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

DUNMORE, Pa., Oct. 30, 2015 (GLOBE NEWSWIRE) -- First National Community Bancorp, Inc. (the "Company") (OTCQX:FNCB), the parent company of Dunmore-based First National Community Bank (the "Bank"), today reported net income for the three months ended September 30, 2015 of $2.3 million, or $0.14 per basic and diluted share. Net income for the comparable period of 2014 was $3.4 million, or $0.20 per basic and diluted share. The $1.1 million decrease in third quarter earnings was primarily attributable to a decrease in non-interest income partially offset by further non-interest expense reductions, an improvement in net interest income and an increase in the credit for loan and lease losses. For the nine months ended September 30, 2015, net income was $6.6 million, or $0.40 per basic and diluted share, a decrease of $6.9 million compared to $13.5 million, or $0.82 per basic and diluted share, for the same nine months of 2014. The decrease in year-to-date earnings reflected a $3.7 million decrease in gains on the sale of investment securities, coupled with non-recurring income recorded in 2014 related to two legal settlements and a gain on the sale of the Company's retail banking operations in Monroe County. Annualized return on average assets was 0.91% and 0.90%, respectively for the three- and nine-month periods ended September 30, 2015, compared to 1.38% and 1.85%, respectively, for the same periods of 2014. For the third quarter and year-to-date periods of 2015, annualized return on average equity was 16.38% and 15.96%, respectively, and 26.81% and 41.43%, respectively, for the comparable 2014 periods.

Third Quarter 2015 Highlights:

  • Company was released from Written Agreement with the Federal Reserve Bank of Philadelphia ("Reserve Bank") effective September 2, 2015
  • Growth in net loans of $40.1 million, or 6.0%, from the end of the second quarter of 2015
  • Tax-equivalent net interest margin improved 22 basis points in the third quarter compared to the second quarter of 2015
  • Decrease of $4.9 million, or 19.7%, in year-to-date non-interest expense
  • Increase in tangible book value of $0.50 per share to $3.60 at September 30, 2015 from $3.10 per share at December 31, 2014

On September 8, 2015, the Company received written notification that effective September 2, 2015 it was released from the Written Agreement by the Reserve Bank. On March 25, 2015, the Company was released from the Consent Order by the Office of the Comptroller of the Currency ("OCC"). Previously the Company had been operating under the Consent Order since September 2010 and the Written Agreement since November 2010. The releases signify that the Reserve Bank and the OCC have determined that the Company and the Bank have met all of the requirements mandated by the Written Agreement and Consent Order, respectively.

"The Company achieved yet another positive milestone in the third quarter with the release from the Written Agreement," stated Steven R. Tokach, President and Chief Executive Officer. "The Company's non-interest expense levels continued to be positively impacted by our improved risk profile. In addition, our net interest income levels rebounded in the third quarter with strong loan growth and the effect of the 44.0% principal prepayment and rate modification from 9.00% to 4.50% of the Company's subordinated debentures at the end of the second quarter of 2015," concluded Mr. Tokach.

Summary Results for the Three and Nine Months Ended September 30, 2015

Net interest income before the credit for loan and lease losses increased $371 thousand, or 5.4%, to $7.2 million for the third quarter of 2015 from $6.8 million for the same period of 2014. The increase was primarily a result of lower interest expense due to the $11.0 million principal prepayment and rate modification of the Company's subordinated debentures completed on June 30, 2015. In addition, net interest income for the third quarter of 2015 improved $0.9 million, or 13.6%, compared to the second quarter of 2015, which largely reflected increased interest income due to higher average balances of loans and investment securities, coupled with lower interest expense resulting from the principal prepayment and rate modification on the subordinated debentures. The tax-equivalent net interest margin for third quarter 2015 was 3.07%, a decrease of 11 basis points compared to the same quarter of 2014. However, the tax-equivalent net interest margin improved 22 basis points compared to 2.85% for the second quarter of 2015.

