GREENWOOD, S.C., April 19, 2010 (GLOBE NEWSWIRE) -- Community Capital Corporation (Nasdaq:CPBK) reports net income for the three months ended March 31, 2010.
- Nonaccrual loans decreased 21% to $32.6 million
- Nonperforming assets (defined as nonaccrual loans, loans 90+ days past due and other real estate) declined 14% to $42.8 million
- Nonperforming assets under contract or letter of intent as of April 19, 2010, and expected to close by June 30, 2010, total $5.5 million which would result in a decline of 13% of nonperforming assets from level at March 31, 2010
- Ratio of past due loans 30 to 89 days to gross loans was 0.44% at March 31, 2010
- Total risk based capital increased to nearly 13%, well above the regulatory requirement to be considered "well capitalized"
- Net interest margin increased 25 basis points versus fourth quarter of 2009
- Net income of $1.6 million resulting in an annualized ROA of 0.87%
- Payment of $912,000 received in settlement of a lawsuit regarding the management of a participation loan
- Efficiency ratio, excluding the litigation settlement of $912,000, was 67.44%
- Bonds were sold during the quarter to shorten the duration of the portfolio resulting in gains of $683,000
- Market value of accounts in our wealth management division grew more than $35 million, or 7%, during the quarter and grew approximately 38% over the past twelve months
William G. Stevens, President and Chief Executive Officer of Community Capital Corporation stated, "We believe that the successes realized in the first quarter of 2010 are the result of a number of decisions we made during 2009 including significantly writing down our nonaccrual loans to a point where they can be liquidated with little to no additional loss, realigning staff to focus our efforts on eliminating nonperforming loans, and raising common equity capital when few community banks could do so. We also reduced staff by approximately 20%, reduced other noninterest expenses including the elimination of board fees, and significantly reduced our reliance on more expensive wholesale funding. While each of these decisions was difficult, they combined to allow us to produce a significant profit for the first three months of 2010. Our net profit of $1,600,000, while including some one time income items, demonstrates the continued core earning capability of our company.
"We increased our capital ratios with total risk based capital at 12.94% as of quarter end, and tier one leverage ratio at 8.43%, which far exceed the regulators threshold for 'well capitalized' status. We are also pleased to report that after only a few weeks into the second quarter, we have commitments allowing us to liquidate $5.5 million in nonperforming assets by June 30, 2010.
"I am hopeful that the results of our first quarter of 2010 coupled with our strengthening capital position give our shareholders further confidence in the manner in which the board of directors and management team are guiding the company through these difficult economic times."
Community Capital Corporation is the parent company of CapitalBank, which operates 18 community oriented branches throughout upstate South Carolina and offers a full array of banking services, including a diverse wealth management group. Additional information on CapitalBank's locations and the products and services offered are available at www.capitalbanksc.com.
Cautionary Note Regarding Forward-Looking Statements
Certain statements in this news release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to future plans and expectations, and are thus prospective. Such forward-looking statements include but are not limited to (1) statements regarding potential future economic recovery, (2) statements with respect to our plans, objectives, expectations and intentions and other statements that are not historical facts, and (3) other statements identified by words such as "believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," and "projects," as well as similar expressions. Such statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate. Therefore, we can give no assurance that the results contemplated in the forward-looking statements will be realized. The inclusion of this forward-looking information should not be construed as a representation by our company or any person that the future events, plans, or expectations contemplated by our company will be achieved. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: (1) the challenges, costs and complications associated with the continued development of our branches; (2) the potential that loan charge-offs may exceed the allowance for loan losses or that such allowance will be increased as a result of factors beyond our control; (3) our ability and success in resolving troubled loans; (4) our dependence on senior management; (5) competition from existing financial institutions operating in our market areas as well as the entry into such areas of new competitors with greater resources, broader branch networks and more comprehensive services; (6) adverse conditions in the stock market, the public debt market, and other capital markets (including changes in interest rate conditions); (7) changes in deposit rates, the net interest margin, and funding sources; (8) risks inherent in making loans including repayment risks and value of collateral; (9) the strength of the U.S. economy in general and the strength of the local economies in which we conduct operations may be different than expected resulting in, among other things, a deterioration in credit quality or a reduced demand for credit, including the resultant effect on our loan portfolio and allowance for loan losses; (10) fluctuations in consumer spending and saving habits; (11) the demand for our products and services; (12) the challenges and uncertainties in the implementation of our expansion and development strategies; (13) the adequacy of expense projections and estimates of impairment loss; (14) changes in the U.S. legal and regulatory framework; (15) unanticipated regulatory or judicial proceedings; and (16) the timely development and acceptance of products and services, including products and services offered through alternative delivery channels such as the Internet.
