AUGUSTA, Ga., Jan. 26, 2007 (PRIME NEWSWIRE) -- Southeastern Bank Financial Corp. (OTCBB:SBFC), the holding company for Georgia Bank & Trust Company of Augusta and Southern Bank & Trust, today reported net income of $2.8 million for the three months ended Dec. 31, 2006, relatively unchanged from the fourth quarter of 2005. Diluted earnings per share for the fourth quarter of 2006 were $0.52, compared with $0.53 for the same period last year.
At Dec. 31, 2006, total assets were $1.0 billion, an increase of $176.9 million, or 20.4 percent, from Dec. 31, 2005. Loans outstanding at the end of the fourth quarter were $750.0 million, an increase of 24.7 percent from Dec. 31, 2005. Total deposits were $801.8 million, an increase of 20.8 percent for the same period.
"We generated robust growth in deposits and loans in the fourth quarter," said R. Daniel Blanton, president and chief executive officer, "though earnings and net income were flat when compared with a strong fourth quarter of 2005, due primarily to increased expenses from the opening of our new Southern Bank & Trust affiliate in Aiken, S.C., and the significant increase in our provision for loan losses required by $57 million in loan growth during the quarter. Overall, 2006 was an excellent year for our company. We reached and exceeded the $1 billion-asset mark, grew income and earnings, and expanded our banking franchise into South Carolina."
Net interest income for the fourth quarter of 2006 was $9.1 million, up 14.6 percent from the same period a year ago. Noninterest income for the quarter was $3.5 million, an increase of 8.5 percent over the fourth quarter of 2005. Noninterest expense was $7.3 million in the fourth quarter of 2006, an increase of $627,172 from a year ago and relatively unchanged from the previous quarter.
Return on average assets (ROA) was 1.10 percent for the fourth quarter of 2006, and return on average shareholders' equity (ROE) was 14.69 percent.
For the full year 2006, the company reported net income of $11.2 million, or $2.08 in diluted earnings per share (EPS), an increase of 12.1 percent in net income and 11.7 percent in diluted EPS from a year ago, as compared to net income of $10.0 million or $1.86 in diluted earnings per share for 2005.
Net interest income for the full year 2006 was $34.2 million, up 16.4 percent from $29.4 million in 2005. Noninterest income in 2006 was $14.0 million, compared to $12.4 million in 2005, an increase of 13.1 percent. Noninterest expense for the full year 2006 totaled $28.9 million, compared to $25.0 million in 2005.
"It was a year of many achievements for our company thanks to the hard work and dedication of our employees, the success of our community-based approach to banking and the vibrancy of our markets," said Blanton. "In 2006, we experienced excellent growth in the Georgia Bank & Trust branch in Athens that was opened late in 2005, gained approval of our thrift charter and established our new Aiken, S.C. affiliate, Southern Bank & Trust, and surpassed our near-term goal for total assets. As we move forward in 2007, our focus will be on further expanding our presence in the communities surrounding Athens and Aiken, sustaining growth in loans and deposits in the Augusta market, and enhancing shareholder value."
About Southeastern Bank Financial Corp.
Southeastern Bank Financial Corp. is the $1 billion-asset bank holding company of Georgia Bank & Trust Company of Augusta (GB&T) and Southern Bank & Trust (SB&T). GB&T is the largest locally owned and operated community bank in the Augusta metro market, with eight full-service Augusta-area offices and an office in Athens, Ga. SB&T is a full-service, federally chartered thrift serving the Aiken County, S.C., market. The company also has mortgage operations in Augusta and Savannah. The banks focus primarily on real estate, commercial and consumer loans to individuals, small to medium-sized businesses and professionals, and also provide wealth management and trust services. The company's common stock is publicly traded on the OTC Bulletin Board under the symbol SBFC. For more information, please visit the company's Web site, www.georgiabankandtrust.com.
Safe Harbor Statement - Forward-Looking Statements
Statements made in this release by Southeastern Bank Financial Corporation (The Company) other than those concerning historical information, should be considered forward-looking and subject to various risks and uncertainties. Such forward-looking statements are made based upon management's belief as well as assumptions made by, and information currently available to, management pursuant to "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. The Company's actual results may differ materially from the results anticipated in forward-looking statements due to a variety of factors, including: unanticipated changes in the Bank's local economy and in the national economy; governmental monetary and fiscal policies; deposit levels, loan demand, loan collateral values and securities portfolio values; difficulties in interest rate risk management; difficulties in expanding our operations into new geographic areas and dealing with an additional regulatory agency; the effects of competition in the banking business; changes in governmental regulation relating to the banking industry, including regulations relating to branching and acquisitions; failure of assumptions underlying the establishment of reserves for loan losses, including the value of collateral underlying delinquent loans; and other factors. The Company cautions that such factors are not exclusive. The Company does not undertake to update any forward-looking statement that may be made from time to time by, or on behalf of, the Company.
