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Select Bancorp Reports Fourth Quarter and Year-End 2015 Earnings

DUNN, N.C., Feb. 05, 2016 (GLOBE NEWSWIRE) -- Select Bancorp, Inc. (the “Company”) (NASDAQ:SLCT), the holding company for Select Bank & Trust, today reported after-tax net income for the year ended December 31, 2015 of $6.6 million and basic and diluted earnings per share of $0.56, compared to $2.4 million and basic and diluted earnings per share of $0.26 for the year ended December 31, 2014.

For the fourth quarter of 2015, the Company reported net income of $1.6 million, and basic and diluted earnings per share of $0.14, compared to net income of $1.3 million and basic and diluted earnings per share of $0.11 for the fourth quarter of 2014.

Total assets, deposits, and total loans for the Company as of December 31, 2015 were $817.0 million, $651.2 million, and $617.4 million, respectively, compared to total assets of $766.1 million, total deposits of $618.9 million, and total loans of $552.0 million as of the same date in 2014.

Year to date return on average assets through December 31, 2015 is 0.86% and year to date return on average equity is 6.42%, compared to 0.37% and 3.17%, respectively, for the twelve months ended December 31, 2014.

Non-performing loans decreased to $8.3 million at December 31, 2015 from $11.9 million at December 31, 2014. Non-performing loans equaled 1.34% of loans at December 31, 2015, decreasing from 2.15% of loans at December 31, 2014. Foreclosed real estate equaled $1.4 million at December 31, 2015, compared to $1.6 million at December 31, 2014. For the year, net charge-offs were $714,000, or 0.12%, of average loans, compared to net recoveries of ($139,000) or (0.03%) of average loans in 2014. At December 31, 2015, the allowance for loan losses was $7.0 million, or 1.14% of total loans, as compared to $6.8 million or 1.24% of total loans at December 31, 2014.

Commenting on 2015 results, William L. Hedgepeth II, President and CEO stated, “We are pleased that the Company reported net income of $6.6 million for the year. Our previously announced acquisition of two new branches, one in Morehead City and the other in Leland, became operational mid-December further expanding our market footprint. While growth is part of our strategic plan, our results for 2015 were impacted by one-time expenses related to our acquisition of the new branches. In addition, in order to achieve greater operating efficiencies, we combined the operations of our Burlington and Gibsonville Offices and closed our Ramsey Street Office in Fayetteville. The one-time cost associated with these initiatives totaled $657,000. These initiatives are intended to enable our branch network, and our Company, to enhance efficiency and customer convenience going forward.

Hedgepeth added, "We believe asset quality is strong and this remains a top priority at Select. As I have said many times: We will compete for loans based on interest rate, but we will not sacrifice credit quality. Our historical asset quality numbers reflect the prudence of this strategy. In addition to operating in markets with healthy economies, we will continue to seek prime locations for expansion and to identify and hire outstanding bankers and lenders in those markets. These people, like many of our current staff, are known in their markets and are astute, highly-skilled business people with exceptionally loyal client bases.”

When the FDIC released deposit market share data as of June 30, 2015, Select Bank held the number one position for deposit market share in Dunn, North Carolina where it is headquartered, a position the Company has maintained the past thirteen years. Additionally, in a report compiled by SNL Financial and published in the June 2015 edition of Business North Carolina ranking the 100 largest financial institutions headquartered in North Carolina, Select Bancorp ranked 32nd. Select also ranked 4th out of the 100 largest financial institutions with headquarters in the state for the fastest growing bank in assets, achieving a 45.45% change over the previous year; as a direct result of the merger between Select and New Century Bank in 2014.

Hedgepeth concluded his remarks by sharing, “Our staff takes a great deal of pride in these deposit market share results, and our rankings from various banking entities, particularly holding the number one position for thirteen straight years in Dunn, N.C. Our entire banking staff is commended for their individual efforts creating our excellent corporate results.”

Select Bank & Trust has branch offices in these North Carolina communities: Dunn, Burlington, Clinton, Elizabeth City, Fayetteville, Goldsboro, Greenville, Leland, Lillington, Lumberton, Morehead City, Raleigh and Washington.

The information as of and for the quarter ended December 31, 2015, as presented is unaudited. This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of our goals and expectations with respect to earnings, earnings per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (ii) statements preceded by, followed by or that include the words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “projects,” “outlook” or similar expressions. The actual results might differ materially from those projected in the forward-looking statements for various reasons, including, but not limited to, our ability to manage growth, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other savings and financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company’s SEC filings, including its periodic reports under the Securities Exchange Act of 1934, as amended, copies of which are available upon request from the Company.



