Select Bancorp Reports First Quarter 2016 Earnings

DUNN, N.C., May 03, 2016 (GLOBE NEWSWIRE) -- Select Bancorp, Inc. (the “Company”) (NASDAQ:SLCT), the holding company for Select Bank & Trust, today reported net income for the quarter ended March 31, 2016 of $1.5 million and basic and diluted earnings per share of $0.13, compared to $1.7 million and basic and diluted earnings per share of $0.15 for the quarter ended March 31, 2015.

Total assets, deposits, and total net loans for the Company as of March 31, 2016 were $830.4 million, $667.7 million, and $622.1 million.

Year to date return on average assets through March 31, 2016 is 0.73% and year to date return on average equity is 6.03%.

Non-performing loans were $8.7 million equaling 1.39% of loans at March 31, 2016. Foreclosed real estate equaled $1.9 million at March 31, 2016 and net recoveries for the quarter were ($154,000), or (0.10%), of average loans. At March 31, 2016, the allowance for loan losses was $7.5 million, or 1.20% of total loans.

Included in the results for the first quarter of 2016 was completion of the Company’s exit of the Small Business Lending Fund (SBLF) program. The Company redeemed all $7.6 million of SBLF preferred stock in January 2016 which impacted shareholders’ equity. Total shareholders’ equity stands at $99.2 million at March 31, 2016.

Commenting on the first quarter results, President and Chief Executive Officer William L. Hedgepeth II, stated, “We continue to believe that Select is well positioned for the remainder of 2016 and beyond.”

Later this year the company will relocate its Raleigh branch from the current location to a full service branch at 4505 Falls of Neuse Road, Suite 100. The new branch is conveniently located just north of the beltline off Wake Forest Road.

Hedgepeth added, "Our asset quality remains strong and this is a top priority at Select. Our loan portfolio performance trends reflect our commitment to a strong credit culture. 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 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.”

