CLARKSTON, Mich., April 29, 2011 (GLOBE NEWSWIRE) -- Clarkston Financial Corporation ("Corporation") (OTCBB:CKFC), the holding company for Clarkston State Bank ("Bank"), today reported a net loss of $38,000 or ($0.03) per basic and diluted common share for the three months ended March 31, 2011, compared to a net loss of $267,000 or $(0.73) per share for the three months ended March 31, 2010.
J. Grant Smith, Clarkston Financial Corporation President and Chief Executive Officer, said, "Although the Corporation posted a small loss for the first quarter, I am proud to announce that we have successfully raised approximately $8,000,000 in new equity. The capital was raised from a combination of local private investors as well as our board of directors, who believe in our mission and successes. All are committed to and are confident in the future of the Bank and the Corporation.
Mr. Smith continued, "During the first quarter, approximately $7,200,000 of this money was infused into the Bank. After the infusion the Bank's quarter end capital ratios were the following: Tier I Leverage Ratio of 9.07%; Tier I Risk Based Capital Ratio of 10.76%; Total Risk Based Capital of 12.03%. Based on these capital ratios the Bank is in excess of what is required to be considered well-capitalized by the Bank's primary regulator."
Mr. Smith concluded, "Our team has worked long and hard to get back to well-capitalized status. We have executed our plan with precision and cooperation from our primary regulator. It is now time to complete the turnaround of the Bank and return the Bank to profitability. We are very excited about our future."
Operating Results
The Corporation's net interest income was $1,025,000 for the quarter ended March 31, 2011 compared to $900,000 for the same period ended March 31, 2010, an increase of $125,000 or 13.88%. The net interest margin of the Bank continues to rise, ending at 4.60% for the quarter ended March 31, 2011, up from 3.53% for the quarter ended March 31, 2010. The rise in net interest margin is reflective of stronger core deposits, and more favorable deposit pricing.
For the second consecutive quarter, the Bank did not have to write a provision for loan loss. This is a reflection of improved asset quality, as well as an adequate allowance for loan and lease losses. As of March 31, 2011, the allowance for loan and lease losses was 3.16%, well above peer averages.
Noninterest income remained relatively flat, with a modest decline due to security gains during the first quarter 2010. Noninterest expense continued to decline, ending the first quarter 2011 at $1,289,000 compared to $1,366,000 for the same period ended March 31, 2010. This represents a decline of $77,000 or 5.64%. This decrease is a direct result of lower costs related to defaulted loans, another sign of improving asset quality.
Balance Sheet
Total assets at March 31, 2011 were $110,510,000 compared to $109,974,000 at March 31, 2010, an increase of $536,000 or 0.49%. The increase in total assets represents the influx of cash related to the capital raise completed by the Corporation.
Total loans decreased $6,024,000 from $87,051,000 at March 31, 2010 to $81,027,000 at March 31, 2011, a decline of 6.92%. Total deposits also shrank to $100,272,000 at March 31, 2011 from $103,841,000 at March 31, 2010, a decline of $3,569,000 or 3.44%. Both the decline in loans and deposits were a direct function of management's efforts to reduce the balance sheet and preserve capital.
Total stockholders' equity increased from ($1,690,000) at March 31, 2010 to $5,451,000 at March 31, 2011, an increase of $7,141,000 or 422.54%. This increase is due to the completion of the capital raise at the Corporation.
Asset Quality
The Bank continues to see significant improvements in the level of non-performing loans. Total non-performing loans have significantly decreased to $3,315,000 at March 31, 2011 compared to $5,395,000 from the same period 2010, a decline of $2,080,000, or 38.55%.
The allowance for possible loan losses decreased to 3.16% of total loans as of March 31, 2011, compared to 4.21% for the same period 2010. The decline in the allowance for loan loss percentage represents a strengthening of the loan portfolio, thus eliminating the need for a provision expense in the first quarter. The improved loan portfolio is a direct result of stronger controls over loan underwriting and an increased focus on credit administration.
