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County Bancorp, Inc. Announces 7.6% Loan Growth and Third Quarter 2015 Net Income of $3.3 Million

Q3 Highlights

  • Net income of $3.3 million
  • Net loan growth of $49.7 million
  • Return on average assets of 1.63%
  • $867 thousand negative provision for loan losses

MANITOWOC, Wis., Oct. 21, 2015 (GLOBE NEWSWIRE) -- County Bancorp, Inc. (NASDAQ:ICBK) today reported third quarter 2015 net income of $3.3 million. This represents an increase of $1.0 million compared to the net income of the third quarter of 2014. Net income for the nine months ended September 30, 2015 was $8.1 million compared to $6.1 million for the same period in 2014. This represents a return on average assets of 1.36% for the nine months ended September 30, 2015 compared to 1.10% for the nine months ended September 30, 2014.

“We are very pleased with our third quarter results, which were highlighted by solid loan growth quarter-over-quarter and year-over-year, primarily in the agricultural space,” said Timothy J. Schneider, President of County Bancorp, Inc. and CEO of its wholly-owned bank subsidiary, Investors Community Bank. “Asset quality continues to improve and, despite growth in our loan portfolio, we were able to have a recovery of loan losses for the quarter. Additionally, in this highly competitive market, we have been able to improve our net interest margin. As a part of our strategic focus, we continue to seek talent in the business banking sector and evaluate acquisition opportunities.”

Total assets of $844.8 million at September 30, 2015 increased $63.7 million, or 8.2%, over total assets as of June 30, 2015 of $781.1 million. Total loans increased $49.6 million, or 7.6%, to $704.0 million at September 30, 2015 from $654.4 million at June 30, 2015.

Non-performing assets decreased 31.4% to $14.2 million at September 30, 2015 from $20.7 million at September 30, 2014, and decreased 22.5% from June 30, 2015 of $18.3 million. This improvement year-over-year was primarily due to other real estate owned, which declined from $8.1 million at September 30, 2014 to $3.0 million at September 30, 2015. The improvement over the previous quarter was the result of a 26.0% decrease in nonaccrual loans from $15.1 million at June 30, 2015, to $11.2 million at September 30, 2015.

Net income for the quarters ended September 30, 2015 and 2014 was $3.3 million and $2.3 million, respectively. The increase in net income of $1.0 million between the third quarters of 2014 and 2015 is primarily the result of $0.9 million recovery of loan losses recognized as a credit to income during the third quarter of 2015. As the result of that recovery and increased net interest income, diluted earnings per share increased to $0.55 for the three months ended September 30, 2015 from $0.47 for the three months ended September 30, 2014. Return on average assets was 1.63% for the three months ended September 30, 2015 compared to 1.22% for the three months ended September 30, 2014. Net interest margin increased to 3.49% for the three months ended September 30, 2015 compared to 3.27% for the three months ended September 30, 2014.

Net income for the nine months ended September 30, 2015 was $8.1 million compared to $6.1 million for the nine months ended September 30, 2014. This represents year-over-year growth of 31.8% which was primarily driven by a $2.2 million increase in net interest income and a $1.3 million recovery of loan losses, which was partially offset by an increase in income tax expense.

About County Bancorp, Inc.

County Bancorp, Inc., a Wisconsin corporation and registered bank holding company founded in May 1996, and our wholly-owned subsidiary Investors Community Bank, a Wisconsin-chartered bank, are headquartered in Manitowoc, Wisconsin. The state of Wisconsin is often referred to as “America’s Dairyland,” and one of the niches we have developed is providing financial services to agricultural businesses statewide, with a primary focus on dairy-related lending. We also serve business and retail customers throughout Wisconsin, with a focus on Northeastern and Central Wisconsin. Our customers are served from our full-service locations in Manitowoc and Stevens Point and our loan production offices in Darlington, Eau Claire, and Fond du Lac.

Forward-Looking Statements

This press release includes "forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "plan," "seek," "comfortable with," "will," "expect," "intend," "estimate," "anticipate," "believe" or "continue" or the negative thereof or variations thereon or similar terminology. Factors that may cause actual results to differ materially from those made or suggested by the forward-looking information contained in this press release include those identified in County Bancorp, Inc.’s most recent annual report on Form 10-K and subsequent SEC filings. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

County Bancorp, Inc.
Consolidated Financial Summary (Unaudited)

