WAUKEGAN, IL--(Marketwired - Mar 19, 2015) - Northern States Financial Corporation (
For the three months ended December 31, 2014, the Company showed a net loss of $142,000 as compared with a net loss of $1,197,000 for the fourth quarter of 2013.
The financial results at the Bank showed 2014 earnings of $543,000 and a fourth quarter net loss of $60,000. The fourth quarter loss resulted from the disposition of non-performing assets totaling $4.9 million at a loss of $440,000 as the Bank continued its efforts to increase its overall asset quality. The Bank's December 31, 2014 leverage capital ratio was 9.88%.
Total assets for the Company were $422 million at December 31, 2014, increasing 7.5% from year-end 2013. During 2014, the Company's capital and deposits increased $22.7 million and $9.6 million, respectively with capital increasing $21.8 million due to the successful April 2014 capital raise. Since the capital raise, management has continued to work to reposition the Company's balance sheet.
In regard to asset quality, the Company's non-performing assets ("NPAs"), consisting of nonaccrual loans, loans ninety or more days past due, still accruing, loans considered troubled debt restructurings and other real estate owned, totaled $37.5 million at December 31, 2014, a reduction of $19.1 million or 34% from $56.6 million at December 31, 2013. Management anticipates continued decreases in NPAs in 2015 as a result of credit remediation and asset sales.
"2014 was a transformative year for the Company and the Bank," stated Scott Yelvington, President and Chief Operating Officer. "A successful capital raise has breathed new life into our organization. We remain focused on the reduction of non-performing assets and were pleased with the $10.0 million reduction in the fourth quarter. Further reductions, cost containment and our ability to deploy liquidity in a disciplined and prudent manner will enhance profitability in the coming quarters."
About Northern States Financial Corporation
Northern States Financial Corporation is the holding company for NorStates Bank, a full-service commercial bank with eight branches in Lake County, Illinois. NorStates Bank is the successor to financial institutions dating to 1919. NorStates Bank serves the populations of northeastern Illinois and southeastern Wisconsin.
Forward-Looking Information
This release may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties may include, but are not necessarily limited to, fluctuations in interest rates, inflation, government regulations, general economic conditions, competition within the business areas in which the Company conducts its operations, including the real estate market in Illinois, and other factors beyond the Company's control. Such risks and uncertainties could cause actual results for subsequent interim periods or for the entire year to differ materially from those expressed or implied by any forward-looking statement. Readers should not place undue reliance on the forward-looking statements, which reflect management's beliefs, expectations and assumptions only as of the date hereof. The Company undertakes no obligation to update and statement to reflect new information or subsequent events or circumstances.
NORTHERN STATES FINANCIAL CORPORATION | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
As of December 31, 2014 and 2013 | ||||||||||
(In thousands of dollars) (Unaudited) | 2014 | 2013 | ||||||||
Assets | ||||||||||
Cash and due from banks | $ | 8,258 | $ | 5,235 | ||||||
Interest bearing deposits in financial institutions - maturities less than 90 days | 26,727 | 42,350 | ||||||||
Total cash and cash equivalents | 34,985 | 47,585 | ||||||||
Interest bearing deposits in financial institutions - maturities of 90 days or greater | 8,483 | 9,227 | ||||||||
Securities available for sale | 121,368 | 92,407 | ||||||||
Securities held to maturity (fair value $16,449 at December 31, 2014) | 16,305 | 0 | ||||||||
Loans and leases, net of deferred fees | 219,049 | 225,295 | ||||||||
Less: Allowance for loan and lease losses | (6,541 | ) | (9,130 | ) | ||||||
Loans and leases, net | 212,508 | 216,165 | ||||||||
Federal Home Loan Bank stock | 931 | 931 | ||||||||
Office buildings and equipment, net | 7,957 | 8,262 | ||||||||
Other real estate owned | 16,514 | 14,357 | ||||||||
Accrued interest receivable | 1,158 | 1,101 | ||||||||
Other assets | 1,814 | 2,377 | ||||||||
Total assets | $ | 422,023 | $ | 392,412 | ||||||
