayment Penalties | -- | -- | -- | -- | 0.21 | |||||||||||||||||||
| Plus the OREO Write-down | -- | -- | 0.02 | -- | 0.02 | |||||||||||||||||||
Adjusted income per diluted share (core earnings per diluted share) (5) | $ | 0.11 | $ | 0.08 | $ | 0.07 | $ | 0.35 | $ | 0.18 | ||||||||||||||
__________ | ||
(1) | The gain on the sale of investment securities, which is included in noninterest income, totaled $493,000, and is shown above net of a tax expense adjustment of $183,000, for the three months ended September 30, 2016, and $1,321,000, and is shown above net of a tax expense adjustment of $490,000, for the nine months ended September 30, 2016. | |
(2) | The FHLB Gain, which is included in noninterest income, totaled $412,000, and is shown above net of a tax expense adjustment of $157,000. | |
(3) | The Debt Prepayment Penalties, which are included in noninterest expense, totaled $5,188,000, and is shown above net of a tax expense adjustment of $1,971,000. | |
(4) | The OREO Write-down, which is included in noninterest expense, totaled $525,000, and is shown above net of a tax expense adjustment of $183,000. | |
(5) | May not foot due to rounding. | |
Core earnings and core earnings per diluted share should be viewed in addition to, and not as a substitute for or superior to, net income and income per diluted share on a GAAP basis. Atlantic Coast’s management believes that the non-GAAP financial measures, when considered together with GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. Atlantic Coast’s management also believes that the non-GAAP financial measures aid investors in analyzing the Company’s business trends and in understanding the Company’s performance. In addition, the Company may utilize non-GAAP financial measures as guides in forecasting, budgeting and long-term planning processes and to measure operating performance for some management compensation purposes.
About the Company
Atlantic Coast Financial Corporation is the holding company for Atlantic Coast Bank, a Florida state-chartered commercial bank. It is a community-oriented financial institution serving the Northeast Florida, Central Florida and Southeast Georgia markets. Investors may obtain additional information about Atlantic Coast Financial Corporation on the Internet at www.AtlanticCoastBank.net, under Investor Relations.
Forward-looking Statements
Statements in this press release that are not historical facts are forward-looking statements that reflect management’s current expectations, assumptions and estimates of future performance and economic conditions, and involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. Such statements are made in reliance upon the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally are identifiable by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “plans,” “intends,” “projects,” “targets,” “estimates,” “preliminary,” or “anticipates” or the negative thereof or comparable terminology, or by discussion of strategy or goals or other future events, circumstances or effects. Moreover, forward-looking statements in this release include, but are not limited to, those relating to: our ability to meet the needs of our customers; our ability to continue to attract new commercial and personal relationship deposits; our ability to navigate a rising-rate environment; our ability to further improve our results of operations and provide greater returns for our stockholders; and the allowance for portfolio loan losses being sufficient to absorb losses in respect of portfolio loans. The Company’s consolidated financial results and the forward-looking statements could be affected by many factors, including but not limited to: general economic trends and changes in interest rates; increased competition; changes in demand for financial services; the state of the banking industry generally; uncertainties associated with newly developed or acquired operations; market disruptions; and cyber-security risks. Further information relating to factors that may impact the Company’s results and forward-looking statements are disclosed in the Company’s filings with the Securities and Exchange Commission. In particular, please refer to “Item 1A. Risk Factors” beginning on page 39 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. The forward-looking statements contained in this release are made as of the date of this release, and the Company disclaims any intention or obligation, other than imposed by law, to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