SOUTHEASTERN BANK FINANCIAL CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
December 31, December 31,
Assets 2006 2005
-------------- --------------
(Unaudited)
Cash and due from banks $ 25,709,915 $ 18,792,799
Federal funds sold 14,688,000 2,758,000
Interest-bearing deposits in
other banks 512,690 1,012,257
-------------- --------------
Cash and cash equivalents 40,910,605 22,563,056
Investment securities
Available-for-sale 199,135,716 197,551,996
Held-to-maturity, at cost (fair
values of $3,048,196 and
$3,897,341, respectively) 2,970,619 3,776,040
Loans held for sale 17,045,134 22,146,834
Loans 732,923,796 579,087,791
Less allowance for loan losses (9,776,779) (9,124,801)
-------------- --------------
Loans, net 723,147,017 569,962,990
Premises and equipment, net 23,402,588 21,376,183
Accrued interest receivable 5,982,654 4,624,023
Bank-owned life insurance 15,982,052 11,863,276
Restricted equity securities 4,936,281 4,287,481
Other assets 7,689,596 6,125,360
-------------- --------------
$1,041,202,262 $ 864,277,239
============== ==============
Liabilities and
Stockholders' Equity
Deposits
Noninterest-bearing $ 106,846,160 $ 97,083,931
Interest-bearing:
NOW accounts 119,334,300 100,692,388
Savings 255,065,766 265,131,754
Money management accounts 45,897,176 37,719,408
Time deposits over $100,000 193,860,714 122,009,813
Other time deposits 80,758,973 41,017,555
-------------- --------------
801,763,089 663,654,849
Federal funds purchased and
securities sold under repurchase
agreements 70,019,551 67,013,416
Advances from Federal Home Loan Bank 60,000,000 52,000,000
Other borrowed funds 1,000,000 1,000,000
Accrued interest payable and
other liabilities 9,495,498 7,025,767
Subordinated debentures 20,000,000 10,000,000
-------------- --------------
Total liabilities 962,278,138 800,694,032
-------------- --------------
Stockholders' equity:
Common stock, $3.00 par value;
10,000,000 shares authorized;
5,433,285 and 5,279,241 shares
issued in 2006 and 2005,
respectively; 5,432,854 and
5,263,144 shares outstanding in
2006 and 2005, respectively 16,299,855 15,837,723
Additional paid-in capital 38,989,058 34,138,876
Retained earnings 25,287,006 16,099,414
Treasury stock, at cost; 431 and
16,097 shares in 2006 and 2005,
respectively (16,809) (233,898)
Accumulated other comprehensive
loss, net (1,634,986) (2,258,908)
-------------- --------------
Total stockholders' equity 78,924,124 63,583,207
-------------- --------------
$1,041,202,262 $ 864,277,239
============== ==============
SOUTHEASTERN BANK FINANCIAL CORPORATION AND SUBSIDIARIES
Consolidated Statements of Income
(Unaudited)
Three Months Ended Year Ended
December, 31 December, 31
------------------------- -------------------------
2006 2005 2006 2005
----------- ----------- ----------- -----------
Interest income:
Loans, including
fees $15,299,290 $11,036,747 $54,338,266 $38,897,578
Investment
securities 2,798,831 2,270,896 10,662,295 7,973,507
Federal funds
sold 210,345 97,206 599,987 380,453
Interest-bearing
deposits in
other banks 5,819 8,999 25,277 25,598
----------- ----------- ----------- -----------
Total interest
income 18,314,285 13,413,848 65,625,825 47,277,136
----------- ----------- ----------- -----------
Interest expense:
Deposits 7,153,424 4,235,668 24,099,107 13,873,143
Federal funds
purchased and
securities sold
under repurchase
agreements 915,831 615,784 3,078,691 1,697,219
Other
borrowings 1,170,797 643,794 4,244,675 2,314,911
----------- ----------- ----------- -----------
Total interest
expense 9,240,052 5,495,246 31,422,473 17,885,273
----------- ----------- ----------- -----------
Net interest
income 9,074,233 7,918,602 34,203,352 29,391,863
Provision for
loan losses 851,457 265,212 2,478,498 1,841,435
----------- ----------- ----------- -----------
Net interest
income after
provision for
loan losses 8,222,776 7,653,390 31,724,854 27,550,428
----------- ----------- ----------- -----------
Noninterest income:
Service charges
and fees on
deposits 1,426,908 1,406,448 5,741,836 5,363,306
Gain on sales
of loans 1,299,510 1,227,734 5,153,754 5,088,557
Investment
securities
(losses) gains,
net (60,085) -- 213,515 (85,666)
Retail invest-
ment income 211,951 164,114 788,287 454,710
Trust service
fees 255,112 171,225 860,238 642,016
Increase in cash
surrender value
of bank-owned
life insurance 159,523 106,346 604,776 399,685
Miscellaneous
income 183,720 129,969 630,797 514,999
----------- ----------- ----------- -----------
Total
noninterest
income 3,476,639 3,205,836 13,993,203 12,377,607
----------- ----------- ----------- -----------
Noninterest expense:
Salaries and