Liabilities and Stockholders' Equity | ||||||||||
Liabilities | ||||||||||
Deposits | ||||||||||
Demand - noninterest bearing | $ | 79,378 | $ | 71,970 | ||||||
Interest bearing | 277,352 | 275,159 | ||||||||
Total deposits | 356,730 | 347,129 | ||||||||
Securities sold under repurchase agreements | 18,447 | 16,213 | ||||||||
Subordinated debentures | 10,310 | 10,310 | ||||||||
Advances from borrowers for taxes and insurance | 1,485 | 1,119 | ||||||||
Accrued interest payable and other liabilities | 2,718 | 7,987 | ||||||||
Total liabilities | 389,690 | 382,758 | ||||||||
Stockholders' Equity | ||||||||||
Common stock | 878 | 1,789 | ||||||||
Preferred stock | 0 | 17,198 | ||||||||
Warrants (584,084 issued and outstanding at December 31, 2013) | 0 | 681 | ||||||||
Additional paid-in capital | 32,088 | 7,326 | ||||||||
(Accumulated deficit) retained earnings | 4,571 | (10,993 | ) | |||||||
Treasury stock, at cost | (4,674 | ) | (4,674 | ) | ||||||
Accumulated other comprehensive loss, net | (530 | ) | (1,673 | ) | ||||||
Total stockholders' equity | 32,333 | 9,654 | ||||||||
Total liabilities and stockholders' equity | $ | 422,023 | $ | 392,412 | ||||||
NORTHERN STATES FINANCIAL CORPORATION | |||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||
Twelve and three months ended December 31, 2014 and 2013 | |||||||||||||||||||
(In thousands of dollars, except per share data) (Unaudited) | |||||||||||||||||||
Twelve months ended | Three months ended | ||||||||||||||||||
Years ended December 31, |
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December 31, 2014 | |
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December 31, 2013 | |
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December 31, 2014 | |
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December 31, 2013 | |
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Interest income | |||||||||||||||||||
Loans (including fee income) | $ | 9,855 | $ | 12,267 | $ | 2,625 | $ | 3,086 | |||||||||||
Securities | |||||||||||||||||||
Taxable | 2,050 | 1,413 | 683 | 360 | |||||||||||||||
Exempt from federal income tax | 28 | 92 | 6 | 22 | |||||||||||||||
Federal funds sold and other | 158 | 166 | 40 | 49 | |||||||||||||||
Total interest income | 12,091 | 13,938 | 3,354 | 3,517 | |||||||||||||||
Interest expense | |||||||||||||||||||
Time deposits | 262 | 338 | 66 | 75 | |||||||||||||||
Other deposits | 91 | 92 | 24 | 25 | |||||||||||||||
Repurchase agreements and federal funds purchased | 2 | 2 | 1 | 1 | |||||||||||||||
Subordinated debentures | 225 | 240 | 54 | 60 | |||||||||||||||
Total interest expense | 580 | 672 | 145 | 161 | |||||||||||||||
Net interest income | 11,511 | 13,266 | 3,209 | 3,356 | |||||||||||||||
Provision for loan and lease losses | 0 | 3,400 | 0 | 900 | |||||||||||||||
Net interest income after provision for loan and lease losses | 11,511 | 9,866 | 3,209 | 2,456 | |||||||||||||||
Noninterest income | |||||||||||||||||||
Service fees on deposits | 1,575 | 1,661 | 377 | 455 | |||||||||||||||
Gain on sale of securities | 94 | 1,749 | 16 | 0 | |||||||||||||||
Net gain (loss) on sale of other real estate owned | (51 | ) | 88 | (440 | ) | (15 | ) | ||||||||||||
Other operating income | 1,657 | 1,608 | 400 | 406 | |||||||||||||||
Total noninterest income | 3,275 | 5,106 | 353 | 846 | |||||||||||||||
Noninterest expense | |||||||||||||||||||
Salaries and employee benefits | 6,226 | 5,680 | 1,726 | 1,446 | |||||||||||||||
Occupancy and equipment, net | 2,145 | 2,284 | 492 | 515 | |||||||||||||||
Data processing | 2,136 | 1,883 | 679 | 463 | |||||||||||||||
Legal | 303 | 634 | 74 | 156 | |||||||||||||||
FDIC insurance | 693 | 884 | 135 | 222 | |||||||||||||||
Audit and other professional | 446 | 697 | 94 | 82 | |||||||||||||||
Printing and supplies expense | 165 | 193 | 49 | 49 | |||||||||||||||
Write-down of other real estate owned | 259 | 1,736 | 26 | 181 | |||||||||||||||
Other real estate owned expense | 632 | 814 | 27 | 413 | |||||||||||||||
Other operating expenses | 1,571 | 1,733 | 402 | 684 | |||||||||||||||
Total noninterest expense | 14,576 | 16,538 | 3,704 | 4,211 | |||||||||||||||
Net income (loss) before income taxes | 210 | (1,566 | ) | (142 | ) | (909 | ) | ||||||||||||
Income tax expense | 0 | 17 | 0 | (14 | ) | ||||||||||||||
Net income (loss) | 210 | (1,583 | ) | (142 | ) | (895 | ) | ||||||||||||
Discount on redemption of preferred stock | (15,883 | ) | 0 | 0 | 0 | ||||||||||||||
