TowneBank Reports Second Quarter Earnings

SUFFOLK, Va., July 24, 2015 (GLOBE NEWSWIRE) -- Hampton Roads based TowneBank (the “Bank”) (NASDAQ:TOWN) reported record earnings of $17.81 million for the quarter ended June 30, 2015, a 52.54% increase, or $6.14 million, over the $11.68 million reported for the comparative period in 2014. Fully diluted earnings per share were $0.35 per share compared to $0.33 per share for the comparative period of 2014. Earnings for the year-to-date period increased 41.84% to $32.35 million as compared to the $22.81 million earned in the same period of 2014. For the year-to-date period, fully diluted earnings per share were $0.63 per share, down slightly from $0.64 per share in comparative 2014. Earnings per share were affected in 2015 by the issuance of 15.55 million new common shares in conjunction with the acquisition of Franklin Financial Corporation (“Franklin”) on January 2, 2015.

The Bank’s common dividend was $0.12 per share for the quarter with the common dividend totaling $6.19 million. The current dividend represents an increase of 9.1% over the dividend paid during the same quarter of 2014.

“We are pleased to report record earnings for the quarter, as we continue to build on the momentum started earlier this year with the Franklin acquisition and our entry into the Richmond, Virginia market,” said G. Robert Aston, Jr., Chairman and Chief Executive Officer. “Our operating results reflect the benefits of the merger as revenue increased $16.15 million, or 26.12%, from the second quarter of 2014 while producing a return on average assets of 1.21% and a return on average tangible equity of 11.77%.

“We have continued to position ourselves for growth and success in the Richmond, Virginia metro market,” added Aston. “The strong team of Richmond hometown bankers we assembled combined with a comprehensive marketing campaign designed to introduce the market to our unique brand has resulted in $66.7 million of new loan originations in Richmond since the merger.”

Second Quarter 2015 Performance Highlights

  • Total revenues were $77.97 million, an increase of $16.15 million, or 26.12%, compared to the second quarter of 2014
    • Taxable equivalent net interest margin was 3.52%, including accretion of 0.10%, compared to 3.43% for second quarter 2014
    • Residential mortgage banking income increased 32.53% from second quarter 2014 to $10.25 million on production volume of $466.23 million
    • Insurance commissions increased 11.15% to $9.88 million
    • Noninterest income was 42.43% of total revenue in second quarter 2015
  • Return on average assets of 1.21%, increased from 0.97% for second quarter 2014
  • Loans held for investment increased $758.93 million, or 21.88%, from June 30, 2014 with organic growth of $299.11 million, an increase of 8.62%
    • Commercial and industrial loans increased by $74.10 million, or 11.25%, with organic growth of $58.97 million
    • Owner occupied commercial real estate loans increased $22.61 million, or 3.06% with organic growth of $6.70 million
    • Income producing commercial real estate loans increased $338.91 million, or 52.22% with organic growth of $119.95 million
    • Construction and development loans increased $66.44 million, or 13.63% with organic growth of $22.24 million
    • Consumer and other loans increased $55.81 million, or 108.90% through organic growth
  • Total deposits were $4.69 billion, an increase of $890.82 million, or 23.47%, from the second quarter of 2014
    • Noninterest bearing deposits increased by 13.34%, to $1.36 billion
    • Average interest-bearing deposit costs were 0.55%, up 4 basis points from the prior year
    • Noninterest bearing deposits were 29.09% of total deposits compared to 31.69% at June 30, 2014
    • Total cost of deposits increased to 0.39% from 0.36% at June 30, 2014 reflective of a greater mix of savings deposits acquired in the Franklin merger
  • Asset quality showed continued strength
    • Nonperforming assets were $53.61 million, or 0.89% of total assets compared to 1.02% at June 30, 2014
    • Nonperforming loans decreased 0.61% to $7.46 million
    • Foreclosed property increased to $46.15 million, including $10.33 million acquired in the Franklin merger
    • Performing troubled debt restructurings decreased $8.79 million
    • Provision for loan losses was $1.72 million for second quarter 2015
  • The Bank remained well-capitalized
    • Common equity tier 1 capital ratio of 12.93%
    • Tier 1 leverage capital ratio of 11.14%
    • Tier 1 risk-based capital ratio of 13.04%
    • Total risk-based capital ratio of 13.80%
    • Tangible book value increased to $12.00

Net Interest Income

Net interest income increased to $44.88 million, an $8.35 million, or 22.84%, increase from the second quarter of 2014. The primary driver of the increase was the significant increase in earning assets from the Franklin merger along with the restructuring of the Franklin balance sheet. Average earning assets increased $994.38 million, or 22.53%, from the second quarter of 2014. Augmenting the increase was a 9 basis point widening of the tax-equivalent net interest margin to 3.52% in the current quarter from 3.43% in the second quarter of 2014. Accretion income added $1.08 million, or 10 basis points, to margin in the current quarter.

On a linked quarter basis, net interest income increased $1.33 million or 3.05%, in second quarter 2015 versus first quarter 2015, while tax-equivalent net interest margin was unchanged from the first quarter of 2015 at 3.52%.

Noninterest Income

% Change
Q2 Q2 Q1 Q2 15 vs. Q2 15 vs.
(in millions)2015 2014 2015 Q2 14 Q1 15
Residential mortgage banking income, net$10,251 $7,735 $8,443 32.53% 21.41%
Real estate brokerage and property management, net4,584 3,248 3,955 41.13% 15.90%
Insurance commissions and other title fees and income, net9,885 8,893 11,049 11.15% (10.53)%
Service charges on deposit accounts2,326 2,366 2,197 (1.69)% 5.87%
Credit card merchant fees, net566 965 432 (41.35)% 31.02%
Other income5,354 2,139 2,691 150.30% 98.96%
Subtotal before gain on investment securities32,966 25,346 28,767 30.06% 14.60%
Net gain on investment securities119 (62) 49 N/M 142.86%
Total noninterest income$33,085 $25,284 $28,816 30.85% 14.81%

Noninterest income, excluding gains or losses on investment securities, was $32.97 million for the second quarter of 2015, an increase of $7.62 million, or 30.06%, from the second quarter of 2014. The majority of the increase from the comparative period in 2014 is attributable to residential mortgage banking income, which increased $2.52 million, or 32.53%, from the second quarter of 2014 primarily due to increased production volumes and improved pricing and margins. Mortgage production was $466.23 million in the second quarter of 2015, which was $131.35 million greater than second quarter 2014. Also contributing to the increase were insurance commissions, which increased $0.99 million, or 11.15%, primarily due to the acquisition of two insurance agencies in February 2015 and one agency in May 2014. The increase in real estate brokerage and property management income was driven by the acquisition of a resort property management company in Hilton Head, South Carolina in fourth quarter 2014 and was partially offset by the sale of our North Carolina-based property management business on April 1, 2015, which generated management fee revenue of $0.97 million in second quarter 2014. The Bank recognized a gain of $1.36 million on the sale, which was recorded in other noninterest income, partially offset by expenses of $0.24 million recorded in noninterest expense.

