CLARKSTON, Mich., Feb. 7, 2013 (GLOBE NEWSWIRE) -- Clarkston Financial Corporation ("Corporation") (OTCBB:CKFC), the holding company for Clarkston State Bank ("Bank"), today reported a net income of $1,258,000 or $0.04 per share for the three months ended December 31, 2012, compared to net loss of $3,554,000 or $0.44 per share for the three months ended December 31, 2011. For the twelve months ended December 31, 2012, the corporation reported a net income of $1,635,000 or $0.05 per share compared to a net loss of $3,654,000 or $0.11 per share for the same period in 2011. This represents the corporation's first full year net income since 2004.
J. Grant Smith, CEO, said, "These results are a testament to the hard work and perseverance of our board of directors, management team, and the entire staff. The positive financial performance serves as an exclamation point to the completion of the turnaround of the Corporation. A plan was developed some years ago and was very well executed by our entire organization with fortitude, determination and without any Federal bailout or incentive money. Our team has worked very hard to execute our plan and survive the financial crises much like many of the businesses in Southeast Michigan have had to do over the past several years. We have a very seasoned team of banking professionals and we look forward to continued positive financial results and future growth. "
Operating Results
The Corporation's net interest income was $1,168,000 for the quarter ended December 31, 2012 compared to $1,244,000 for the same period ended December 31, 2011, a decrease of $76,000 or 6.11%. The net interest margin of the Bank showed a modest decrease, ending at 4.65% for the quarter ended December 31, 2012, down from 4.85% for the quarter ended December 31, 2011. This decrease in net interest margin is representative of decreased yields on new loans and investments.
Noninterest income increased in the fourth quarter 2012, due to lower losses on the sale of other real estate owned, ending at $220,000 compared to ($714,000) for the quarter ended December 31, 2011, an increase of $934,000 or 130.81%. Noninterest expense increased, ending the fourth quarter 2012 at $1,585,000 compared to $1,500,000 for the same period ended December 31, 2011.
During the fourth quarter of 2012, net income was positively impacted by the reversal of a portion of the previously established net deferred tax asset valuation allowance, resulting in federal income tax benefit of $1,500,000.
Balance Sheet
Total assets at December 31, 2012 were $123,503,000 compared to $114,374,000 at December 31, 2011, an increase of $9,129,000 or 7.98%. The growth in total assets represents increased cash balances as a result of additional growth in core deposits.
Total loans increased $4,731,000 from $88,081,000 at December 31, 2011 to $92,812,000 at December 31, 2012, an increase of 5.37%. Total deposits increased $7,572,000 or 7.22%, ending at $112,467,000 for December 31, 2012, up from $104,895,000 at December 31, 2011. Total stockholders' equity increased from $3,934,000 at December 31, 2011 to $5,448,000 at December 31, 2012, an increase of $1,514,000 or 38.49%. This increase is due to the net income in 2012.
Asset Quality
Total non-performing loans decreased to $972,000 at December 31, 2012 compared to $2,244,000 from the same period 2011, a decrease of $1,272,000, or 56.68%. The allowance for loan loss decreased to 2.63% of total loans as of December 31, 2012, compared to 3.25% for the same period 2011. Management continually monitors the allowance for loan loss to determine its adequacy.
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.
| CLARKSTON FINANCIAL CORPORATION | ||
| CONSOLIDATED BALANCE SHEET | ||
| (Dollars, in thousands) | ||
| (unaudited) | ||
| 12/31/2012 | 12/31/2011 | |
| Assets | ||
| Cash and due from banks | $ 14,517 | $ 9,783 |
| Securities – Available for sale | 7,709 | 9,412 |
| Federal Home Loan Bank stock, at cost | 556 | 556 |
| Loans | 92,812 | 88,081 |
| Allowance for possible loan losses | (2,438) | (2,865) |
| Net loans | 90,374 | 85,216 |
| Banking premises and equipment | 4,955 | 4,586 |
| Other real estate owned | 3,431 | 4,411 |
| Accrued interest receivable and other assets | 1,962 | 410 |
| Total assets | $ 123,504 | $ 114,374 |
| Liabilities and Stockholders' Equity (Deficit) | ||
| Liabilities | ||
| Deposits | ||
| Noninterest-bearing demand deposits | 38,553 | 23,902 |
| Interest-bearing | 73,914 | 80,993 |
| Total deposits | 112,467 | 104,895 |
| Other Liabilities | ||
| Other borrowings | 5,300 | 5,300 |
| Accrued interest payable and other liabilities | 289 | 245 |
| Total liabilities | 118,056 | 110,440 |
| Stockholders' Equity | ||
| Common stock | 11,908 | 11,807 |
| Paid-in capital | 11,789 | 11,688 |
| Restricted stock - Unearned compensation | (167) | -- |
