CLARKSTON, Mich., April 23, 2015 (GLOBE NEWSWIRE) -- Clarkston Financial Corporation ("Corporation") (OTCBB:CKFC), the holding company for Clarkston State Bank ("Bank"), today reported a net income of $252,000 or $0.08 per share for the three months ended March 31, 2015, compared to net income of $280,000 or $0.09 per share for the three months ended March 31, 2014. During the first quarter the Corporation returned to booking a provision for income taxes. The pre-tax net income was $382,000 for the quarter ended March 31, 2015. This represents an increase of $102,000 or 36.43% in pre-tax income year over year.
J. Grant Smith, CEO, said, "We are pleased with the results of our first quarter. Although loan originations were light we have a good pipeline of new loan business we expect to close in the second quarter. In addition, our deposit gathering efforts remain robust. We continue to maintain an excellent mix of deposits which is the catalyst for the Bank's excellent net interest margin of 4.43%. We are very optimistic our financial performance will be very good the remainder of the year as the impact of closing two of our offices will lower operating expenses and increase efficiencies."
Operating Results
The Corporation's net interest income remained steady, increasing slightly to $1,331,000 for the quarter ended March 31, 2015 compared to $1,330,000 for the same period ended March 31, 2014. The net interest margin of the Bank remains elevated compared to peers, but has realized some compression, ending at 4.43% for the quarter ended March 31, 2015, down from 5.03% for the quarter ended March 31, 2014.
Noninterest income increased in the first quarter 2015. The quarter ended at $451,000 compared to $278,000 for the quarter ended March 31, 2014, an increase of $173,000 or 62.23%. This increase was largely driven by the sale of the Bank's downtown Clarkston office which was sold in March as part of the plan to close the branch on April 17, 2015. Noninterest expense increased, ending the first quarter 2015 at $1,400,000 compared to $1,328,000 for the same period ended March 31, 2014, an increase of $72,000 or 5.42%.
Balance Sheet
Total assets at March 31, 2015 were $147,639,000 compared to $132,990,000 at March 31, 2014, an increase of $14,649,000 or 11.02%. The increase in total assets represents an increase in cash as a result of an increase in noninterest bearing demand deposits.
Gross loans increased $8,799,000 from $105,146,000 at March 31, 2014 to $113,945,000 at March 31, 2015, an increase of 8.37%. Total deposits increased $12,770,000 or 11.06%, ending at $128,268,000 for March 31, 2015, up from $115,498,000 at March 31, 2014. Total stockholders' equity increased from $11,311,000 at March 31, 2014 to $13,165,000 at March 31, 2015, an increase of $1,854,000 or 16.39%.
Asset Quality
Total non-performing loans increased to $219,000 at March 31, 2015 compared to $144,000 from the same period in 2014, an increase of $75,000, or 52.08%. The allowance for loan loss decreased to 1.55% of total loans as of March 31, 2015, compared to 1.73% for the same period in 2014. 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) | (unaudited) | ||
| 3/31/2015 | 12/31/2014 | 3/31/2014 | |
| Assets | |||
| Cash and due from banks | $14,473 | $11,908 | $9,644 |
| Securities – Available for sale | 7,441 | 5,581 | 6,421 |
| Federal Home Loan Bank stock, at cost | 409 | 409 | 556 |
| Loans | 113,945 | 114,680 | 105,146 |
| Allowance for possible loan losses | (1,771) | (1,873) | (1,821) |
| Net loans | 112,174 | 112,807 | 103,325 |
| Banking premises and equipment | 4,436 | 4,809 | 4,870 |
| Deferred tax asset | 6,663 | 6,793 | 6,103 |
| Other real estate owned | 1,396 | 1,396 | 1,506 |
| Accrued interest receivable and other assets | 647 | 676 | 565 |
| Total assets | $147,639 | $144,379 | $132,990 |
| Liabilities and Stockholders' Equity | |||
| Liabilities | |||
| Deposits | |||
| Noninterest-bearing demand deposits | 52,367 | 52,919 | 46,792 |
| Interest-bearing | 75,901 | 72,449 | 68,706 |
| Total deposits | 128,268 | 125,368 | 115,498 |
| Other Liabilities | |||
| Other borrowings | 5,775 | 5,625 | 5,300 |
| Accrued interest payable and other liabilities | 431 | 497 | 881 |
| Total liabilities | 134,474 | 131,490 | 121,679 |
| Stockholders' Equity | |||
| Common stock | 11,945 | 11,917 | 11,917 |
| Paid-in capital | 11,826 | 11,798 | 11,798 |
