CLARKSTON, Mich., Feb. 01, 2017 (GLOBE NEWSWIRE) -- Clarkston Financial Corporation (“Corporation”) (OTCBB:CKFC), the holding company for Clarkston State Bank (“Bank”), today reported a net income of $512,000 or $0.16 per share for the three months ended December 31, 2016, compared to net income of $227,000 or $0.07 per share for the three months ended December 31, 2015. For the twelve months ended December 31, 2016, the corporation reported a net income of $1,393,000 or $0.43 per share compared to a net income of $1,030,000 or $0.32 per share for the same period in 2015.
J. Grant Smith, CEO, said, "We are executing our plan to reduce costs and improve our loan out-standings while at the same time keeping our asset quality well below peer levels. Our excellent balance sheet fundamentals when combined with a good net interest margin and lower operating costs have now positioned the bank to perform at a high level. Our efficiency ratio has improved significantly and will have a very positive impact on our performance as we move forward.”
Operating Results
The Corporation’s net interest income increased to $1,695,000 for the quarter ended December 31, 2016 compared to $1,409,000 for the same period ended December 31, 2015. The Bank’s net interest margin remains very good compared to peers ending at 4.12% for the quarter ended December 31, 2016, down from 4.29% for the quarter ended December 31, 2015. The net interest margin benefits from the very good deposit mix of which demand deposits represents 50.8% of total deposits.
Noninterest income increased during the fourth quarter 2016. The quarter ended at $243,000 compared to $(95,000) for the quarter ended December 31, 2015, an increase of $338,000 or 355.79%. The increase in noninterest income is attributable to increased fee income and gains on the sale of both loans and securities. Noninterest expense decreased, ending the fourth quarter 2016 at $1,107,000 compared to $1,246,000 for the same period ended December 31, 2015, a decrease of $139,000 or 11.16%. The decline in noninterest expense has helped to improve the Corporation’s efficiency ratio, ending the quarter at 57.12% compared to 94.80% at December 31, 2015.
Balance Sheet
Total assets at December 31, 2016 were $179,007,000 compared to $172,302,000 at December 31, 2015, an increase of $6,705,000 or 3.89%. The increase in assets is largely due to the increase in deposits throughout the year.
Net loans increased $24,620,000 from $125,499,000 at December 31, 2015 to $150,119,000 at December 31, 2016, an increase of 19.62%. Total deposits increased $5,475,000 or 3.59%, ending at $157,842,000 for December 31, 2016, up from $152,367,000 at December 31, 2015. Total stockholders’ equity increased from $13,893,000 at December 31, 2015 to $15,189,000 at December 31, 2016, an increase of $1,296,000 or 9.33%.
Asset Quality
The Bank continues to have excellent asset quality and has no non-performing loans at December 31, 2016. The allowance for loan loss decreased slightly to 1.16% of total loans as of December 31, 2016, compared to 1.20% for the same period 2015. Management continually monitors the allowance for loan loss to determine its adequacy.
Clarkston State Bank opened in January 1999 and operates two branches in Clarkston and Waterford, Michigan.
Safe Harbor. This news release contains comments or information that constitute forward-looking statements within the context of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve significant risks and uncertainties. Actual results may differ materially from the results discussed in the forward-looking statements. Factors that may cause such a difference include: changes in interest rates and interest-rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking regulations; changes in tax laws; changes in prices, levies, and assessments; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior and their ability to repay loans; and changes in the national and local economy. The Corporation assumes no responsibility to update forward-looking statements.
