LAKE HAVASU CITY, Ariz., Oct. 28, 2011 (GLOBE NEWSWIRE) -- State Bank Corp. (OTCBB:SBAZ)("Company"), the holding company for Mohave State Bank ("Bank"), today announced net income of $123,000, or $0.02 per diluted share, for the quarter ended September 30, 2011, as compared to net income of $235,000, or $0.06 per diluted share, for the same period of 2010. For the nine months ended September 30, 2011, the Company reported net income of $405,000, or $0.08 per diluted share, as compared to a net operating loss in the same period of 2010.
Third Quarter 2011 Highlights include:
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Three straight quarters of sustained profitability after operating losses in 2009 and 2010.
-
A 63% reduction year over year in quarterly net credit losses.
-
Increase in non-interest bearing deposits to $50.6 million, or 20.4 percent of total deposits.
- The Bank increased its tier 1 leverage ratio to 9.14 percent.
"We continue to show improvement with each passing quarter. Our core operating income is strong with our net interest margin at 4.15 percent. Excluding credit costs, our cost efficiency ratio is now in the low 60 percent range. With ongoing borrower stabilization, we expect to make progress on reducing nonperforming assets over the next few quarters," commented Brian M. Riley, President & CEO.
While data suggests that real estate values are continuing to stabilize and the credit environment is showing improvement, the Company provided $500,000 in additional loan loss reserves during the third quarter of 2011 as compared to $200,000 in the same period of 2010. The reserves were added to proactively protect against an uncertain economic environment and cover current credit losses. Net credit losses during the third quarter of 2011 were reduced significantly to $1.5 million as compared to $4.0 million for the same period of 2010.
The Company's net interest margin continues to remain strong after several quarters of nonaccrual loan activity. The net interest margin was 4.15 percent during the quarter ended September 30, 2011. The cost of funds continued to decrease to 0.61 percent. Cost control remains a focus of the Company, with regulatory assessments, data processing fees, and professional expenses all trending lower.
Nonperforming assets were $41.4 million at September 30, 2011, a slight increase from $41.1 million at December 31, 2010, but down $2.7 million, or 6.1 percent, from the most recent sequential quarter. Nonperforming assets represented 14.3 percent of total assets at September 30, 2011 as compared to 13.6 percent at December 31, 2010. Of the $22.5 million in nonaccrual loans at September 30, 2011, $10.5 million in loans continue to perform as agreed and will in time be restored to full accrual status. The allowance for loan and lease losses totaled $5.4 million, or 2.72 percent of total loans, at September 30, 2011.
As of September 30, 2011, total assets were $289.9 million, a decrease of $12.7 million from $302.6 million at December 31, 2010. Total loans were $198.4 million at September 30, 2011 as compared to $218.6 million at December 31, 2010. Total deposits were $248.3 million at September 30, 2011 as compared to $253.2 million at December 31, 2010.
Shareholder equity increased to $27.4 million at September 30, 2011 from $23.8 million at December 31, 2010. This was a result of the combination of net operating income and success in the Company's common stock offering. The Bank must meet certain minimum capital requirements to satisfy federal and state laws. The following table provides the Bank's capital ratio at September 30, 2011:
|
Actual Ratio |
Ratio to be well capitalized |
Consent Order Requirement |
|
|
Leverage Ratio Tier 1 Capital to Risk-Weighted Assets Total Capital to Risk-Weighted Assets |
9.14% 11.54% 12.59% |
5.00% 6.00% 10.00% |
9.25% N/A 12.00% |
The Company expects to comply with all capital requirements through a combination of active balance sheet management and net operating income.
About the Company
State Bank Corp., headquartered in Lake Havasu City, Arizona, is the parent company of Mohave State Bank, the largest locally-owned bank in Mohave County. Mohave State Bank is a full-service bank providing deposit and loan products, and convenient on-line banking to individuals, businesses and professionals. The Bank was established in October 1991, and the holding company was formed in 2004. The Bank has six full-service branches: two in Lake Havasu City, two in Kingman, one in Bullhead City, and one in Yuma, Arizona. The Company is traded over-the-counter as SBAZ. For further information, please visit the web site: www.mohavestbank.com.