other personnel
expense 4,321,912 4,177,408 17,805,381 15,531,421
Occupancy
expenses 775,451 688,037 2,847,075 2,730,594
Other operating
expenses 2,159,400 1,764,146 8,232,547 6,757,077
----------- ----------- ----------- -----------
Total nonin-
terest expense 7,256,763 6,629,591 28,885,003 25,019,092
----------- ----------- ----------- -----------
Income before
income taxes 4,442,652 4,229,635 16,833,054 14,908,943
Income tax
expense 1,594,388 1,363,744 5,673,382 4,954,734
----------- ----------- ----------- -----------
Net income $ 2,848,264 $ 2,865,891 $11,159,672 $ 9,954,209
=========== =========== =========== ===========
Basic net income
per share $ 0.52 $ 0.54 $ 2.09 $ 1.89
=========== =========== =========== ===========
Diluted net
income per
share $ 0.52 $ 0.53 $ 2.08 $ 1.86
=========== =========== =========== ===========
Weighted average
common shares
outstanding 5,430,704 5,262,465 5,324,558 5,257,904
=========== =========== =========== ===========
Weighted average
number of common
and common
equivalent shares
outstanding 5,470,701 5,367,624 5,371,656 5,350,384
=========== =========== =========== ===========
SOUTHEASTERN BANK FINANCIAL CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
Year Ended December 31,
2006 2005
------------- -------------
Cash flows from operating activities:
Net income $ 11,159,672 $ 9,954,209
Adjustments to reconcile net income to
net cash provided by operating activities
Depreciation 1,367,117 1,454,503
Deferred income tax benefit (885,411) (617,633)
Provision for loan losses 2,478,498 1,841,435
Net investment securities
(gains) losses (213,515) 85,666
Net (accretion of discount) amortization
of premium on investment securities (368,389) 311,604
Increase in CSV of bank owned
life insurance (604,776) (399,685)
Stock options compensation cost 415,290 --
Loss on disposal of premises
and equipment 161 7,278
Loss on the sale of other real estate 15,779 7,888
Gain on sales of loans (5,153,754) (5,088,557)
Real estate loans originated
for sale (267,214,635) (264,726,917)
Proceeds from sales of real
estate loans 277,470,089 262,447,254
Increase in accrued interest
receivable (1,358,631) (985,776)
(Increase) decrease in other assets (1,283,476) 89,557
Increase in accrued interest payable
and other liabilities 2,839,458 1,754,211
------------- -------------
Net cash provided by operating
activities 18,663,477 6,135,037
------------- -------------
Cash flows from investing activities:
Proceeds from sales of available for
sale securities 42,346,092 23,852,712
Proceeds from maturities of available
for sale securities 94,486,868 24,281,923
Proceeds from maturities of held to
maturity securities 805,000 --
Purchase of available for
sale securities (136,889,018) (100,960,474)
Purchase of Federal Home Loan
Bank stock (873,800) (968,759)
Proceeds from redemption of FHLB stock 225,000 225,000
Net increase in loans (155,141,724) (100,569,887)
Purchase of Bank-owned life insurance (3,500,000) --
Additions to premises and equipment (5,184,834) (4,402,964)
Proceeds from sale of other real estate 157,420 271,846
Proceeds from sale of premises
and equipment 1,791,151 2,500
------------- -------------
Net cash used in
investing activities (161,777,845) (158,268,103)
------------- -------------
Cash flows from financing activities:
Net increase in deposits 138,108,240 106,870,178
Net increase in federal funds
purchased and securities sold under
repurchase agreements 3,006,135 22,432,157
Advances from Federal Home Loan Bank 19,000,000 17,000,000
Payments of Federal Home Loan
Bank advances (11,000,000) (5,000,000)
Proceeds from subordinated debentures 10,000,000 10,000,000
Proceeds from issuance of common stock 4,999,969 --
Proceeds from other borrowed funds -- 100,000
Purchase of treasury stock (61,983) --
Payment of cash dividends (2,766,571) (2,733,428)
Proceeds from stock options exercised 176,127 3,018
------------- -------------
Net cash provided by
financing activities 161,461,917 148,671,925
------------- -------------
Net increase (decrease) in
cash and cash equivalents $ 18,347,549 $ (3,461,141)
Cash and cash equivalents at
beginning of period 22,563,056 26,024,197
------------- -------------
Cash and cash equivalents at
end of period $ 40,910,605 $ 22,563,056
============= =============
Supplemental disclosures of cash paid
during the period for:
Interest $ 29,987,756 $ 17,310,768
============= =============
Income taxes $ 6,264,835 $ 5,046,258
============= =============
Supplemental information on noncash
investing activities:
Loans transferred to other
real estate $ 173,199 $ 226,305
============= =============