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KS Bancorp, Inc. (KSBI) Announces Second Quarter 2015 Financial Results

SMITHFIELD, N.C., July 23, 2015 (GLOBE NEWSWIRE) -- KS Bancorp, Inc. (the "Company") (OTCBB:KSBI), parent company of KS Bank, Inc. (the "Bank"), announced unaudited net income available to common shareholders of $327,000, or $.25 per diluted share, for the three months ended June 30, 2015, compared to a net income available to common shareholders of $158,000, or $.12 per diluted share, for the three months ended June 30, 2014. This represents an increase in net income of 107.0% in the second quarter of 2015, as compared to the second quarter of 2014.

For the six months ended June 30, 2015, net income available to common shareholders totaled $649,000, an increase in $390,000, or 150.6% from the $259,000 for the same period ended June 30, 2014. Net income per common share increased from $0.20 at June 30, 2014 to $.50 at June 30, 2015.

Net interest income for the three months ended June 30, 2015 was $2.6 million, compared to $2.5 million for the same period in 2014. Non-interest income for the period ended June 30, 2015 was $486,000, compared to $468,000 for the same period ended June 30, 2014. Non-interest expense for the three months ended June 30, 2015 and June 30, 2014 was $2.6 million.

For the six months ended June 30, 2015, net interest income was $5.2 million, compared to net interest income of $4.8 million for the six months ended June 30, 2014. Non-interest income was $930,000 for the six months ended June 30, 2015, compared to $940,000 for the six months ended June 30, 2014. Non-interest expenses remain constant at $5.2 million for the six months ended June 30, 2015 and June 30, 2014.

The Company's unaudited consolidated total assets increased $5.2 million to $323.7 million at June 30, 2015, compared to $318.5 million at December 31, 2014. Net loan balances increased $4.2 million with a balance of $225.6 million at June 30, 2015, compared to $221.4 million at December 31, 2014. The Company's investment securities decreased $1.7 million to $71.2 million at June 30, 2015, compared to $72.9 million at December 31, 2014. Total deposits have increased $5.6 million to $254.5 million at June 30, 2015, compared to $248.9 million at December 31, 2014. Total stockholders' equity increased $405,000 from $21.8 million at December 31, 2014, to $22.2 million at June 30, 2015.

Nonperforming assets, which includes nonaccrual loans and OREO, decreased $2.7 million from $6.4 million at December 31, 2014 to $3.7 million at June 30, 2015. The nonperforming assets consist of $810,000 in OREO and $2.9 million in nonaccrual loans. For the six months ended June 30, 2015, there was no expense to the provision for loan losses. The allowance for loan losses at June 30, 2015 totaled $3.5 million, or 1.53% of all outstanding loans.

KS Bank continues to be well-capitalized according to regulatory standards with total risk based capital of 15.67%, tier 1 risk- based capital of 14.42%, common equity tier 1 risked based capital of 14.42%, and a tier 1 leverage ratio of 9.85% at June 30, 2015. The minimum levels to be considered well capitalized for each of these ratios are 10.0%, 8.0%, 6.5%, and 5.0%, respectively.

Commenting on the second quarter of 2015 results, Mr. Keen, President and CEO, stated, "KS Bank continues to build a conservative balance sheet with increasing profits as compared to recent quarters. Loan and deposit growth continues in spite of the challenges of an extremely low interest rate environment and no relief from regulations passed down from Washington."

KS Bancorp, Inc. is a Smithfield, North Carolina-based single bank holding company. KS Bank, Inc., a state-chartered savings bank, is KS Bancorp's sole subsidiary. The Bank is a full service community bank serving the citizens of eastern North Carolina since 1924. The Bank offers a broad range of personal and business banking products and services, mortgage products and wealth management advisory services. There are nine full service branches located in Kenly, Selma, Clayton, Garner, Goldsboro, Wilson, Wendell, Smithfield, and Four Oaks, North Carolina plus a mortgage servicing location in Greenville, NC. For more information, visit www.ksbankinc.com.

This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like "expect," "anticipate," "estimate" and "believe," variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. The Company undertakes no obligation to update any forward-looking statements.

KS Bancorp, Inc. and Subsidiary
Consolidated Statements of Financial Condition
June 30, 2015
(unaudited)
December 31,
2014*
(Dollars in thousands)
ASSETS
Cash and due from banks:
Interest-earning $ 7,735 $ 4,188
Noninterest-earning 1,166 1,328
Time Deposit 100 100
Investment securities available for sale, at fair value 71,186 72,944
Federal Home Loan Bank stock, at cost 1,771 1,785
Presold mortgages in process of settlement 365 --
Loans 229,100 224,912
Less allowance for loan losses (3,509) (3,511)
Net loans 225,591 221,401
Accrued interest receivable 1,012 994
Foreclosed real estate and repossessions, net 810 2,121
Property and equipment, net 8,118 8,161
Other assets 5,865 5,429
Total assets $ 323,719 $ 318,451
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits $ 254,526 $ 248,915
Short-term borrowings 582 1,837
Long-term borrowings 43,248 43,248
Accrued interest payable 261 339
Accrued expenses and other liabilities 2,929 2,344
Total liabilities 301,546 296,683
Stockholder's Equity:
Common stock, no par value, authorized 20,000,000 shares; 1,309,501 shares issued and outstanding in 2015 and 2014 1,607 1,607
Retained earnings, substantially restricted 20,741 20,171
Accumulated other comprehensive (loss) (175) (10)
Total stockholders' equity 22,173 21,768
Total liabilities and stockholders' equity $ 323,719 $ 318,451
* Derived from audited financial statements
KS Bancorp, Inc and Subsidiary
Consolidated Statements of Income (Unaudited)
Three Months Ended
June 30,
Six Months Ended
June 30,
2015 2014 2015 2014
(In thousands, except per share data)
Interest and dividend income:
Loans $ 2,846 $ 2,653 $ 5,662 $ 5,225
Investment securities
Taxable 320 313 634 635
Tax-exempt 75 114 160 241
Dividends 21 12 41 24
Interest-bearing deposits 3 1 5 2
Total interest and dividend income 3,265 3,093 6,502 6,127
Interest expense:
Deposits 314 276 618 570
Borrowings 355 351 725 704
Total interest expense 669 627 1,343 1,274
Net interest income 2,596 2,466 5,159 4,853
Provision for loan losses -- -- -- --
Net interest income after provision for loan losses 2,596 2,466 5,159 4,853
Noninterest income:
Service charges on deposit accounts 306 312 607 613
Fees from presold mortgages 74 47 93 92
Gain on sale of investments -- 9 -- 40
Other income 106 100 230 195
Total noninterest income 486 468 930 940
Noninterest expenses:
Compensation and benefits 1,591 1,517 3,127 3,030
Occupancy and equipment 74 80 337 342
Data processing & outside service fees 406 399 637 627
Advertising 13 14 28 33
Net foreclosed real estate 1 51 26 154
Other 534 556 1,014 1,091
Total noninterest expenses 2,619 2,617 5,169 5,277
Income before income taxes 463 317 920 516
Income tax 136 93 271 125
Net income 327 224 649 391
Dividends on preferred stock -- (55) -- (109)
Accretion of discount on preferred stock, net -- (11) -- (23)
Income available to common stockholders $ 327 $ 158 $ 649 $ 259
Basic and Diluted earnings per share $ 0.25 $ 0.12 $ 0.50 $ 0.20

CONTACT: Harold T. Keen President and Chief Executive Officer (919) 938-3101 Regina J Smith Chief Financial Officer (919) 938-3101

Source:KS Bancorp