In comparison to the first quarter of 2015, noninterest income, excluding gains or losses on investment securities, increased $4.20 million, or 14.60%. Residential mortgage banking income increased by $1.81 million, or 21.41%, from the first quarter of 2015 as mortgage production increased by $147.81 million. Real estate brokerage and property management income increased due to a seasonal increase related to our resort property management business. The increase was offset by the sale of our North Carolina-based property management business, which generated $1.80 million in management fee revenue in first quarter 2015. The sale resulted in a gain of $1.36 million, which was recorded in other noninterest income Insurance commissions decreased due to lower contingent commission revenue, which is mostly received during the first quarter of each year.

Noninterest Expense

% Change
Q2 Q2 Q1 Q2 15 vs. Q2 15 vs.
(in millions)2015 2014 2015 Q2 14 Q1 15
Salaries and benefits$26,544 $25,325 $27,679 4.81% (4.10)%
Occupancy expense4,856 4,393 4,930 10.54% (1.50)%
Furniture and equipment2,369 2,040 2,369 16.13% %
Acquisition-related expenses370 35 415 957.14% (10.84)%
Other14,928 12,875 15,047 15.95% (0.79)%
Total noninterest expense$49,067 $44,668 $50,440 9.85% (2.72)%

Noninterest expense increased by $4.40 million, or 9.85%, from the comparative quarter of 2014. Driving the increase were operating expenses of $2.51 million related to the Franklin merger. Additionally, operating expenses increased $2.13 million due to our insurance and resort property management acquisitions in first quarter of 2015 and in 2014.

Noninterest expense decreased by $1.37 million, or 2.72%, from the first quarter of 2015. Driving the decrease were salary and benefits expenses, which decreased by $1.14 million due to lower payroll taxes and employee incentive compensation combined with a decrease in costs related to foreclosed properties.

Segment Results

$ Change
(in millions) Q2 Q2 Q1 Q2 15 vs. Q2 15 vs.
Segment Net Income 2015 2014 2015 Q2 14 Q1 15
Banking $13,067 $8,919 $11,108 $4,148 $1,959
Realty 3,727 1,434 1,647 2,293 2,080
Insurance 1,018 1,324 1,783 (306) (765)
Total net income $17,812 $11,677 $14,538 $6,135 $3,274

Banking
Net income for the three months ended June 30, 2015 for the Banking segment was $13.07 million, increasing $4.15 million, or 46.51%, from the comparative 2014 quarter. The increase in earnings was driven by an increase in net interest income of $8.02 million, primarily due to the increase in earning assets acquired in the Franklin merger. The increase in net interest income was partially offset by an increase in the loan loss provision driven by loan growth and the reclassification of industrial revenue bonds from investment securities to loans, as shown below, combined with an increase in noninterest expense related to the Franklin merger and increases in charitable contributions, marketing expenses, and the opening of a new banking office in May 2015.

The increase in earnings of $1.96 million, or 17.64% from the first quarter of 2015 was primarily driven by an increase in revenue due to a combination of higher net interest income of $0.89 million, which was primarily due to loan growth, and an increase in other income of $1.05 million driven by a gain of $0.57 million on the sale of land owned by the Bank. Also contributing to the increase in earnings was a decrease in noninterest expenses of $2.07 million as personnel costs, foreclosed property expenses and outside processing costs all saw decreases. The increase was partially offset by an increase in the loan loss provision as discussed above.

Reclassification of Industrial Revenue Bonds
Prior to Subsequent to
June 30, 2015Reclassification Reclassification Reclassification
Securities held to maturity, at amortized cost$254,702 $(174,507) $80,195
Loans, net of unearned income and deferred costs:4,053,620 174,507 4,228,127
Allowance for loan losses(36,486) (804) (37,290)
Net loans4,017,134 173,703 4,190,837
Three Months Ended June 30, 2015
Prior to Subsequent to
Reclassification Reclassification Reclassification
INTEREST INCOME:
Loans, including fees$46,941 $1,229 $48,170
Investment securities4,550 (1,229) 3,321
Provision for loan losses919 804 1,723

Realty
For the three months ended June 30, 2015, the Realty segment had net income of $3.73 million, an increase of $2.29 million compared to the second quarter of 2014. Contributing to the improvement was an increase in residential mortgage banking income of $2.64 million, or 33.77%. Also contributing to the improvement was an increase in property management fees of $1.22 million, or 86.67%. Additionally, second quarter results included a gain of $1.36 million on the sale of our North Carolina-based property management business, partially offset by expenses of $0.24 million.

Net income in the Realty segment increased by $2.08 million from the linked quarter ended March 31, 2015. The increase resulted from a combination of higher residential mortgage banking income of $1.94 million, a seasonal increase in real estate brokerage income of $0.70 million, and the gain on the sale of our North Carolina-based property management business. The improvement in earnings was partially offset by a decrease in property management fees of $0.07 million due to the sale of our North Carolina-based property management business, which generated $1.80 million in management fee revenue in first quarter 2015, and an increase in noninterest expenses of $0.55 million.

Insurance
The Insurance segment had net income of $1.02 million for the three months ended June 30, 2015, a decrease of $0.31 million as compared to the second quarter of 2014. Contributing to the decline were increases in personnel costs related to 401(k) expenses, acquisition-related expenses, and legal fees. The insurance agency acquisitions in first quarter 2015 and second quarter 2014 resulted in additional commissions and fee revenue of $0.98 million and additional $0.94 million of noninterest expenses.

Net income decreased $0.77 million from the first quarter of 2015. The decline from the linked quarter was driven by a decrease in contingency and bonus revenue of $2.14 million, which offset a seasonal increase in property and casualty commission income of $1.06 million. Contingent commissions are seasonal in nature and are mostly received during the first quarter of each year.