Dividends to preferred stockholders | 516 | 1,037 | 0 | 264 | |||||||||||||||
Accretion of discount on preferred stock | 13 | 151 | 0 | 38 | |||||||||||||||
Net income (loss) available to common stockholders | $ | 15,564 | $ | (2,771 | ) | $ | (142 | ) | $ | (1,197 | ) | ||||||||
Basic income (loss) per average outstanding share | $ | 0.26 | $ | (0.65 | ) | $ | (0.00 | ) | $ | (0.28 | ) | ||||||||
Diluted income (loss) per average outstanding share | $ | 0.26 | $ | (0.65 | ) | $ | (0.00 | ) | $ | (0.28 | ) | ||||||||
NORTHERN STATES FINANCIAL CORPORATION | ||||||||||||
KEY PERFOMANCE DATA | ||||||||||||
($ 000s, except per share data) | ||||||||||||
Year ended December 31: | 2014 | 2013 | ||||||||||
Net Income | $ | 15,564 | $ | (2,771 | ) | |||||||
Basic earnings per share | $ | 0.26 | $ | (0.65 | ) | |||||||
Diluted earnings per share | $ | 0.26 | $ | (0.65 | ) | |||||||
Return on average assets | 3.81 | % | -0.68 | % | ||||||||
Return on average equity | 61.27 | % | -20.66 | % | ||||||||
Yield on interest earning assets | 3.17 | % | 3.54 | % | ||||||||
Cost of interest bearing liabilities | 0.19 | % | 0.21 | % | ||||||||
Net interest spread | 2.98 | % | 3.33 | % | ||||||||
Net interest margin | 3.02 | % | 3.37 | % | ||||||||
Net charged-off loans | $ | 2,589 | $ | 14,997 | ||||||||
Net charged-off loans to average loans | 1.19 | % | 5.90 | % | ||||||||
Quarter ended: | Dec. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | |||||||||
Net income | $ | (142 | ) | $ | 283 | $ | (1,197 | ) | ||||
Basic earnings per share | $ | (0.00 | ) | $ | 0.00 | $ | (0.28 | ) | ||||
Diluted earnings per share | $ | (0.00 | ) | $ | 0.00 | $ | (0.28 | ) | ||||
Return on average assets | -0.13 | % | 0.27 | % | -1.17 | % | ||||||
Return on average equity | -1.75 | % | 3.50 | % | -42.16 | % | ||||||
Yield on interest earning assets | 3.39 | % | 3.10 | % | 3.55 | % | ||||||
Cost of interest bearing liabilities | 0.18 | % | 0.18 | % | 0.20 | % | ||||||
Net interest spread | 3.21 | % | 2.92 | % | 3.35 | % | ||||||
Net interest margin | 3.24 | % | 2.96 | % | 3.39 | % | ||||||
Net charged-off loans | $ | 1,866 | $ | 163 | $ | 6,542 | ||||||
Net charged-off loans to average loans annualized | 3.45 | % | 0.30 | % | 11.05 | % | ||||||
Dec. 31, 2014 | Dec. 31, 2013 | |||||||||||
Total Stockholders' Equity | $ | 32,333 | $ | 9,654 | ||||||||
Deferred tax asset | 25,566 | 27,157 | ||||||||||
Deferred tax asset valuation allowance | (25,183 | ) | (26,071 | ) | ||||||||
Book Value per Share | $ | 0.37 | $ | 2.26 | ||||||||
Number of Common Shares Outstanding | 87,604,088 | 4,270,755 | ||||||||||
Dec. 31, 2014 | Dec. 31, 2013 | |||||||||||||
Assets | $ | 422,023 | $ | 392,412 | ||||||||||
Loans | ||||||||||||||
Commercial | 14,239 | 13,929 | ||||||||||||
Real estate-construction | 11,600 | 18,963 | ||||||||||||
Real estate-mortgage 1-4 family | 30,546 | 29,285 | ||||||||||||
Real estate-mortgage 5+ family | 32,968 | 29,019 | ||||||||||||
Real estate-mortgage commercial | 119,669 | 119,897 | ||||||||||||
Home equity | 9,131 | 13,020 | ||||||||||||
Installment | 1,069 | 1,247 | ||||||||||||
Deferred loan fees | (173 | ) | (65 | ) | ||||||||||
Total loans | 219,049 | 225,295 | ||||||||||||
Deposits | ||||||||||||||
Demand-noninterest bearing | $ | 79,378 | $ | 71,970 | ||||||||||
Demand-interest bearing | 61,313 | 60,815 | ||||||||||||
Money market accounts | 51,046 | 52,490 | ||||||||||||
Savings | 77,789 | 73,907 | ||||||||||||
Time, $100,000 and over | 37,483 | 33,226 | ||||||||||||
Time, under $100,000 | 49,471 | 54,721 | ||||||||||||
Time, brokered | 250 | 0 | ||||||||||||
Total deposits | 356,730 | 347,129 | ||||||||||||
Nonperforming assets (NPAs) | ||||||||||||||
Nonaccrual loans | $ | 16,551 | $ | 19,062 | ||||||||||
90 days or more past due, still accruing | 1,126 | 776 | ||||||||||||
Trouble debt restructurings | 3,288 | 22,437 | ||||||||||||
Total nonperforming loans | 20,965 | 42,275 | ||||||||||||
Other real estate owned | 16,514 | 14,357 | ||||||||||||
Total NPAs | 37,479 | 56,632 | ||||||||||||
NPAs excluding troubled debt restructurings | 34,191 | 34,195 | ||||||||||||
Nonperforming loans to total loans | 9.57 | % | 18.76 | % | ||||||||||
NPAs to total assets | 8.88 | % | 14.43 | % | ||||||||||
NPAs excluding troubled debt restructurings to total assets | 8.10 | % | 8.71 | % | ||||||||||
Contact Information:
For Additional Information, Contact:
Scott Yelvington
President and Chief Executive Officer
(847) 244-6000 Ext. 201
Websites: www.nsfc.com | www.nsfc.net