The State Bank Corp. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8162
Forward-looking Statements
This press release may include forward-looking statements about State Bank Corp. and its subsidiary, Mohave State Bank, for which the Company claims the protection of safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on management's knowledge and belief as of today and include information concerning the Company's possible or assumed future financial condition, and its results of operations and business. Forward-looking statements are subject to risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include fluctuations in interest rates, government policies and regulations (including monetary and fiscal policies), legislation, economic conditions, borrower capacity to repay, operational factors and competition in the geographic and business areas in which the Company conducts its operations. All forward-looking statements included in this press release are based on information available at the time of the release, and the Company assumes no obligation to update any forward-looking statement.
| State Bank Corp. | |||||
| Five-Quarter Performance Summary | |||||
| For the Quarter Ended | |||||
| Dollars in thousands - Unaudited | 9/30/2011 | 6/30/2011 | 3/31/2011 | 12/31/2010 | 9/30/2010 |
| Performance Highlights | |||||
| Earnings: | |||||
| Total revenue (Net int. income + nonint. income) | $ 3,190 | $ 3,246 | $ 3,299 | $ 3,406 | $ 3,330 |
| Net interest income | $ 2,647 | $ 2,756 | $ 2,846 | $ 2,827 | $ 2,796 |
| Provision for loan losses | $ 500 | $ -- | $ 196 | $ 1,100 | $ 200 |
| Noninterest income | $ 543 | $ 490 | $ 453 | $ 579 | $ 534 |
| Noninterest expense | $ 2,567 | $ 3,113 | $ 2,954 | $ 3,208 | $ 2,395 |
| Net income (loss) | $ 123 | $ 133 | $ 149 | $ (2,893) | $ 235 |
| Per Share Data: | |||||
| Net income (loss), basic | $ 0.02 | $ 0.02 | $ 0.04 | $ (0.75) | $ 0.06 |
| Net income (loss), diluted | $ 0.02 | $ 0.02 | $ 0.04 | $ (0.75) | $ 0.06 |
| Cash dividends declared | $ -- | $ -- | $ -- | $ -- | $ -- |
| Book value | $ 4.83 | $ 4.80 | $ 5.80 | $ 6.17 | $ 7.00 |
| Tangible book value | $ 4.83 | $ 4.80 | $ 5.80 | $ 6.17 | $ 7.00 |
| Performance Ratios: | |||||
| Return on average assets | 0.16% | 0.17% | 0.19% | -3.63% | 0.28% |
| Return on average equity | 1.79% | 1.96% | 2.45% | -44.46% | 3.45% |
| Net interest margin, taxable equivalent | 4.15% | 4.28% | 4.33% | 4.10% | 3.72% |
| Average cost of funds | 0.61% | 0.68% | 0.72% | 0.82% | 1.03% |
| Average yield on loans | 5.45% | 5.57% | 5.67% | 5.46% | 5.49% |
| Efficiency ratio | 80.47% | 95.90% | 89.54% | 94.19% | 71.92% |
| Non-interest income to total revenue | 17.02% | 15.10% | 13.73% | 17.00% | 16.04% |
| Capital & Liquidity: | |||||
| Total equity to total assets (EOP) | 9.47% | 9.08% | 7.86% | 8.40% | 7.61% |
| Tangible equity to tangible assets | 9.47% | 9.08% | 7.86% | 8.40% | 7.61% |
| Total loans to total deposits | 80.25% | 79.37% | 87.30% | 83.83% | 79.63% |
| Mohave State Bank | |||||
| Tier 1 leverage ratio | 9.14% | 8.76% | 8.41% | 7.80% | 8.12% |
| Tier 1 risk based capital | 11.54% | 11.12% | 10.46% | 9.61% | 10.31% |
