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First National Community Bancorp, Inc. Announces Second Quarter 2015 Net Income

DUNMORE, Pa., July 30, 2015 (GLOBE NEWSWIRE) -- First National Community Bancorp, Inc. (OTCQX:FNCB), the parent company of Dunmore-based First National Community Bank (the "Bank"), today reported net income for the three months ended June 30, 2015 of $0.8 million, or $0.05 per basic and diluted share. Net income for the comparable period of 2014 was $6.6 million, or $0.40 per basic and diluted share. For the six months ended June 30, 2015, net income was $4.3 million, or $0.26 per basic and diluted share, a decrease of $5.8 million compared to $10.1 million, or $0.61 per basic and diluted share, for the same six months of 2014. The decrease in quarter- and year-to-date earnings reflected non-recurring income recorded in 2014 related to two legal settlements received in the second quarter of 2014 and a gain on the sale of the Company's retail banking operations in Monroe County in the first quarter of 2014.

Annualized return on average assets was 0.34% and 0.89%, respectively for the three and six-month periods ended June 30, 2015, compared to 2.73% and 2.09%, respectively, for the same periods of 2014. For the second quarter and year-to-date periods of 2015, annualized return on average equity was 5.89% and 15.84%, respectively, and 60.91% and 50.62%, respectively, for the comparable 2014 periods.

On June 30, 2015, pursuant to approval from both the holders of the Company's fixed-rate subordinated notes due 2019 (the "Notes") and the Federal Reserve Bank of Philadelphia, the Company amended the original terms of the Notes to reduce the annual interest rate from 9.00% to 4.50% effective July 1, 2015 and to accelerate a partial repayment of principal amount. On June 30, 2015, the Company repaid $11.0 million, or 44.0%, of outstanding principal. These changes equate to a savings of $1.6 million in annual interest expense related to the Notes.

Second Quarter 2015 Highlights:

  • Lowered annual interest rate on the Notes by 50.0% and made a 44.0% principal reduction payment;
  • Total deposit growth of $70.0 million, or 8.8%, from the end of 2014 and $90.3 million, or 11.6%, from the end of the first quarter of 2015; and
  • Non-interest expense decreased 20.6% comparing the six-month periods ended June 30, 2015 and 2014.

"Amending the interest rate and accelerating repayment of 44.0% of the principal on the Notes was a key strategic transaction for the Company that will improve our net interest margin and profitability going forward," stated Steven R. Tokach, President and Chief Executive Officer. "Additionally, future non-interest expense levels should benefit from reduced insurance costs, given our improved risk profile," concluded Mr. Tokach.

Summary Results for the Three and Six Months Ended June 30, 2015

Net interest income before credit for loan and lease losses was $6.3 million for the second quarter, and $12.6 million for the six months ended June 30, 2015 compared to $6.7 million and $13.2 million for the same periods in 2014. The decrease was primarily a result of lower interest and dividend income on securities, which reflected tax planning strategies involving the repositioning of the investment portfolio from tax-exempt securities into taxable securities and the timing of the reinvestment of sales proceeds. Partially offsetting the reduction in interest income was a $0.3 million reduction in interest expense, which was primarily due to a decrease in funding costs. The tax-equivalent net interest margin for second quarter 2015 was 2.85%, which was unchanged from the first quarter of 2015, and a decrease of 30 basis points from the prior year period. The Company anticipates an improvement in its future funding costs and tax-equivalent net interest margin as a result of the 50.0% reduction in the annual interest rate and 44.0% principal reduction of the Notes.

