FRANKLIN, N.C., July 19, 2018 (GLOBE NEWSWIRE) -- Entegra Financial Corp. (the “Company”) (NASDAQ:ENFC), the holding company for Entegra Bank (the “Bank”), today announced earnings and related data for the three and six months ended June 30, 2018.

Highlights 

The following tables highlight the trends that the Company believes are most relevant to understanding the performance of the Company.  As further detailed in Appendix A to this press release, core results (which are non-U.S. generally accepted accounting principles, or non-GAAP, financial measures) reflect adjustments for investment gains and losses, investment impairment, and merger-related expenses.

 For the Three Months Ended June 30,
 (Dollars in thousands, except per share data)
 2018 2017 Change (%)
 GAAP Core GAAP Core GAAP Core
Net income $  3,087 $  3,704 $  2,102 $  2,358 46.9% 57.1%
Net interest income$  12,310  N/A  $  10,222  N/A  20.4% N/A
Net interest margin (tax equivalent)3.36%  N/A  3.36%  N/A  0.0% N/A
Return on average assets0.76% 0.92% 0.61% 0.68% 24.6% 35.3%
Return on average equity 8.04% 11.80% 6.09% 7.35% 32.0% 60.5%
Efficiency ratio 69.36% 64.94% 72.13% 68.88% -3.8% -5.7%
Diluted earnings per share$  0.44 $  0.53 $  0.32 $  0.36 37.5% 47.2%


 For the Six Months Ended June 30,
 (Dollars in thousands, except per share data)
 2018 2017 Change (%)
 GAAP Core GAAP Core GAAP Core
Net income$  6,669 $  7,450 $  3,402 $  4,385 96.0% 69.9%
Net interest income$  24,703  N/A  $  19,834  N/A  24.5% N/A
Tax-equivalent net interest margin3.42%  N/A  3.33%  N/A  2.7% N/A
Return on average assets0.83% 0.93% 0.50% 0.65% 66.0% 43.1%
Return on average equity8.76% 11.99% 4.99% 6.81% 75.6% 76.1%
Efficiency ratio 67.70% 64.77% 75.82% 69.91% -10.7% -7.4%
Diluted earnings per share$  0.95 $  1.06 $  0.52 $  0.67 82.7% 58.2%


  As of June 30, As of December 31,
  2018 2017
  (Dollars in thousands, except per share data)
Asset Quality:    
Non-performing loans $  4,524 $  4,778
Real estate owned $  2,802 $  2,568
Non-performing assets  $  7,326 $  7,346
Non-performing loans to total loans  0.43% 0.48%
Non-performing assets to total assets  0.45% 0.46%
Net charge-offs $  92 $  315
       
Allowance for loan losses to non-performing loans 254.75% 227.86%
Allowance for loan losses to total loans 1.10% 1.08%
     
Other Data:    
Book value per share $  22.46 $  22.00
Tangible book value per share $  18.42 $  17.90
Closing market price per share $  29.30 $  29.25
Closing price-to-tangible book value ratio 159.07% 163.41%
Equity to assets ratio 9.51% 9.57%
Tangible common equity to tangible assets ratio 7.93% 7.93%

Management Commentary

Roger D. Plemens, President and CEO of the Company, reported, “We are pleased with our second quarter results, as they reflect our continued focus on growing net interest income which increased 20.4% from the same quarter in 2017.  We are also pleased with the increase in Small Business Administration (“SBA”) gains during the second quarter of 2018 compared to the first quarter of 2017 which reflect the impact of hiring an SBA Director in January 2018.  Looking forward, we remain focused on opportunities to grow our franchise with an emphasis on deposits in rural markets.”

Net Interest Income

Net interest income increased $2.1 million, or 20.4%, to $12.3 million for the three months ended June 30, 2018 compared to $10.2 million for the same period in 2017.  Net interest income increased $4.9 million, or 24.5%, to $24.7 million for the six months ended June 30, 2018 compared to $19.8 million for the same period in 2017.  The increase in net interest income was primarily due to higher volumes in the loan portfolio as well as an increase in the yields earned on cash, taxable investments and loans partially offset by increased deposit balances and the costs of deposits and borrowings.  Net interest margin was 3.36% for both the three months ended June 30, 2018 and 2017 and 3.42% and 3.33% for the six months ended June 30, 2018 and 2017, respectively.