| Total risk based capital | 12.59% | 12.38% | 11.74% | 10.88% | 11.58% |
| Asset Quality: | |||||
| Gross charge-offs | $ 1,697 | $ 1,848 | $ 318 | $ 2,372 | $ 4,040 |
| Net charge-offs (NCOs) | $ 1,465 | $ 1,816 | $ 260 | $ 2,199 | $ 4,031 |
| NCO to average loans, annualized | 2.88% | 3.47% | 0.48% | 3.87% | 6.83% |
| Non-accrual loans | $ 22,527 | $ 26,746 | $ 21,162 | $ 23,587 | $ 23,324 |
| Other real estate owned | $ 18,832 | $ 16,962 | $ 16,966 | $ 17,467 | $ 16,130 |
| Repossessed assets | $ -- | $ -- | $ -- | $ -- | $ 30 |
| Non-performing assets (NPAs) | $ 41,359 | $ 43,708 | $ 38,128 | $ 41,054 | $ 39,484 |
| NPAs to total assets | 14.26% | 14.56% | 12.28% | 13.57% | 12.28% |
| Loans >90 days past due | $ 51 | $ 435 | $ -- | $ -- | $ 36 |
| NPAs + 90 days past due | $ 41,410 | $ 44,143 | $ 38,128 | $ 41,054 | $ 39,520 |
| NPAs + loans 90 days past due to total assets | 14.28% | 14.70% | 12.28% | 13.57% | 12.29% |
| Allowance for loan losses to total loans | 2.72% | 3.09% | 3.88% | 3.74% | 4.07% |
| Allowance for loan losses to NPAs | 13.12% | 14.62% | 21.52% | 20.14% | 23.73% |
| Period End Balances: | |||||
| Assets | $ 289,967 | $ 300,192 | $ 310,417 | $ 302,637 | $ 321,438 |
| Total Loans (before reserves) | $ 199,278 | $ 206,554 | $ 211,391 | $ 221,099 | $ 230,016 |
| Deposits | $ 248,316 | $ 260,239 | $ 262,572 | $ 253,259 | $ 274,388 |
| Stockholders' equity | $ 27,448 | $ 27,257 | $ 24,795 | $ 23,777 | $ 26,994 |
| Common stock market capitalization | $ 14,821 | $ 12,720 | $ 12,830 | $ 7,170 | $ 11,526 |
| Full-time equivalent employees | 81 | 77 | 76 | 75 | 77 |
| Shares outstanding | 5,678,718 | 5,678,718 | 4,276,589 | 3,854,714 | 3,854,714 |
| Average Balances: | |||||
| Assets | $ 298,471 | $ 309,688 | $ 307,770 | $ 318,759 | $ 341,627 |
| Earning assets | $ 261,946 | $ 264,124 | $ 269,814 | $ 283,134 | $ 308,256 |
| Total Loans (before reserves) | $ 203,737 | $ 209,414 | $ 215,506 | $ 227,485 | $ 235,987 |
| Deposits | $ 257,326 | $ 258,275 | $ 260,438 | $ 268,722 | $ 290,062 |
| Other borrowings | $ 12,833 | $ 23,506 | $ 22,175 | $ 23,084 | $ 23,203 |
| Stockholders' equity | $ 27,441 | $ 27,111 | $ 24,335 | $ 26,030 | $ 27,272 |
| Shares outstanding, basic - wtd | 5,678,718 | 5,405,572 | 3,895,714 | 3,854,714 | 3,854,714 |
| Shares outstanding, diluted - wtd | 5,679,536 | 5,407,139 | 3,906,856 | 3,857,001 | 3,857,634 |
| State Bank Corp. | ||
| Balance Sheets | ||
| Dollars in thousands - Unaudited | 9/30/2011 | 12/31/2010 |
| Consolidated Balance Sheets | ||
| Assets | ||
| Cash and cash equivalents | $ 2,073 | $ 4,102 |
| Interest bearing deposits | 3,637 | 200 |
| Overnight Funds | 18,250 | 13,690 |
| Held for maturity securities | 638 | 684 |
| Available for sale securities | 32,738 | 32,262 |
| Total cash and securities | 57,336 | 50,938 |
| Loans held for sale, before reserves | 862 | 2,264 |
| Gross loans held for investment | 198,416 | 218,559 |
| Loan loss reserve | (5,425) | (8,270) |
| Total net loans | 193,853 | 212,553 |
| Premises and equipment, net | 10,610 | 10,842 |
| Other real estate owned | 18,832 | 17,467 |
| Federal Home Loan Bank and other stock | 2,509 | 2,829 |
| Company owned life insurance | 5,345 | 5,327 |