Non-interest income was $1.6 million and $5.0 million, respectively, for the three and six months ended June 30, 2015, compared to $5.0 million and $8.4 million, respectively, for the same periods in 2014. The decrease in second quarter and year-to-date 2015 non-interest income was primarily due to nonrecurring income recorded in the comparable periods of 2014. In the second quarter of 2014, the Company received $2.1 million in recoveries related to two legal settlements, one of which was the recovery of all past due interest, late charges and legal and other expenses as part of a settlement of previously charged-off commercial real estate loans, and the other was a recovery in connection with a previously disclosed shareholder derivative suit. In addition, net gains on the sale of securities decreased $1.4 million and $0.7 million, respectively, comparing the three and six month periods ended June 30, 2015 and 2014. Also impacting the decrease in non-interest income for the year-to-date periods, were nonrecurring income in 2014 from the legal settlements detailed above and the divestiture of retail banking operations in Monroe County.

For the three months ended June 30, 2015, non-interest expense decreased $2.3 million, or 25.5%, to $6.7 million, from $9.0 million for the same three months of 2014. On a year-to-date basis, non-interest expense decreased $3.5 million, or 20.6%, to $13.5 million in 2015 from $17.0 million in 2014. For both the three-month and year-to-date periods, the decrease resulted primarily from reductions in expenses of other real estate owned, legal expense and Federal Deposit Insurance Corporate ("FDIC") insurance expense. With regard to the reduction in FDIC insurance, the Company was notified during the second quarter of 2015 that it was now considered in Risk Category I, the lowest risk category, for assessment purposes. Also during the second quarter of 2015, due to its improved risk profile, the Company renewed its professional liability, fidelity bond and errors and omissions insurance policies at considerably lower rates.

Asset Quality

The Company recorded net charge-offs of $1.0 million and $1.1 million, respectively, for the three and six months ended June 30, 2015, respectively, compared to net recoveries of $3.6 million and $3.7 million, respectively, for the same periods of 2014. During the second quarter of 2015, the Company recorded a partial charge-off in the amount of $0.9 million on one commercial real estate loan. The net recovery position in 2014 was due largely to the previously mentioned legal settlement. The majority of the balance of net charge-offs was recorded during the second quarter of 2015.

Total non-performing loans were $5.8 million at June 30, 2015, an increase of $0.6 million, or 11.1%, from $5.2 million at March 31, 2015, and $0.2 million, or 4.3%, from December 31, 2014. The ratio of non-performing loans to total loans was 0.84% at June 30, 2015 compared to 0.77% at March 31, 2015 and 0.82% at December 31, 2014. (At March 31, 2015, the most recent data available, the FDIC average for commercial banks with assets between $1.0 billion and $3.0 billion at March 31, 2015 was 0.91%.) The allowance for loan and lease losses as a percentage of gross loans was 1.51% at June 30, 2015, 1.63% at March 31, 2015 and 1.72% at the end of 2014. (The above described FDIC peer group average was 1.35% at March 31, 2015.)

Financial Condition

Total assets increased $57.6 million, or 5.9%, to $1.0 billion at June 30, 2015 as compared to $970.0 million at December 31, 2014. The balance sheet growth largely reflected a $36.6 million increase in cash and cash equivalents, which resulted from a $70.0 million or 8.8%, increase in total deposits, partially offset by a $14.4 million, or 14.9%, reduction in borrowed funds. Interest-bearing deposits increased $50.0 million, or 7.5% from year-end 2014 to the close of the second quarter of 2015, while non-interest bearing demand deposits grew by $20.0 million, or 16.1%. The increase in interest-bearing deposits primarily reflected the attainment of a large deposit relationship, partially offset by the planned runoff of higher-costing certificates of deposit generated through QwickRate®, a national deposit listing service. The Company experienced moderate loan demand, as loans, net of unearned income, net deferred loan fees and costs and the ALLL, increased $14.5 million, or 2.2% from December 31, 2014 to June 30, 2015. The reduction in borrowed funds reflected decreases of $3.4 million, or 5.6%, in FHLB of Pittsburgh advances and $11.0 million, or 44.0%, in the Company's Notes.