Balance Sheet

At June 30, 2015, total Bank assets reached $6.06 billion, an increase of $1.15 billion, or 23.33%, over June 30, 2014.

Loans

% Change
Q2 Q2 Q1 Q2 15 vs. Q2 15 vs.
(in thousands)2015 2014 2015 Q2 14 Q1 15
Construction and land development$554,053 $487,613 $519,390 13.63% 6.67%
Commercial real estate - investment related properties987,945 649,040 954,826 52.22% 3.47%
Commercial real estate - owner occupied760,622 738,008 770,880 3.06% (1.33)%
Multifamily real estate137,378 55,620 146,395 146.99% (6.16)%
1-4 family residential real estate948,138 828,832 915,205 14.39% 3.60%
Commercial and industrial business loans732,936 658,839 700,252 11.25% 4.67%
Consumer loans and other107,055 51,246 88,747 108.90% 20.63%
Total$4,228,127 $3,469,198 $4,095,695 21.88% 3.23%

The Bank’s loan portfolio ended the period at $4.23 billion representing an increase of 21.88%, or $758.93 million, from the prior year and an increase of 3.23%, or $132.43 million, from March 31, 2015. Organic growth in 2015, including the effect of loan transfers to OREO, was $208.90 million, or 11.66% on an annualized basis. Included in this growth were new originations of $66.70 million in our Richmond market.

Deposits

% Change
Q2 Q2 Q1 Q2 15 vs. Q2 15 vs.
(in thousands)2015 2014 2015 Q2 14 Q1 15
Noninterest-bearing demand$1,363,551 $1,203,040 $1,261,482 13.34% 8.09%
Interest-bearing:
Demand and money market accounts1,680,038 1,306,595 1,643,534 28.58% 2.22%
Savings300,203 192,932 303,936 55.60% (1.23)%
Certificates of deposits1,342,860 1,093,262 1,296,666 22.83% 3.56%
Total$4,686,652 $3,795,829 $4,505,618 23.47% 4.02%

The Bank continued to experience solid deposit growth with total deposits increasing to $4.69 billion, up $890.82 million, or 23.47%, from June 30, 2014. The increase was mostly due to the deposits acquired in the Franklin merger. Organic growth in total deposits was $143.47 million, or 7.46% on an annualized basis, from December 31, 2014. The Bank saw continued growth in noninterest bearing demand deposits, which ended the quarter at $1.36 billion, a 13.34% increase from June 30, 2014. Noninterest deposits represented 29.09% of total deposits at June 30, 2015. The slight percentage decline from June 30, 2014 was a result of the funding mix in the acquired Franklin deposits.

Capital Ratios

Q2 Q2 Q1
2015 2014 2015
Common Equity Tier 1 (a) 12.93% N/A 13.09%
Tier 1 (a) 13.04% 12.83% 13.20%
Total (a) 13.80% 13.79% 13.96%
Tier 1 leverage ratio (a) 11.14% 10.16% 10.99%

(a) Basel III rules became effective January 1, 2015, with transitional provisions. All prior year data is based on Basel I rules

The Bank’s total equity at June 30, 2015 rose to $802.89 million, an increase of $198.08 million, or 32.75%, from June 30, 2014. Common equity increased 52.83%, or $274.48 million, as the Bank issued common stock in the amount of $238.66 million in the Franklin merger and redeemed in full its $76.46 million of outstanding Non-Cumulative Convertible Preferred Stock, Series C issued to the U.S. Treasury under the Small Business Lending Fund during first quarter 2015. Total risk-based capital remained strong as total risk-based capital, Tier 1 capital, Tier 1 leverage ratios, and common equity Tier 1 capital ratios were 13.80%, 13.04%, 11.14%, 12.93%, respectively. All ratios exceed the current regulatory standards for well capitalized status.

Asset Quality

(in thousands)6/30/2015 3/31/2015 12/31/2014 9/30/2014 6/30/2014
Nonperforming loans$7,455 $7,045 $6,741 $5,853 $7,501
Foreclosed property46,154 51,698 35,116 37,951 42,404
Total nonperforming assets$53,609 $58,743 $41,857 $43,804 $49,905
Quarterly net loans charged off$339 $333 $262 $602 $925
Year-to-date net loans charged off$672 $333 $2,955 $2,694 $2,092

Continued improvements in credit quality contributed to the Bank's financial results as nonperforming loans decreased to $7.46 million from $7.50 million, at June 30, 2014 and increased from $7.05 million at March 31, 2015. Net charge-offs were $0.34 million in the second quarter of 2015 compared to $0.92 million in the second quarter of 2014 and $0.33 million in the linked quarter. Total nonperforming assets were $53.61 million, or 0.89%, of Bank assets, including foreclosed property of $10.33 million originally acquired in the Franklin merger, at June 30, 2015, as compared to $49.91 million, or 1.02%, at June 30, 2014, and $58.74 million, or 1.01%, at March 31, 2015. The allowance for loan losses was $37.29 million, increased from $35.79 million at June 30, 2014 and $35.91 million at March 31, 2015. A reclassification of industrial revenue bonds from investment securities to loans during second quarter 2015 was responsible for $0.80 million of the increase, while loan growth drove the remainder of the increase. The total allowance for loan losses, including purchased loans, was 0.88% of loans held for investment at June 30, 2015, compared to 1.03% at June 30, 2014 and 0.88% at March 31, 2015. The allowance for loan losses on originated loans was 1.00% of originated loans held for investment at June 30, 2015, compared to 1.04% at June 30, 2014 and 1.00% at March 31, 2015. The allowance for loan losses was 5.0 times nonperforming loans held for investment, compared to 4.77 at June 30, 2014 and 5.10 times at March 31, 2015.