September 30,
2015
June 30,
2015
March 31,
2015
September 30,
2014
Selected Balance Sheet Data:
(In thousands, except per share data)
Total assets $ 844,791 $ 781,117 $ 781,408 $ 743,018
Total loans 704,029 654,389 635,067 591,623
Allowance for loan losses 9,833 9,897 10,269 10,374
Deposits 636,221 608,571 608,441 599,931
Shareholders' equity 104,436 101,024 99,544 77,722
Common equity 96,436 93,024 91,544 69,722
Stock Price Information:
High $ 20.00 $ 20.33 $ 21.70 N/A
Low $ 16.46 $ 17.90 $ 16.76 N/A
Market price (2015)/Book value (2014) per common share $ 19.14 $ 19.00 $ 19.68 $ 15.57
Common shares outstanding 5,734 5,734 5,734 4,464
Non-Performing Assets:
(In thousands)
Nonaccrual loans $ 11,172 $ 15,098 $ 12,834 $ 12,550
Other real estate owned 3,024 3,211 5,128 8,149
Total non-performing assets $ 14,196 $ 18,309 $ 17,962 $ 20,699
Restructured loans not on nonaccrual $ 617 $ 820 $ 826 $ 918
Non-performing assets as a % of total loans 2.02% 2.80% 2.83% 3.50%
Non-performing assets as a % of total assets 1.68% 2.34% 2.30% 2.79%
Allowance for loan losses as a % of nonperforming assets 69.27% 54.06% 57.17% 50.12%
Allowance for loan losses as a % of total loans 1.40% 1.51% 1.62% 1.75%
Net charge-off (recoveries) year-to-date (555) 248 (268) 121
Recovery of loan loss year-to-date (1,325) (458) (602) -
For the three months ended For the nine months ended
September 30,
2015
September 30,
2014
September 30,
2015
September 30,
2014
Selected Income Statement Data:
(In thousands, except per share data)
Net interest income $ 6,871 $ 5,805 $ 19,261 $ 17,099
Recovery of loan losses (867) - (1,325) -
Net interest income after provision for (recovery of) loan losses 7,738 5,805 20,586 17,099
Non-interest income 1,723 1,798 5,310 5,167
Non-interest expense 4,135 4,264 12,983 12,735
Income tax expense 1,996 1,068 4,839 3,403
Net income $ 3,330 $ 2,271 $ 8,074 $ 6,128
Return on average assets 1.63% 1.22% 1.36% 1.10%
Return on average shareholders' equity 11.32% 9.88% 9.44% 9.08%
Return on average common shareholders' equity (1) 13.58% 12.51% 11.28% 11.50%
Efficiency ratio (1) 48.42% 53.23% 51.04% 52.87%
Per Common Share Data:
Basic $ 0.56 $ 0.48 $ 1.37 $ 1.29
Diluted $ 0.55 $ 0.47 $ 1.34 $ 1.26
Dividends declared $ 0.04 $ - $ 0.12 $ -
(1) This is a non-GAAP financial measure. A reconciliation to GAAP is included below.
Non interest income:
Service charges $ 238 $ 388 $ 744 $ 559
Loan servicing fees 1,236 1,183 3,648 3,518
Loan servicing rights (51) 84 (25) 116
Gain on sale of loans 44 69 166 251
Income on OREO 33 100 243 509
Other 223 (26) 534 214
Total $ 1,723 $ 1,798 $ 5,310 $ 5,167
Non-interest expense:
Employee compensation and benefits $ 2,643 $ 2,570 $ 8,232 $ 7,628
Occupancy 100 75 260 229
Information processing 183 361 527 641
Professional fees 513 343 900 696
FDIC assessment 101 121 321 397
OREO expenses 121 192 261 686
Writedown of OREO - 44 182 729
Net loss (gain) on OREO (26) 173 260 235
Business development 147 203 371 402
Other 353 182 1,669 1,092
Total $ 4,135 $ 4,264 $ 12,983 $ 12,735
Non-GAAP Financial Measures
Return on average common shareholders' equity reconciliation:
Return on average shareholders' equity 11.32% 9.88% 9.44% 9.08%
Effect of excluding average preferred shareholders' equity 2.26% 2.63% 1.84% 2.42%
Return on average common shareholders' equity 13.58% 12.51% 11.28% 11.50%
Efficiency ratio GAAP to non-GAAP reconciliation:
Non-interest expense $ 4,135 $ 4,264 $ 12,983 $ 12,735
Less: net (loss)/gain on sales and write-downs of OREO 26 (217) (442) (964)
Adjusted non-interest expense (non-GAAP) $ 4,161 $ 4,047 $ 12,541 $ 11,771
Net interest income $ 6,871 $ 5,805 $ 19,261 $ 17,099
Non-interest income 1,723 1,798 5,310 5,167
Operating revenue $ 8,594 $ 7,603 $ 24,571 $ 22,266
Efficiency ratio 48.42% 53.23% 51.04% 52.87%