Clarkston State Bank opened in January 1999 and operates four branches in Clarkston, Waterford, and Independence Township, 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.
The Clarkston Financial Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=8228
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CLARKSTON FINANCIAL CORPORATION CONSOLIDATED FINANCIAL HIGHLIGHTS |
||||||
| (Dollars in thousands, except share and per share data) | ||||||
| Quarter Ended | ||||||
| 3/31/2011 | 12/31/2010 | 3/31/2010 | ||||
| MARKET DATA | ||||||
| Book value per share | $ 0.25 | $ (1.23) | $ (0.76) | |||
| Market value per share | $ 0.90 | $ 0.50 | $ 0.66 | |||
| Earnings per share - basic & diluted | $ (0.03) | $ 0.06 | $ (0.73) | |||
| Average basic and diluted shares outstanding | 5,464,777 | 2,225,706 | 1,466,087 | |||
| Period end common shares | 26,737,435 | 2,225,706 | 2,225,706 | |||
| PERFORMANCE RATIOS | ||||||
| Return on average assets | -0.14% | -1.24% | -0.95% | |||
| Return on average equity | -13.58% | -72.55% | -184.16% | |||
| Net interest margin - CSB | 4.60% | 4.18% | 3.53% | |||
| Efficiency ratio | 103.03% | 96.86% | 118.87% | |||
| Texas Ratio | 58.12% | 143.60% | 130.31% | |||
| CAPITAL & LIQUIDITY | ||||||
| Total Risk Based Capital - CSB | 12.03% | 3.91% | 3.89% | |||
| Tier 1 Risk Based Capital - CSB | 10.76% | 2.64% | 2.61% | |||
| Tier 1 Leverage - CSB | 9.07% | 2.26% | 2.20% | |||
| Loan to deposit ratio | 80.81% | 79.71% | 83.83% | |||
| ASSET QUALITY | ||||||
| Gross loan charge-offs | $ 91 | $ 559 | $ 122 | |||
| Net loan charge-offs | $ 5 | $ 509 | $ 83 | |||
| Allowance for loan and lease losses to total loans | 3.16% | 3.20% | 4.21% | |||
| Nonperforming loans to total loans | 4.09% | 3.37% | 6.20% | |||
| Nonperforming assets to total assets | 6.43% | 6.81% | 7.22% | |||
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CLARKSTON FINANCIAL CORPORATION |
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| CONSOLIDATED BALANCE SHEET | |||
| (Dollars, in thousands) | |||
| (unaudited) | (unaudited) | ||
| 3/31/2011 | 12/31/2010 | 3/31/2010 | |
| Assets | |||
| Cash and cash equivalents: | |||
| Cash and due from banks | $ 10,715 | $ 7,125 | $ 4,780 |
| Federal funds sold | -- | -- | 1,405 |
| Total cash and cash equivalents | 10,715 | 7,125 | 6,185 |
| Securities – Available for sale | 11,670 | 8,748 | 11,973 |
| Federal Home Loan Bank stock, at cost | 662 | 662 | 760 |
| Loans | 81,027 | 80,160 | 87,051 |
| Allowance for possible loan losses | (2,560) | (2,566) | (3,666) |
| Net loans | 78,467 | 77,594 | 83,385 |
| Banking premises and equipment | 4,723 | 4,731 | 4,821 |
| Other real estate owned | 3,789 | 4,365 | 2,548 |
| Accrued interest receivable and other assets | 484 | 486 | 302 |
| Total assets | $ 110,510 | $ 103,711 | $ 109,974 |
| Liabilities and Stockholders' Equity (Deficit) | |||
| Liabilities | |||
| Deposits | |||
| Noninterest-bearing demand deposits | 22,601 | 20,051 | 20,240 |
| Interest-bearing | 77,671 | 80,515 | 83,601 |
| Total deposits | 100,272 | 100,566 | 103,841 |