Change
Q2 Q2 Q1 Q2 15 vs. Q2 15 vs.
(dollars in thousands) 2015 2014 2015 Q2 14 Q1 15
Total loans 90 days past due and still accruing $277 $28 $3 $249 $274
Total loans 30-89 days past due $5,283 $12,663 $10,483 $(7,380) $(5,200)
Allowance for loan losses $37,290 $35,786 $35,907 $1,504 $1,383
Total performing TDRs $31,714 $40,500 $32,896 $(8,786) $(1,182)
Nonperforming loans to period end loans 0.18% 0.22% 0.17% (0.04) 0.01
Nonperforming assets to period end assets 0.89% 1.02% 1.01% (0.13) (0.12)
Allowance for loan losses to period end loans 0.88% 1.03% 0.88% (0.15)
Allowance for loan losses (originated) to originated period end loans 1.00% 1.04% 1.00% (0.04)
Net charge-offs to average loans (annualized) 0.03% 0.11% 0.03% (0.08)
Ratio of allowance for loan losses to nonperforming loans 5.00x 4.77x 5.10x 0.23x (0.10)x

About TowneBank:
As one of the top community banks in Virginia and North Carolina, TowneBank operates 36 banking offices serving Chesapeake, Chesterfield County, Glen Allen, Hampton, James City County, Mechanicsville, Newport News, Norfolk, Portsmouth, Richmond, Suffolk, Virginia Beach, Williamsburg, and York County in Virginia, along with Moyock, Grandy, Camden County, Southern Shores, Corolla and Nags Head in North Carolina. Towne also offers a full range of financial services through its controlled divisions and subsidiaries that include Towne Investment Group, Towne Insurance Agency, TFA Benefits, TowneBank Mortgage, TowneBank Commercial Mortgage, Berkshire Hathaway HomeServices Towne Realty, Towne 1031 Exchange, LLC, and Beach Properties of Hilton Head. Local decision-making is a hallmark of its hometown banking strategy that is delivered through the leadership of each group’s President and Board of Directors. With total assets of $6.06 billion as of June 30, 2015, TowneBank is one of the largest banks headquartered in Virginia.

Non-GAAP Financial Measures:
This press release contains financial information determined by methods other than in accordance with GAAP. The Company’s management uses these non-GAAP financial measures in their analysis of the Company’s performance. These measures typically adjust GAAP performance measures to exclude the effects of the amortization of intangibles and include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant activities or transactions that are infrequent in nature. Since the presentation of these GAAP performance measures and their impact differ between companies, management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of GAAP to non-GAAP disclosures are included as tables at the end of this release.

Forward-Looking Statements:
Statements made in this release, other than those concerning historical financial information, may be considered forward-looking statements, which speak only as of the date of this release and are based on current expectations and involve a number of assumptions. TowneBank intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and is including this statement for purposes of these safe harbor provisions. The Company’s ability to predict results, or the actual effect of future plans or strategies, is inherently uncertain. Factors which could have a material effect on the operations and future prospects of TowneBank include but are not limited to changes in interest rates, general economic and business conditions; legislative/regulatory changes; the monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Board of Governors of the Federal Reserve; the quality and composition of the loan and securities portfolios; demand for loan products; deposit flows; competition; demand for financial services in the companies’ respective market areas; implementation of new technologies; ability to develop and maintain secure and reliable electronic systems; changes in the securities markets; changes in accounting principles, policies and guidelines; mergers and acquisitions; and other risk factors detailed from time to time in filings made by TowneBank with the FDIC. TowneBank undertakes no obligation to update or clarify these forward-looking statements, whether as a result of new information, future events or otherwise.

Selected Financial Highlights (unaudited)
TOWNEBANK
June 30, 2015
(dollars in thousands, except per share data)
Increase/ % Increase/
Three months ended June 30,2015 2014 (Decrease) (Decrease)
Results of Operations:
Net interest income$44,884 $36,538 $8,346 22.84%
Noninterest income (1)32,966 25,346 7,620 30.06%
Gain (loss) on investment securities119 (62) 181 N/M
Total Revenue77,969 61,822 16,147 26.12%
Noninterest expenses49,067 44,668 4,399 9.85%
Provision for loan losses1,723 (833) 2,556 N/M
Income before income tax and noncontrolling interest27,179 17,987 9,192 51.10%
Provision for income tax expense8,201 5,432 2,769 50.98%
Net income18,978 12,555 6,423 51.16%
Net income attributable to noncontrolling interest(1,166) (878) (288) 32.80%
Net income attributable to TowneBank17,812 11,677 6,135 52.54%
Preferred stock dividends and accretion 191 (191) (100.00)%
Net income available to common shareholders17,812 11,486 6,326 55.08%
Net income per common share - basic0.35 0.33 0.02 6.06%
Net income per common share - diluted0.35 0.33 0.02 6.06%
Period End Data:
Total assets$6,055,181 $4,909,843 $1,145,338 23.33%
Total assets - tangible5,879,975 4,779,709 1,100,266 23.02%
Earning assets (2)5,576,243 4,536,817 1,039,426 22.91%
Loans (net of unearned income)4,228,127 3,469,198 758,929 21.88%
Allowance for loan losses37,290 35,786 1,504 4.20%
Goodwill and other intangibles175,207 130,134 45,073 34.64%
Nonperforming assets53,609 49,905 3,704 7.42%
Noninterest bearing deposits1,363,551 1,203,040 160,511 13.34%
Interest bearing deposits3,323,101 2,592,789 730,312 28.17%
Total deposits4,686,652 3,795,829 890,823 23.47%
Total equity802,891 604,812 198,079 32.75%
Total equity - tangible627,685 474,678 153,007 32.23%
Common equity794,018 519,536 274,482 52.83%
Common equity - tangible618,812 389,402 229,410 58.91%
Book value per common share15.40 14.63 0.77 5.26%
Book value per common share - tangible12.00 10.96 1.04 9.49%
Daily Average Balances:
Total assets$5,900,816 $4,810,582 $1,090,234 22.66%
Total assets - tangible5,724,957 4,683,697 1,041,260 22.23%
Earning assets (2)5,407,516 4,413,137 994,379 22.53%
Loans (net of unearned income), excluding nonaccrual loans4,161,304 3,433,425 727,879 21.20%
Allowance for loan losses36,854 37,458 (604) (1.61)%
Goodwill and other intangibles175,858 126,885 48,973 38.60%
Noninterest bearing deposits1,307,075 1,118,051 189,024 16.91%
Interest bearing deposits3,241,276 2,587,137 654,139 25.28%
Total deposits4,548,351 3,705,188 843,163 22.76%
Total equity800,369 601,203 199,166 33.13%
Total equity - tangible624,511 474,319 150,192 31.66%
Common equity791,915 516,102 275,813 53.44%
Common equity - tangible616,057 389,217 226,840 58.28%
Key Ratios:
Return on average assets1.21% 0.97% 0.24% 24.74%
Return on average assets - tangible1.28% 1.03% 0.25% 24.27%
Return on average equity8.93% 7.79% 1.14% 14.63%
Return on average equity - tangible11.77% 10.20% 1.57% 15.39%
Return on average common equity9.02% 8.93% 0.09% 1.01%
Return on average common equity - tangible11.93% 12.24% (0.31)% (2.53)%
Net interest margin-fully tax equivalent (2)(3)3.52% 3.43% 0.09% 2.62%
Net interest margin (2)3.43% 3.36% 0.07% 2.08%
Average earning assets/total average assets91.64% 91.74% (0.10)% (0.11)%
Average loans/average deposits91.49% 92.67% (1.18)% (1.27)%
Average noninterest deposits/total average deposits28.74% 30.18% (1.44)% (4.77)%
Allowance for loan losses/period end loans0.88% 1.03% (0.15)% (14.56)%
Nonperforming assets to period end assets0.89% 1.02% (0.13)% (12.75)%
Period end equity/period end total assets13.26% 12.32% 0.94% 7.63%
Efficiency ratio (1)63.03% 72.18% (9.15)% (12.68)%
(1) Excludes gain (loss) on investment securities
(2) Includes bank-owned life insurance
(3) Presented on a tax-equivalent basis


