National Commerce Corporation Announces Second Quarter 2015 Earnings

BIRMINGHAM, Ala., July 23, 2015 (GLOBE NEWSWIRE) -- National Commerce Corporation (NASDAQ:NCOM) (the "Company") today reported second quarter 2015 net income to common shareholders of $2.3 million, compared with $1.1 million for the second quarter of 2014. Diluted net earnings per share were $0.24 for the second quarter of 2015, compared with $0.20 for the second quarter of 2014, representing a 20% increase.

"We are pleased with the first six months of the year," said John H. Holcomb, III, Chairman and CEO of the Company. "Our growth continues to meet our expectations, and I am also encouraged by the growth we are experiencing in our United Legacy market area following the March conversion of United Legacy to our core operating system. While the year is off to a good start, we again remind ourselves that we have a lot of work ahead of us to continue to achieve our goals."

Several important measures from the second quarter of 2015 are as follows:

  • Net Interest Margin (tax-effected) of 4.22%, compared with 3.29% for the second quarter of 2014.
  • Return on Average Assets of 0.75%, compared with 0.61% for the second quarter of 2014.
  • Return on Average Tangible Common Equity of 6.35%, compared with 5.00% for the second quarter of 2014.
  • Second quarter 2015 loan growth (excluding mortgage loans held for sale) of $49.9 million, representing a 21.7% annualized growth rate. Excluding factoring receivables, loans grew $44.5 million, representing a 20.9% annualized growth rate.
  • Second quarter 2015 deposit growth of $51.3 million, representing a 20.6% annualized growth rate.
  • $84.8 million in mortgage production, compared with $56.5 million for the second quarter of 2014.
  • $189 million in purchased volume in the factoring division. Note that, because the Company entered the factoring business in the third quarter of 2014, no comparable figure is available for the second quarter of 2014.
  • Increase in non-acquired non-performing assets to $4.2 million from $2.3 million at March 31, 2015.
  • Annualized net charge-offs of 0.16%, compared to 0.13% for the second quarter of 2014.
  • Ending tangible book value per share of $15.12.
  • Ending book value per share of $18.50.

"I am also pleased about our recent announcement with Reunion Bank of Florida," continued Holcomb. "We believe the cultural fit between our organizations is outstanding, and we are excited about adding the Reunion team and shareowners to the National Commerce family."

The Company will host a live audio webcast conference call beginning at 9:00 a.m. Central Time on July 24, 2015 to discuss second quarter 2015 results. Investors may call in (toll free) by dialing (855) 871-0559 (conference ID 82247899). A replay of the conference call will be available beginning two hours after the completion of the call until 10:59 p.m. Central Time on Sunday, July 26, 2015 and can be accessed by dialing (855) 859-2056.

Investors who plan to participate in the live webcast of the conference call should access the webcast by visiting the Company's Investor Relations page located at www.nationalbankofcommerce.com. A replay of the webcast will be available on the website for one year. A copy of this press release will also be available at the same location.

Use of Non-GAAP Financial Measures

Some of the financial measures presented in this press release and included in the accompanying unaudited financial statements are not measures prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). These non-GAAP financial measures include tangible common equity, return on average tangible common equity, tangible book value per share, allowance for loan losses to nonacquired loans, efficiency ratio and operating efficiency ratio. Our management uses the non-GAAP financial measures set forth below in its analysis of the Company's performance.

  • "Tangible common equity" is total shareholders' equity less goodwill, other intangible assets and minority interest not included in intangible assets.
  • "Average tangible common equity" is defined as the average of our tangible common equity for the applicable period.
  • "Return on average tangible common equity," or ROATCE, is defined as net income available to common shareholders divided by average tangible common equity.
  • "Tangible book value per share" is defined as tangible common equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.
  • "Allowance for loan losses to nonacquired loans" is defined as the total allowance for loan losses less the allowance for loan losses attributable to factored receivables divided by nonacquired loans held for investment excluding factored receivables at end of the period.
  • "Efficiency ratio" is defined as noninterest expense divided by our operating revenue (which is equal to net interest income plus noninterest income) excluding one-time gains and losses on sales of securities. This measure is important to investors looking for a measure of efficiency in our productivity measured by the amount of revenue generated for each dollar spent.
  • "Operating efficiency ratio" is defined as noninterest expense divided by our operating revenue, excluding one-time gains and losses on sales of securities and one-time gains and expenses related to merger and acquisition-related activities. This measure is important to investors looking for a measure of efficiency in our productivity measured by the amount of revenue generated for each dollar spent.