Total shareholders' equity increased $3.5 million, or 6.9%, to $54.9 million at June 30, 2015 from $51.4 million at December 31, 2014. The capital improvement resulted primarily from net income of $4.3 million partially offset by a $0.8 million decrease in accumulated other comprehensive income, which resulted entirely from depreciation in the fair value of available-for-sale securities offset by the tax impact of the depreciation. At June 30, 2015, the Company's total risk-based capital and Tier I leverage ratios were 11.60% and 6.64%, respectively. The respective ratios for the Bank at June 30, 2015 were 13.82% and 9.28%. The ratios well exceeded the 10.00% and 5.00% required to be well capitalized under the prompt corrective action provisions of the Basel III capital framework for U.S. banking organizations, which became effective for the Company and the Bank on January 1, 2015.

Availability of Filings

Copies of the Company's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q will be provided upon request from: Shareholder Relations, First National Community Bancorp, Inc., 102 East Drinker Street, Dunmore, PA 18512 or by calling (570) 348-6419. These reports, along with all of the Company's filings with the Securities and Exchange Commission are also available on the Investor Relations page of the Company's website, www.fncb.com/investorrelations.

About First National Community Bank:

First National Community Bancorp, Inc. is the bank holding company of First National Community Bank, which provides personal, small business and commercial banking services to individuals and businesses throughout Lackawanna, Luzerne, and Wayne Counties in Northeastern Pennsylvania. The institution was established as a National Banking Association in 1910 as The First National Bank of Dunmore, and has been operating under its current name since 1988. For more information about FNCB, visit www.fncb.com.

The Company may from time to time make written or oral "forward-looking statements," including statements contained in the Company's filings with the Securities and Exchange Commission ("SEC"), in its reports to shareholders, and in other communications by the Company, which are made in good faith by the Company pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include statements with respect to the Company's beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, that are subject to significant risks and uncertainties, and are subject to change based on various factors (some of which are beyond the Company's control). The words "may," "could," "should," "would," "believe," "anticipate," "estimate," "expect," "intend," "plan" and similar expressions are intended to identify forward-looking statements. The following factors, among others, could cause the Company's financial performance to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements: the strength of the United States economy in general and the strength of the local economies in the Company's markets; the effects of, and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market and monetary fluctuations; the timely development of and acceptance of new products and services; the ability of the Company to compete with other institutions for business; the composition and concentrations of the Company's lending risk and the adequacy of the Company's reserves to manage those risks; the valuation of the Company's investment securities; the ability of the Company to pay dividends or repurchase common shares; the ability of the Company to retain key personnel; the impact of any pending or threatened litigation against the Company; the marketability of shares of the Company and fluctuations in the value of the Company's share price; the impact of the Company's ability to comply with its regulatory agreements and orders; the effectiveness of the Company's system of internal controls; the ability of the Company to attract additional capital investment; the impact of changes in financial services' laws and regulations (including laws concerning capital adequacy, taxes, banking, securities and insurance); the impact of technological changes and security risks upon the Company's information technology systems; changes in consumer spending and saving habits; the nature, extent, and timing of governmental actions and reforms, and the success of the Company at managing the risks involved in the foregoing and other risks and uncertainties, including those detailed in the Company's filings with the SEC.

The Company cautions that the foregoing list of important factors is not all inclusive. Readers are also cautioned not to place undue reliance on any forward-looking statements, which reflect management's analysis only as of the date of this report, even if subsequently made available by the Company on its website or otherwise. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company to reflect events or circumstances occurring after the date of this report.

Readers should carefully review the risk factors described in the Annual Report and other documents that the Company periodically files with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2014.

