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Carolina Bank Holdings, Inc. Reports EPS of $0.32 for the Second Quarter of 2015

GREENSBORO, N.C., July 30, 2015 (GLOBE NEWSWIRE) -- Carolina Bank Holdings, Inc. (NASDAQ:CLBH) today reported second quarter 2015 results with highlights as follows:

2nd Quarter 2015 Financial Highlights

  • Net income of $1,666,000 in the second quarter of 2015 increased 122.1% from $750,000 in the second quarter of 2014.
  • Net income available to common shareholders increased 212.5% to $1,572,000 in the second quarter of 2015 from $503,000 in the second quarter of 2014.
  • Diluted net income per common share was $0.32 in the second quarter of 2015 compared to $0.15 in the second quarter of 2014.
  • Convertible preferred stock, which was issued on March 31, 2015, was converted into 1,550,000 shares of new common stock in May of 2015.
  • Series A preferred stock of $11.0 million was retired using a majority of the net proceeds of $14.1 million raised in the convertible preferred stock private placement.
  • Average non-interest bearing demand deposits increased 31.5% in the second quarter of 2015 from the second quarter of 2014.
  • Non-performing assets were $17.1 million, or 2.50% of assets, at June 30, 2015 compared to $16.9 million, or 2.52% of assets, at June 30, 2014.
  • Classified loans decreased to $18.5 million at June 30, 2015 from $20.1 million at June 30, 2014.
  • The Mortgage Division realized net income of $649,000 in the second quarter of 2015 compared to a loss of $183,000 in the second quarter of 2014.

Robert T. Braswell, President and CEO, commented, "I am pleased to report that our remaining $11 million in Series A preferred stock with a 9% per annum dividend rate was repurchased and retired in May 2015, which will eliminate approximately $1 million per year in dividend payments. Our Series B convertible preferred stock, which was issued on March 31, 2015 in a private placement offering, was also converted to common stock in May after an affirmative vote by our stockholders. The above actions have improved our capital position and provide a base for future growth."

"Our diluted earnings per share which totaled $1.25 over the last four quarters and $0.32 in the second quarter of 2015 reflect our success in executing our business plans. The growth of over 31% in our average non-interest bearing demand accounts in the past year validates that our emphasis on exceptional customer service has enhanced our relationships with customers," said Braswell.

Braswell further commented, "It is with great pleasure that I announce that J. Alexander S. Barrett, a Partner with Hagan Barrett Langley, PLLC, practicing in the areas of complex business and commercial litigation and employment law, was unanimously elected as Chairman of the Board. Alex has been a Board member since 2004 and has chaired a number of committees. I would also like to thank Gary N. Brown, who was a founding director, for his outstanding service as our Chairman for six years and prior service as Vice Chairman for twelve years. Gary will continue on the Board and has agreed to serve again as Vice Chairman."

About the Company

Carolina Bank, the banking subsidiary of Carolina Bank Holdings, Inc. began banking operations on November 25, 1996. The parent company is a North Carolina corporation organized in 2000. The bank is engaged in lending and deposit gathering activities in the Piedmont Triad of North Carolina, with operations in four counties: Guilford, Alamance, Forsyth and Randolph. The bank has eight full-service banking locations, four in Greensboro, one in Asheboro, one in High Point, one in Burlington, and one in Winston-Salem. Our Greensboro Friendly Center branch will close on July 31, 2015 due to an expiring lease in late 2015. Our second full-service office in Winston-Salem, currently under construction, will open in August of 2015. Residential mortgage loan production offices are located in Burlington, Chapel Hill, Pinehurst, and Sanford in addition to a wholesale residential mortgage operation in Greensboro. The Company's stock is listed on the NASDAQ Global Market under the symbol CLBH. Further information is available on the Company's web site: www.carolinabank.com.

This press release contains forward-looking statements regarding future events. These statements are only predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks of managing our growth, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to be materially different from those in the forward-looking statements is contained in the Company's filings with the Securities and Exchange Commission. Carolina Bank Holdings, Inc. undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.

Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Balance Sheets
June 30, December 31,
2015 2014
(unaudited)
(in thousands, except share data)
Assets
Cash and due from banks $ 6,245 $ 7,942
Interest-bearing deposits with banks 25,343 38,232
Bank term deposits 14,106 14,106
Securities available-for-sale, at fair value 48,198 51,200
Securities held-to-maturity (fair values of $15,253 in 2015 and $15,945 in 2014) 15,068 15,644
Loans held for sale 70,897 39,780
Loans 461,000 472,189
Less allowance for loan losses (5,795) (6,520)
Net loans 455,205 465,669
Premises and equipment, net 18,916 18,311
Other real estate owned 5,352 5,610
Bank-owned life insurance 11,660 11,483
Other assets 12,695 11,286
Total assets $ 683,685 $ 679,263
Liabilities and Stockholders' Equity
Deposits
Non-interest bearing demand $ 112,751 $ 106,163
NOW, money market and savings 339,731 344,919
Time 140,237 143,816
Total deposits 592,719 594,898
Advances from the Federal Home Loan Bank 2,733 2,785
Securities sold under agreements to repurchase 63 176
Subordinated debentures 19,610 19,610
Other liabilities and accrued expenses 10,100 9,139
Total liabilities 625,225 626,608
Stockholders' equity
Preferred stock, no par value, authorized 1,000,000 shares; Series A preferred shares issued and outstanding 0 in 2015 and 10,994 in 2014 -- 10,994
Common stock, $1 par value; authorized 20,000,000 shares; issued and outstanding 4,986,380 in 2015 and 3,434,680 in 2014 4,986 3,435
Additional paid-in capital 28,875 16,339
Retained earnings 23,702 20,748
Stock in directors' rabbi trust (1,641) (1,465)
Directors' deferred fees obligation 1,641 1,465
Accumulated other comprehensive income 897 1,139
Total stockholders' equity 58,460 52,655
Total liabilities and stockholders' equity $ 683,685 $ 679,263
Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Statements of Income (unaudited)
Three Months Six Months
Ended June 30, Ended June 30,
2015 2014 2015 2014
(in thousands, except per share data)
Interest income
Loans $ 6,025 $ 5,858 $ 12,017 $ 11,612
Investment securities, taxable 325 411 663 831
Investment securities, non taxable 125 136 247 278
Interest from deposits in banks 65 49 126 109
Total interest income 6,540 6,454 13,053 12,830
Interest expense
NOW, money market, savings 237 240 476 476
Time deposits 287 407 599 825
Other borrowed funds 151 164 303 328
Total interest expense 675 811 1,378 1,629
Net interest income 5,865 5,643 11,675 11,201
Provision for loan losses 535 346 835 1,116
Net interest income after provision for loan losses 5,330 5,297 10,840 10,085
Non-interest income
Service charges 312 321 615 620
Mortgage banking income 3,721 1,954 6,628 3,287
Gain on sale of investment securities available-for-sale -- 94 27 143
Other 95 (29) 141 40
Total non-interest income 4,128 2,340 7,411 4,090
Non-interest expense
Salaries and benefits 4,582 4,016 8,900 7,851
Occupancy and equipment 759 793 1,535 1,554
Foreclosed property expense 155 58 24 163
Professional fees 454 546 903 1,004
Outside data processing 265 275 539 526
FDIC insurance 130 133 261 267
Advertising and promotion 160 173 353 494
Stationery, printing and supplies 147 141 298 278
Other 449 577 830 910
Total non-interest expense 7,101 6,712 13,643 13,047
Income before income taxes 2,357 925 4,608 1,128
Income tax expense 691 175 1,313 113
Net income 1,666 750 3,295 1,015
Dividends on preferred stock 94 247 341 438
Net income available to common stockholders $ 1,572 $ 503 $ 2,954 $ 577
Net income per common share
Basic $ 0.38 $ 0.15 $ 0.78 $ 0.17
Diluted $ 0.32 $ 0.15 $ 0.70 $ 0.17
Carolina Bank Holdings, Inc.
Consolidated Financial Highlights
Second Quarter 2015
(unaudited)
Quarterly Years Ended
2nd Qtr 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr
($ in thousands except for share data) 2015 2015 2014 2014 2014 2014 2013
EARNINGS
Net interest income $ 5,865 5,810 6,164 5,892 5,643 23,509 22,315
Provision for loan losses $ 535 300 50 270 346 966 3,450
NonInterest income $ 4,128 3,283 2,721 2,602 2,340 9,413 14,334
NonInterest expense $ 7,101 6,542 7,128 6,829 6,712 27,004 27,620
Net income $ 1,666 1,629 1,319 1,012 750 4,710 4,010
Net income available to common stockholders $ 1,572 1,382 1,072 764 503 3,721 2,928
Basic earnings per common share $ 0.38 0.40 0.31 0.22 0.15 1.08 0.86
Diluted earnings per common share $ 0.32 0.40 0.31 0.22 0.15 1.08 0.85
Average common shares outstanding 4,099,303 3,434,680 3,434,680 3,431,933 3,430,036 3,432,832 3,410,974
Average diluted common shares outstanding 4,988,938 3,451,902 3,434,680 3,432,130 3,434,101 3,438,203 3,426,764
PERFORMANCE RATIOS
Return on average assets * 0.96% 0.97% 0.78% 0.60% 0.46% 0.71% 0.60%
Return on average common equity ** 11.38% 13.24% 10.36% 7.56% 5.12% 9.32% 7.52%
Net interest margin (fully-tax equivalent) * 3.65% 3.75% 3.95% 3.81% 3.74% 3.84% 3.59%
Efficiency ratio 70.38% 71.21% 79.39% 79.48% 83.19% 81.16% 74.88%
Efficiency ratio (excluding mortgage division) 69.79% 68.63% 73.94% 68.81% 73.10% 71.03% 69.63%
# full-time equivalent employees - period end 192 191 189 193 195 189 191
CAPITAL
Equity to period-end assets 8.55% 9.60% 7.75% 7.68% 7.57% 7.75% 7.50%
Common tangible equity to assets 8.55% 6.07% 6.13% 6.03% 5.93% 6.13% 5.83%
Tier 1 leverage capital ratio - Bank 9.24% 9.20% 9.11% 9.03% 9.07% 9.11% 8.86%
Tier 1 risk-based capital ratio - Bank 11.23% 11.25% 11.42% 11.05% 10.81% 11.42% 11.19%
Total risk-based capital ratio - Bank 13.21% 13.50% 13.67% 13.61% 13.41% 13.67% 13.85%
Book value per common share *** $ 11.72 11.48 12.13 11.75 11.57 12.13 11.26
ASSET QUALITY
Net loan charge-offs (recoveries) $ 1,694 (134) 76 927 1,432 2,301 5,731
Net charge-offs (recoveries) to average loans * 1.45% -0.11% 0.06% 0.80% 1.26% 0.50% 1.33%
Allowance for loan losses $ 5,795 6,954 6,520 6,546 7,203 6,520 7,663
Allowance for loan losses to loans held invst. 1.26% 1.49% 1.38% 1.39% 1.55% 1.38% 1.73%
Nonperforming loans $ 11,716 6,362 6,458 10,348 12,435 6,458 16,731
Performing restructured loans $ 9,450 9,548 9,774 9,883 9,983 9,774 10,381
Other real estate owned $ 5,352 5,116 5,610 5,587 4,431 5,610 2,329
Nonperforming loans to loans held for investment 2.54% 1.36% 1.37% 2.20% 2.68% 1.37% 3.77%
Nonperforming assets to total assets 2.50% 1.62% 1.78% 2.40% 2.52% 1.78% 2.88%
END OF PERIOD BALANCES
Total assets $ 683,685 710,672 679,263 669,029 669,162 679,263 661,807
Total loans held for investment $ 461,000 467,232 472,189 470,782 464,706 472,189 444,087
Total deposits $ 592,719 609,417 594,898 586,940 577,313 594,898 579,097
Stockholders' equity $ 58,460 68,238 52,655 51,352 50,679 52,655 49,604
AVERAGE BALANCES
Total assets $ 699,101 682,777 675,159 669,168 656,724 664,812 671,529
Total earning assets $ 654,317 638,368 629,331 623,761 613,582 620,996 627,491
Total loans held for investment $ 465,914 472,073 475,106 466,268 455,798 462,870 432,471
Total non interest-bearing demand deposits $ 118,577 110,318 104,241 96,248 90,186 94,618 82,343
Common stockholders' equity $ 55,414 42,341 41,065 40,069 39,401 39,904 38,927
* annualized for all periods presented
**return on average common equity is computed using net income available to common stockholders
***assumes conversion of convertible preferred stock to 1,550,000 shares of common stock in 1st Quarter 2015

CONTACT: FOR ADDITIONAL INFORMATION, PLEASE CONTACT: Carolina Bank Holdings, Inc. T. Allen Liles, EVP and CFO Telephone: 336-286-8746 Email: a.liles@carolinabank.comSource:Carolina Bank Holdings, Inc.