We believe that these non-GAAP financial measures provide useful information to management and investors that is supplementary to our financial condition, results of operations and cash flows computed in accordance with GAAP; however, we acknowledge that our non-GAAP financial measures have a number of limitations. As such, you should not view these disclosures as a substitute for results determined in accordance with GAAP, and they are not necessarily comparable to non-GAAP financial measures that other companies use. These non-GAAP financial measures exclude various items detailed in the attached "Non-GAAP Reconciliation."

About National Commerce Corporation

National Commerce Corporation ("NCC") is a bank holding company headquartered in Birmingham, Alabama. Through its subsidiary bank, National Bank of Commerce, NCC provides a broad array of financial services to businesses, business owners and professionals through eight full-service banking offices in Alabama (in Birmingham, Huntsville, Auburn-Opelika and Baldwin County) and seven full-service banking offices in central Florida (in Vero Beach through National Bank of Commerce and in Longwood, Winter Park, Orlando, Oviedo and Kissimmee through United Legacy Bank, a division of National Bank of Commerce). The company also owns a majority stake in Corporate Billing, LLC, a transaction-based finance company headquartered in Decatur, Alabama that provides factoring, invoicing, collection and accounts receivable management services to transportation companies and automotive parts and service providers nationwide.

NCC files periodic reports with the U.S. Securities and Exchange Commission (the "SEC"). Copies of its filings may be obtained through the SEC's website at www.sec.gov or at www.nationalbankofcommerce.com. More information about NCC and National Bank of Commerce may be obtained at www.nationalbankofcommerce.com.

Forward-Looking Statements

Certain statements contained in this press release that are not statements of historical fact constitute forward-looking statements for which NCC claims the protection of the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995 (the "Act"), notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in NCC's future filings with the SEC, in press releases and in oral and written statements made by NCC or with NCC's approval that are not statements of historical fact and that constitute forward-looking statements within the meaning of the Act. Examples of forward-looking statements include, but are not limited to: (i) projections of revenues, expenses, income or loss, earnings or loss per share, the payment or nonpayment of dividends, capital structure and other financial items; (ii) statements of NCC's plans, objectives and expectations or those of its management or Board of Directors, including those relating to products or services; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Words such as "believes," "anticipates," "expects," "intends," "targeted," "continue," "remain," "will," "should," "may" and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Forward-looking statements are subject to various risks and uncertainties, including those risks and uncertainties described under the heading "Risk Factors" in NCC's Annual Report on Form 10-K for the year ended December 31, 2014 and described in any subsequent reports that NCC has filed with the SEC, which are accessible on the SEC's website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. You should not rely upon forward-looking statements as predictions of future events. NCC undertakes no obligation to update any forward-looking statements or to make any other forward-looking statements, whether as a result of new information, future events or otherwise. In that respect, NCC cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made.