ATLANTIC COAST FINANCIAL CORPORATION Statements of Operations (Unaudited) (In thousands, except per share amounts) | |||||||||||||||||||||
| Three Months Ended | Year Ended | ||||||||||||||||||||
Dec. 31, | Sept. 30, | Dec. 31, | Dec. 31, | Dec. 31, | |||||||||||||||||
| Interest and dividend income: | |||||||||||||||||||||
| Loans, including fees | $ | 8,282 | $ | 7,961 | $ | 7,032 | $ | 31,681 | $ | 26,705 | |||||||||||
| Securities and interest-earning deposits in other financial institutions | 423 | 521 | 775 | 2,208 | 3,091 | ||||||||||||||||
| Total interest and dividend income | 8,705 | 8,482 | 7,807 | 33,889 | 29,796 | ||||||||||||||||
| Interest expense: | |||||||||||||||||||||
| Deposits | 1,001 | 962 | 660 | 3,607 | 2,426 | ||||||||||||||||
| Securities sold under agreements to repurchase | -- | -- | -- | 1 | 1,541 | ||||||||||||||||
| Federal Home Loan Bank advances | 588 | 658 | 1,266 | 3,808 | 4,719 | ||||||||||||||||
| Other borrowings | -- | -- | -- | 1 | -- | ||||||||||||||||
| Total interest expense | 1,589 | 1,620 | 1,926 | 7,417 | 8,686 | ||||||||||||||||
| Net interest income | 7,116 | 6,862 | 5,881 | 26,472 | 21,110 | ||||||||||||||||
| Provision for portfolio loan losses | 50 | 220 | 225 | 619 | 807 | ||||||||||||||||
Net interest income after provision for portfolio loan losses | 7,066 | 6,642 | 5,656 | 25,853 | 20,303 | ||||||||||||||||
| Noninterest income: | |||||||||||||||||||||
| Service charges and fees | 532 | 592 | 734 | 2,320 | 2,747 | ||||||||||||||||
| Gain on sale of loans held-for-sale | 368 | 235 | 281 | 1,966 | 1,570 | ||||||||||||||||
| Gain on sale of portfolio loans | 87 | 9 | -- | 314 | -- | ||||||||||||||||
| Gain (loss) on sale of securities available-for-sale | -- | 493 | -- | 1,321 | (9 | ) | |||||||||||||||
| Bank owned life insurance earnings | 116 | 117 | 118 | 465 | 480 | ||||||||||||||||
| Interchange fees | 323 | 326 | 362 | 1,356 | 1,563 | ||||||||||||||||
| Other | 514 | 425 | 107 | 1,505 | 499 | ||||||||||||||||
| Total noninterest income | 1,940 | 2,197 | 1,602 | 9,247 | 6,850 | ||||||||||||||||
| Noninterest expense: | |||||||||||||||||||||
| Compensation and benefits | 3,171 | 3,562 | 3,203 | 13,703 | 12,457 | ||||||||||||||||
| Occupancy and equipment | 432 | 658 | 526 | 2,295 | 2,133 | ||||||||||||||||
| FDIC insurance premiums | 134 | 135 | 174 | 607 | 677 | ||||||||||||||||
| Foreclosed assets, net | 81 | -- | 525 | 335 | 643 | ||||||||||||||||
| Data processing | 653 | 587 | 495 | 2,209 | 1,828 | ||||||||||||||||
| Outside professional services | 488 | 487 | 180 | 1,985 | 1,801 | ||||||||||||||||
| Collection expense and repossessed asset losses | 140 | 101 | 159 | 503 | 464 | ||||||||||||||||
| Securities sold under agreements to repurchase prepayment penalties | -- | -- | -- | -- | 5,188 | ||||||||||||||||
| Other | 877 | 836 | 938 | 3,413 | 3,751 | ||||||||||||||||
| Total noninterest expense | 5,976 | 6,366 | 6,200 | 25,050 | 28,942 | ||||||||||||||||
| Income (loss) before income tax expense | 3,030 | 2,473 | 1,058 | 10,050 | (1,789 | ) | |||||||||||||||
| Income tax expense (benefit) | 1,028 | 917 | 369 | 3,632 | (9,507 | ) | |||||||||||||||
| Net income | $ | 2,002 | $ | 1,556 | $ | 689 | $ | 6,418 | $ | 7,718 | |||||||||||
| Net income per basic and diluted share | $ | 0.13 | $ | 0.10 | $ | 0.04 | $ | 0.42 | $ | 0.50 | |||||||||||
| Basic and diluted weighted average shares outstanding | 15,417 | 15,420 | 15,399 | 15,417 | 15,398 | ||||||||||||||||
ATLANTIC COAST FINANCIAL CORPORATION Balance Sheets (Unaudited) (Dollars in thousands) | ||||||||||
Dec. 31, | Dec. 31, | |||||||||
| ASSETS | ||||||||||
| Cash and due from financial institutions | $ | 3,744 | $ | 6,108 | ||||||
| Short-term interest-earning deposits | 56,149 | 17,473 | ||||||||
| Total cash and cash equivalents | 59,893 | 23,581 | ||||||||
| Securities available-for-sale | 65,293 | 120,110 | ||||||||
| Portfolio loans, net of allowance of $8,162 and $7,745, respectively | 639,245 | 603,507 | ||||||||
| Other loans: | ||||||||||
| Loans held-for-sale | 7,147 | 6,591 | ||||||||
| Warehouse loans held-for-investment | 80,577 | 44,074 | ||||||||
| Total other loans | 87,724 | 50,665 | ||||||||
| Federal Home Loan Bank stock, at cost | 8,792 | 9,517 | ||||||||
| Land, premises and equipment, net | 14,945 | 15,472 | ||||||||
| Bank owned life insurance | 17,535 | 17,070 | ||||||||
| Other real estate owned | 2,886 | 3,232 | ||||||||
| Accrued interest receivable | 1,979 | 2,107 | ||||||||
| Deferred tax assets, net | 6,752 | 9,107 | ||||||||