Provision for Loan Losses

The provision for loan losses was $0.4 million and $0.7 million for the three and six months ended June 30, 2018, respectively, compared to $0.3 million and $0.6 million for the comparable periods of 2017.  The increases in provision for loan losses are mainly attributable to organic loan growth.  The Company continues to experience modest levels of net charge-offs and non-performing loans.

Noninterest Income

Noninterest income decreased $0.4 million, or 23.3%, to $1.3 million for the three months ended June 30, 2018, compared to $1.7 million for the same period in 2017, primarily as the result of losses on sale of investment securities related to an investment portfolio restructuring.  Increases in gains on sale of SBA loans, interchange fees and income from Small Business Investment Company (“SBIC”) holdings were partially offset by decreases in servicing income, mortgage banking, and equity securities gains for the three months ended June 30, 2018 compared to the same period in 2017.  The Company recorded a valuation adjustment against its loan servicing rights of $0.2 million and $0.1 million for the three months ended June 30, 2018 and 2017, respectively.  

Noninterest income increased $0.2 million, or 6.9%, to $2.7 million for the six months ended June 30, 2018, compared to $2.5 million for the same period in 2017, primarily as the result of the other than temporary impairment on one investment security of $0.7 million in 2017 compared to realized losses on sale of investments of $0.5 million in 2018.  Increases in gains on sale of SBA loans, service charges on deposit accounts, interchange fees and income from SBIC holdings were partially offset by decreases in servicing income and equity securities gains. The Company recorded a valuation adjustment against its loan servicing rights of $0.3 million and $0.2 million for the six months ended June 30, 2018 and 2017, respectively.  

Noninterest Expense

Noninterest expense increased $0.8 million, or 9.4%, to $9.4 million for the three months ended June 30, 2018, compared to $8.6 million for the same period in 2017. Noninterest expense increased $1.6 million, or 9.2%, to $18.6 million for the six months ended June 30, 2018, compared to $17.0 million for the same period in 2017. The increases were primarily related to increased compensation and employee benefits, net occupancy expenses, and data processing expenses as the 2018 period included the full impact of the Chattahoochee Bank of Georgia acquisition and the branches acquired from Stearns Bank. 

Income Taxes

Effective tax rates for the three and six months ended June 30, 2018 were 19.0% and 18.0%, respectively, compared to 29.0% and 28.2% for the same periods in 2017.  Income tax expense for the 2018 periods benefitted from the newly enacted federal tax rate of 21%, compared to a federal tax rate of 35% in 2017.  In addition, income tax expense for all periods benefited from tax-exempt income related to municipal bond investments and bank-owned life insurance (“BOLI”).

Balance Sheet

Total assets increased $46.8 million, or an annualized rate of 5.9%, to $1.63 billion at June 30, 2018 from $1.58 billion at December 31, 2017.

Loans receivable increased $47.0 million, or an annualized rate of 9.4%, to $1.05 billion at June 30, 2018 from $1.00 billion at December 31, 2017.  Loan growth continues to be primarily concentrated in commercial real estate and commercial and industrial loans. 

Core deposits decreased $9.9 million to $753.5 million at June 30, 2018 from $763.4 million at December 31, 2017.  Retail certificates of deposit decreased $3.3 million to $354.3 million at June 30, 2018 from $357.6 million at December 31, 2017.  Wholesale deposits have been a source of funding loan growth and increased $71.6 million to $112.7 million at June 30, 2018 from $41.1 million at December 31, 2017.  We continue to focus on gathering core deposits, which decreased from 66% of the Company’s deposit portfolio at December 31, 2017 to 62% at June, 30 2018.  

Total shareholders’ equity increased $3.5 million to $154.8 million at June 30, 2018, compared to $151.3 million at December 31, 2017. This increase was primarily attributable to $6.7 million of net income, offset by a $3.8 million after-tax decline in the market value of investment securities available for sale.  Tangible book value per share, a non-GAAP measure, increased $0.52 to $18.42 at June 30, 2018 from $17.90 at December 31, 2017.  See Appendix A for a reconciliation of our tangible book value per share to the comparable GAAP measure.

Asset Quality

Non-performing loans to total loans and non-performing assets to total assets decreased to 0.43% and 0.45%, respectively, at June 30, 2018 compared to 0.48% and 0.46%, respectively, at December 31, 2017.  Net loan charge-offs continue to remain modest, totaling $0.1 million for the six months ended June 30, 2018.