Non-interest income was $1.4 million for the three months ended September 30, 2015, a decrease of $3.0 million, or 69.0%, compared to $4.4 million for the same period of 2014. The revenue decline was due entirely to a $3.0 million decrease in net gains received on security sales. Non-interest income totaled $6.3 million for the nine months ended September 30, 2015, a decrease of $6.6 million, or 50.7%, from $12.9 million for the same nine months of 2014. The reduction in non-interest income for the year-to-date periods reflected the decrease in net gains on investment security sales, coupled with non-recurring income earned in 2014. Year-to-date net gains on the sale of securities were $2.3 million in 2015, which was $3.7 million lower than the $6.0 million in net gains on the sale of securities recorded in 2014. In addition, non-interest income for the nine months ended September 30, 2014 included $2.1 million of non-recurring income received from the settlement of judgments filed pursuant to a large commercial credit relationship resulting in the recovery of all past due interest, late charges and legal and other expenses associated with a previously charged-off commercial real estate loan relationship, and a $0.6 million net gain recorded on the divestiture of the Company's retail banking operations in Monroe County.

For the three months ended September 30, 2015, non-interest expense decreased $1.4 million, or 17.6%, to $6.4 million, from $7.8 million for the same three months of 2014. On a year-to-date basis, non-interest expense decreased $4.8 million, or 19.7%, to $19.9 million in 2015 from $24.7 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, regulatory assessments, legal expense professional fees and Federal Deposit Insurance Corporation ("FDIC") insurance expense, all of which reflected improvement in the Company's risk profile.

Asset Quality

Net charge-offs were $0.3 million and $1.4 million for the three and nine months ended September 30, 2015, respectively, compared to net charge-offs of $0.2 million for the three months ended September 30, 2014 and net recoveries of $3.5 million for the 2014 year-to-date period. Net charge-offs for the nine months ended September 30, 2015 resulted primarily from the partial charge-off of two commercial loan relationships: two construction, land acquisition and development loans to one commercial customer aggregating $0.7 million in the third quarter of 2015 and one commercial real estate loan to another commercial customer in the amount of $0.9 million in the second quarter of 2015. The net recovery position in 2014 was due largely to the previously mentioned legal settlement.

Total non-performing loans were $6.7 million at September 30, 2015, an increase of $1.0 million, or 17.1%, from $5.8 million at June 30, 2015, and $1.2 million, or 22.1%, from December 31, 2014. The ratio of non-performing loans to total loans was 0.93% at September 30, 2015 compared to 0.84% at June 30, 2015 and 0.82% at December 31, 2014. (At June 30, 2015, the most recent data available, the FDIC average for bank holding companies with assets between $1.0 billion and $3.0 billion was 0.92%.) At September 30, 2015, the Company's allowance for loan and lease losses as a percentage of gross loans at September 30, 2015 equaled 1.36% which was comparable to that of the peer group. (The above described FDIC peer group average was 1.30% at June 30, 2015.)

Financial Condition

Total assets reached $1.1 billion at September 30, 2015, an increase of $85.2 million, or 8.8%, from $970.0 million at December 31, 2014. The Company experienced strong growth in its earning assets. Specifically, net loans grew $54.6 million, or 8.3%, to $713.3 million at September 30, 2015 from $658.7 million at December 31, 2014. In addition, available-for-sale securities increased $30.2 million, or 13.8%, to $249.2 million at the end of the third quarter of 2015 from $219.0 million at year-end 2014. Earning asset growth was funded primarily by an increase in total deposits of $56.7 million, or 7.1%, coupled with an increase in borrowed funds of $20.9 million, or 21.6%. With regard to deposit growth, interest-bearing deposits increased $28.7 million, or 4.3% from year-end 2014 to the close of the third quarter of 2015, while non-interest bearing demand deposits grew by $28.0 million, or 22.6%. The increase in interest-bearing deposits primarily reflected the attainment of a large commercial deposit relationship and normal cyclical deposit growth, partially offset by the planned runoff of higher-costing certificates of deposit generated through QwickRate®, a national deposit listing service. The increase in borrowed funds reflected an increase of $31.9 million, or 52.1%, in FHLB of Pittsburgh advances, partially offset by the $11.0 million, or 44.0%, prepayment of the Company's subordinated debentures.