Additional factors that could cause our results to differ materially from those described in the forward-looking statements can be found in Community Capital Corporation's reports (such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K) filed with the SEC and available at the SEC's Internet site (http://www.sec.gov). All references to financial information as of December 31, 2009 are derived from our Annual Report on Form 10-K for the year ended December 31, 2009. All subsequent written and oral forward-looking statements concerning the company or any person acting on its behalf is expressly qualified in its entirety by the cautionary statements above. We do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.
| SUMMARY CONSOLIDATED FINANCIAL DATA | ||||||
| Reclassifications – Certain captions and amounts in the 2009 financial statements were reclassified to conform with the 2010 presentation. Such reclassifications had no effect on net income or shareholders' equity. | ||||||
|
Financial Highlights (Dollars in thousands, except per share data) |
Three Months Ended March 31 |
Three Months Ended December 31 |
Three Months Ended March 31 |
|||
| 2010 | 2009 | 2009 | ||||
| Earnings Summary | (Unaudited) | (Unaudited) | (Unaudited) | |||
| Interest income | $ 8,257 | $ 8,502 | $ 9,466 | |||
| Interest expense | 2,836 | 3,225 | 3,514 | |||
| Net interest income | 5,421 | 5,277 | 5,952 | |||
| Provision for loan losses | 1,600 | 1,000 | 2,000 | |||
| Noninterest income | 3,358 | 1,981 | 1,862 | |||
| Noninterest expense | 4,893 | 7,117 | 4,753 | |||
| Income (loss) before taxes | 2,286 | (859) | 1,059 | |||
| Income tax expense | 686 | 523 | 196 | |||
| Net income (loss) | $ 1,600 | $ (1,382) | $ 863 | |||
| Per Shares Ratios: | ||||||
| Basic earnings (loss) per share | $0.16 | $(0.15) | $0.19 | |||
| Diluted earnings (loss) per share | $0.16 | $(0.15) | $0.19 | |||
| Dividends declared per share | $0.00 | $0.00 | $0.15 | |||
| Book value per share | $5.55 | $5.44 | $14.51 | |||
| Common Share Data: | ||||||
| Outstanding at period end | 9,921,321 | 9,875,823 | 4,516,690 | |||
| Weighted average outstanding | 9,852,026 | 9,327,208 | 4,442,440 | |||
| Diluted weighted average outstanding | 9,894,888 | 9,327,208 | 4,499,178 | |||
| Capital Ratios: | ||||||
| Tier 1 leverage ratio | 8.43% | 8.31% | 8.48% | |||
| Tier 1 risk-based capital ratio | 11.67% | 10.88% | 10.58% | |||
| Total risk-based capital ratio | 12.94% | 12.15% | 11.84% | |||
| Tangible equity to tangible assets (period end) | 7.19% | 6.97% | 7.36% | |||
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| Balance Sheet Highlights | ||||||
| Average Balances: | ||||||
| Total assets | $ 749,768 | $ 749,170 | $ 783,405 | |||
| Earning assets | 685,008 | 708,038 | 717,556 | |||
| Loans | 560,249 | 596,492 | 637,298 | |||
| Deposits | 582,109 | 572,368 | 518,575 | |||
| Interest bearing deposits | 471,191 | 467,712 | 432,046 | |||