Non-GAAP Financial Measures

Statements included in this press release include non-GAAP financial measures and should be read along with the accompanying tables in Appendix A, which provide a reconciliation of non-GAAP financial measures to GAAP financial measures. This press release and the accompanying tables discuss financial measures, such as core noninterest expense, core net income, core diluted earnings per share, core return on average assets, core return on tangible average equity, core efficiency ratio, tangible common equity, tangible assets and tangible book value per share, which are all non-GAAP measures. We believe that such non-GAAP measures are useful because they enhance the ability of investors and management to evaluate and compare the Company’s operating results from period to period in a meaningful manner. Non-GAAP measures should not be considered as an alternative to any measure of performance as promulgated under GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company’s results or financial condition as reported under GAAP.

About Entegra Financial Corp. and Entegra Bank

Entegra Financial Corp. is the holding company of Entegra Bank. The Company’s shares of common stock trade on the NASDAQ Global Market under the symbol “ENFC.”

Entegra Bank operates a total of 18 branches located throughout the Western North Carolina counties of Cherokee, Haywood, Henderson, Jackson, Macon, Polk and Transylvania, the Upstate South Carolina counties of Anderson, Greenville, and Spartanburg and the Northern Georgia counties of Pickens and Hall. The Bank also operates loan production offices in Asheville, NC, Clemson, SC, and Duluth, GA. For further information, visit the Bank’s website www.entegrabank.com.

Disclosures About Forward-Looking Statements

The discussions included in this press release and its appendices may contain “forward-looking statements.” For the purposes of these discussions, any statements that are not statements of historical fact may be deemed to be “forward-looking statements.” Such statements are often characterized by the use of qualifying words such as “expects,” “anticipates,” “believes,” “estimates,” “plans,” “projects,” “will,” “should,” or other statements concerning opinions or judgments of the Company and its management about future events.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated and may adversely affect our results of operations and financial condition. The accuracy of such forward-looking statements could be affected by factors including, but not limited to: the Company’s ability to implement aspects of its growth strategy; the financial success or changing conditions or strategies of the Company’s customers or vendors; the Company’s ability to compete effectively against other financial institutions in its banking markets; fluctuations in interest rates; actions of government regulators; the availability of capital and personnel; and general economic and market conditions. These forward-looking statements express management’s current expectations, plans or forecasts of future events, results of operation and financial condition. Additional factors that could cause actual results to differ materially from those anticipated by forward-looking statements are discussed in the Company’s reports filed with or furnished to the Securities and Exchange Commission (the “SEC”) and available on the SEC’s website, including without limitation its annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. These forward-looking statements speak only as of the date of this press release, and the Company undertakes no obligation to revise or update these statements following the date of this press release, except as required by applicable law.

 
 ENTEGRA FINANCIAL CORP. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Amounts in thousands, except per share data)
 Three Months Ended June 30,
 2018 2017
Interest income$  15,329 $  12,024
Interest expense  3,019   1,802
    
Net interest income  12,310   10,222
    
Provision for loan losses  357   325
    
Net interest income after provision for loan losses  11,953   9,897
    
Servicing income, net  39   158
Mortgage banking  283   344
Gain on sale of SBA loans  229   4
Gain (loss) on sale of investments  (508)   36
Equity securities gains   45   100
Service charges on deposit accounts  405   412
Interchange fees  271   243
Bank owned life insurance  194   214
Other  340   182
Total noninterest income  1,298   1,693
    
Compensation and employee benefits  5,652   5,086
Net occupancy  1,122   926
Federal deposit insurance  148   135
Professional and advisory  333   363
Data processsing  566   424
Marketing and advertising  235   226
Net cost of operation of real estate owned  93   81
Merger-related expenses  272   408
Other  1,018   981
Total noninterest expense  9,439   8,630
    
Income before taxes  3,812   2,960
    
Income tax expense   725   858
    
Net income$  3,087 $  2,102
    
Earnings per common share:   
Basic$  0.45 $  0.33
Diluted$  0.44 $  0.32
    
Weighted average common shares outstanding:   
Basic  6,889,743   6,464,572
Diluted  7,039,809   6,549,000
    


 
ENTEGRA FINANCIAL CORP. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Amounts in thousands, except per share data)
 
 Six Months Ended June 30,
 2018 2017
Interest income$  30,171 $  23,361
Interest expense  5,468   3,527
    