| CLARKSTON FINANCIAL CORPORATION | |||||||||
| CONSOLIDATED BALANCE SHEET | |||||||||
| (Dollars, in thousands) | |||||||||
| (unaudited) | |||||||||
| 12/31/2016 | 12/31/2015 | ||||||||
| Assets | |||||||||
| Cash and due from banks | $ | 9,004 | $ | 24,264 | |||||
| Securities – Available for sale | 8,481 | 9,649 | |||||||
| Federal Home Loan Bank stock, at cost | 232 | 232 | |||||||
| Loans | 151,887 | 127,028 | |||||||
| Allowance for possible loan losses | (1,767 | ) | (1,529 | ) | |||||
| Net loans | 150,119 | 125,499 | |||||||
| Banking premises and equipment | 3,682 | 3,915 | |||||||
| Deferred tax asset | 5,595 | 6,299 | |||||||
| Other real estate owned | 1,221 | 1,581 | |||||||
| Accrued interest receivable and other assets | 674 | 863 | |||||||
| Total assets | $ | 179,007 | $ | 172,302 | |||||
| Liabilities and Stockholders' Equity | |||||||||
| Liabilities | |||||||||
| Deposits | |||||||||
| Noninterest-bearing demand deposits | 80,217 | 82,408 | |||||||
| Interest-bearing | 77,625 | 69,959 | |||||||
| Total deposits | 157,842 | 152,367 | |||||||
| Other Liabilities | |||||||||
| Other borrowings | 5,416 | 5,621 | |||||||
| Accrued interest payable and other liabilities | 560 | 421 | |||||||
| Total liabilities | 163,818 | 158,409 | |||||||
| Stockholders' Equity | |||||||||
| Common stock | 11,923 | 11,945 | |||||||
| Paid-in capital | 11,804 | 11,826 | |||||||
| Restricted stock - Unearned compensation | 0 | (45 | ) | ||||||
| Accumulated deficit | (8,396 | ) | (9,789 | ) | |||||
| Accumulated other comprehensive income (loss) | (141 | ) | (45 | ) | |||||
| Total stockholders' equity | 15,189 | 13,893 | |||||||
| Total liabilities and stockholders' equity | $ | 179,007 | $ | 172,302 | |||||
| CLARKSTON FINANCIAL CORPORATION | |||||||||||||||
| CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||||||
| (Dollars, in thousands) | |||||||||||||||
| (unaudited) | (unaudited) | ||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||
| 12/31/2016 | 12/31/2015 | 12/31/2016 | 12/31/2015 | ||||||||||||
| Interest Income | |||||||||||||||
| Interest and fees on loans | $ | 1,768 | $ | 1,483 | $ | 6,693 | $ | 5,853 | |||||||
| Interest on investment securities: | 40 | 42 | 189 | 149 | |||||||||||
| Interest on federal funds sold | 6 | 5 | 46 | 17 | |||||||||||
| Total interest income | 1,814 | 1,530 | 6,928 | 6,019 | |||||||||||
| Interest Expense | |||||||||||||||
| Deposits | 54 | 48 | 183 | 208 | |||||||||||
| Borrowings | 65 | 72 | 261 | 295 | |||||||||||
| Total interest expense | 119 | 120 | 445 | 504 | |||||||||||
| Net Interest Income | 1,695 | 1,409 | 6,484 | 5,515 | |||||||||||
| Provision for Possible Loan Losses | 20 | (275 | ) | 50 | (275 | ) | |||||||||
| Net Interest Income after provision for possible loan losses | 1,675 | 1,684 | 6,434 | 5,790 | |||||||||||
| Noninterest Income | |||||||||||||||
| Service fees on loan and deposit accounts | 124 | 159 | 491 | 513 | |||||||||||
| Gain on sale of securities | 12 | 0 | 12 | 34 | |||||||||||
| Loss on sale of other real estate owned | 0 | (275 | ) | (14 | ) | (275 | ) | ||||||||
| Other | 108 | 21 | 247 | 593 | |||||||||||
| Total noninterest income | 243 | (95 | ) | 736 | 865 | ||||||||||
| Noninterest Expense | |||||||||||||||
| Salaries and employee benefits | 630 | 697 | 2,906 | 2,919 | |||||||||||
| Occupancy | 124 | 141 | 496 | 555 | |||||||||||
| Advertising | (5 | ) | 29 | 101 | 107 | ||||||||||
| Outside processing | 117 | 128 | 473 | 464 | |||||||||||
| Professional fees | 54 | 56 | 193 | 208 | |||||||||||
| FDIC insurance | 21 | 27 | 106 | 98 | |||||||||||