Total shareholders' equity increased $8.2 million, or 16.0%, to $59.6 million at September 30, 2015 from $51.4 million at December 31, 2014. The capital improvement resulted primarily from net income of $6.6 million coupled with a $1.4 million increase in accumulated other comprehensive income, which resulted entirely from appreciation in the fair value of available-for-sale securities offset by the tax impact of the appreciation. At September 30, 2015, the Company's total risk-based capital and Tier I leverage ratios were 11.20% and 6.57%, respectively. The respective ratios for the Bank at September 30, 2015 were 13.29% and 9.11%. The ratios 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
Sept 30, Jun 30, Mar 31, Dec 31, Sept 30,
2015 2015 2015 2014 2014
Per share data:
Net income (fully diluted) $ 0.14 $ 0.05 $ 0.21 $ -- $ 0.20
Cash dividends declared $ -- $ -- $ -- $ -- $ --
Book value $ 3.61 $ 3.33 $ 3.38 $ 3.12 $ 3.06
Tangible book value $ 3.60 $ 3.32 $ 3.36 $ 3.10 $ 3.03
Market value:
High $ 6.05 $ 6.55 $ 5.40 $ 6.65 $ 6.85
Low $ 5.02 $ 5.15 $ 5.25 $ 5.60 $ 5.75
Close $ 5.19 $ 6.05 $ 5.26 $ 6.00 $ 6.75
Common shares outstanding 16,500,945 16,500,945 16,500,945 16,484,419 16,471,569
Selected ratios:
Annualized return on average assets 0.91% 0.34% 1.45% (0.01)% 1.38%
Annualized return on average shareholders' equity 16.38% 5.89% 26.34% (0.24)% 26.81%
Tier I leverage ratio 6.57% 6.64% 6.57% 6.05% 6.19%
Total risk-based capital to risk-adjusted assets 11.20% 11.60% 12.96% 13.67% 13.50%
Average shareholders' equity to average total assets 5.55% 5.73% 5.52% 5.22% 5.14%
Yield on earning assets (FTE) 3.50% 3.45% 3.48% 3.56% 3.84%
Cost of funds 0.51% 0.73% 0.75% 0.79% 0.80%
Net interest spread (FTE) 2.98% 2.72% 2.73% 2.77% 3.04%
Net interest margin (FTE) 3.07% 2.85% 2.85% 2.90% 3.18%
Total delinquent loans/total loans 1.29% 1.34% 1.10% 1.21% 1.16%
Allowance for loan and lease losses/total loans 1.36% 1.51% 1.63% 1.72% 1.76%
Non-performing loans/total loans 0.93% 0.84% 0.77% 0.82% 0.82%
Net charge-offs/average loans 0.04% 0.14% 0.01% 0.02% 0.03%
First National Community Bancorp, Inc.
Year-to-Date Consolidated Statements of Income
Nine Months Ended
September 30,
(in thousands, except share data) 2015 2014
Interest income
Interest and fees on loans $ 19,640 $ 19,958
Interest and dividends on securities
U.S. government agencies 3,044 2,496
State and political subdivisions, tax-free 91 1,679
State and political subdivisions, taxable 447 271
Other securities 331 206
Total interest and dividends on securities 3,913 4,652
Interest on interest-bearing deposits in other banks 42 44
Total interest income 23,595 24,654
Interest expense
Interest on deposits 2,003 2,435
Interest on borrowed funds
Interest on Federal Home Loan Bank of Pittsburgh advances 367 334
Interest on subordinated debentures 1,290 1,706
Interest on junior subordinated debentures 150 149
Total interest on borrowed funds 1,807 2,189
Total interest expense 3,810 4,624
Net interest income before credit for loan and lease losses 19,785 20,030
Credit for loan and lease losses (340) (5,629)
Net interest income after credit for loan and lease losses 20,125 25,659
Non-interest income
Deposit service charges 2,218 2,217
Net gain on the sale of securities 2,302 6,006
Net gain on the sale of mortgage loans held for sale 69 223
Net loss on the sale of education loans -- (13)