Net interest income  24,703   19,834
    
Provision for loan losses  718   640
    
Net interest income after provision for loan losses  23,985   19,194
    
Servicing income, net  133   253
Mortgage banking  522   564
Gain on sale of SBA loans  290   146
Gain (loss) on sale of investments  (520)   43
Equity securities gains (losses)  (8)   313
Other than temporary impairment on available-for-sale securities  -    (700)
Service charges on deposit accounts  836   803
Interchange fees  519   409
Bank owned life insurance  394   395
Other  548   312
Total noninterest income  2,714   2,538
    
Compensation and employee benefits  11,269   9,922
Net occupancy  2,214   1,877
Federal deposit insurance  427   239
Professional and advisory  610   637
Data processsing  1,075   825
Marketing and advertising  444   474
Net cost of operation of real estate owned  143   215
Merger-related expenses  468   856
Other  1,912   1,948
Total noninterest expense  18,562   16,993
    
Income before taxes  8,137   4,739
    
Income tax expense   1,468   1,337
    
Net income$  6,669 $  3,402
    
Earnings per common share:   
Basic$  0.97 $  0.53
Diluted$  0.95 $  0.52
    
Weighted average common shares outstanding:   
Basic  6,887,838   6,460,693
Diluted  7,034,316   6,540,524
    



ENTEGRA FINANCIAL CORP. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
 
  June 30, 2018   December 31, 2017 
  (Unaudited)   (Unaudited) 
Assets   
    
Cash and cash equivalents$  113,119 $  109,467
Investments - equity securities  6,696   6,095
Investments - available for sale  334,344   342,863
Other investments  12,039   12,386
Loans held for sale (includes $3,978 and $0 at fair value)  5,113   3,845
Loans receivable  1,052,172   1,005,139
Allowance for loan losses  (11,525)   (10,887)
Real estate owned  2,802   2,568
Fixed assets, net  24,419   24,113
Bank owned life insurance  32,543   32,150
Net deferred tax asset  8,515   8,831
Goodwill  23,903   23,903
Core deposit intangibles, net  3,923   4,269
Other assets  20,231   16,707
    
Total assets$  1,628,294 $  1,581,449
    
Liabilities and Shareholders' Equity   
    
Liabilities   
Core deposits$  753,544 $  763,422
Retail certificates of deposit  354,348   357,629
Wholesale deposits  112,686   41,126
Federal Home Loan Bank advances  213,500   223,500
Junior subordinated notes  14,433   14,433
Holding company line of credit  5,000   5,000
Post employment benefits  9,941   10,174
Other liabilities  10,056   14,852
Total liabilities$  1,473,508 $  1,430,136
    
Total shareholders' equity  154,786   151,313
    
Total liabilities and shareholders' equity$  1,628,294 $  1,581,449
    
    

APPENDIX A – RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)

  Three Months Ended June 30, 
  2018 2017 
(Dollars in thousands, except per share data)     
      
Core Noninterest Expense     
Noninterest expense (GAAP) $  9,439 $  8,630 
Merger-related expenses   (272)   (408) 
Core noninterest expense (Non-GAAP) $  9,167 $  8,222 
      
Core Net Income     
Net income (GAAP) $  3,087 $  2,102 
Loss (gain) on sale of investments   402   (23) 
Other than temporary impairment of investment securities available for sale   -   14 
Merger-related expenses   215   265 
Core net income (Non-GAAP) $  3,704 $  2,358 
      
Core Diluted Earnings Per Share     
Diluted earnings per share (GAAP) $  0.44 $  0.32 
Loss (gain) on sale of investments   0.06   -  
Other than temporary impairment of investment securities available for sale   -    -  
Merger-related expenses   0.03   0.04 
Core diluted earnings per share (Non-GAAP) $  0.53 $  0.36 
      
Core Return on Average Assets     
Return on Average Assets (GAAP) 0.76% 0.61% 
Gain(loss) on sale of investments 0.10% -0.01% 
Other than temporary impairment of investment securities available for sale 0.00% 0.00% 
Merger-related expenses 0.06% 0.08% 
Core Return on Average Assets (Non-GAAP) 0.92% 0.68% 
      
Core Return on Tangible Average Equity     
Return on Average Equity (GAAP) 8.04% 6.09% 
Loss (gain) on sale of investments 1.05% -0.07% 
Other than temporary impairment of investment securities available for sale 0.00% 0.04% 
Merger-related expenses 0.56% 0.77% 
Effect of goodwill and intangibles 2.15% 0.51% 
Core Return on Average Tangible Equity (Non-GAAP) 11.80% 7.35% 
      