Select Bancorp, Inc.
Selected Financial Information and Other Data
($ in thousands, except per share data)
At or for the three months ended At or for the twelve months ended
December 31, September 30, June 30, March 31, December 31, December 31, December 31, December 31,
2015 2015 2015 2015 2014 2015 2014 2013
Summary of Operations:
Total interest income$ 8,425 $ 8,412 $ 8,262 $ 8,242 $ 7,988 $ 33,341 $ 26,104 $ 22,903
Total interest expense 890 878 835 939 1,141 3,542 4,519 5,258
Net interest income 7,535 7,534 7,427 7,303 6,847 29,799 21,585 17,645
Provision for (recovery of) loan losses 506 393 (139) 130 177 890 (194) (325)
Net interest income after provision 7,029 7,141 7,566 7,173 6,670 28,909 21,779 17,970
Noninterest income 916 572 941 863 836 3,292 2,675 2,629
Merger/Acquisition related expenses 240 103 35 - 217 378 1,941 -
Noninterest expense 5,497 5,467 5,518 5,370 5,345 21,852 18,719 15,855
Income before income taxes 2,208 2,143 2,954 2,666 1,944 9,971 3,794 4,744
Provision for income taxes 570 792 1,133 923 666 3,418 1,437 1,803
Net Income 1,638 1,351 1,821 1,743 1,278 6,553 2,357 2,941
Dividends on Preferred Stock 20 19 19 19 19 77 38 -
Net income available to common shareholders$ 1,618 $ 1,332 $ 1,802 $ 1,724 $ 1,259 $ 6,476 $ 2,319 $ 2,941
Share and Per Share Data:
Earnings per share - basic$ 0.14 $ 0.12 $ 0.16 $ 0.15 $ 0.11 $ 0.56 $ 0.26 $ 0.43
Earnings per share - diluted$ 0.14 $ 0.12 $ 0.16 $ 0.15 $ 0.11 $ 0.56 $ 0.26 $ 0.43
Book value per share$ 8.38 $ 8.28 $ 8.17 $ 8.07 $ 7.91 $ 8.38 $ 8.59 $ 8.09
Tangible book value per share$ 7.67 $ 7.58 $ 7.45 $ 7.33 $ 7.16 $ 7.67 $ 7.83 $ 8.07
Ending shares outstanding 11,583,011 11,577,111 11,499,398 11,458,561 11,377,980 11,583,011 11,377,980 6,921,352
Weighted average shares outstanding:
Basic 11,580,745 11,521,043 11,481,137 11,426,378 11,375,803 11,502,800 8,870,114 6,918,814
Diluted 11,627,974 11,582,724 11,548,878 11,510,147 11,475,865 11,567,811 8,974,384 6,919,760
Selected Performance Ratios:
Return on average assets(2) 0.82% 0.69% 0.98% 0.94% 0.65% 0.86% 0.37% 0.53%
Return on average equity(2) 6.20% 5.21% 7.22% 7.11% 5.23% 6.42% 3.12% 5.28%
Net interest margin 4.18% 4.34% 4.46% 4.30% 3.87% 4.38% 3.88% 3.46%
Efficiency ratio (1) 65.05% 67.44% 65.94% 65.76% 69.57% 66.04% 77.16% 78.20%
Period End Balance Sheet Data:
Loans, net of unearned income$ 617,398 $ 597,969 $ 573,729 $ 558,923 $ 552,038 $ 617,398 $ 552,038 $ 346,500
Total Earning Assets 726,408 711,622 665,028 663,017 698,266 726,408 698,266 483,054
Goodwill 6,931 6,931 6,931 6,931 6,931 6,931 6,931 -
Core Deposit Intangible 1,241 1,196 1,320 1,470 1,625 1,241 1,625 182
Total Assets 817,015 786,495 742,443 748,371 766,121 817,015 766,121 525,646
Deposits 651,161 619,935 579,609 600,520 618,902 651,161 618,902 448,458
Short term debt 24,594 30,722 32,884 18,943 20,733 24,594 20,733 6,305
Long term debt 33,782 28,846 24,914 25,282 25,591 33,782 25,591 12,372
Shareholders' equity 104,702 103,545 101,552 100,076 97,685 104,702 97,685 56,004
Selected Average Balances:
Gross Loans$ 601,966 $ 585,541 $ 569,785 $ 557,177 $ 546,626 $ 578,759 $ 430,571 $ 354,871
Total Earning Assets 714,755 689,166 669,586 672,655 702,818 686,663 565,264 511,597
Core Deposit Intangible 1,139 1,251 1,389 1,546 1,714 1,330 884 237
Total Assets 796,414 771,913 744,118 748,047 776,839 765,284 631,905 555,354
Deposits 631,855 607,722 588,328 600,601 632,633 607,214 523,954 470,526
Short term debt 35,303 35,012 28,212 19,298 19,790 32,316 9,957 13,879
Long term debt 20,872 22,631 22,895 25,444 25,818 20,147 20,494 12,372
Shareholders' equity 104,732 102,879 101,216 99,376 97,030 102,068 74,365 55,701
Asset Quality Ratios:
Nonperforming loans$ 8,280 $ 10,899 $ 11,702 $ 13,473 $ 11,876 $ 8,280 $ 11,876 $ 15,856
Other real estate owned 1,401 1,007 1,030 1,187 1,585 1,401 1,585 2,008
Allowance for loan losses 7,021 7,032 6,842 6,919 6,844 7,021 6,844 7,054
Nonperforming loans (3) to period-end loans 1.34% 1.82% 2.04% 2.41% 2.15% 1.34% 2.15% 4.58%
Allowance for loan losses to period-end loans 1.14% 1.18% 1.19% 1.24% 1.24% 1.14% 1.24% 2.04%
Delinquency Ratio (4) 0.41% 0.36% 0.32% 0.23% 0.91% 0.41% 0.91% 0.25%
Net loan charge-offs (recoveries) to average loans 0.34% 0.14% -0.01% 0.04% -0.10% 0.12% -0.03% 0.15%
(1) Efficiency ratio is calculated as non-interest expenses divided by the sum of net interest income and non-interest income.
(2) Annualized.
(3) Nonperforming loans consist of non-accrual loans and restructured loans.
(4) Delinquency Ratio includes loans 30-89 days past due and excludes non-accrual loans.


Mark A. Jeffries Executive Vice President Chief Financial Officer Office: 910-892-7080 and Direct: 910-897-3603 markj@SelectBank.com SelectBank.com

Source:Select Bancorp Inc.