| Noninterest bearing deposits | 110,918 | 104,656 | 86,529 | |||
| Other borrowings | 95,400 | 99,748 | 183,018 | |||
| Junior subordinated debentures | 10,310 | 10,310 | 10,310 | |||
| Shareholders' equity | 54,396 | 58,028 | 65,274 | |||
| Performance Ratios: | ||||||
| Return on average assets | 0.87% | (0.73)% | 0.45% | |||
| Return on average shareholders' equity | 11.93% | (9.45)% | 5.36% | |||
| Net interest margin (fully tax equivalent at 38%) | 3.25% | 3.00% | 3.44% | |||
| Efficiency ratio | 59.91% | 94.54% | 60.96% | |||
| Asset Quality: | ||||||
| Nonperforming loans | $ 33,922 | $ 42,826 | $ 28,174 | |||
| Other real estate | 8,833 | 7,165 | 8,473 | |||
| Total nonperforming assets | 42,755 | 49,991 | 36,647 | |||
| Total impaired loans | 77,469 | 71,956 | 92,120 | |||
| Net charge-offs/write-downs | 1,742 | 24,783 | 3,775 | |||
| Net charge-offs/write-downs to average loans | 0.31% | 4.15% | 0.59% | |||
| Allowance for loan losses to nonperforming loans | 41.32% | 33.06% | 42.03% | |||
| Nonperforming loans to total loans | 6.18% | 7.55% | 4.50% | |||
| Nonperforming assets to total assets | 5.73% | 6.67% | 4.75% | |||
| Allowance for loan losses to period end loans | 2.55% | 2.50% | 1.89% | |||
| Other Selected Ratios: | ||||||
| Average equity to average assets | 7.26% | 7.75% | 8.33% | |||
| Average loans to average deposits | 96.24% | 104.21% | 122.89% | |||
| Average loans to average earning assets | 81.79% | 84.25% | 88.82% | |||
|
Balance Sheet Data (Dollars in thousands, except per share data) |
Period Ended March 31 |
Period Ended December 31 |
Period Ended March 31 |
| 2010 | 2009 | 2009 | |
| (Unaudited) | (Unaudited) | ||
| Assets: | |||
| Cash and cash equivalents: | |||
| Cash and due from banks | $ 10,384 | $ 10,141 | $ 11,680 |
| Interest bearing deposit accounts | 60,002 | 38,990 | 466 |
| Total cash and cash equivalents | 70,386 | 49,131 | 12,146 |
| Investment securities: | |||
| Securities held-for-sale | 67,764 | 68,826 | 72,569 |
| Securities held-to-maturity | 160 | 160 | 215 |
| Nonmarketable equity securities | 10,364 | 10,186 | 9,635 |
| Total investment securities | 78,288 | 79,172 | 82,419 |
| Loans held for sale | 1,396 | 1,103 | 1,774 |
| Loans receivable | 549,010 | 567,178 | 626,069 |
| Allowance for loan losses | (14,018) | (14,160) | (11,842) |
| Other real estate owned | 8,833 | 7,165 | 8,473 |
| Premises and equipment, net | 15,931 | 16,150 | 16,997 |
| Prepaid expenses | 4,548 | 4,873 | 488 |
| Intangible assets | 1,560 | 1,663 | 1,981 |
| Goodwill | -- | -- | 7,418 |
| Cash surrender value of life insurance | 16,861 | 16,689 | 16,164 |
| Deferred tax asset | 5,955 | 6,622 | 3,058 |
| Income tax receivable | 1,640 | 9,634 | -- |
| Other assets | 5,447 | 4,222 | 6,958 |
| Total assets | $ 745,837 | $ 749,442 | $ 772,103 |
| Liabilities and shareholders' equity: | |||
| Deposits: | |||
| Noninterest bearing | $ 101,462 | $ 112,333 | $ 89,384 |