Selected Financial Highlights (unaudited)
TOWNEBANK
June 30, 2015
(dollars in thousands)
Increase/ % Increase/
Six Months Ended June 30, 20152015 2014 (Decrease) (Decrease)
Results of Operations:
Net interest income$88,440 $71,730 $16,710 23.30%
Noninterest income (1)61,732 48,073 13,659 28.41%
Gain (loss) on investment securities169 (60) 229 N/M
Total Revenue150,341 119,743 30,598 25.55%
Noninterest expenses99,507 85,749 13,758 16.04%
Provision for loan losses2,045 (503) 2,548 N/M
Income before income tax and noncontrolling interest48,789 34,497 14,292 41.43%
Provision for income tax expense14,586 10,337 4,249 41.10%
Net income34,203 24,160 10,043 41.57%
Net income attributable to noncontrolling interest(1,853) (1,352) (501) 37.06%
Net income attributable to TowneBank32,350 22,808 9,542 41.84%
Preferred stock dividends13 382 (369) (96.60)%
Net income available to common shareholders32,337 22,426 9,911 44.19%
Net income per common share - basic0.64 0.64 %
Net income per common share - diluted0.63 0.64 (0.01) (1.56)%
Period End Data:
Total assets$6,055,181 $4,909,843 $1,145,338 23.33%
Total assets - tangible5,879,975 4,779,709 1,100,266 23.02%
Earning assets (2)5,576,243 4,536,817 1,039,426 22.91%
Loans (net of unearned income)4,228,127 3,469,198 758,929 21.88%
Allowance for loan losses37,290 35,786 1,504 4.20%
Goodwill and other intangibles175,207 130,134 45,073 34.64%
Nonperforming assets53,609 49,905 3,704 7.42%
Noninterest bearing deposits1,363,551 1,203,040 160,511 13.34%
Interest bearing deposits3,323,101 2,592,789 730,312 28.17%
Total deposits4,686,652 3,795,829 890,823 23.47%
Total equity802,891 604,812 198,079 32.75%
Total equity - tangible627,685 474,678 153,007 32.23%
Common equity794,018 519,536 274,482 52.83%
Common equity - tangible618,812 389,402 229,410 58.91%
Book value per common share15.40 14.63 0.77 5.26%
Book value per common share - tangible12.00 10.96 1.04 9.49%
Daily Average Balances:
Total assets$5,865,372 $4,748,079 $1,117,293 23.53%
Total assets - tangible5,684,147 4,624,679 1,059,468 22.91%
Earning assets (2)5,349,362 4,357,786 991,576 22.75%
Loans (net of unearned income), excluding nonaccrual loans4,114,156 3,401,627 712,529 20.95%
Allowance for loan losses36,453 38,024 (1,571) (4.13)%
Goodwill and other intangibles181,224 123,400 57,824 46.86%
Noninterest bearing deposits1,281,690 1,078,200 203,490 18.87%
Interest bearing deposits3,245,034 2,566,436 678,598 26.44%
Total deposits4,526,724 3,644,637 882,087 24.20%
Total equity791,152 596,472 194,680 32.64%
Total equity - tangible609,928 473,072 136,856 28.93%
Common equity780,014 511,295 268,719 52.56%
Common equity - tangible598,790 387,895 210,895 54.37%
Key Ratios:
Return on average assets1.11% 0.97% 0.14% 14.43%
Return on average assets - tangible1.19% 1.03% 0.16% 15.53%
Return on average equity8.25% 7.71% 0.54% 7.00%
Return on average equity - tangible11.04% 10.03% 1.01% 10.07%
Return on average common equity8.36% 8.85% (0.49)% (5.54)%
Return on average common equity - tangible11.24% 12.04% (0.80)% (6.64)%
Net interest margin-fully tax equivalent (2)(3)3.52% 3.43% 0.09% 2.62%
Net interest margin (2)3.43% 3.36% 0.07% 2.08%
Average earning assets/total average assets91.20% 91.78% (0.58)% (0.63)%
Average loans/average deposits90.89% 93.33% (2.44)% (2.61)%
Average noninterest deposits/total average deposits28.31% 29.58% (1.27)% (4.29)%
Allowance for loan losses/period end loans0.88% 1.03% (0.15)% (14.56)%
Nonperforming assets to period end assets0.89% 1.02% (0.13)% (12.75)%
Period end equity/period end total assets13.26% 12.32% 0.94% 7.63%
Efficiency ratio (1)66.26% 71.57% (5.31)% (7.42)%
(1) Excludes gain on investment securities
(2) Includes bank-owned life insurance
(3) Presented on a tax-equivalent basis