Core Efficiency Ratio     
Efficiency ratio (GAAP) 69.36% 72.43% 
Gain (loss) on sale of investments -2.51% 0.04% 
Other than temporary impairment of investment securities available for sale 0.00% 0.00% 
Merger-related expenses -1.91% -3.26% 
Core Efficiency Ratio (Non-GAAP) 64.94% 69.21% 
      
      
  As Of 
  June 30, 2018 December 31, 2017 
  (Dollars in thousands, except share data)
Tangible Assets     
Total Assets $  1,628,294 $  1,581,449 
Goodwill and Intangibles   (27,826)   (28,172) 
Tangible Assets $  1,600,468 $  1,553,277 
      
Tangible Book Value Per Share     
Book Value (GAAP) $  154,786 $  151,313 
Goodwill and intangibles   (27,826)   (28,172) 
Book Value (Tangible) $  126,960 $  123,141 
Outstanding shares   6,891,672   6,879,191 
Tangible Book Value Per Share $  18.42 $  17.90 
      


   Six Months Ended June 30,
   2018 2017
(Dollars in thousands, except per share data)     
      
Core Noninterest Expense     
Noninterest expense (GAAP)  $  18,562 $  16,993
Merger-related expenses    (468)   (856)
Core noninterest expense (Non-GAAP)  $  18,094 $  16,137
      
Core Net Income     
Net income (GAAP)  $  6,669 $  3,402
Loss (gain) on sale of investments    411   (28)
Other than temporary impairment of investment securities available for sale    -    455
Merger-related expenses    370   556
Core net income (Non-GAAP)  $  7,450 $  4,385
      
Core Diluted Earnings Per Share     
Diluted earnings per share (GAAP)  $  0.95 $  0.52
Loss (gain) on sale of investments    0.06   - 
Other than temporary impairment of investment securities available for sale    -    0.06
Merger-related expenses    0.05   0.09
Core diluted earnings per share (Non-GAAP)  $  1.06 $  0.67
      
Core Return on Average Assets     
Return on Average Assets (GAAP)  0.83% 0.50%
Gain on sale of investments  0.05%   - 
Other than temporary impairment of investment securities available for sale  0.00% 0.07%
Merger-related expenses  0.05% 0.08%
Core Return on Average Assets (Non-GAAP)  0.93% 0.65%
      
Core Return on Tangible Average Equity     
Return on Average Equity (GAAP)  8.76% 4.99%
Loss (gain) on sale of investments  0.54% -0.04%
Other than temporary impairment of investment securities available for sale  0.00% 0.67%
Merger-related expenses  0.49% 0.82%
Effect of goodwill and intangibles  2.20% 0.37%
Core Return on Average Tangible Equity (Non-GAAP)  11.99% 6.81%
      
Core Efficiency Ratio     
Efficiency ratio (GAAP)  67.70% 75.82%
Gain (loss) on sale of investments  -1.86% 0.19%
Other than temporary impairment of investment securities available for sale  0.00% -2.97%
Merger-related expenses  -1.07% -2.97%
Core Efficiency Ratio (Non-GAAP)  64.77% 70.07%
      
      
      

APPENDIX B – TAX EQUIVALENT NET INTEREST MARGIN ANALYSIS (UNAUDITED)

  Average
Outstanding
Balance
 Interest Yield/ Rate Average
Outstanding
Balance
 Interest Yield/ Rate
  (Dollars in thousands)
Interest-earning assets:            
Loans, including loans held for sale $  1,032,053 $  12,468 4.85% $  765,764 $  9,035 4.73%
Loans, tax exempt (1)   15,282   116 3.06%   16,183   151 3.73%
Investments - taxable   249,493   1,557 2.50%   313,653   1,822 2.29%
Investment tax exempt (1)   84,325   768 3.64%   118,437   1,227 4.11%
Interest earning deposits   99,284   431 1.74%   52,993   127 0.96%
Other investments, at cost   12,352   174 5.65%   11,808   144 4.89%
             
Total interest-earning assets   1,492,789   15,515 4.17%   1,278,838   12,506 3.92%
             
Noninterest-earning assets   122,152       103,141    
             
Total assets $  1,614,941     $ 1,381,979    
             
Interest-bearing liabilities:            
Savings accounts $  52,232 $  14 0.11% $  48,280 $  13 0.11%
Time deposits   417,482   1,209 1.16%   360,885   783 0.87%
Money market accounts   332,366   507 0.61%   257,457   236 0.37%
Interest bearing transaction accounts   207,625   97 0.19%   167,487   53 0.13%
Total interest bearing deposits   1,009,705   1,827 0.73%   834,109   1,085 0.52%
             