| Interest bearing | 477,034 | 471,150 | 429,019 |
| Total deposits | 578,496 | 583,483 | 518,403 |
| Federal funds purchased & Other ST Borrowings | -- | -- | 33,959 |
| Securities sold under agreements to repurchase | -- | -- | 2,047 |
| FHLB advances | 95,400 | 95,400 | 135,400 |
| Junior subordinated debentures | 10,310 | 10,310 | 10,310 |
| Other liabilities | 6,574 | 6,492 | 6,453 |
| Total liabilities | $ 690,780 | $ 695,685 | $ 706,572 |
| Shareholders' equity: | |||
| Common stock: $1 par value; 20 million shares authorized | 10,721 | 10,721 | 5,716 |
| Nonvested restricted stock | (293) | (364) | (651) |
| Capital surplus | 65,906 | 66,473 | 62,658 |
| Accumulated other comprehensive income | 444 | 909 | 820 |
| Retained earnings | (10,105) | (11,705) | 14,403 |
| Treasury stock, at cost | (11,616) | (12,277) | (17,415) |
| Total shareholders' equity | 55,057 | 53,757 | 65,531 |
| Total liabilities and shareholders' equity | $ 745,837 | $ 749,442 | $ 772,103 |
|
Income Statement Data (Dollars in thousands, except per share data) |
Three Months Ended March 31 |
Three Months Ended December 31 |
Three Months Ended March 31 |
| 2010 | 2009 | 2009 | |
| (Unaudited) | (Unaudited) | (Unaudited) | |
| Interest income: | |||
| Loans, including fees | $ 7,500 | $ 7,644 | $ 8,490 |
| Investment securities | 736 | 839 | 974 |
| Federal funds sold and interest-bearing deposits | 22 | 19 | 2 |
| Total interest income | 8,258 | 8,502 | 9,466 |
| Interest expense: | |||
| Deposits | 1,930 | 2,031 | 1,842 |
| Borrowings and other | 906 | 1,194 | 1,672 |
| Total interest expense | 2,836 | 3,225 | 3,514 |
| Net interest income | 5,422 | 5,277 | 5,952 |
| Provision for loan losses | 1,600 | 1,000 | 2,000 |
| Net interest income after provision for loan losses | 3,822 | 4,277 | 3,952 |
| Noninterest income: | |||
| Service charges on deposit accounts | 482 | 583 | 563 |
| Gain on sale of loans held for sale | 298 | 276 | 322 |
| Commissions from sales of mutual funds | 64 | 78 | 37 |
| Income from fiduciary activities | 472 | 451 | 348 |
| Gain on sale of securities held-for-sale | 683 | -- | 145 |
| Gain on sale of premises and equipment | -- | 1 | 3 |
| Other operating income | 1,358 | 592 | 444 |
| Total non-interest income | 3,357 | 1,981 | 1,862 |
| Non-interest expense: | |||
| Salaries and employee benefits | 2,439 | 2,578 | 2,594 |
| Net occupancy expense | 322 | 342 | 320 |
| Amortization of intangible assets | 103 | 106 | 108 |
| Furniture and equipment expense | 203 | 209 | 233 |
| Loss on sale of securities held-for-sale | -- | 172 | -- |
| FDIC banking assessments | 346 | 1,009 | 106 |
| FHLB prepayment penalties | -- | 530 | -- |
| Write downs on other real estate owned | 40 | 800 | 76 |
| Other operating expenses | 1,440 | 1,371 | 1,318 |
| Total noninterest expense | 4,893 | 7,117 | 4,755 |
| Income (loss) before taxes | 2,286 | (859) | 1,059 |
| Income tax expense | 686 | 523 | 196 |