NATIONAL COMMERCE CORPORATION
Unaudited Financial Highlights
(In thousands, except share and per share amounts and percentages)
For the Three Months Ended
June 30, March 31, December 31, September 30, June 30,
2015 2015 2014 2014 2014
Earnings Summary
Interest income $ 12,714 $ 12,193 $ 10,578 $ 8,107 $ 6,449
Interest expense 1,071 1,027 846 730 634
Net interest income 11,643 11,166 9,732 7,377 5,815
Provision for loan losses 120 161 826 152 --
Gain (loss) on sale of securities -- -- -- (33) --
Other noninterest income (1) 2,206 1,764 1,419 1,353 1,326
Merger/conversion related expenses 168 79 246 262 146
Other noninterest expense (2) 9,448 9,211 6,910 5,719 5,289
Income before income taxes 4,113 3,479 3,169 2,564 1,706
Income tax expense 1,264 1,092 1,158 841 568
Net income before minority interest 2,849 2,387 2,011 1,723 1,138
Net income attributable to minority interest 593 466 304 208 --
Net income to common shareholders $ 2,256 $ 1,921 $ 1,707 $ 1,515 $ 1,138
Weighted average common and diluted shares outstanding
Basic 9,438,541 7,701,663 6,223,377 5,855,276 5,739,173
Diluted 9,569,695 7,801,577 6,305,626 5,929,386 5,793,444
Net earnings per common share
Basic $ 0.24 $ 0.25 $ 0.27 $ 0.26 $ 0.20
Diluted $ 0.24 $ 0.25 $ 0.27 $ 0.26 $ 0.20
June 30, March 31, December 31, September 30, June 30,
Selected Performance Ratios 2015 2015 2014 2014 2014
Return on average assets (ROAA) (3) 0.75% 0.67% 0.72% 0.73% 0.61%
Return on average equity (ROAE) 5.22 5.58 6.11 6.17 5.00
Return on average tangible common equity (ROATCE) 6.35 7.15 7.86 6.76 5.00
Net interest margin - taxable equivalent 4.22 4.25 4.58 3.87 3.29
Efficiency ratio 69.43 71.85 64.17 68.51 76.11
Operating efficiency ratio (2) 68.22 71.24 61.97 65.51 74.07
Noninterest income / average assets (annualized) 0.73 0.62 0.60 0.65 0.72
Noninterest expense / average assets (annualized) 3.19 3.24 3.01 2.87 2.94
Yield on loans 5.15 5.26 5.37 4.73 4.17
Cost of total deposits 0.38% 0.38% 0.36% 0.35% 0.34%
June 30, March 31, December 31, September 30, June 30,
Factoring Metrics 2015 2015 2014 2014 2014
Recourse purchased volume $ 89,009 $ 84,725 $ 107,891 N/A N/A
Non-recourse purchased volume 99,614 90,402 90,791 N/A N/A
Total purchased volume $ 188,623 $ 175,127 $ 198,682 N/A N/A
Average turn (days) 37.66 41.57 40.08 N/A N/A
Net charge-offs / total purchased volume (0.04)% 0.09% 0.02% N/A N/A
Average discount rate 1.67% 1.65% 1.65% N/A N/A
June 30, March 31, December 31, September 30, June 30,
Mortgage Metrics 2015 2015 2014 2014 2014
Total production ($) $ 84,796 $ 55,731 $ 55,931 $ 53,542 $ 56,510
Refinance (%) 18.6% 26.9% 22.6% 19.0% 11.8%
Purchases (%) 81.4% 73.1% 77.4% 81.0% 88.2%
NATIONAL COMMERCE CORPORATION
Unaudited Financial Highlights
(In thousands, except share and per share amounts and percentages)
As of
June 30, March 31, December 31, September 30, June 30,
Balance Sheet Highlights 2015 2015 2014 2014 2014
Cash and cash equivalents $ 142,393 $ 149,907 $ 123,435 $ 90,909 $ 105,889
Total securities 42,586 37,631 34,932 34,439 45,986
Mortgage loans held for sale 13,750 13,804 9,329 11,329 11,922
Acquired purchased credit impaired loans 5,724 8,852 9,077 -- --
Acquired non-purchased credit impaired loans 131,953 138,040 143,981 -- --
Nonacquired loans held for investment (4) 757,976 704,307 653,063 623,958 588,065
CBI loans (factoring receivables) 75,000 69,541 82,600 81,926 --
Total gross loans held for investment 970,653 920,740 888,721 705,884 588,065
Allowance for loan losses 9,274 9,522 9,802 9,018 8,974
Total intangibles 31,310 30,560 30,591 23,115 --
Total assets 1,256,614 1,206,667 1,138,426 897,982 783,197
Total deposits 1,051,483 1,000,217 971,060 763,509 666,735
Borrowings 22,000 22,000 22,000 22,000 22,000