Three Months Ended
September 30, 2015 September 30, 2014
Average
Balance (1)
Income/
Expense
Yields/
Rates
Average
Balance (1)
Income/
Expense
Yields/
Rates
Assets
Investment securities $ 84,528 $ 359 1.70% $ 76,259 $ 334 1.75%
Loans (2) 691,049 8,393 4.86% 590,272 7,225 4.90%
Interest bearing deposits due from other banks 12,741 11 0.35% 43,837 23 0.21%
Total interest-earning assets $ 788,318 $ 8,763 4.45% $ 710,368 $ 7,582 4.27%
Allowance for loan losses (10,462) (10,474)
Other assets 40,043 45,542
Total assets $ 817,899 $ 745,436
Liabilities
Savings, NOW, money market, interest checking 162,719 194 0.48% 138,713 166 0.48%
Time deposits 395,967 1,381 1.40% 404,854 1,383 1.37%
Total interest-bearing deposits $ 558,686 $ 1,575 1.13% $ 543,567 $ 1,549 1.14%
Other borrowings 8,830 63 2.83% 10,629 32 1.19%
FHLB advances 52,058 157 1.20% 19,609 77 1.56%
Junior subordinated debentures 12,372 99 3.21% 12,372 120 3.88%
Total interest-bearing liabilities $ 631,946 $ 1,894 1.20% $ 586,177 $ 1,778 1.21%
Non-interest bearing deposits 60,196 60,156
Other liabilities 8,099 7,188
Total liabilities $ 700,241 $ 653,521
SBLF preferred stock (3) 15,000 15,000
Shareholders' equity 102,658 76,915
Total liabilities and equity $ 817,899 $ 745,436
Net interest income 6,869 5,804
Interest rate spread (4) 3.25% 3.06%
Net interest margin (5) 3.49% 3.27%
Ratio of interest-earning assets to interest -bearing liabilities 1.25 1.21
Nine Months Ended
September 30, 2015 September 30, 2014
Average
Balance (1)
Income/
Expense
Yields/
Rates
Average
Balance (1)
Income/
Expense
Yields/
Rates
Assets
Investment securities $ 82,187 $ 1,037 1.68% $ 74,402 $ 1,026 1.84%
Loans (2) 661,797 23,687 4.77% 582,616 21,704 4.97%
Interest bearing deposits due from other banks 17,715 41 0.31% 50,305 90 0.24%
Total interest-earning assets $ 761,699 $ 24,765 4.34% $ 707,323 $ 22,820 4.30%
Allowance for loan losses (10,438) (10,531)
Other assets 42,010 48,751
Total assets $ 793,271 $ 745,543
Liabilities
Savings, NOW, money market, interest checking 154,046 543 0.47% 130,884 468 0.48%
Time deposits 395,005 3,998 1.35% 417,125 4,198 1.34%
Total interest-bearing deposits $ 549,051 $ 4,541 1.10% $ 548,009 $ 4,666 1.14%
Other borrowings 9,369 221 3.15% 12,377 463 4.99%
FHLB advances 39,276 403 1.37% 19,271 232 1.61%
Junior subordinated debentures 12,372 339 3.66% 12,372 360 3.88%
Total interest-bearing liabilities $ 610,068 $ 5,504 1.20% $ 592,029 $ 5,721 1.29%
Non-interest bearing deposits 61,236 56,733
Other liabilities 7,900 6,828
Total liabilities $ 679,204 $ 655,590
SBLF preferred stock (3) 15,000 15,000
Shareholders' equity 99,067 74,953
Total liabilities and equity $ 793,271 $ 745,543
Net interest income 19,261 17,099
Interest rate spread (4) 3.13% 3.01%
Net interest margin (5) 3.37% 3.22%
Ratio of interest-earning assets to interest -bearing liabilities 1.25 1.19
(1) Average balances are calculated on amortized cost.
(2) Includes loan fee income, nonaccruing loan balances, and interest received on such loans.
(3) The SBLF preferred stock refers to our Series C noncumulative perpetual preferred stock issued to the U.S. Treasury through the U.S. Treasury’s Small Business Lending Fund program.
(4) Interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest bearing liabilities.
(5) Net interest margin represents net interest income divided by average total interest-earning assets.


Investor Relations Contact Timothy J. Schneider CEO, Investors Community Bank Phone: (920) 686-5604 Email: tschneider@investorscommunitybank.com

Source:County Bancorp, Inc.