FHLB advances   220,698   930 1.67%   223,500   542 0.97%
Junior subordinated debentures   14,433   142 3.89%   14,433   141 3.92%
Other borrowings   9,170   120 5.25%   3,044   34 4.48%
             
Total interest-bearing liabilities   1,254,006   3,019 0.97%   1,075,086   1,802 0.67%
             
Noninterest-bearing deposits   191,471       154,898    
             
Other non interest bearing liabilities   15,940       13,999    
             
Total liabilities   1,461,417       1,243,983    
Total equity   153,524       137,996    
             
Total liabilities and equity $  1,614,941     $ 1,381,979    
             
             
Tax-equivalent net interest income   $  12,496     $  10,704  
             
             
Net interest-earning assets (2) $  238,783     $  203,752    
             
Average interest-earning assets to interest-bearing liabilities 119.04%     118.95%    
             
Tax-equivalent net interest rate spread (3)     3.20%     3.25%
Tax-equivalent net interest margin (4)     3.36%     3.36%
             
(1) Tax exempt loans and investments are calculated giving effect to a 21% federal tax rate in 2018 and a 35% federal tax rate in 2017.
(2) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3) Tax-equivalent net interest rate spread represents the difference between the tax equivalent yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(4) Tax-equivalent net interest margin represents tax equivalent net interest income divided by average total interest-earning assets.
             
             


  For the Six Months Ended June 30,
  2018 2017
  Average
Outstanding
Balance
 Interest Yield/ Rate Average
Outstanding
Balance
 Interest Yield/ Rate
  (Dollars in thousands)
Interest-earning assets:            
Loans, including loans held for sale $ 1,020,132 $  24,360 4.82% $  754,521 $  17,511 4.68%
Loans, tax exempt (1)   15,535   233 3.02%   15,549   288 3.73%
Investments - taxable   255,697   3,346 2.62%   305,029   3,581 2.35%
Investment tax exempt (1)   80,250   1,465 3.65%   114,954   2,352 4.09%
Interest earning deposits   93,031   778 1.69%   55,427   243 0.88%
Other investments, at cost   12,371   345 5.62%   12,831   316 4.97%
             
Total interest-earning assets   1,477,016   30,526 4.17%   1,258,311   24,291 3.89%
             
Noninterest-earning assets   123,411       100,113    
             
Total assets $ 1,600,427     $  1,358,424    
             
Interest-bearing liabilities:            
Savings accounts $  51,681 $  29 0.11% $  45,661 $  25 0.11%
Time deposits   410,422   2,123 1.04%   344,834   1,540 0.90%
Money market accounts   325,895   873 0.54%   252,069   455 0.36%
Interest bearing transaction accounts   209,982   184 0.18%   151,464   93 0.12%
Total interest bearing deposits   997,980   3,209 0.65%   794,028   2,113 0.54%
             
FHLB advances   222,092   1,750 1.57%   249,052   1,072 0.87%
Junior subordinated debentures   14,433   280 3.86%   14,433   278 3.88%
Other borrowings   8,967   229 5.15%   2,917   64 4.42%
             
Total interest-bearing liabilities   1,243,472   5,468 0.89%   1,060,430   3,527 0.67%
             
Noninterest-bearing deposits   187,294       147,770    
             
Other non interest bearing liabilities   17,348       13,968    
             
Total liabilities   1,448,114       1,222,168    
Total equity   152,313       136,256    
             
Total liabilities and equity $ 1,600,427     $  1,358,424    
             
             
Tax-equivalent net interest income   $  25,058     $  20,764  
             
             
Net interest-earning assets (2) $  233,544     $  197,881    
             
Average interest-earning assets to interest-bearing liabilities 118.78%     118.66%    
             
Tax-equivalent net interest rate spread (3)     3.28%     3.22%
Tax-equivalent net interest margin (4)     3.42%     3.33%
             
(1) Tax exempt loans and investments are calculated giving effect to a 21% federal tax rate in 2018 and a 35% federal tax rate in 2017.
(2) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3) Tax-equivalent net interest rate spread represents the difference between the tax equivalent yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(4) Tax-equivalent net interest margin represents tax equivalent net interest income divided by average total interest-earning assets.


Contact:         
Roger D. Plemens
President and Chief Executive Officer
(828) 524-7000