First National Community Bancorp, Inc.
Selected Financial Data
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
2015 2015 2014 2014 2014
Per share data:
Net income (fully diluted) $ 0.05 $ 0.21 $ -- $ 0.20 $ 0.40
Cash dividends declared $ -- $ -- $ -- $ -- $ --
Book value $ 3.33 $ 3.38 $ 3.12 $ 3.06 $ 2.99
Tangible book value $ 3.32 $ 3.36 $ 3.10 $ 3.03 $ 2.96
Market value:
High $ 6.55 $ 5.40 $ 6.65 $ 6.85 $ 6.85
Low $ 5.15 $ 5.25 $ 5.60 $ 5.75 $ 5.16
Close $ 6.05 $ 5.26 $ 6.00 $ 6.75 $ 6.05
Common shares outstanding 16,500,945 16,500,945 16,484,419 16,471,569 16,471,569
Selected ratios:
Annualized return on average assets 0.34% 1.45% (0.01)% 1.38% 2.73%
Annualized return on average shareholders' equity 5.89% 26.34% (0.24)% 26.81% 60.91%
Tier I leverage ratio 6.64% 6.57% 6.05% 6.19% 5.84%
Total risk-based capital to risk-adjusted assets 11.60% 12.96% 13.67% 13.50% 13.07%
Average shareholders' equity to average total assets 5.73% 5.52% 5.22% 5.14% 4.49%
Yield on earning assets (FTE) 3.45% 3.48% 3.56% 3.84% 3.83%
Cost of funds 0.73% 0.75% 0.79% 0.80% 0.80%
Net interest spread (FTE) 2.72% 2.73% 2.77% 3.04% 3.03%
Net interest margin (FTE) 2.85% 2.85% 2.90% 3.18% 3.15%
Total delinquent loans/total loans 1.34% 1.10% 1.21% 1.16% 1.24%
Allowance for loan and lease losses/total loans 1.51% 1.63% 1.72% 1.76% 1.82%
Non-performing loans/total loans 0.84% 0.77% 0.82% 0.82% 0.83%
Net charge-offs (recoveries)/average loans 0.14% 0.01% 0.02% 0.03% (0.54)%
First National Community Bancorp, Inc.
Year-to-Date Consolidated Statements of Income
Six Months Ended
June 30,
(in thousands, except share data) 2015 2014
Interest income
Interest and fees on loans $ 12,947 $ 13,106
Interest and dividends on securities
U.S. government agencies 1,983 1,603
State and political subdivisions, tax-free 72 1,270
State and political subdivisions, taxable 123 195
Other securities 239 132
Total interest and dividends on securities 2,417 3,200
Interest on interest-bearing deposits in other banks 32 36
Total interest income 15,396 16,342
Interest expense
Interest on deposits 1,326 1,684
Interest on borrowed funds
Interest on Federal Home Loan Bank of Pittsburgh advances 239 209
Interest on subordinated debentures 1,128 1,131
Interest on junior subordinated debentures 100 99
Total interest on borrowed funds 1,467 1,439
Total interest expense 2,793 3,123
Net interest income before provision (credit) for loan and lease losses 12,603 13,219
Provision (Credit) for loan and lease losses (149) (5,575)
Net interest income after provision (credit) for loan and lease losses 12,752 18,794
Non-interest income
Deposit service charges 1,419 1,436
Net gain on the sale of securities 2,298 3,048
Net gain on the sale of mortgage loans held for sale 56 166
Net loss on the sale of education loans -- (13)
Net gain on the sale of other real estate owned 16 68
Gain on branch divestitures -- 607
Loan-related fees 196 191
Income from bank-owned life insurance 270 331
Legal settlements 184 2,127
Other 525 454
Total non-interest income 4,964 8,415
Non-interest expense
Salaries and employee benefits 6,342 6,493
Occupancy expense 1,165 1,116
Equipment expense 826 713
Advertising expense 249 244
Data processing expense 949 1,048
Regulatory assessments 508 1,123
Bank shares tax 435 351