Total liabilities 1,081,985 1,034,495 1,002,265 793,931 690,838
Minority interest 7,527 7,166 7,239 7,142 --
Common stock 94 94 75 59 58
Total shareholders' equity 174,629 172,172 136,161 104,051 92,359
Tangible common equity $ 142,726 $ 141,380 $ 105,265 $ 80,728 $ 92,359
End of period common shares outstanding 9,438,541 9,438,541 7,541,541 5,924,579 5,761,094
As of and For the Three Months Ended
June 30, March 31, December 31, September 30, June 30,
Asset Quality Analysis 2015 2015 2014 2014 2014
Nonacquired
Nonaccrual loans $ 2,688 $ 618 $ 2,276 $ 1,087 $ 1,195
Other real estate and repossessed assets 1,494 1,494 823 830 800
Loans past due 90 days or more and still accruing 44 168 217 176 --
Total nonacquired nonperforming assets $ 4,226 $ 2,280 $ 3,316 $ 2,093 $ 1,995
Acquired
Nonaccrual loans $ 2,795 $ 2,576 $ 2,589 $ -- $ --
Other real estate and repossessed assets 142 542 557 -- --
Loans past due 90 days or more and still accruing -- -- 80 -- --
Total acquired nonperforming assets $ 2,937 $ 3,118 $ 3,226 $ -- $ --
Selected asset quality ratios
Nonperforming assets / Assets 0.57% 0.45% 0.57% 0.23% 0.25%
Nonperforming assets / Loans + OREO + repossessed assets 0.74 0.59 0.74 0.30 0.34
Net charge-offs (recoveries) to average loans (annualized) 0.16 0.20 0.02 0.07 0.13
Allowance for loan losses to total loans 0.96 1.03 1.10 1.28 1.53
Nonacquired nonperforming assets / Nonacquired loans + nonacquired OREO
+ nonacquired repossessed assets (4) 0.56 0.32 0.51 0.33 0.34
Allowance for loan losses to nonacquired nonperforming loans 339.46 1,211.45 393.18 714.01 750.96
Allowance for loan losses to nonacquired loans (4) 1.13% 1.22% 1.35% 1.42% 1.53%
For the Three Months Ended
June 30, March 31, December 31, September 30, June 30,
Taxable Equivalent Yields/Rates 2015 2015 2014 2014 2014
Interest income:
Loans 5.15% 5.26% 5.37% 4.73% 4.17%
Mortgage loans held for sale 4.02 3.63 4.32 4.26 4.00
Interest on securities:
Taxable 3.33 2.92 3.17 3.04 2.67
Non-taxable 5.08 5.72 5.73 5.97 5.89
Cash balances in other banks 0.38 0.36 0.26 0.26 0.23
Total interest earning assets 4.60 4.64 4.97 4.25 3.65
Interest expense:
Interest on deposits 0.50 0.49 0.46 0.44 0.43
Interest on FHLB & other borrowings 2.01 2.01 2.02 2.00 2.01
Total interest bearing liabilities 0.54 0.53 0.52 0.50 0.50
Net interest spread 4.06 4.11 4.45 3.75 3.15
Net interest margin 4.22% 4.25% 4.58% 3.87% 3.29%
NATIONAL COMMERCE CORPORATION
Unaudited Financial Highlights
(In thousands, except share and per share amounts and percentages)
As of
June 30, March 31, December 31, September 30, June 30,
2015 2015 2014 2014 2014
Shareholders' Equity and Capital Ratios
Tier 1 Leverage Ratio 11.09% 11.41% 10.68% 9.87% 11.97%
Tier 1 Common Capital Ratio 12.86 13.54 10.66 11.12 14.81
Tier 1 Risk -based Capital Ratio 12.86 13.54 10.66 11.12 14.81
Total Risk Based Capital Ratio 13.78 14.55 11.75 12.37 16.06
Equity / Assets 13.90 14.27 11.96 11.59 11.79
Tangible common equity to tangible assets 11.65% 12.02% 9.50% 9.23% 11.79%
Book value per share $ 18.50 $ 18.24 $ 18.05 $ 17.56 $ 16.03
Tangible book value per share $ 15.12 $ 14.98 $ 13.96 $ 13.63 $ 16.03
For the Three Months Ended
June 30, March 31, December 31, September 30, June 30,
2015 2015 2014 2014 2014
Detail of other noninterest expense
Salaries and employee benefits $ 5,114 $ 4,987 $ 3,717 $ 3,547 $ 3,119
Commission-based compensation 1,056 796 900 459 471
Occupancy and equipment expense 829 836 572 477 459
Data processing expenses 487 425 291 295 294
Advertising and marketing expenses 125 173 126 79 63
Legal fees 239 167 389 326 134
FDIC insurance assessments 152 206 151 131 105
Accounting and audit expenses 225 223 208 102 103
Consulting and other professional expenses 183 105 150 89 73
Telecommunications expenses 135 128 79 67 67