| Other assets | 1,482 | 2,681 |
| Total Assets | $ 289,967 | $ 302,637 |
| Liabilities | ||
| Non interest bearing demand | $ 50,566 | $ 42,894 |
| Money market, NOW and savings | 114,603 | 122,331 |
| Time deposits <$100K | 42,336 | 43,452 |
| Time deposits >$100K | 40,811 | 44,582 |
| Total Deposits | 248,316 | 253,259 |
| Securities sold under repurchase agreements | 10,770 | 21,051 |
| Federal Home Loan Bank advances | 2,000 | 2,000 |
| Subordinated debt | 675 | 1,812 |
| Total Debt | 13,445 | 24,863 |
| Other Liabilities | 758 | 738 |
| Total Liabilities | 262,519 | 278,860 |
| Shareholders' Equity | ||
| Common stock | 24,522 | 21,655 |
| Accumulated retained earnings | 2,238 | 1,833 |
| Accumulated other comprehensive income | 688 | 289 |
| Total shareholders equity | 27,448 | 23,777 |
| Total liabilities and shareholders' equity | $ 289,967 | $ 302,637 |
| State Bank Corp. | ||||
| Statement of Operations | ||||
| For the Quarter Ended | Year to Date | |||
| Dollars in thousands - Unaudited | 9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 |
| Statements of Operations | ||||
| Interest income | ||||
| Loans, including fees | $ 2,776 | $ 3,236 | $ 8,751 | $ 10,764 |
| Securities | 256 | 345 | 859 | 1,197 |
| Fed funds and other | 30 | 18 | 45 | 53 |
| Total interest income | 3,062 | 3,599 | 9,655 | 12,014 |
| Interest expense | ||||
| Deposits | 388 | 726 | 1,248 | 2,729 |
| Borrowings | 27 | 77 | 157 | 325 |
| Total interest expense | 415 | 803 | 1,405 | 3,054 |
| Net interest income | 2,647 | 2,796 | 8,250 | 8,960 |
| Provision for loan losses | 500 | 200 | 696 | 8,915 |
| Net interest income after loan loss provision | 2,147 | 2,596 | 7,554 | 45 |
| Noninterest income | ||||
| Service charges on deposits | 126 | 136 | 365 | 475 |
| Mortgage loan fees | 66 | 2 | 248 | 24 |
| Gain on sale of loans | 123 | 255 | 377 | 612 |
| Other income | 228 | 141 | 496 | 685 |
| Total noninterest income | 543 | 534 | 1,486 | 1,796 |
| Noninterest expense | ||||
| Salaries and employee benefits | 1,148 | 1,115 | 3,385 | 3,375 |
| Net occupancy expense | 90 | 94 | 257 | 269 |
| Equipment expense | 45 | 41 | 123 | 148 |
| Data processing | 196 | 231 | 675 | 779 |
| Director fees & expenses | 36 | 58 | 115 | 186 |
| Insurance | 49 | 21 | 145 | 57 |
| Marketing & promotion | 72 | 51 | 180 | 224 |
| Professional fees | 94 | 190 | 280 | 378 |
| Office expense | 46 | 51 | 146 | 166 |
| Regulatory assessments | 127 | 258 | 561 | 828 |
| OREO and repossessed assets | 546 | 177 | 2,461 | 3,963 |
| Other expenses | 118 | 108 | 307 | 332 |
| Total noninterest expense | 2,567 | 2,395 | 8,635 | 10,705 |
| Income (loss) before provision (benefit) for income taxes | 123 | 735 | 405 | (8,864) |
| Provision (benefit) for income taxes | -- | 500 | -- | (1,581) |
| Net Income (Loss) | $ 123 | $ 235 | $ 405 | $ (7,283) |
| Per Share Data | ||||
| Basic EPS | $ 0.02 | $ 0.06 | $ 0.08 | $ (1.89) |
| Diluted EPS | $ 0.02 | $ 0.06 | $ 0.08 | $ (1.89) |
| Average shares outstanding | ||||
| Basic | 5,678,718 | 3,854,714 | 4,999,866 | 3,854,714 |
| Effect of dilutive shares | 818 | 2,920 | 4,471 | 2,920 |
| Diluted | 5,679,536 | 3,857,634 | 5,004,337 | 3,857,634 |