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County Bancorp, Inc. Announces Second Quarter 2015 Earnings

Q2 Highlights

  • Net Income of $2.2 million
  • Return on average assets of 1.14%
  • 37.4% decrease in other real estate owned

MANITOWOC, Wis., July 22, 2015 (GLOBE NEWSWIRE) -- County Bancorp, Inc. (NASDAQ:ICBK) today reported second quarter 2015 net income of $2.2 million. Earnings for the six months ended June 30, were $4.7 million in 2015 compared to $3.9 million for the same period in 2014. This represents a return on average assets of 1.21% for the six months ended June 30, 2015 compared to 1.03% for the first half of 2014.

“We attribute our strong second quarter earnings to steady net interest margins in this highly competitive loan market,” said Timothy J. Schneider, President of County Bancorp, Inc. and CEO of Investors Community Bank. “We were also able to increase non-interest income, primarily from the sale of agricultural loans and Farm Service Agency Government Guaranteed loans, which has helped us maintain a solid efficiency ratio. In addition, reductions in other real estate owned, have also contributed to our bottom line. We are well positioned for growth and continue to seek additional business banking talent as well as strategic acquisition opportunities.”

Total assets of $781.1 million at June 30, 2015 were similar to the first quarter ended March 31, 2015 of $781.4 million. Total loans increased $19.3 million or 3.0% to $654.4 million at June 30, 2015 from $635.1 million at March 31, 2015. This increased loan demand was funded by deploying cash and cash equivalents.

Non-performing assets improved 28.1% to $18.3 million at June 30, 2015 from $25.4 million at June 30, 2014. The largest improvement was in other real estate owned which declined from $11.4 million at June 30, 2014 to $3.2 million at June 30, 2015. Non-performing assets increased slightly by $0.3 million from the prior quarter. The decrease in other real estate owned was offset by an increase in nonaccrual loans.

Net income for the quarters ended June 30, 2015 and 2014 were both $2.2 million. This represents a return on average assets of 1.14% for the three months ended June 30, 2015 compared to 1.16% for the three months ended June 30, 2014. Net interest margin increased to 3.34% for the three months ended June 30, 2015, compared to 3.27% for the three months ended June 30, 2014. Despite similar earnings, diluted earnings per share decreased to $0.36 for the three months ended June 30, 2015 from $0.45 at June 30, 2014, as the result of the 1,357,000 shares that were issued during our initial public offering in January, 2015.

Net income for the six months ended June 30, 2015 was $4.7 million compared to $3.9 million for the six months ended June 30, 2014. This represents year-over-year growth of 23.0 % which was primarily driven by a $1.1 million increase in net interest income and a $0.5 million recovery of loan losses offset in part by increased non-interest operating expenses including costs associated with being a public company.

About County Bancorp, Inc.

County Bancorp, Inc., a Wisconsin corporation and registered bank holding company founded in May 1996, and our wholly-owned subsidiary Investors Community Bank, a Wisconsin-chartered bank, are headquartered in Manitowoc, Wisconsin. The state of Wisconsin is often referred to as “America’s Dairyland,” and one of the niches we have developed is providing financial services to agricultural businesses statewide, with a primary focus on dairy-related lending. We also serve business and retail customers throughout Wisconsin, with a focus on Northeastern and Central Wisconsin. Our customers are served from our full-service locations in Manitowoc and Stevens Point, and our loan production offices in Darlington, Eau Claire, and Fond du Lac.

Forward-Looking Statements

This press release includes "forward-looking statements”. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "plan," "seek," "comfortable with," "will," "expect," "intend," "estimate," "anticipate," "believe" or "continue" or the negative thereof or variations thereon or similar terminology. Factors that may cause actual results to differ materially from those made or suggested by the forward-looking information contained in this press release include those identified in County Bancorp, Inc.’s most recent annual report on Form 10-K and subsequent SEC filings. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

County Bancorp, Inc.