Net gain on the sale of other real estate owned 145 103
Gain on branch divestitures -- 607
Loan-related fees 290 292
Income from bank-owned life insurance 415 496
Legal settlements 184 2,127
Other 720 799
Total non-interest income 6,343 12,857
Non-interest expense
Salaries and employee benefits 9,582 9,809
Occupancy expense 1,665 1,554
Equipment expense 1,234 1,068
Advertising expense 335 353
Data processing expense 1,420 1,556
Regulatory assessments 711 1,389
Bank shares tax 652 372
Expense of other real estate owned 338 2,495
Legal expense 331 1,428
Professional fees 780 1,240
Insurance expense 528 757
Other operating expenses 2,301 2,718
Total non-interest expense 19,877 24,739
Income before income taxes 6,591 13,777
(Credit) provision for income taxes (40) 326
Net income $ 6,631 $ 13,451
Income per share
Basic $ 0.40 $ 0.82
Diluted $ 0.40 $ 0.82
Cash dividends declared per common share $ -- $ --
Weighted average number of shares outstanding:
Basic 16,497,373 16,471,569
Diluted 16,497,373 16,471,851
First National Community Bancorp, Inc.
Quarter-to-Date Consolidated Statements of Income
Three Months Ended
Sept 30, Jun 30, Mar 31, Dec 31, Sept 30,
(in thousands, except share data) 2015 2015 2015 2014 2014
Interest income
Interest and fees on loans $ 6,693 $ 6,475 $ 6,472 $ 6,671 $ 6,852
Interest and dividends on securities
U.S. government agencies 1,061 1,012 971 998 893
State and political subdivisions, tax-free 19 22 50 204 409
State and political subdivisions, taxable 324 97 26 53 76
Other securities 92 82 157 66 74
Total interest and dividends on securities 1,496 1,213 1,204 1,321 1,452
Interest on interest-bearing deposits in other banks 10 11 21 27 8
Total interest income 8,199 7,699 7,697 8,019 8,312
Interest expense
Interest on deposits 677 643 683 745 751
Interest on borrowed funds
Interest on Federal Home Loan Bank of Pittsburgh advances 128 119 120 116 125
Interest on subordinated debentures 162 565 563 575 575
Interest on junior subordinated debentures 50 51 49 87 50
Total interest on borrowed funds 340 735 732 778 750
Total interest expense 1,017 1,378 1,415 1,523 1,501
Net interest income before (credit) provision for loan and lease losses 7,182 6,321 6,282 6,496 6,811
(Credit) provision for loan and lease losses (191) 345 (494) (240) (54)
Net interest income after (credit) provision for loan and lease losses 7,373 5,976 6,776 6,736 6,865
Non-interest income
Deposit service charges 799 745 674 758 781
Net gain on the sale of securities 4 74 2,224 634 2,958
Net gain on the sale of mortgage loans held for sale 13 16 40 69 57
Net gain on the sale of other real estate owned 129 11 5 106 35
Loan-related fees 94 106 90 148 101
Income from bank-owned life insurance 145 135 135 154 165
Legal settlements -- 184 -- -- --
Other 195 274 251 194 345
Total non-interest income 1,379 1,545 3,419 2,063 4,442
Non-interest expense
Salaries and employee benefits 3,240 3,203 3,139 3,302 3,316
Occupancy expense 500 532 633 534 438
Equipment expense 408 442 384 403 355
Data processing expense 471 501 448 532 508
Regulatory assessments 203 99 409 412 266
Bank shares tax 217 218 217 150 21
Expense of other real estate owned 91 147 100 74 514
Legal expense 80 88 163 371 268
Professional fees 193 286 301 327 306
Insurance expense 128 202 198 194 196
Other operating expenses 884 962 790 2,531 1,595