| Other Liabilities | |||
| Federal Home Loan Bank advances | -- | -- | 2,000 |
| Other borrowings | 4,330 | 5,330 | 5,330 |
| Accrued interest payable and other liabilities | 457 | 551 | 492 |
| Total liabilities | 105,059 | 106,447 | 111,664 |
| Stockholders' Equity | |||
| Common stock | 10,733 | 6,630 | 6,645 |
| Paid-in capital | 10,733 | 6,630 | 6,645 |
| Restricted stock - Unearned compensation | (30) | (53) | (175) |
| Accumulated deficit | (16,076) | (16,037) | (14,974) |
| Accumulated other comprehensive income (loss) | 91 | 94 | 170 |
| Total stockholders' equity | 5,451 | (2,736) | (1,690) |
| Total liabilities and stockholders' equity | $ 110,510 | $ 103,711 | $ 109,974 |
| CLARKSTON FINANCIAL CORPORATION | ||
| CONSOLIDATED STATEMENT OF OPERATIONS | ||
| (Dollars, in thousands) | ||
| (unaudited) | (unaudited) | |
| 3/31/2011 | 3/31/2010 | |
| Interest Income | ||
| Interest and fees on loans | $ 1,218 | $ 1,290 |
| Interest on investment securities: | 84 | 111 |
| Interest on federal funds sold | 4 | 1 |
| Total interest income | 1,306 | 1,402 |
| Interest Expense | ||
| Deposits | 205 | 396 |
| Borrowings | 76 | 106 |
| Total interest expense | 281 | 502 |
| Net Interest Income | 1,025 | 900 |
| Provision for Possible Loan Losses | -- | 50 |
| Net Interest Income/(Expense) after provision for possible loan losses | 1,025 | 850 |
| Noninterest Income | ||
| Service fees on loan and deposit accounts | 149 | 159 |
| Gain on sale of securities | -- | 33 |
| Loss on sale of other real estate owned | 28 | (19) |
| Other | 49 | 76 |
| Total noninterest income | 226 | 249 |
| Noninterest Expense | ||
| Salaries and employee benefits | 514 | 507 |
| Occupancy | 156 | 139 |
| Advertising | 18 | 9 |
| Outside processing | 127 | 125 |
| Professional fees | 76 | 159 |
| FDIC insurance | 126 | 107 |
| Defaulted loan expense | 160 | 210 |
| Other | 112 | 110 |
| Total noninterest expense | 1,289 | 1,366 |
| Loss before income taxes | (38) | (267) |
| Income Tax Benefit | -- | -- |
| Net Loss | $ (38) | $ (267) |
| CLARKSTON FINANCIAL CORPORATION | |||
| LOAN INFORMATION | |||
| (unaudited) | (unaudited) | ||
| CATEGORY | 3/31/2011 | 12/31/2010 | 3/31/2010 |
| Commercial Loans | $ 8,041 | $ 8,565 | $ 7,865 |
| Real Estate Mortgage Loans: | |||
| Commercial | 59,492 | 57,752 | 60,232 |
| 1-4 Residential | 9,610 | 9,869 | 10,651 |
| Construction and other | 3,145 | 3,160 | 7,145 |
| Total mortgage loans on real estate | 72,247 | 70,781 | 78,027 |
| Consumer | 739 | 814 | 1,158 |
| Total Loans | 81,027 | 80,160 | 87,051 |
| Less: Allowance for loan losses | (2,560) | (2,566) | (3,666) |
| Net Loans | $ 78,467 | $ 77,594 | $ 83,385 |
| (unaudited) | (unaudited) | ||
| ASSET QUALITY | 3/31/2011 | 12/31/2010 | 3/31/2010 |
| Total nonaccrual loans | $ 3,315 | $ 2,700 | $ 5,395 |
| Total loans past due 90 days or more and still accruing | -- | -- | -- |
| Total nonperforming loans | 3,315 | 2,700 | $ 5,395 |
| Other real estate owned | 3,789 | 4,365 | 2,548 |
| Total nonperforming assets | $ 7,104 | $ 7,065 | $ 7,943 |