Selected Financial Highlights (unaudited)
TOWNEBANK
June 30, 2015
(dollars in thousands, except per share data)
June 30, March 31, Increase/ % Increase/
Three Months Ended2015 2015 (Decrease) (Decrease)
Results of Operations:
Net interest income$44,884 $43,556 $1,328 3.05%
Noninterest income (1)32,966 28,767 4,199 14.60%
Gain (loss) on investment securities119 49 70 142.86%
Total Revenue77,969 72,372 5,597 7.73%
Noninterest expenses49,067 50,440 (1,373) (2.72)%
Provision for loan losses1,723 323 1,400 433.44%
Income before income tax and noncontrolling interest27,179 21,610 5,569 25.77%
Provision for income tax expense8,201 6,385 1,816 28.44%
Net income18,978 15,224 3,754 24.66%
Net income attributable to noncontrolling interest(1,166) (686) (480) 69.97%
Net income attributable to TowneBank17,812 14,538 3,274 22.52%
Preferred stock dividends and accretion 13 (13) (100.00)%
Net income available to common shareholders17,812 14,525 3,287 22.63%
Net income per common share - basic0.35 0.29 0.06 20.69%
Net income per common share - diluted0.35 0.29 0.06 20.69%
Period End Data:
Total assets$6,055,181 $5,828,703 $226,478 3.89%
Total assets - tangible5,879,975 5,649,097 230,878 4.09%
Earning assets (2)5,576,243 5,355,376 220,867 4.12%
Loans (net of unearned income)4,228,127 4,095,695 132,432 3.23%
Allowance for loan losses37,290 35,907 1,383 3.85%
Goodwill and other intangibles175,207 179,607 (4,400) (2.45)%
Nonperforming assets53,609 58,743 (5,134) (8.74)%
Noninterest bearing deposits1,363,551 1,261,482 102,069 8.09%
Interest bearing deposits3,323,101 3,244,136 78,965 2.43%
Total deposits4,686,652 4,505,618 181,034 4.02%
Total equity802,891 791,581 11,310 1.43%
Total equity - tangible627,685 611,974 15,711 2.57%
Common equity794,018 783,157 10,861 1.39%
Common equity - tangible618,812 603,550 15,262 2.53%
Book value per common share15.40 15.22 0.18 1.18%
Book value per common share - tangible12.00 11.73 0.27 2.30%
Daily Average Balances:
Total assets$5,900,816 $5,829,533 $71,283 1.22%
Total assets - tangible5,724,957 5,642,883 82,074 1.45%
Earning assets (2)5,407,516 5,290,562 116,954 2.21%
Loans (net of unearned income), excluding nonaccrual loans4,161,304 4,066,484 94,820 2.33%
Allowance for loan losses36,854 36,048 806 2.24%
Goodwill and other intangibles175,858 186,650 (10,792) (5.78)%
Noninterest bearing deposits1,307,075 1,256,023 51,052 4.06%
Interest bearing deposits3,241,276 3,248,834 (7,558) (0.23)%
Total deposits4,548,351 4,504,857 43,494 0.97%
Total equity800,369 781,833 18,536 2.37%
Total equity - tangible624,511 595,183 29,328 4.93%
Common equity791,915 767,980 23,935 3.12%
Common equity - tangible616,057 581,330 34,727 5.97%
Key Ratios:
Return on average assets1.21% 1.01% 0.20% 19.80%
Return on average assets - tangible1.28% 1.08% 0.20% 18.52%
Return on average equity8.93% 7.54% 1.39% 18.44%
Return on average equity - tangible11.77% 10.27% 1.50% 14.61%
Return on average common equity9.02% 7.67% 1.35% 17.60%
Return on average common equity - tangible11.93% 10.51% 1.42% 13.51%
Net interest margin-fully tax equivalent (2)(3)3.52% 3.52% % %
Net interest margin (2)3.43% 3.43% % %
Average earning assets/total average assets91.64% 90.75% 0.89% 0.98%
Average loans/average deposits91.49% 90.27% 1.22% 1.35%
Average noninterest deposits/total average deposits28.74% 27.88% 0.86% 3.08%
Allowance for loan losses/period end loans0.88% 0.88% % %
Nonperforming assets to period end assets0.89% 1.01% (0.12)% (11.88)%
Period end equity/period end total assets13.26% 13.58% (0.32)% (2.36)%
Efficiency ratio (1)63.03% 69.74% (6.71)% (9.62)%
(1) Excludes gain (loss) on investment securities
(2) Includes bank-owned life insurance
(3) Presented on a tax-equivalent basis


TOWNEBANK
Average Balances, Yields and Rate Paid (unaudited)
(dollars in thousands)
Three Months Ended Three Months Ended Three Months Ended
June 30, 2015 March 31, 2015 June 30, 2014
InterestAverage InterestAverage InterestAverage
AverageIncome/Yield/ AverageIncome/Yield/ AverageIncome/Yield/
BalanceExpenseRate BalanceExpenseRate BalanceExpenseRate
Assets:
Loans (net of unearned income and deferred costs), excluding nonaccrual loans$4,161,304 $48,730 4.70% $4,066,484 $47,890 4.78% $3,433,425 $40,449 4.73%
Taxable investment securities818,000 2,825 1.38% 749,414 2,801 1.49% 602,375 1,843 1.22%
Tax-exempt investment securities63,255 496 3.14% 66,812 536 3.20% 70,842 554 3.13%
Interest-bearing deposits87,709 56 0.25% 202,852 125 0.25% 177,045 111 0.25%
Loans held for sale131,305 1,161 3.54% 64,512 565 3.50% 71,883 719 4.00%
Bank-owned life insurance145,943 2,044 5.62% 140,488 1,753 5.06% 57,567 667 4.65%
Total earning assets5,407,516 55,312 4.10% 5,290,562 53,670 4.11% 4,413,137 44,343 4.03%
Less: allowance for loan losses(36,854) (36,048) (37,458)
Total nonearning assets530,154 575,019 434,903
Total assets$5,900,816 $5,829,533 $4,810,582
Liabilities and Equity:
Interest-bearing deposits
Demand and money market$1,646,075 $1,144 0.28% $1,635,454 $1,111 0.28% $1,305,681 $807 0.25%
Savings301,020 692 0.92% 305,016 683 0.91% 311,732 723 0.93%
Certificates of deposit1,294,181 2,606 0.81% 1,308,364 2,630 0.82% 969,724 1,765 0.73%
Total interest-bearing deposits3,241,276 4,442 0.55% 3,248,834 4,424 0.55% 2,587,137 3,295 0.51%
Borrowings460,993 3,382 2.90% 447,198 3,388 3.03% 426,424 3,333 3.09%
Total interest-bearing liabilities3,702,269 7,824 0.85% 3,696,032 7,812 0.86% 3,013,561 6,628 0.88%
Demand deposits1,307,075 1,256,023 1,118,051
Other noninterest-bearing liabilities91,103 95,645 77,767
Total liabilities5,100,447 5,047,700 4,209,379
Shareholders’ equity800,369 781,833 601,203
Total liabilities and equity$5,900,816 $5,829,533 $4,810,582
Net interest income (tax-equivalent basis) $47,488 $45,858 $37,715
Reconcilement of Non-GAAP Financial Measures
Bank-owned life insurance (2,044) (1,753) (667)
Tax-equivalent basis adjustment (560) (549) (510)
Net interest income (GAAP) $44,884 $43,556 $36,538
Interest rate spread (1) 3.26% 3.26% 3.15%
Interest expense as a percent of average earning assets 0.58% 0.60% 0.60%
Net interest margin (tax equivalent basis) (2) 3.52% 3.52% 3.43%
Total cost of deposits 0.39% 0.40% 0.36%