Expense of other real estate owned 247 1,981
Legal expense 251 1,160
Professional fees 587 934
Insurance expense 400 561
Other operating expenses 1,503 1,232
Total non-interest expense 13,462 16,956
Income before income taxes 4,254 10,253
(Credit) provision for income taxes (40) 160
Net income $ 4,294 $ 10,093
Income per share
Basic $ 0.26 $ 0.61
Diluted $ 0.26 $ 0.61
Cash dividends declared per common share $ -- $ --
Weighted average number of shares outstanding:
Basic 16,495,558 16,471,569
Diluted 16,495,558 15,471,992
First National Community Bancorp, Inc.
Quarter-to-Date Consolidated Statements of Income
Three Months Ended
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(in thousands, except share data) 2015 2015 2014 2014 2014
Interest income
Interest and fees on loans $ 6,475 $ 6,472 $ 6,671 $ 6,852 $ 6,612
Interest and dividends on securities
U.S. government agencies 1,012 971 998 893 860
State and political subdivisions, tax-free 22 50 204 409 560
State and political subdivisions, taxable 97 26 53 76 97
Other securities 82 157 66 74 76
Total interest and dividends on securities 1,213 1,204 1,321 1,452 1,593
Interest on interest-bearing deposits in other banks 11 21 27 8 13
Total interest income 7,699 7,697 8,019 8,312 8,218
Interest expense
Interest on deposits 643 683 745 751 819
Interest on borrowed funds
Interest on Federal Home Loan Bank of Pittsburgh advances 119 120 116 125 113
Interest on subordinated debentures 565 563 575 575 568
Interest on junior subordinated debentures 51 49 87 50 50
Total interest on borrowed funds 735 732 778 750 731
Total interest expense 1,378 1,415 1,523 1,501 1,550
Net interest income before provision (credit) for loan and lease losses 6,321 6,282 6,496 6,811 6,668
Provision (Credit) for loan and lease losses 345 (494) (240) (54) (4,005)
Net interest income after provision (credit) for loan and lease losses 5,976 6,776 6,736 6,865 10,673
Non-interest income
Deposit service charges 745 674 758 781 746
Net gain on the sale of securities 74 2,224 634 2,958 1,480
Net gain on the sale of mortgage loans held for sale 16 40 69 57 91
Net loss on the sale of education loans -- -- -- -- --
Net gain on the sale of other real estate owned 11 5 106 35 39
Loan-related fees 106 90 148 101 98
Income from bank-owned life insurance 135 135 154 165 164
Legal settlements 184 -- -- -- 2,127
Other 274 251 194 345 217
Total non-interest income 1,545 3,419 2,063 4,442 4,962
Non-interest expense
Salaries and employee benefits 3,203 3,139 3,302 3,316 3,093
Occupancy expense 532 633 534 438 472
Equipment expense 442 384 403 355 357
Data processing expense 501 448 532 508 526
Regulatory assessments 99 409 412 266 450
Bank shares tax 218 217 150 21 175
Expense of other real estate owned 147 100 74 514 1,818
Legal expense 88 163 371 268 513
Professional fees 286 301 327 306 484
Insurance expense 202 198 194 196 279
Other operating expenses 962 790 2,531 1,595 798
Total non-interest expense 6,680 6,782 8,830 7,783 8,965
Income before income taxes 841 3,413 (31) 3,524 6,670
Provision (Credit) for income taxes 22 (62) -- 166 90
Net income $ 819 $ 3,475 $ (31) $ 3,358 $ 6,580
Income per share
Basic $ 0.05 $ 0.21 $ -- $ 0.20 $ 0.40
Diluted $ 0.05 $ 0.21 $ -- $ 0.20 $ 0.40
Cash dividends declared per common share $ -- $ -- $ -- $ -- $ --