ORE, Repo asset and other collection expenses 71 122 102 32 20
Core deposit intangible amortization 111 111 18 -- --
Other noninterest expense 889 1,011 453 377 527
Total noninterest expense $ 9,616 $ 9,290 $ 7,156 $ 5,981 $ 5,435
NATIONAL COMMERCE CORPORATION
Unaudited Financial Highlights
(In thousands, except share and per share amounts and percentages)
As of
June 30, March 31, December 31, September 30, June 30,
Non-GAAP Reconciliation 2015 2015 2014 2014 2014
Total shareholders' equity $ 174,629 $ 172,172 $ 136,161 $ 104,051 $ 92,359
Less: Intangible assets 31,310 30,560 30,591 23,115 --
Less: minority interest not included in intangible assets 593 232 305 208 --
Tangible common equity $ 142,726 $ 141,380 $ 105,265 $ 80,728 $ 92,359
Common shares outstanding at year or period end 9,438,541 9,438,541 7,541,541 5,924,579 5,761,094
Tangible book value per share $ 15.12 $ 14.98 $ 13.96 $ 13.63 $ 16.03
Total assets at end of period $ 1,256,614 $ 1,206,667 $ 1,138,426 $ 897,982 $ 783,197
Less: Intangible assets 31,310 30,560 30,591 23,115 --
Adjusted total assets at end of period $ 1,225,304 $ 1,176,107 $ 1,107,835 $ 874,867 $ 783,197
Tangible common equity to tangible assets 11.65% 12.02% 9.50% 9.23% 11.79%
Total allowance for loan losses $ 9,274 $ 9,522 $ 9,802 $ 9,018 $ 8,974
Less: allowance for loan losses attributable to CBI (factoring receivables) 715 956 955 175 --
Adjusted allowance for loan losses at end of period $ 8,559 $ 8,566 $ 8,847 $ 8,843 $ 8,974
Nonacquired loans held for investment (4) 757,976 704,307 653,063 623,958 588,065
Allowance for loan losses to nonacquired loans (4) 1.13% 1.22% 1.35% 1.42% 1.53%
For the Three Months Ended
June 30, March 31, December 31, September 30, June 30,
2015 2015 2014 2014 2014
Non-GAAP Reconciliation
Total average shareholders' equity $ 173,354 $ 139,618 $ 110,855 $ 97,344 $ 91,325
Less: Average intangible assets 30,555 30,553 24,417 8,291 --
Less: average minority interest not included in intangible assets 315 46 277 188 --
Average tangible common equity $ 142,484 $ 109,019 $ 86,161 $ 88,865 $ 91,325
Net income to common shareholders 2,256 1,921 1,707 1,515 1,138
Return on average tangible common equity (ROATCE) 6.35% 7.15% 7.86% 6.76% 5.00%
Efficiency ratio:
Net interest income $ 11,643 $ 11,166 $ 9,732 $ 7,377 $ 5,815
Total noninterest income 2,206 1,764 1,419 1,320 1,326
Less: gain (loss) on sale of securities -- -- -- (33) --
Operating revenue $ 13,849 $ 12,930 $ 11,151 $ 8,730 $ 7,141
Expenses:
Total noninterest expenses $ 9,616 $ 9,290 $ 7,156 $ 5,981 $ 5,435
Efficiency ratio 69.43% 71.85% 64.17% 68.51% 76.11%
Operating efficiency ratio:
Net interest income $ 11,643 $ 11,166 $ 9,732 $ 7,377 $ 5,815
Total noninterest income 2,206 1,764 1,419 1,320 1,326
Less: gain (loss) on sale of securities -- -- -- (33) --
Operating revenue $ 13,849 $ 12,930 $ 11,151 $ 8,730 $ 7,141
Expenses:
Total noninterest expenses $ 9,616 $ 9,290 $ 7,156 $ 5,981 $ 5,435
Less: merger/conversion expenses 168 79 246 262 146
Adjusted noninterest expenses $ 9,448 $ 9,211 $ 6,910 $ 5,719 $ 5,289
Operating efficiency ratio 68.22% 71.24% 61.97% 65.51% 74.07%
(1) Excludes securities gains
(2) Excludes merger and conversion related expenses
(3) Net income to common shareholders / average assets
(4) Excludes CBI loans
NATIONAL COMMERCE CORPORATION
Unaudited Consolidated Balance Sheets
(In thousands, except share and per share data)
Assets
June 30, 2015 December 31, 2014
Cash and due from banks $ 17,677 $ 14,236
Interest-bearing deposits with banks 124,716 109,199
Cash and cash equivalents 142,393 123,435
Investment securities held-to-maturity (fair value of $12,122 at June 30, 2015) 12,609 --
Investment securities available-for-sale 29,977 34,932
Other investments 5,844 5,421