Total non-interest expense 6,415 6,680 6,782 8,830 7,783
Income before income taxes 2,337 841 3,413 (31) 3,524
Provision (Credit) for income taxes -- 22 (62) -- 166
Net income $ 2,337 $ 819 $ 3,475 $ (31) $ 3,358
Income per share
Basic $ 0.14 $ 0.05 $ 0.21 $ -- $ 0.20
Diluted $ 0.14 $ 0.05 $ 0.21 $ -- $ 0.20
Cash dividends declared per common share $ -- $ -- $ -- $ -- $ --
Weighted average number of shares outstanding:
Basic 16,500,945 16,500,945 16,490,111 16,475,899 16,471,569
Diluted 16,500,945 16,500,945 16,490,111 16,475,899 16,471,569
First National Community Bancorp, Inc.
Consolidated Balance Sheets
Sept 30, Jun 30, Mar 31, Dec 31, Sept 30,
(in thousands) 2015 2015 2015 2014 2014
Assets
Cash and cash equivalents:
Cash and due from banks $ 20,631 $ 22,443 $ 19,985 $ 22,657 $ 21,532
Interest-bearing deposits in other banks 10,383 49,872 17,390 13,010 18,461
Total cash and cash equivalents 31,014 72,315 37,375 35,667 39,993
Securities available for sale, at fair value 249,228 226,539 204,635 218,989 217,412
Stock in Federal Home Loan Bank of Pittsburgh at cost 4,298 2,684 3,061 2,803 4,356
Loans held for sale 4,634 138 -- 603 171
Loans, net of net deferred costs and unearned income 723,166 683,588 672,165 670,267 678,160
Allowance for loan and lease losses (9,825) (10,328) (10,944) (11,520) (11,898)
Net loans 713,341 673,260 661,221 658,747 666,262
Bank premises and equipment, net 11,258 11,059 11,221 11,003 11,094
Accrued interest receivable 2,618 2,174 2,118 2,075 2,158
Intangible assets 179 220 261 302 344
Bank-owned life insurance 29,232 29,087 28,952 28,817 28,663
Other real estate owned 1,618 1,740 2,369 2,255 2,617
Other assets 7,799 8,455 9,028 8,768 9,063
Total assets $ 1,055,219 $ 1,027,671 $ 960,241 $ 970,029 $ 982,133
Liabilities
Deposits:
Demand (non-interest-bearing) $ 152,038 $ 144,075 $ 134,993 $ 124,064 $ 148,430
Interest-bearing 700,004 721,293 640,118 671,272 654,766
Total deposits 852,042 865,368 775,111 795,336 803,196
Borrowed funds:
Federal Home Loan Bank of Pittsburgh advances 93,058 57,771 67,612 61,194 68,786
Subordinated debentures 14,000 14,000 25,000 25,000 25,000
Junior subordinated debentures 10,310 10,310 10,310 10,310 10,310
Total borrowed funds 117,368 82,081 102,922 96,504 104,096
Accrued interest payable 11,187 11,344 10,788 10,262 10,515
Other liabilities 14,989 13,935 15,678 16,529 14,005
Total liabilities 995,586 972,728 904,499 918,631 931,812
Shareholders' equity
Preferred stock -- -- -- -- --
Common stock 20,626 20,626 20,626 20,605 20,589
Additional paid-in capital 61,939 61,870 61,801 61,781 61,692
Accumulated deficit (25,495) (27,832) (28,651) (32,126) (32,095)
Accumulated other comprehensive income 2,563 279 1,966 1,138 135
Total shareholders' equity 59,633 54,943 55,742 51,398 50,321
Total liabilities and shareholders' equity $ 1,055,219 $ 1,027,671 $ 960,241 $ 970,029 $ 982,133
First National Community Bancorp, Inc.
Summary Tax-equivalent Net Interest Income
Three Months Ended
Sept 30, Jun 30, Mar 31, Dec 31, Sept 30,
(dollars in thousands) 2015 2015 2015 2014 2014
Interest income
Loans:
Loans - taxable $ 6,371 $ 6,148 $ 6,148 $ 6,340 $ 6,524
Loans - tax-free 488 495 491 501 497
Total loans 6,859 6,643 6,639 6,841 7,021
Securities:
Securities, taxable 1,477 1,191 1,154 1,117 1,043
Securities, tax-free 29 33 76 309 620
Total interest and dividends on securities 1,506 1,224 1,230 1,426 1,663