(1) Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities. Fully tax equivalent.
(2) Net interest margin is net interest income expressed as a percentage of average earning assets. Fully tax equivalent.


TOWNEBANK
Average Balances, Yields and Rate Paid (unaudited)
(dollars in thousands)
Six Months Ended Six Months Ended Six Months Ended June 30, 2015
June 30, 2015 June 30, 2014 Compared with June 30, 2014
InterestAverage InterestAverage
AverageIncome/Yield/ AverageIncome/Yield/ IncreaseChange due to
BalanceExpenseRate BalanceExpenseRate (Decrease)RateVolume
Assets:
Loans (net of unearned income and deferred costs), excluding nonaccrual loans$4,114,156 $96,619 4.74% $3,401,627 $80,169 4.75% $16,450 $(284)$16,734
Taxable investment securities783,896 5,626 1.44% 514,888 3,332 1.29% 2,294 396 1,898
Tax-exempt investment securities65,024 1,032 3.17% 71,126 1,053 2.96% (21)73 (94)
Interest-bearing deposits144,962 181 0.25% 255,157 319 0.25% (138) (138)
Loans held for sale98,093 1,726 3.52% 57,447 1,147 3.99% 579 (150)729
Bank-owned life insurance143,231 3,797 5.35% 57,541 1,416 4.96% 2,381 117 2,264
Total earning assets5,349,362 108,981 4.11% 4,357,786 87,436 4.05% 21,545 152 21,393
Less: allowance for loan losses(36,453) (38,024)
Total nonearning assets$552,463 $428,317
Total assets$5,865,372 $4,748,079
Liabilities and Equity:
Interest-bearing deposits
Demand and money market$1,640,794 $2,255 0.28% $1,282,139 $1,547 0.24% $708 $235 $473
Savings303,007 1,375 0.92% 315,476 1,448 0.93% (73)(16)(57)
Certificates of deposit1,301,233 5,236 0.81% 968,821 3,643 0.76% 1,593 270 1,323
Total interest-bearing deposits3,245,034 8,866 0.55% 2,566,436 6,638 0.52% 2,228 489 1,739
Borrowings454,134 6,770 2.96% 430,966 6,633 3.06% 137 (213)350
Subordinated debentures % %
Total interest-bearing liabilities3,699,168 15,636 0.85% 2,997,402 13,271 0.89% 2,365 276 2,089
Demand deposits1,281,690 1,078,200
Other noninterest-bearing liabilities93,362 76,005
Total liabilities5,074,220 4,151,607
Shareholders’ equity791,152 596,472
Total liabilities and equity$5,865,372 $4,748,079
Net interest income (tax-equivalent basis)$93,345 $74,165 $19,180 $(124)$19,304
Reconcilement of Non-GAAP Financial Measures
Bank-owned life insurance (3,797) (1,416) (2,381)
Tax-equivalent basis adjustment (1,108) (1,019) $(89)
Net interest income (GAAP) $88,440 $71,730 $16,710
Interest rate spread (1) 3.26% 3.15%
Interest expense as a percent of average earning assets 0.59% 0.61%
Net interest margin (tax equivalent basis) (2) 3.52% 3.43%
Total cost of deposits 0.39% 0.37%

(1) Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities. Fully tax equivalent.
(2) Net interest margin is net interest income expressed as a percentage of average earning assets. Fully tax equivalent.

TOWNEBANK
Consolidated Statements of Income (unaudited)
(dollars in thousands)
Three Months Ended Six Months Ended
June 30, June 30,
2015 2014 2015 2014
INTEREST INCOME:
Loans, including fees$48,170 $39,939 $95,511 $79,150
Investment securities3,321 2,396 6,658 4,385
Interest-bearing deposits in financial institutions and federal funds sold56 111 181 319
Mortgage loans held for sale1,161 719 1,726 1,147
Total Interest Income52,708 43,165 104,076 85,001
INTEREST EXPENSE:
Deposits4,442 3,295 8,866 6,638
Advances from the Federal Home Loan Bank3,365 3,320 6,739 6,606
Repurchase agreements and other borrowings17 12 31 27
Total Interest Expense7,824 6,627 15,636 13,271
Net Interest Income44,884 36,537 88,440 71,730
PROVISION FOR LOAN LOSSES1,723 (833) 2,045 (503)
Net Interest Income after Provision for Loan Losses43,161 37,370 86,395 72,233
NONINTEREST INCOME:
Residential mortgage banking income, net10,251 7,735 18,694 12,798
Real estate brokerage and property management income, net4,584 3,248 8,539 6,539
Insurance commissions and other title fees and income, net9,885 8,893 20,934 17,954
Service charges on deposit accounts2,326 2,366 4,523 4,498
Credit card merchant fees, net566 965 998 1,738
Other income5,354 2,139 8,044 4,546
Net gain (loss) on investment securities119 (62) 169 (60)
Total Noninterest Income33,085 25,284 61,901 48,013
NONINTEREST EXPENSE:
Salaries and employee benefits26,544 25,325 54,223 48,721
Occupancy expense4,856 4,393 9,786 8,569
Furniture and equipment2,369 2,040 4,738 4,040
Other expenses15,298 12,910 30,760 24,419
Total Noninterest Expense49,067 44,668 99,507 85,749
Income before income tax expense and noncontrolling interest27,179 17,986 48,789 34,497
Provision for income tax expense8,201 5,432 14,586 10,337
Net income18,978 12,554 34,203 24,160
Net income attributable to noncontrolling interest(1,166) (878) (1,853) (1,352)
Net income attributable to TowneBank$17,812 $11,676 $32,350 $22,808
Preferred stock dividends 191 13 382
Net income available to common shareholders$17,812 $11,485 $32,337 $22,426
Per common share information
Basic earnings$0.35 $0.33 $0.64 $0.64
Diluted earnings$0.35 $0.33 $0.63 $0.64
Cash dividends declared$0.12 $0.11 $0.23 $0.21