Mortgage loans held-for-sale 13,750 9,329
Loans, net of unearned income 970,653 888,721
Less: allowance for loan losses 9,274 9,802
Loans, net 961,379 878,919
Premises and equipment, net 27,554 27,560
Accrued interest receivable 2,217 2,193
Bank owned life insurance 11,848 10,641
Other real estate 1,494 1,008
Deferred tax assets, net 12,149 11,444
Goodwill 29,775 28,834
Core deposit intangible, net 1,535 1,757
Other assets 4,090 2,953
Total assets $ 1,256,614 $ 1,138,426
Liabilities and Shareholders' Equity
Deposits:
Noninterest-bearing demand $ 246,804 $ 217,643
Interest-bearing demand 162,087 154,816
Savings and money market 414,720 392,394
Time 227,872 206,207
Total deposits 1,051,483 971,060
Federal Home Loan Bank advances 22,000 22,000
Accrued interest payable 453 431
Other liabilities 8,049 8,774
Total liabilities 1,081,985 1,002,265
Commitments
Shareholders' equity:
Preferred stock, 250,000 shares authorized, no shares issued or outstanding -- --
Common stock, at June 30, 2015, $0.01 par value, 30,000,000 shares authorized and
9,438,541 shares issued and outstanding; at December 31, 2014, $0.01 par value,
12,500,000 shares authorized and 7,541,541 shares issued and outstanding 94 75
Additional paid-in capital 165,674 131,455
Retained earnings (deficit) 724 (3,453)
Accumulated other comprehensive income 610 845
Total shareholders' equity attributable to National Commerce Corporation 167,102 128,922
Noncontrolling interest 7,527 7,239
Total shareholders' equity 174,629 136,161
Total liabilities and shareholders' equity $ 1,256,614 $ 1,138,426
NATIONAL COMMERCE CORPORATION
Unaudited Consolidated Statements of Earnings
(In thousands, except per share data)
For the Three Months Ended For the Six Months Ended
June 30, June 30,
2015 2014 2015 2014
Interest and dividend income:
Interest and fees on loans $ 12,226 $ 6,053 $ 24,018 $ 11,839
Interest and dividends on taxable investment securities 269 310 525 627
Interest on non-taxable investment securities 114 42 156 84
Interest on interest-bearing deposits and federal funds sold 105 44 208 107
Total interest income 12,714 6,449 24,907 12,657
Interest expense:
Interest on deposits 961 524 1,879 1,074
Interest on borrowings 110 110 219 219
Total interest expense 1,071 634 2,098 1,293
Net interest income 11,643 5,815 22,809 11,364
Provision for loan losses 120 -- 281 --
Net interest income after provision for loan losses 11,523 5,815 22,528 11,364
Other income:
Service charges and fees on deposit accounts 308 172 575 338
Mortgage origination and fee income 1,505 1,048 2,776 1,753
Merchant sponsorship revenue 191 -- 191 --
Income from bank owned life insurance 86 60 165 120
Wealth management fees 13 15 32 29
(Loss) gain on other real estate (11) -- (24) 5
(Loss) gain on sale of investment securities available-for-sale -- -- -- --
Other 114 31 255 48
Total other income 2,206 1,326 3,970 2,293
Other expense:
Salaries and employee benefits 5,114 3,119 10,101 6,115
Commission-based compensation 1,056 471 1,852 777
Occupancy and equipment 829 459 1,665 895
Core deposit intangible amortization 111 -- 222 --
Other operating expense 2,506 1,386 5,066 2,529
Total other expense 9,616 5,435 18,906 10,316
Earnings before income taxes 4,113 1,706 7,592 3,341
Income tax expense 1,264 568 2,356 1,160
Net earnings 2,849 1,138 5,236 2,181
Less: Net earnings attributable to noncontrolling interest 593 -- 1,059 --
Net earnings attributable to National Commerce Corporation $ 2,256 $ 1,138 $ 4,177 $ 2,181
Basic earnings per common share $ 0.24 $ 0.20 $ 0.49 $ 0.38
Diluted earnings per common share $ 0.24 $ 0.20 $ 0.48 $ 0.38
NATIONAL COMMERCE CORPORATION
Average Balance Sheets and Net Interest Analysis
For the Three Months Ended
(Dollars in thousands)
June 30, 2015