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 March 31, 2016, 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
March 31, December 31, September 30, June 30, March 31, December 31, December 31, December 31,
20162015 2015 20152015201520142013
Summary of Operations:
Total interest income$ 8,432 $ 8,425 $ 8,412 $ 8,262 $ 8,242 $ 33,341 $ 26,104 $ 22,903
Total interest expense 927 890 878 835 939 3,542 4,519 5,258
Net interest income 7,505 7,535 7,534 7,427 7,303 29,799 21,585 17,645
Provision for (recovery of) loan losses 352 506 393 (139) 130 890 (194) (325)
Net interest income after provision 7,153 7,029 7,141 7,566 7,173 28,909 21,779 17,970
Noninterest income 866 916 572 941 863 3,292 2,675 2,629
Merger/Acquisition related expenses - 240 103 35 - 378 1,941 -
Noninterest expense 5,620 5,497 5,467 5,518 5,370 21,852 18,719 15,855
Income before income taxes 2,399 2,208 2,143 2,954 2,666 9,971 3,794 4,744
Provision for income taxes 896 570 792 1,133 923 3,418 1,437 1,803
Net Income 1,503 1,638 1,351 1,821 1,743 6,553 2,357 2,941
Dividends on Preferred Stock 4 20 19 19 19 77 38 -
Net income available to common shareholders$ 1,499 $ 1,618 $ 1,332 $ 1,802 $ 1,724 $ 6,476 $ 2,319 $ 2,941
Share and Per Share Data:
Earnings per share - basic$ 0.13 $ 0.14 $ 0.12 $ 0.16 $ 0.15 $ 0.56 $ 0.26 $ 0.43
Earnings per share - diluted$ 0.13 $ 0.14 $ 0.12 $ 0.16 $ 0.15 $ 0.56 $ 0.26 $ 0.43
Book value per share$ 8.56 $ 8.38 $ 8.28 $ 8.17 $ 8.07 $ 8.38 $ 8.59 $ 8.09
Tangible book value per share$ 7.21 $ 7.67 $ 7.58 $ 7.45 $ 7.33 $ 7.67 $ 7.83 $ 8.07
Ending shares outstanding 11,584,011 11,583,011 11,577,111 11,499,398 11,458,561 11,583,011 11,377,980 6,921,352
Weighted average shares outstanding:
Basic 11,583,440 11,580,745 11,521,043 11,481,137 11,426,378 11,502,800 8,870,114 6,918,814
Diluted 11,626,609 11,627,974 11,582,724 11,548,878 11,510,147 11,567,811 8,974,384 6,919,760
Selected Performance Ratios:
Return on average assets(2) 0.73% 0.82% 0.69% 0.98% 0.94% 0.86% 0.37% 0.53%
Return on average equity(2) 6.03% 6.20% 5.21% 7.22% 7.11% 6.42% 3.12% 5.28%
Net interest margin 4.14% 4.18% 4.34% 4.46% 4.30% 4.38% 3.88% 3.46%
Efficiency ratio(1) 67.14% 65.05% 67.44% 65.94% 65.76% 66.04% 77.16% 78.20%
Period End Balance Sheet Data:
Loans, net of unearned income$ 622,092 $ 617,398 $ 597,969 $ 573,729 $ 558,923 $ 617,398 $ 552,038 $ 346,500
Total Earning Assets 753,726 726,408 711,622 665,028 663,017 726,408 698,266 483,054
Goodwill 6,931 6,931 6,931 6,931 6,931 6,931 6,931 -
Core Deposit Intangible 1,125 1,241 1,196 1,320 1,470 1,241 1,625 182
Total Assets 830,395 817,015 786,495 742,443 748,371 817,015 766,121 525,646
Deposits 667,654 651,161 619,935 579,609 600,520 651,161 618,902 448,458
Short term debt 31,218 24,594 30,722 32,884 18,943 24,594 20,733 6,305
Long term debt 28,559 33,782 28,846 24,914 25,282 33,782 25,591 12,372
Shareholders' equity 99,210 104,702 103,545 101,552 100,076 104,702 97,685 56,004
Selected Average Balances:
Gross Loans$ 623,286 $ 601,966 $ 585,541 $ 569,785 $ 557,177 $ 578,759 $ 430,571 $ 354,871
Total Earning Assets 734,859 714,755 689,166 669,586 672,655 686,663 565,264 511,597
Core Deposit Intangible 1,186 1,139 1,251 1,389 1,546 1,330 884 237
Total Assets 832,738 796,414 771,913 744,118 748,047 765,284 631,905 555,354
Deposits 672,151 631,855 607,722 588,328 600,601 607,214 523,954 470,526
Short term debt 36,039 35,303 35,012 28,212 19,298 32,316 9,957 13,879
Long term debt 20,822 20,872 22,631 22,895 25,444 20,147 20,494 12,372
Shareholders' equity 100,312 104,732 102,879 101,216 99,376 102,068 74,365 55,701
Asset Quality Ratios:
Nonperforming loans$ 8,750 $ 8,280 $ 10,899 $ 11,702 $ 13,473 $ 8,280 $ 11,876 $ 15,856
Other real estate owned 1,888 1,401 1,007 1,030 1,187 1,401 1,585 2,008
Allowance for loan losses 7,527 7,021 7,032 6,842 6,919 7,021 6,844 7,054
Nonperforming loans (3) to period-end loans 1.39% 1.41% 1.82% 2.04% 2.41% 1.34% 2.15% 4.58%
Allowance for loan losses to period-end loans 1.20% 1.14% 1.18% 1.19% 1.24% 1.14% 1.24% 2.04%
Delinquency Ratio (4) 0.45% 0.41% 0.36% 0.32% 0.23% 0.41% 0.91% 0.25%
Net loan charge-offs (recoveries) to average loans -0.10% 0.34% 0.14% -0.01% 0.04% 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.