TOWNEBANK
Consolidated Statements of Comprehensive Income (unaudited)
(dollars in thousands)
Three Months Ended Six Months Ended
June 30, June 30,
2015 2014 2015 2014
Net income$18,978 $12,555 $34,203 $24,160
Other comprehensive income (loss)
Unrealized gains (losses) on securities
Unrealized holding gains (losses) arising during the period(3,200) 1,445 (286) 1,804
Deferred tax expense1,120 (506) 100 (632)
Realized gains reclassified into earnings 62 (49) 60
Deferred tax benefit (22) 17 (21)
Net unrealized gains (losses)(2,080) 979 (218) 1,211
Defined benefit retirement plan
Amortization18 78
Deferred tax expense(6) (27)
Change in defined benefit retirement plan, net of tax12 51
Other comprehensive income (loss), net of tax(2,068) 979 (167) 1,211
Comprehensive income$16,910 $13,534 $34,036 $25,371


TOWNEBANK
Consolidated Balance Sheets
(dollars in thousands)
June 30, December 31,
2015 2014 2014
(unaudited) (1)
ASSETS
Cash and due from banks$184,099 $268,012 $212,994
Interest-bearing deposits in financial institutions1,011 1,011 1,011
Total Cash and Cash Equivalents185,110 269,023 214,005
Securities available for sale, at fair value759,425 549,177 603,908
Securities held to maturity, at amortized cost80,195 88,148 85,247
Federal Home Loan Bank stock, at amortized cost24,058 21,987 22,157
Total Securities863,678 659,312 711,312
Mortgage loans held for sale165,994 91,763 71,390
Loans, net of unearned income and deferred costs:
Real estate - residential 1-4 family948,138 828,832 837,370
Real estate - commercial1,748,567 1,387,048 1,447,078
Real estate - construction and land development554,053 487,613 452,481
Real estate - multifamily137,378 55,620 51,472
Commercial and industrial business732,936 658,839 700,623
Consumer and other loans107,055 51,246 75,365
Loans, net of unearned income and deferred costs4,228,127 3,469,198 3,564,389
Less: Allowance for loan losses(37,290) (35,786) (35,917)
Net Loans4,190,837 3,433,412 3,528,472
Premises and equipment, net172,492 152,646 155,774
Goodwill153,191 111,761 113,159
Other intangible assets, net22,016 18,373 22,509
Bank-owned life insurance policies146,729 57,779 58,716
Other assets155,134 115,774 107,148
TOTAL ASSETS$6,055,181 $4,909,843 $4,982,485
LIABILITIES AND EQUITY
Liabilities
Deposits:
Noninterest-bearing demand$1,363,551 $1,203,040 $1,224,466
Interest-bearing:
Demand and money market accounts1,680,038 1,306,595 1,365,183
Savings300,203 192,932 301,033
Certificates of deposit1,342,860 1,093,262 955,920
Total Deposits4,686,652 3,795,829 3,846,602
Advances from the Federal Home Loan Bank437,584 394,620 398,181
Repurchase agreements and other borrowings35,737 27,525 31,893
Total Borrowings473,321 422,145 430,074
Other liabilities92,317 87,057 87,533
TOTAL LIABILITIES5,252,290 4,305,031 4,364,209
Shareholders’ Equity
Preferred stock: 2,000,000 shares authorized
0 shares issued at June 30, 2015 and 76,458 shares issued
at June 30, 2014 and December 31, 2014 76,458 76,458
Common stock, $1.667 par: 90,000,000 shares authorized
51,551,312; 35,516,140; and 35,785,679 shares issued at
June 30, 2015 and 2014 and December 31, 2014, respectively85,936 59,205 59,655
Capital surplus532,646 315,946 317,718
Retained earnings175,145 143,519 154,655
Common stock issued to deferred compensation trust, at cost
651,738; 617,886; and 627,730 shares at
June 30, 2015 and 2014 and December 31, 2014, respectively(10,110) (9,508) (9,674)
Deferred compensation trust10,110 9,508 9,674
Accumulated other comprehensive income291 867 458
TOTAL SHAREHOLDERS’ EQUITY794,018 595,995 608,944
Noncontrolling interests8,873 8,817 9,332
TOTAL EQUITY802,891 604,812 618,276
TOTAL LIABILITIES AND EQUITY$6,055,181 $4,909,843 $4,982,485

(1) As derived from the audited consolidated financial statements for December 31, 2014.

TOWNEBANK
June 30, 2015
Reconcilement of Non-GAAP Financial Measures:
(dollars in thousands)
Three Months Ended
June 30, June 30, December 31,
2015 2014 2014
Return on average assets (GAAP basis) 1.21% 0.97% 0.57%
Impact of excluding average goodwill and other intangibles and amortization 0.07% 0.02% 0.06%
Return on average tangible assets (Non-GAAP) 1.28% 0.99% 0.63%
Return on average equity (GAAP basis) 8.93% 7.79% 4.62%
Impact of excluding average goodwill and other intangibles and amortization 2.84% 2.41% 1.73%
Return on average tangible equity (Non-GAAP) 11.77% 10.2% 6.35%
Return on average common equity (GAAP basis) 9.02% 8.93% 5.21%
Impact of excluding average goodwill and other intangibles and amortization 2.91% 3.31% 2.31%
Return on average tangible common equity (Non-GAAP) 11.93% 12.24% 7.52%
Book value (GAAP basis) $15.4 $14.63 $14.88
Impact of excluding average goodwill and other intangibles and amortization (3.40) (3.63) (3.79)
Tangible book value $12.00 $10.96 $11.09


For more information contact: G. Robert Aston, Jr., Chairman and CEO, 757-638-6780 Clyde E. McFarland, Jr., Senior Executive Vice President and CFO, 757-638-6801 William B. Littreal, Chief Investment Relations Officer and COO, 757-638-6813

Source:TowneBank