Consolidated Financial Summary (Unaudited)

June 30,
2015
March 31,
2015
June 30,
2014
Selected Balance Sheet Data:
(In thousands, except per share data)
Total assets $ 781,117 $ 781,408 $ 757,736
Total loans 654,389 635,067 585,993
Allowance for loan losses 9,897 10,269 10,556
Deposits 608,571 608,441 620,638
Shareholders' equity 101,024 99,544 75,791
Common equity 93,024 91,544 67,791
Stock Price Information:
High $ 20.33 $ 21.70 N/A
Low $ 17.90 $ 16.76 N/A
Market value (2015)/Book value (2014) per common share $ 19.00 $ 19.68 $ 15.19
Common shares outstanding 5,734 5,734 4,464
Non-Performing Assets:
(In thousands)
Nonaccrual loans $ 15,098 $ 12,834 $ 14,004
Other real estate owned 3,211 5,128 11,445
Total non-performing assets $ 18,309 $ 17,962 $ 25,449
Restructured loans not on nonaccrual $ 820 $ 826 $ 963
Non-performing assets as a % of total loans 2.80% 2.83% 4.34%
Non-performing assets as a % of total assets 2.34% 2.30% 3.36%
Allowance for loan losses as a % of nonperforming assets 54.06% 57.17% 41.48%
Allowance for loan losses as a % of total loans 1.51% 1.62% 1.80%
Net charge-off (recoveries) year-to-date 248 (268) (61)
Provision for (recovery of) loan loss year-to-date (458) (602) -
For the three months ended For the six months ended
June 30,
2015
June 30,
2014
June 30,
2015
June 30,
2014
Selected Income Statement Data:
(In thousands, except per share data)
Net interest income $ 6,225 $ 5,830 $ 12,390 $ 11,294
Provision for (recovery of ) loan losses 144 - (458) -
Net interest income after provision for (recovery of) loan losses 6,081 5,830 12,848 11,294
Non-interest income 1,713 1,559 3,587 3,369
Non-interest expense 4,230 3,890 8,848 8,471
Income tax expense 1,345 1,332 2,843 2,335
Net income $ 2,219 $ 2,167 $ 4,744 $ 3,857
Return on average assets 1.14% 1.16% 1.21% 1.03%
Return on average shareholders' equity 7.66% 9.66% 8.41% 8.69%
Return on average common shareholders' equity 9.00% 12.28% 10.01% 11.01%
Efficiency ratio 54.38% 51.81% 52.45% 52.68%
Per Common Share Data:
Basic $ 0.36 $ 0.46 $ 0.80 $ 0.81
Diluted $ 0.36 $ 0.45 $ 0.79 $ 0.79
Dividends declared $ 0.04 $ - $ 0.08 $ -
Non interest income:
Service charges $ 286 $ 76 $ 506 $ 171
Loan servicing fees 1,221 1,174 2,412 2,335
Loan servicing rights (35) (106) 26 32
Gain on sale of loans 29 94 122 182
Income on ORE 96 198 210 409
Other 116 123 311 240
Total $ 1,713 $ 1,559 $ 3,587 $ 3,369
Non-interest expense:
Employee compensation and benefits $ 2,869 $ 2,477 $ 5,589 $ 5,058
Occupancy 79 74 160 154
Information processing 178 136 344 280
Professional fees 161 194 387 353
FDIC assessment 122 126 220 276
ORE expenses 57 234 140 494
Writedown of ORE - - 182 685
Net loss/(gain) on ORE (86) 62 287 62
Business development 115 99 224 199
Other 735 488 1,315 910
Total $ 4,230 $ 3,890 $ 8,848 $ 8,471
Non-GAAP Financial Measures
The information below reconciles the return on average common
shareholders' equity to its most comparable U.S. GAAP measure:
Return on average common shareholders' equity
Return on average shareholders' equity 7.66% 9.66% 8.41% 8.69%
Effect of excluding average preferred shareholders' equity 1.34% 2.62% 1.60% 2.32%
Return on average common shareholders' equity 9.00% 12.28% 10.01% 11.01%
Efficiency ratio GAAP to non-GAAP reconciliation:
Non-interest expense $ 4,230 $ 3,890 $ 8,848 $ 8,471
Less: net (loss)/gain on sales and write-downs of OREO 87 (62) (468) (747)
Adjusted non-interest expense (non-GAAP) $ 4,317 $ 3,828 $ 8,380 $ 7,724
Net interest income $ 6,225 $ 5,830 $ 12,390 $ 11,294
Non-interest income 1,713 1,559 3,587 3,369
Operating revenue $ 7,938 $ 7,389 $ 15,977 $ 14,663
Efficiency ratio 54.38% 51.81% 52.45% 52.68%