| Accumulated deficit | (18,057) | (19,691) |
| Accumulated other comprehensive income (loss) | (25) | 130 |
| Total stockholders' equity | 5,448 | 3,934 |
| Total liabilities and stockholders' equity | $ 123,504 | $ 114,374 |
| CLARKSTON FINANCIAL CORPORATION | ||||
| CONSOLIDATED STATEMENT OF OPERATIONS | ||||
| (Dollars, in thousands) | ||||
| (unaudited) | (unaudited) | |||
| Three Months Ended | Twelve Months Ended | |||
| 12/31/2012 | 12/31/2011 | 12/31/2012 | 12/31/2011 | |
| Interest Income | ||||
| Interest and fees on loans | $ 1,328 | $ 1,362 | $ 5,366 | $ 5,083 |
| Interest on investment securities: | 35 | 71 | 173 | 319 |
| Interest on federal funds sold | 6 | 2 | 25 | 19 |
| Total interest income | 1,369 | 1,437 | 5,562 | 5,421 |
| Interest Expense | ||||
| Deposits | 93 | 150 | 458 | 705 |
| Borrowings | 108 | 43 | 341 | 208 |
| Total interest expense | 201 | 193 | 799 | 913 |
| Net Interest Income | 1,168 | 1,244 | 4,763 | 4,508 |
| Provision for Possible Loan Losses | 45 | 2,584 | 180 | 2,859 |
| Net Interest Income after provision for possible loan losses | 1,123 | (1,340) | 4,583 | 1,649 |
| Noninterest Income | ||||
| Service fees on loan and deposit accounts | 131 | 121 | 504 | 576 |
| Gain on sale of securities | 29 | -- | 197 | 55 |
| Loss on sale of other real estate owned | (29) | (876) | (53) | (1,033) |
| Other | 89 | 41 | 239 | 151 |
| Total noninterest income | 220 | (714) | 889 | (251) |
| Noninterest Expense | ||||
| Salaries and employee benefits | 862 | 539 | 2,527 | 2,027 |
| Occupancy | 154 | 153 | 600 | 603 |
| Advertising | 18 | 14 | 80 | 67 |
| Outside processing | 135 | 135 | 550 | 532 |
| Professional fees | 30 | 68 | 342 | 259 |
| FDIC insurance | 36 | 60 | 230 | 294 |
| Defaulted loan expense | 151 | 370 | 507 | 816 |
| Other | 199 | 161 | 501 | 454 |
| Total noninterest expense | 1,585 | 1,500 | 5,337 | 5,052 |
| Income/(Loss) before income taxes | (242) | (3,554) | 135 | (3,654) |
| Income Tax Benefit | (1,500) | -- | (1,500) | -- |
| Net Income/(Loss) | $ 1,258 | $ (3,554) | $ 1,635 | $ (3,654) |
| CLARKSTON FINANCIAL CORPORATION | |||||
| CONSOLIDATED FINANCIAL HIGHLIGHTS | |||||
| (Dollars in thousands, except share and per share data) | |||||
| Quarter Ended | |||||
| 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | 12/31/2011 | |
| MARKET DATA | |||||
| Book value per share | $ 0.17 | $ 0.13 | $ 0.13 | $ 0.12 | $ 0.12 |
| Market value per share | $ 0.15 | $ 0.55 | $ 0.36 | $ 0.36 | $ 0.42 |
| Earnings per share - basic & diluted | $ 0.04 | $ 0.02 | $ 0.02 | $ 0.01 | $ (0.44) |
| Average basic shares outstanding | 32,421,855 | 32,286,613 | 32,291,150 | 31,957,165 | 31,950,625 |
| Average diluted shares outstanding | 32,421,855 | 32,286,613 | 32,291,150 | 31,957,165 | 31,950,625 |
| Period end common shares | 32,421,855 | 32,421,855 | 32,433,355 | 31,957,165 | 31,950,625 |
| PERFORMANCE RATIOS | |||||
| Return on average assets | 4.23% | 0.41% | 0.67% | 0.18% | -12.35% |
| Return on average equity | 123.59% | 12.24% | 20.03% | 5.13% | -213.35% |
| Net interest margin - CSB | 4.65% | 4.59% | 4.74% | 4.78% | 4.85% |
| Efficiency ratio | 114.20% | 87.86% | 83.33% | 93.09% | 283.10% |
| Texas Ratio | 36.52% | 48.98% | 49.06% | 55.80% | 58.21% |
| CAPITAL & LIQUIDITY | |||||
| Total Risk Based Capital - CSB | 10.77% | 10.59% | 10.22% | 10.01% | 10.23% |
| Tier 1 Risk Based Capital - CSB | 9.51% | 9.33% | 8.96% | 8.74% | 8.96% |
| Tier 1 Leverage - CSB | 8.14% | 7.69% | 7.56% | 7.65% | 7.44% |
| Loan to deposit ratio | 82.52% | 80.54% | 85.61% | 82.73% | 83.97% |
| ASSET QUALITY | |||||
| Gross loan charge-offs | $ 136 | $ 275 | $ 99 | $ 352 | $ 1,898 |
| Net loan charge-offs | $ 78 | $ 199 | $ 5 | $ 325 | $ 1,879 |
| Allowance for loan and lease losses to total loans | 2.63% | 2.71% | 2.80% | 2.80% | 3.25% |
| Nonperforming loans to total loans | 1.05% | 1.21% | 1.89% | 2.12% | 2.55% |
| Nonperforming assets to total assets | 3.57% | 4.70% | 4.83% | 5.22% | 5.82% |
| CLARKSTON FINANCIAL CORPORATION | ||
| LOAN INFORMATION | ||
| (unaudited) | ||
| CATEGORY | 12/31/2012 | 12/31/2011 |
| Commercial Loans | $ 15,182 | $ 14,491 |
| Real Estate Mortgage Loans: | ||
| Commercial | 66,923 | 60,453 |
| 1-4 Residential | 6,977 | 8,990 |
| Construction and other | 3,521 | 3,677 |
| Total mortgage loans on real estate | 77,421 | 73,120 |
| Consumer | 209 | 470 |
| Total Loans | 92,812 | 88,081 |
| Less: Allowance for loan losses | (2,438) | (2,865) |
| Net Loans | $ 90,374 | $ 85,216 |
| (unaudited) | ||
| ASSET QUALITY | 12/31/2012 | 12/31/2011 |
| Total nonaccrual loans | $ 969 | $ 2,244 |
| Total loans past due 90 days or more and still accruing | 3 | -- |
| Total nonperforming loans | 972 | 2,244 |
| Other real estate owned | 3,431 | 4,411 |
| Total nonperforming assets | $ 4,403 | $ 6,655 |