Interest-bearing deposits in other banks 10 11 21 27 8
Total interest income 8,375 7,878 7,890 8,294 8,692
Interest expense
Deposits 677 643 683 745 751
Borrowed funds 340 735 732 778 750
Total interest expense 1,017 1,378 1,415 1,523 1,501
Net interest income $ 7,358 $ 6,500 $ 6,475 $ 6,771 $ 7,191
Average balances
Earning assets:
Loans:
Loans - taxable $ 660,709 $ 637,005 $ 633,731 $ 635,146 $ 635,032
Loans - tax-free 41,746 42,225 41,125 40,477 39,849
Total loans 702,455 679,230 674,856 675,623 674,881
Securities:
Securities, taxable 241,799 211,833 194,268 196,351 177,863
Securities, tax-free 1,707 2,007 4,283 17,055 36,246
Total interest and dividends on securities 243,506 213,840 198,551 213,406 214,109
Interest-bearing deposits in other banks 12,185 18,984 34,708 43,618 15,983
Total interest-earning assets 958,146 912,054 908,115 932,647 904,973
Non-earning assets 62,063 62,254 61,476 58,826 62,582
Total assets $ 1,020,209 $ 974,308 $ 969,591 $ 991,473 $ 967,555
Interest-bearing liabilities:
Deposits $ 690,039 $ 646,656 $ 658,193 $ 675,901 $ 640,394
Borrowed funds 105,109 108,234 99,046 99,251 114,137
Total interest-bearing liabilities 795,148 754,890 757,239 775,152 754,531
Demand deposits 143,140 137,674 132,316 139,336 137,992
Other liabilities 25,303 25,964 26,525 25,278 25,337
Shareholders' equity 56,618 55,780 53,511 51,707 49,695
Total liabilities and shareholders' equity $ 1,020,209 $ 974,308 $ 969,591 $ 991,473 $ 967,555
Yield/Cost
Earning assets:
Loans:
Interest and fees on loans - taxable 3.86% 3.86% 3.88% 3.99% 4.11%
Interest and fees on loans - tax-free 4.67% 4.69% 4.78% 4.95% 4.99%
Total loans 3.91% 3.91% 3.94% 4.05% 4.16%
Securities:
Securities, taxable 2.44% 2.25% 2.38% 2.28% 2.35%
Securities, tax-free 6.75% 6.64% 7.10% 7.25% 6.84%
Total interest and dividends on securities 2.47% 2.29% 2.48% 2.67% 3.11%
Interest on interest-bearing deposits in other banks 0.33% 0.23% 0.24% 0.25% 0.20%
Total earning assets 3.50% 3.45% 3.48% 3.56% 3.84%
Interest-bearing liabilities:
Interest on deposits 0.39% 0.40% 0.42% 0.44% 0.47%
Interest on borrowed funds 1.29% 2.72% 2.96% 3.14% 2.63%
Total interest-bearing liabilities 0.51% 0.73% 0.75% 0.79% 0.80%
Net interest spread 2.98% 2.72% 2.73% 2.77% 3.04%
Net interest margin 3.07% 2.85% 2.85% 2.90% 3.18%
First National Community Bancorp, Inc.
Asset Quality Data
Sept 30, Jun 30, Mar 31, Dec 31, Sept 30,
(in thousands) 2015 2015 2015 2014 2014
At period end
Non-accrual loans, including non-performing troubled debt restructured loans (TDRs) $ 6,741 $ 5,757 $ 5,184 $ 5,522 $ 5,539
Loans past due 90 days or more and still accruing -- -- -- -- 49
Total non-performing loans 6,741 5,757 5,184 5,522 5,588
Other real estate owned (OREO) 1,618 1,740 2,369 2,255 2,617
Total non-performing loans and OREO $ 8,359 $ 7,497 $ 7,553 $ 7,777 $ 8,205
TDRs performing in accordance with modified terms $ 5,065 $ 5,289 $ 5,807 $ 5,282 $ 5,326
For the three months ended
Allowance for loan and lease losses
Beginning balance $ 10,328 $ 10,944 $ 11,520 $ 11,898 $ 12,175
Loans charged-off 968 1,192 277 427 359
Recoveries of charged-off loans 656 231 195 289 136
Net charge-offs 312 961 82 138 223
(Credit) provision for loan and lease losses (191) 345 (494) (240) (54)
Ending balance $ 9,825 $ 10,328 $ 10,944 $ 11,520 $ 11,898

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