Weighted average number of shares outstanding:
Basic 16,500,945 16,490,111 16,475,899 16,471,569 16,471,569
Diluted 16,500,945 16,490,111 16,475,899 16,471,569 16,471,569
First National Community Bancorp, Inc.
Consolidated Balance Sheets
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(in thousands) 2015 2015 2014 2014 2014
Assets
Cash and cash equivalents:
Cash and due from banks $ 22,443 $ 19,985 $ 22,657 $ 21,532 $ 21,429
Interest-bearing deposits in other banks 49,872 17,390 13,010 18,461 9,220
Total cash and cash equivalents 72,315 37,375 35,667 39,993 30,649
Securities available for sale at fair value 226,539 204,635 218,989 217,412 209,264
Stock in Federal Home Loan Bank of Pittsburgh at cost 2,684 3,061 2,803 4,356 4,339
Loans held for sale 138 -- 603 171 424
Loans, net of net deferred costs and unearned income 683,588 672,165 670,267 678,160 670,977
Allowance for loan and lease losses (10,328) (10,944) (11,520) (11,898) (12,175)
Net loans 673,260 661,221 658,747 666,262 658,802
Bank premises and equipment, net 11,059 11,221 11,003 11,094 11,338
Accrued interest receivable 2,174 2,118 2,075 2,158 2,272
Intangible assets 220 261 302 344 385
Bank-owned life insurance 29,087 28,952 28,817 28,663 28,498
Other real estate owned 1,740 2,369 2,255 2,617 3,182
Other assets 8,455 9,028 8,768 9,063 8,722
Total assets $ 1,027,671 $ 960,241 $ 970,029 $ 982,133 $ 957,875
Liabilities
Deposits:
Demand (non-interest-bearing) $ 144,075 $ 134,993 $ 124,064 $ 148,430 $ 125,578
Interest-bearing 721,293 640,118 671,272 654,766 644,660
Total deposits 865,368 775,111 795,336 803,196 770,238
Borrowed funds:
Federal Home Loan Bank of Pittsburgh advances 57,771 67,612 61,194 68,786 77,378
Subordinated debentures 14,000 25,000 25,000 25,000 25,000
Junior subordinated debentures 10,310 10,310 10,310 10,310 10,310
Total borrowed funds 82,081 102,922 96,504 104,096 112,688
Accrued interest payable 11,344 10,788 10,262 10,515 9,953
Other liabilities 13,935 15,678 16,529 14,005 15,790
Total liabilities 972,728 904,499 918,631 931,812 908,669
Shareholders' equity
Preferred stock -- -- -- -- --
Common stock 20,626 20,626 20,605 20,589 20,589
Additional paid-in capital 61,870 61,801 61,781 61,692 61,664
Accumulated deficit (27,832) (28,651) (32,126) (32,095) (35,453)
Accumulated other comprehensive income 279 1,966 1,138 135 2,406
Total shareholders' equity 54,943 55,742 51,398 50,321 49,206
Total liabilities and shareholders' equity $ 1,027,671 $ 960,241 $ 970,029 $ 982,133 $ 957,875
First National Community Bancorp, Inc.
Summary Tax-equivalent Net Interest Income
Three Months Ended
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(dollars in thousands) 2015 2015 2014 2014 2014
Interest income
Loans:
Loans - taxable $ 6,148 $ 6,148 $ 6,340 $ 6,524 $ 6,292
Loans - tax-free 495 491 501 497 485
Total loans 6,643 6,639 6,841 7,021 6,777
Securities:
Securities, taxable 1,191 1,154 1,117 1,043 1,033
Securities, tax-free 33 76 309 620 848
Total interest and dividends on securities 1,224 1,230 1,426 1,663 1,881
Interest-bearing deposits in other banks 11 21 27 8 13
Total interest income 7,878 7,890 8,294 8,692 8,671
Interest expense
Deposits 643 683 745 751 819
Borrowed funds 735 732 778 750 731
Total interest expense 1,378 1,415 1,523 1,501 1,550