| Net income (loss) | $ 1,600 | $ (1,382) | $ 863 |
|
|
| March 31, 2010 | December 31, 2009 | March 31, 2009 | ||||
| Balance | Percent | Balance | Percent | Balance | Percent | |
| Loans: | ||||||
| Commercial and agricultural | $ 38,487 | 7.01% | $ 35,082 | 6.18% | $ 39,678 | 6.34% |
| Real Estate – construction | 128,110 | 23.33% | 145,130 | 25.59% | 176,668 | 28.22% |
| Real Estate – mortgage and commercial | 312,246 | 56.88% | 316,571 | 55.82% | 336,304 | 53.72% |
| Home equity | 46,548 | 8.48% | 47,409 | 8.36% | 48,266 | 7.71% |
| Consumer – Installment | 22,344 | 4.07% | 21,564 | 3.80% | 23,622 | 3.77% |
| Other | 1,275 | 0.23% | 1,422 | 0.25% | 1,531 | 0.24% |
| Total | $ 549,010 | 100.00% | $ 567,178 | 100.00% | $ 626,069 | 100.00% |
| March 31, 2010 | December 31, 2009 | March 31, 2009 | ||||
| Balance | Percent | Balance | Percent | Balance | Percent | |
| Deposits: | ||||||
| Noninterest bearing demand | $ 101,462 | 17.54% | $ 112,333 | 19.25% | $ 89,384 | 17.24% |
| Interest bearing demand | 64,367 | 11.13% | 66,807 | 11.45% | 68,803 | 13.27% |
| Money market and savings | 175,471 | 30.33% | 166,086 | 28.47% | 136,294 | 26.29% |
| Brokered deposits | 25,880 | 4.47% | 27,200 | 4.66% | 53,139 | 10.25% |
| Certificates of deposit | 211,316 | 36.53% | 211,057 | 36.17% | 170,783 | 32.95% |
| Total | $ 578,496 | 100.00% | $ 583,483 | 100.00% | $ 518,403 | 100.00% |
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Wealth Management Group Fiduciary and Related Services: (Dollars in thousands, except number of accounts) |
March 31, 2010 | December 31, 2009 | March 31, 2009 |
| Market value of accounts | $ 540,791 | $ 505,031 | $ 392,777 |
| Market value of discretionary accounts | $ 201,320 | $ 188,663 | $ 155,553 |
| Market value of non-discretionary accounts | $ 339,471 | $ 316,368 | $ 237,224 |
| Total number of accounts | 1,505 | 1,440 | 1,373 |
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Yield/Rate Analysis YTD |
Three Months Ended | ||
| March 31, 2010 | |||
| Average | Yield/ | ||
| (Dollars in thousands) | Balance | Interest | Rate |
| ASSETS | |||
| Loans(1)(3) | $ 560,249 | $ 7,506 | 5.43% |
| Securities, taxable(2) | 54,697 | 536 | 3.97% |
| Securities, nontaxable(2)(3) | 15,827 | 233 | 5.97% |
| Nonmarketable Equity Securities | 10,267 | 31 | 1.22% |
| Fed funds sold and other (incl. FHLB) | 43,968 | 22 | 0.20% |
| Total earning assets | 685,008 | $ 8,328 | 4.93% |
| Non-earning assets | 64,760 | ||
| Total assets | $ 749,768 | ||
|
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| LIABILITIES AND | |||
| STOCKHOLDERS' EQUITY | |||
| Transaction accounts | $ 190,446 | $ 552 | 1.18% |
| Regular savings accounts | 43,175 | 138 | 1.30% |
| Certificates of deposit | 237,570 | 1,240 | 2.12% |
| FHLB Advances | 95,400 | 727 | 3.09% |
| Junior subordinate debentures | 10,310 | 179 | 7.04% |
| Total interest-bearing liabilities | 576,901 | $ 2,836 | 1.99% |