March 31, 2015

December 31, 2014

September 30, 2014

June 30, 2014
Interest earning assets
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Average Balance
Interest Income/ Expense Average Yield/ Rate
Loans $ 944,373 $ 12,116 5.15% $ 903,563 $ 11,709 5.26% $ 748,373 $ 10,124 5.37% $ 640,806 $ 7,636 4.73% $ 570,896 $ 5,935 4.17%
Mortgage loans held for sale 11,180 112 4.02 9,487 85 3.63 9,914 108 4.32 10,348 111 4.26 12,145 121 4.00
Securities:
Taxable securities 32,402 269 3.33 35,540 256 2.92 34,366 275 3.17 36,011 276 3.04 46,525 310 2.67
Tax-exempt securities 14,297 181 5.08 4,750 67 5.72 4,640 67 5.73 4,584 69 5.97 4,496 66 5.89
Cash balances in other banks 112,081 105 0.38 114,579 103 0.36 48,646 32 0.26 67,191 44 0.26 77,607 44 0.23
Total interest earning assets 1,114,333 $ 12,783 4.60 1,067,919 $ 12,220 4.64 845,939 $ 10,606 4.97 758,940 $ 8,136 4.25 711,669 $ 6,476 3.65
Non-interest earning assets 95,949 94,118 96,203 68,521 31,040
Total assets $ 1,210,282 $ 1,162,037 $ 942,142 $ 827,461 $ 742,709
Interest bearing liabilities
Interest bearing transactions accounts $ 157,261 $ 97 0.25% $ 159,706 $ 99 0.25% $ 135,882 $ 96 0.28% $ 125,356 $ 89 0.28% $ 112,371 $ 73 0.26%
Savings & money market deposits 408,117 417 0.41 391,321 377 0.39 330,459 309 0.37 308,942 295 0.38 276,062 253 0.37
Time deposits 208,388 447 0.86 209,016 442 0.86 161,368 329 0.81 118,023 235 0.79 97,303 198 0.82
Federal Home Loan Bank & other borrowed money 22,000 110 2.01 22,000 109 2.01 22,027 112 2.02 22,000 111 2.00 22,000 110 2.01
Total interest-bearing liabilities 795,766 $ 1,071 0.54 782,043 $ 1,027 0.53 649,736 $ 846 0.52 574,321 $ 730 0.50 507,736 $ 634 0.50
Non-interest bearing deposits 233,136 232,497 172,290 150,566 141,623
Total funding sources 1,028,902 1,014,540 822,026 724,887 649,359
Non-interest bearing liabilities 8,026 7,879 9,261 5,230 2,025
Shareholders' equity 173,354 139,618 110,855 97,344 91,325
$ 1,210,282 $ 1,162,037 $ 942,142 $ 827,461 $ 742,709
Net interest rate spread 4.06% 4.11% 4.45% 3.75% 3.15%
Net interest income/margin (Taxable equivalent) 11,712 4.22% 11,193 4.25% 9,760 4.58% 7,406 3.87% 5,842 3.29%
Tax equivalent adjustment 69 27 28 29 27
Net interest income/margin $ 11,643 4.19% $ 11,166 4.24% $ 9,732 4.56% $ 7,377 3.86% $ 5,815 3.28%

CONTACT: National Commerce Corporation Will Matthews Vice Chairman and Chief Financial Officer (205) 313-8122

Source:National Commerce Corporation