| Defaulted loan expense | 29 | 41 | 154 | 213 | |||||||||||
| Other | 138 | 129 | 515 | 543 | |||||||||||
| Total noninterest expense | 1,107 | 1,246 | 4,945 | 5,108 | |||||||||||
| Income/(Loss) before income taxes | 811 | 343 | 2,225 | 1,547 | |||||||||||
| Income Tax Expense | 299 | 116 | 833 | 517 | |||||||||||
| Net Income/(Loss) | $ | 512 | $ | 227 | $ | 1,393 | $ | 1,030 | |||||||
| CLARKSTON FINANCIAL CORPORATION | ||||||||||||||||
| CONSOLIDATED FINANCIAL HIGHLIGHTS | ||||||||||||||||
| (Dollars in thousands, except share and per share data) | Quarter Ended | |||||||||||||||
| 12/31/2016 | 9/30/2016 | 6/30/2016 | 3/31/2016 | 12/31/2015 | ||||||||||||
| MARKET DATA | ||||||||||||||||
| Book value per share | $ | 4.67 | $ | 4.55 | $ | 4.44 | $ | 4.33 | $ | 4.26 | ||||||
| Market value per share | $ | 5.25 | $ | 3.95 | $ | 3.85 | $ | 4.00 | $ | 3.70 | ||||||
| Earnings per share - basic & diluted | $ | 0.16 | $ | 0.11 | $ | 0.11 | $ | 0.06 | $ | 0.07 | ||||||
| Period end common shares | 3,249,156 | 3,261,156 | 3,261,156 | 3,261,156 | 3,261,156 | |||||||||||
| PERFORMANCE RATIOS | ||||||||||||||||
| Return on average assets | 1.14 | % | 0.84 | % | 0.71 | % | 0.46 | % | 0.57 | % | ||||||
| Return on average equity | 10.66 | % | 10.17 | % | 8.88 | % | 5.64 | % | 6.62 | % | ||||||
| Net interest margin - CSB | 4.12 | % | 4.13 | % | 4.15 | % | 4.29 | % | 4.29 | % | ||||||
| Efficiency ratio | 57.12 | % | 65.89 | % | 71.65 | % | 80.97 | % | 94.80 | % | ||||||
| Texas Ratio | 6.32 | % | 7.32 | % | 7.57 | % | 10.15 | % | 10.90 | % | ||||||
| CAPITAL & LIQUIDITY | ||||||||||||||||
| Tier 1 Leverage - CSB | 8.94 | % | 8.76 | % | 8.38 | % | 8.40 | % | 8.46 | % | ||||||
| Common Equity Tier 1 Capital - CSB | 9.90 | % | 9.50 | % | 9.67 | % | 9.57 | % | 9.09 | % | ||||||
| Tier 1 Risk Based Capital - CSB | 9.90 | % | 9.50 | % | 9.67 | % | 9.57 | % | 9.09 | % | ||||||
| Total Risk Based Capital - CSB | 11.01 | % | 10.50 | % | 10.70 | % | 10.62 | % | 10.36 | % | ||||||
| Loan to deposit ratio | 96.23 | % | 97.10 | % | 89.11 | % | 84.65 | % | 83.37 | % | ||||||
| ASSET QUALITY | ||||||||||||||||
| Gross loan charge-offs | $ | 0 | $ | 0 | $ | 0 | $ | 14 | $ | 0 | ||||||
| Net loan charge-offs (recoveries) | $ | (170 | ) | $ | (5 | ) | $ | (14 | ) | $ | (16 | ) | $ | (3 | ) | |
| Allowance for loan and lease losses to total loans | 1.16 | % | 1.07 | % | 1.12 | % | 1.12 | % | 1.20 | % | ||||||
| Nonperforming loans to total loans | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | ||||||
| Nonperforming assets to total assets | 0.68 | % | 0.69 | % | 0.69 | % | 0.87 | % | 0.92 | % | ||||||
| CLARKSTON FINANCIAL CORPORATION | ||||||||
| LOAN INFORMATION | ||||||||
| (unaudited) | ||||||||
| CATEGORY | 12/31/2016 | 12/31/2015 | ||||||
| Commercial Loans | $ | 18,781 | $ | 14,126 | ||||
| Real Estate Mortgage Loans: | ||||||||
| Commercial | 118,838 | 102,098 | ||||||
| 1-4 Residential | 3,036 | 4,077 | ||||||
| Construction and other | 2,468 | 1,369 | ||||||
| Total mortgage loans on real estate | 124,341 | 107,544 | ||||||
| Consumer | 8,765 | 5,358 | ||||||
| Total Loans | 151,887 | 127,028 | ||||||
| Less: Allowance for loan losses | (1,767 | ) | (1,529 | ) | ||||
| Net Loans | $ | 150,119 | $ | 125,499 | ||||
| (unaudited) | ||||||||
| ASSET QUALITY | 12/31/2016 | 12/31/2015 | ||||||
| Total nonaccrual loans | $ | 0 | $ | 0 | ||||
| Total loans past due 90 days or more and still accruing | 0 | 0 | ||||||
| Total nonperforming loans | 0 | 0 | ||||||
| Other real estate owned | 1,221 | 1,581 | ||||||
| Total nonperforming assets | $ | 1,221 | $ | 1,581 | ||||