| Restricted stock - Unearned compensation | (60) | (24) | (77) |
| Accumulated deficit | (10,567) | (10,819) | (12,275) |
| Accumulated other comprehensive income (loss) | 21 | 17 | (52) |
| Total stockholders' equity | 13,165 | 12,889 | 11,311 |
| Total liabilities and stockholders' equity | $147,639 | $144,379 | $132,990 |
| CLARKSTON FINANCIAL CORPORATION | ||
| CONSOLIDATED STATEMENT OF OPERATIONS | ||
| (Dollars, in thousands) | ||
| (unaudited) | ||
| Three Months Ended | ||
| 3/31/2015 | 3/31/2014 | |
| Interest Income | ||
| Interest and fees on loans | $1,433 | $1,425 |
| Interest on investment securities: | 37 | 42 |
| Interest on federal funds sold | 5 | 1 |
| Total interest income | 1,475 | 1,468 |
| Interest Expense | ||
| Deposits | 53 | 54 |
| Borrowings | 91 | 84 |
| Total interest expense | 144 | 138 |
| Net Interest Income | 1,331 | 1,330 |
| Provision for Possible Loan Losses | -- | -- |
| Net Interest Income after provision for possible loan losses | 1,331 | 1,330 |
| Noninterest Income | ||
| Service fees on loan and deposit accounts | 114 | 123 |
| Other | 337 | 155 |
| Total noninterest income | 451 | 278 |
| Noninterest Expense | ||
| Salaries and employee benefits | 828 | 730 |
| Occupancy | 150 | 143 |
| Advertising | 28 | 20 |
| Outside processing | 118 | 126 |
| Professional fees | 55 | 77 |
| FDIC insurance | 23 | 48 |
| Defaulted loan expense | 53 | 49 |
| Other | 145 | 135 |
| Total noninterest expense | 1,400 | 1,328 |
| Income before income taxes | 382 | 280 |
| Income Tax Expense | 130 | -- |
| Net Income | $252 | $280 |
| CLARKSTON FINANCIAL CORPORATION | |||||
| CONSOLIDATED FINANCIAL HIGHLIGHTS | |||||
| (Dollars in thousands, except share and per share data) | |||||
| Quarter Ended | |||||
| 3/31/2015 | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | |
| MARKET DATA | |||||
| Book value per share | $4.04 | $3.97 | $3.67 | $3.58 | $3.48 |
| Market value per share | $4.00 | $3.77 | $4.35 | $4.30 | $4.60 |
| Earnings per share - basic & diluted | $0.08 | $0.29 | $0.09 | $0.07 | $0.09 |
| Period end common shares | 3,261,156 | 3,246,156 | 3,246,156 | 3,246,156 | 3,246,156 |
| PERFORMANCE RATIOS | |||||
| Return on average assets | 0.69% | 2.59% | 0.87% | 0.70% | 0.87% |
| Return on average assets - CSB | 0.94% | 2.47% | 1.21% | 1.11% | 1.29% |
| Return on average equity | 7.81% | 30.80% | 10.21% | 8.13% | 10.06% |
| Return on average equity - CSB | 7.82% | 21.05% | 9.82% | 8.92% | 10.49% |
| Net interest margin - CSB | 4.43% | 4.50% | 4.71% | 4.93% | 5.03% |
| Efficiency ratio | 78.59% | 82.80% | 80.84% | 84.64% | 82.60% |
| Texas Ratio | 11.59% | 11.10% | 11.40% | 11.36% | 12.54% |
| CAPITAL & LIQUIDITY | |||||
| Tier 1 Leverage - CSB | 8.71% | 8.78% | 8.82% | 9.30% | 9.17% |
| Common Equity Tier 1 Capital - CSB | 9.84% | -- | -- | -- | -- |
| Tier 1 Risk Based Capital - CSB | 9.84% | 9.68% | 9.52% | 9.82% | 9.96% |
| Total Risk Based Capital - CSB | 11.10% | 10.93% | 10.77% | 11.08% | 11.21% |
| Loan to deposit ratio | 88.83% | 91.47% | 91.23% | 94.72% | 91.04% |
| ASSET QUALITY | |||||
| Gross loan charge-offs | $249 | $ -- | $11 | $ -- | $25 |
| Net loan charge-offs (recoveries) | $101 | $ (20) | $ (12) | $ (20) | $ -- |
| Allowance for loan and lease losses to total loans | 1.55% | 1.63% | 1.65% | 1.67% | 1.73% |
| Nonperforming loans to total loans | 0.19% | 0.13% | 0.13% | 0.13% | 0.14% |
| Nonperforming assets to total assets | 1.09% | 1.07% | 1.09% | 1.15% | 1.24% |
| CLARKSTON FINANCIAL CORPORATION | |||
| LOAN INFORMATION | |||
| (unaudited) | (unaudited) | ||
| CATEGORY | 3/31/2015 | 12/31/2014 | 3/31/2014 |
| Commercial Loans | $11,852 | $13,737 | $11,760 |
| Real Estate Mortgage Loans: | |||
| Commercial | 91,430 | 91,496 | 83,237 |
| 1-4 Residential | 4,794 | 5,086 | 5,881 |
| Construction and other | 3,723 | 4,136 | 4,108 |
| Total mortgage loans on real estate | 99,947 | 100,718 | 93,226 |
| Consumer | 2,146 | 225 | 160 |
| Total Loans | 113,945 | 114,680 | 105,146 |
| Less: Allowance for loan losses | (1,771) | (1,873) | (1,821) |
| Net Loans | $112,174 | $112,807 | $103,325 |
| (unaudited) | (unaudited) | ||
| ASSET QUALITY | 3/31/2015 | 12/31/2014 | 3/31/2014 |
| Total nonaccrual loans | $219 | $144 | $144 |
| Total loans past due 90 days or more and still accruing | -- | -- | -- |
| Total nonperforming loans | 219 | 144 | 144 |
| Other real estate owned | 1,396 | 1,396 | 1,506 |
| Total nonperforming assets | $1,615 | $1,540 | $1,650 |