| Other assets | 2,415 | 2,830 | ||||||||
| Total assets | $ | 907,459 | $ | 857,198 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
| Deposits: | ||||||||||
| Noninterest-bearing demand | $ | 59,696 | $ | 47,208 | ||||||
| Interest-bearing demand | 106,004 | 105,159 | ||||||||
| Savings and money markets | 224,987 | 171,664 | ||||||||
| Time | 237,726 | 231,790 | ||||||||
| Total deposits | 628,413 | 555,821 | ||||||||
| Securities sold under agreements to purchase | -- | 9,991 | ||||||||
| Federal Home Loan Bank advances | 188,758 | 207,543 | ||||||||
| Accrued expenses and other liabilities | 3,270 | 3,105 | ||||||||
| Total liabilities | 820,441 | 776,460 | ||||||||
| Common stock, additional paid-in capital, retained deficit, and other equity | 88,644 | 82,070 | ||||||||
| Accumulated other comprehensive loss | (1,626 | ) | (1,332 | ) | ||||||
Total stockholders’ equity | 87,018 | 80,738 | ||||||||
Total liabilities and stockholders’ equity | $ | 907,459 | $ | 857,198 | ||||||
ATLANTIC COAST FINANCIAL CORPORATION Selected Consolidated Financial Ratios and Other Data (Unaudited) (Dollars in thousands) | ||||||||||||||||||||
At and for the | At and for the | |||||||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||||||
| Interest rate | ||||||||||||||||||||
| Net interest spread | 3.20 | % | 2.96 | % | 3.01 | % | 2.81 | % | ||||||||||||
| Net interest margin | 3.30 | % | 3.10 | % | 3.12 | % | 2.95 | % | ||||||||||||
| Average balances | ||||||||||||||||||||
| Portfolio loans receivable, net | $ | 650,269 | $ | 561,234 | $ | 645,946 | $ | 493,950 | ||||||||||||
| Total interest-earning assets | 862,303 | 757,736 | 848,013 | 715,884 | ||||||||||||||||
| Total assets | 903,170 | 813,716 | 891,578 | 771,103 | ||||||||||||||||
| Deposits | 606,441 | 501,023 | 579,429 | 479,859 | ||||||||||||||||
| Total interest-bearing liabilities | 755,182 | 675,466 | 748,544 | 641,045 | ||||||||||||||||
| Total liabilities | 816,064 | 732,196 | 806,488 | 693,483 | ||||||||||||||||
Stockholders’ equity | 87,106 | 81,520 | 85,090 | 77,620 | ||||||||||||||||
| Performance ratios (annualized) | ||||||||||||||||||||
| Return on average total assets | 0.89 | % | 0.34 | % | 0.72 | % | 1.00 | % | ||||||||||||
Return on average stockholders’ equity | 9.19 | % | 3.38 | % | 7.54 | % | 9.94 | % | ||||||||||||
| Ratio of operating expenses to average total assets | 2.65 | % | 3.05 | % | 2.81 | % | 3.75 | % | ||||||||||||
| Credit and liquidity ratios | ||||||||||||||||||||
| Nonperforming loans | $ | 10,154 | $ | 4,225 | $ | 10,154 | $ | 4,225 | ||||||||||||
| Foreclosed assets | 2,886 | 3,232 | 2,886 | 3,232 | ||||||||||||||||
| Impaired loans | 37,302 | 38,660 | 37,302 | 38,660 | ||||||||||||||||
| Nonperforming assets to total assets | 1.44 | % | 0.87 | % | 1.44 | % | 0.87 | % | ||||||||||||
| Nonperforming loans to total portfolio loans | 1.57 | % | 0.69 | % | 1.57 | % | 0.69 | % | ||||||||||||
| Allowance for loan losses to nonperforming loans | 80.38 | % | 183.31 | % | 80.38 | % | 183.31 | % | ||||||||||||
| Allowance for loan losses to total portfolio loans | 1.26 | % | 1.27 | % | 1.26 | % | 1.27 | % | ||||||||||||
| Net charge-offs to average outstanding portfolio loans (annualized) | 0.02 | % | 0.08 | % | 0.03 | % | 0.04 | % | ||||||||||||
| Ratio of gross portfolio loans to total deposits | 103.02 | % | 109.97 | % | 103.02 | % | 109.97 | % | ||||||||||||
| Capital ratios | ||||||||||||||||||||
Tangible stockholders’ equity to tangible assets (1) | 9.59 | % | 9.42 | % | 9.59 | % | 9.42 | % | ||||||||||||
Average stockholders’ equity to average total assets | 9.64 | % | 10.02 | % | 9.54 | % | 10.07 | % | ||||||||||||
| Other Data | ||||||||||||||||||||
| Tangible book value per share (1) | $ | 5.61 | $ | 5.21 | $ | 5.61 | $ | 5.21 | ||||||||||||
| Stock price per share | 6.80 | 5.86 | 6.80 | 5.86 | ||||||||||||||||
| Stock price per share to tangible book value per share (1) | 121.19 | % | 112.56 | % | 121.19 | % | 112.56 | % | ||||||||||||
__________ | ||
(1) | Non-GAAP financial measure. Because the Company does not currently have any intangible assets, tangible stockholders’ equity is equal to stockholders’ equity, tangible assets is equal to assets, and tangible book value is equal to book value. Accordingly, no reconciliations are required for these measures. | |
View source version on businesswire.com: http://www.businesswire.com/news/home/20170124006316/en/
Contacts:
Tracy L. Keegan, 904-998-5501
Executive
Vice President and Chief Financial Officer