Net interest income $ 6,500 $ 6,475 $ 6,771 $ 7,191 $ 7,121
Average balances
Earning assets:
Loans:
Loans - taxable $ 637,005 $ 633,731 $ 635,146 $ 635,032 $ 622,815
Loans - tax-free 42,225 41,125 40,477 39,849 39,465
Total loans 679,230 674,856 675,623 674,881 662,280
Securities:
Securities, taxable 211,833 194,268 196,351 177,863 174,076
Securities, tax-free 2,007 4,283 17,055 36,246 48,349
Total interest and dividends on securities 213,840 198,551 213,406 214,109 222,425
Interest-bearing deposits in other banks 18,984 34,708 43,618 15,983 20,782
Total interest-earning assets 912,054 908,115 932,647 904,973 905,487
Non-earning assets 62,254 61,476 58,826 62,582 60,607
Total assets $ 974,308 $ 969,591 $ 991,473 $ 967,555 $ 966,094
Interest-bearing liabilities:
Deposits $ 646,656 $ 658,193 $ 675,901 $ 640,394 $ 676,969
Borrowed funds 108,234 99,046 99,251 114,137 94,952
Total interest-bearing liabilities 754,890 757,239 775,152 754,531 771,921
Demand deposits 137,674 132,316 139,336 137,992 126,372
Other liabilities 25,964 26,525 25,278 25,337 24,470
Shareholders' equity 55,780 53,511 51,707 49,695 43,331
Total liabilities and shareholders' equity $ 974,308 $ 969,591 $ 991,473 $ 967,555 $ 966,094
Yield/Cost
Earning assets:
Loans:
Interest and fees on loans - taxable 3.86% 3.88% 3.99% 4.11% 4.04%
Interest and fees on loans - tax-free 4.69% 4.78% 4.95% 4.99% 4.91%
Total loans 3.91% 3.94% 4.05% 4.16% 4.09%
Securities:
Securities, taxable 2.25% 2.38% 2.28% 2.35% 2.37%
Securities, tax-free 6.64% 7.10% 7.25% 6.84% 7.02%
Total interest and dividends on securities 2.29% 2.48% 2.67% 3.11% 3.38%
Interest on interest-bearing deposits in other banks 0.23% 0.24% 0.25% 0.20% 0.25%
Total earning assets 3.45% 3.48% 3.56% 3.84% 3.83%
Interest-bearing liabilities:
Interest on deposits 0.40% 0.42% 0.44% 0.47% 0.48%
Interest on borrowed funds 2.72% 2.96% 3.14% 2.63% 3.08%
Total interest-bearing liabilities 0.73% 0.75% 0.79% 0.80% 0.80%
Net interest spread 2.72% 2.73% 2.77% 3.04% 3.03%
Net interest margin 2.85% 2.85% 2.90% 3.18% 3.15%
First National Community Bancorp, Inc.
Asset Quality Data
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(in thousands) 2015 2015 2014 2014 2014
At period end
Non-accrual loans, including non-performing troubled debt restructured loans (TDRs) $ 5,757 $ 5,184 $ 5,522 $ 5,539 $ 5,550
Loans past due 90 days or more and still accruing -- -- -- 49 --
Total non-performing loans 5,757 5,184 5,522 5,588 5,550
Other real estate owned (OREO) 1,740 2,369 2,255 2,617 3,182
Total non-performing loans and OREO $ 7,497 $ 7,553 $ 7,777 $ 8,205 $ 8,732
TDRs performing in accordance with modified terms $ 5,289 $ 5,807 $ 5,282 $ 5,326 $ 4,991
For the three months ended
Allowance for loan and lease losses
Beginning balance $ 10,944 $ 11,520 $ 11,898 $ 12,175 $ 12,589
Loans charged-off 1,192 277 427 359 333
Recoveries of charged-off loans 231 195 289 136 3,924
Net charge-offs (recoveries) 961 82 138 223 (3,591)
Provision (credit) for loan and lease losses 345 (494) (240) (54) (4,005)
Ending balance $ 10,328 $ 10,944 $ 11,520 $ 11,898 $ 12,175

CONTACT: INVESTOR CONTACT: James M. Bone, Jr., CPA Executive Vice President and Chief Financial Officer First National Community Bank (570) 348-6419 james.bone@fncb.comSource:First National Community Bancorp