| Non-interest bearing liabilities | 118,471 | ||
| Stockholders' equity | 54,396 | ||
| Total liabilities & equity | $ 749,768 | ||
| Net interest income/ | |||
| interest rate spread | $ 5,492 | 2.94% | |
| Net yield on earning assets | 3.25% | ||
| Yield/Rate Analysis | Three Months Ended | ||
| December 31, 2009 | |||
| Average | Yield/ | ||
| (Dollars in thousands) | Balance | Interest | Rate |
| ASSETS | |||
| Loans(1)(3) | $ 596,492 | $ 7,652 | 5.09% |
| Securities, taxable(2) | 50,438 | 585 | 4.60% |
| Securities, nontaxable(2)(3) | 20,192 | 295 | 5.80% |
| Nonmarketable Equity Securities | 10,186 | 39 | 1.52% |
| Fed funds sold and other (incl. FHLB) | 30,730 | 19 | 0.25% |
| Total earning assets | $ 708,038 | $ 8,590 | 4.81% |
| Non-earning assets | 41,132 | ||
| Total assets | $ 749,170 | ||
| LIABILITIES AND | |||
| STOCKHOLDERS' EQUITY | |||
| Transaction accounts | $ 186,748 | $ 523 | 1.11% |
| Regular savings accounts | 42,120 | 151 | 1.42% |
| Certificates of deposit | 238,844 | 1,357 | 2.25% |
| FHLB Advances | 99,748 | 1,013 | 4.03% |
| Junior subordinate debt | 10,310 | 181 | 6.97% |
| Total interest-bearing liabilities | 577,770 | $ 3,225 | 2.21% |
| Non-interest bearing liabilities | 113,372 | ||
| Stockholders' equity | 58,028 | ||
| Total liabilities & equity | $ 749,170 | ||
| Net interest income/ | |||
| interest rate spread | $ 5,365 | 2.60% | |
| Net yield on earning assets | 3.00% | ||
|
Yield/Rate Analysis YTD |
Three Months Ended | ||
| March 31, 2009 | |||
| Average | Yield/ | ||
| (Dollars in thousands) | Balance | Interest | Rate |
| ASSETS | |||
| Loans(1)(3) | $ 637,298 | $ 8,499 | 5.41% |
| Securities, taxable(2) | 47,225 | 615 | 5.28% |
| Securities, nontaxable(2)(3) | 28,152 | 453 | 6.53% |
| Nonmarketable Equity Securities | 2,041 | 30 | 5.96% |
| Fed funds sold and other (incl. FHLB) | 2,840 | 2 | 0.29% |
| Total earning assets | 717,556 | $ 9,599 | 5.43% |
| Non-earning assets | 65,849 | ||
| Total assets | $ 783,405 | ||
| LIABILITIES AND | |||
| STOCKHOLDERS' EQUITY | |||
| Transaction accounts | $ 207,123 | $ 290 | 0.57% |
| Regular savings accounts | 37,360 | 168 | 1.82% |
| Certificates of deposit | 187,563 | 1,384 | 2.99% |
| Other short term borrowings | 36,218 | 34 | 0.38% |
| FHLB Advances | 146,800 | 1,457 | 4.03% |
| Junior subordinate debentures | 10,310 | 181 | 7.12% |
| Total interest-bearing liabilities | 625,374 | $ 3,514 | 2.28% |
| Non-interest bearing liabilities | 92,757 | ||
| Stockholders' equity | 65,274 | ||
| Total liabilities & equity | $ 783,405 | ||
| Net interest income/ | |||
| interest rate spread | $ 6,085 | 3.15% | |
| Net yield on earning assets | 3.44% | ||
(1) The effect of loans in nonaccrual status and fees collected is not significant to the computations.
(2) Average investment securities exclude the valuation allowance on securities available-for-sale.
(3) Fully tax-equivalent basis at 38% tax rate for nontaxable securities and loans.