Three Months Ended
June 30, 2015 June 30, 2014
Average
Balance (1)
Income/
Expense
Yields/
Rates
Average
Balance (1)
Income/
Expense
Yields/
Rates
Assets
Investment securities $ 81,307 $ 341 1.68% $ 74,481 $ 338 1.82%
Loans (2) 648,752 7,666 4.73% 576,293 7,397 5.13%
Interest bearing deposits due from other banks 14,952 12 0.32% 61,500 41 0.27%
Total interest-earning assets $ 745,011 $ 8,019 4.31% $ 712,274 $ 7,776 4.37%
Allowance for loan losses (10,327) (10,546)
Other assets 44,013 47,179
Total assets $ 778,697 $ 748,907
Liabilities
Savings, NOW, money market, interest checking 149,893 175 0.47% 131,908 157 0.48%
Time deposits 391,588 1,313 1.34% 419,575 1,402 1.34%
Total interest-bearing deposits $ 541,481 $ 1,488 1.10% $ 551,483 $ 1,559 1.13%
Other borrowings 6,426 64 3.98% 12,644 205 6.49%
FHLB advances 33,000 124 1.50% 17,000 62 1.46%
Junior subordinated debentures 12,372 120 3.88% 12,372 120 3.88%
Total interest-bearing liabilities $ 593,279 $ 1,796 1.21% $ 593,499 $ 1,946 1.31%
Non-interest bearing deposits 62,401 58,796
Other liabilities 7,327 6,884
Total liabilities $ 663,007 $ 659,179
SBLF preferred stock (3) 15,000 15,000
Shareholders' equity 100,690 74,728
Total liabilities and equity $ 778,697 $ 748,907
Net interest income 6,223 5,830
Interest rate spread (4) 3.09% 3.06%
Net interest margin (5) 3.34% 3.27%
Ratio of interest-earning assets to interest -bearing
liabilities
1.26 1.20
Six Months Ended
June 30, 2015 June 30, 2014
Average
Balance (1)
Income/
Expense
Yields/
Rates
Average
Balance (1)
Income/
Expense
Yields/
Rates
Assets
Investment securities $ 80,996 $ 677 1.67% $ 73,457 $ 692 1.88%
Loans (2) 646,931 15,294 4.73% 578,725 14,479 5.00%
Interest bearing deposits due from other banks 20,243 30 0.30% 55,481 67 0.24%
Total interest-earning assets $ 748,170 $ 16,001 4.28% $ 707,663 $ 15,238 4.31%
Allowance for loan losses (10,448) (10,559)
Other assets 43,428 48,516
Total assets $ 781,150 $ 745,620
Liabilities
Savings, NOW, money market, interest checking 149,637 349 0.47% 126,904 302 0.48%
Time deposits 394,516 2,617 1.33% 423,363 2,815 1.33%
Total interest-bearing deposits $ 544,153 $ 2,966 1.09% $ 550,267 $ 3,117 1.13%
Other borrowings 9,645 159 3.30% 13,265 431 6.50%
FHLB advances 32,779 246 1.50% 19,099 156 1.63%
Junior subordinated debentures 12,372 240 3.88% 12,372 240 3.88%
Total interest-bearing liabilities $ 598,949 $ 3,611 1.21% $ 595,003 $ 3,944 1.33%
Non-interest bearing deposits 61,708 54,994
Other liabilities 7,678 6,837
Total liabilities $ 668,335 $ 656,834
SBLF preferred stock (3) 15,000 15,000
Shareholders' equity 97,815 73,786
Total liabilities and equity $ 781,150 $ 745,620
Net interest income 12,390 11,294
Interest rate spread (4) 3.07% 2.98%
Net interest margin (5) 3.31% 3.19%
Ratio of interest-earning assets to interest -bearing
liabilities
1.25 1.19
(1) Average balances are calculated on amortized cost.
(2) Includes loan fee income, nonaccruing loan balances, and interest received on such loans.
(3) The SBLF preferred stock refers to our Series C noncumulative perpetual preferred stock issued to the U.S. Treasury through the
U.S. Treasury’s Small Business Lending Fund program.
(4) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest
bearing liabilities.
(5) Net interest margin represents net interest income divided by average total interest-earning assets.



Investor Relations Contact Timothy J. Schneider CEO, Investors Community Bank Phone: (920) 686-5604 Email: tschneider@investorscommunitybank.com

Source:County Bancorp, Inc.