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KS Bancorp, Inc. (KSBI) Announces Second Quarter 2016 Financial Results

SMITHFIELD, N.C., July 21, 2016 (GLOBE NEWSWIRE) -- KS Bancorp, Inc. (the “Company”) (OTCBB:KSBI), parent company of KS Bank, Inc. (the “Bank”), announced unaudited net income available to common shareholders of $527,000, or $.40 per diluted share, for the three months ended June 30, 2016, compared to a net income available to common shareholders of $327,000, or $.25 per diluted share, for the three months ended June 30, 2015. Included in the second quarter 2016 earnings, is a one-time gain on the sale of other real estate owned property (OREO), which increased net earnings by $111,000.

For the six months ended June 30, 2016, net income available to common shareholders totaled $962,000, a $313,000 increase, or 48.2% from $649,000 for the same period ended June 30, 2015. Net income per common share increased from $.50 at June 30, 2015 to $.73 at June 30, 2016.

Net interest income for the three months ended June 30, 2016 was $2.8 million, compared to $2.6 million for the same period in 2015. Non-interest income for the period ended June 30, 2016 was $701,000, compared to $486,000 for the same period ended June 30, 2015. The increase in noninterest income is primarily the result of income from the Trust Services Division, which was added in July, 2015. Non-interest expense for the three months ended June 30, 2016 remained the same at $2.6 million, as compared to the same period ended June 30, 2015.

The Company’s unaudited consolidated total assets increased $15.0 million to $352.4 million at June 30, 2016, compared to $337.4 million at December 31, 2015. Net loan balances increased $4.1 million with a balance of $251.7 million at June 30, 2016, compared to $247.6 million at December 31, 2015. The Company’s investment securities remained at $67.6 million at June 30, 2016. Total deposits have increased 8.7% or $22.4 million to $279.9 million at June 30, 2016, compared to $257.5 million at December 31, 2015. Total stockholders’ equity increased $1.7 million from $22.9 million at December 31, 2015 to $24.6 million at June 30, 2016.

Nonperforming assets, which includes nonaccrual loans and OREO, represent less than 1.0 % of the total assets. The nonperforming assets consist of $206,000 in OREO and $2.1 million in nonaccrual loans. For the six months ended June 30, 2016, $5,000 was expensed to the provision for loan losses. The allowance for loan losses at June 30, 2016 totaled $3.5 million, or 1.39% of all outstanding loans.

Commenting on the second quarter results, Harold T. Keen, President/CEO stated, “We are very pleased with the second quarter and year-to-date results. During the second quarter, we were able to take into income a gain on the sale of an OREO property that the bank had held for sale for a period of time. As the economy continues to improve, the company continues to grow its loan portfolio while maintaining asset quality. Additionally, the company has seen strong growth in deposits during the first half of 2016.”

KS Bank continues to be well-capitalized according to regulatory standards with total risk based capital of 14.18%, tier 1 risk- based capital of 12.92%, common equity tier 1 risked based capital of 12.92%, and a tier 1 leverage ratio of 9.47% at June 30, 2016. The minimum levels to be considered well capitalized for each of these ratios are 10.0%, 8.0%, 6.5%, and 5.0%, respectively.

KS Bancorp, Inc. is a Smithfield, North Carolina-based single bank holding company. KS Bank, Inc., a state-chartered savings bank, is KS Bancorp’s sole subsidiary. The Bank is a full service community bank serving the citizens of eastern North Carolina since 1924. The Bank offers a broad range of personal and business banking products and services, mortgage products and wealth management advisory services. There are nine full service branches located in Kenly, Selma, Clayton, Garner, Goldsboro, Wilson, Wendell, Smithfield, and Four Oaks, North Carolina plus a mortgage servicing location in Greenville, NC. In addition, KS Wealth Management has an office in Asheboro, NC and maintains a presence in Waynesville and Wilmington, NC. For more information, visit www.ksbankinc.com.

This release contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate” and “believe,” variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. The Company undertakes no obligation to update any forward-looking statements.

KS Bancorp, Inc. and Subsidiary
Consolidated Statements of Financial Condition
June 30 2016 December 31,
(unaudited) 2015*
(Dollars in thousands)
ASSETS
Cash and due from banks:
Interest-earning$15,709 $3,839
Noninterest-earning 1,063 836
Time Deposit 100 100
Investment securities available for sale, at fair value 67,642 67,582
Federal Home Loan Bank stock, at cost 1,749 1,991
Presold mortgages in process of settlement 216 -
Loans 255,230 251,163
Less allowance for loan losses (3,551) (3,535)
Net loans 251,679 247,628
Accrued interest receivable 1,055 1,008
Foreclosed real estate and repossessions, net 206 753
Property and equipment, net 7,885 8,059
Other assets 5,155 5,638
Total assets$352,459 $337,434
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Deposits$279,956 $257,514
Short-term borrowings 1,359 10,687
Long-term borrowings 43,248 43,248
Accrued interest payable 284 272
Accrued expenses and other liabilities 3,043 2,805
Total liabilities 327,890 314,526
Stockholder's Equity:
Common stock, no par value, authorized 20,000,000 shares;
1,309,501 shares issued and outstanding in 2015 and 2014 1,607 1,607
Retained earnings, substantially restricted 22,366 21,508
Accumulated other comprehensive (loss) 596 (207)
Total stockholders' equity 24,569 22,908
Total liabilities and stockholders' equity$352,459 $337,434
* Derived from audited financial statements

KS Bancorp, Inc and Subsidiary
Consolidated Statements of Income (Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2016 2015 2016 2015
( In thousands, except per share data)
Interest and dividend income:
Loans$ 3,092 $ 2,846 $ 6,143 $ 5,662
Investment securities
Taxable 303 320 612 634
Tax-exempt 44 75 91 160
Dividends 21 21 45 41
Interest-bearing deposits 9 3 11 5
Total interest and dividend income 3,469 3,265 6,902 6,502
Interest expense:
Deposits 334 314 654 618
Borrowings 362 355 731 725
Total interest expense 696 669 1,385 1,343
Net interest income 2,773 2,596 5,517 5,159
Provision for loan losses - - 5 -
Net interest income after
provision for loan losses 2,773 2,596 5,512 5,159
Noninterest income:
Service charges on deposit accounts 332 306 682 607
Fees from presold mortgages 99 74 132 93
Gain on sale of investments - - 3 -
Other income 270 106 537 230
Total noninterest income 701 486 1,354 930
Noninterest expenses:
Compensation and benefits 1,686 1,591 3,356 3,127
Occupancy and equipment 307 248 627 511
Data processing & outside service fees 198 232 401 463
Advertising 32 13 45 28
Net foreclosed real estate (107) 1 (84) 26
Other 506 534 1,013 1,014
Total noninterest expenses 2,622 2,619 5,358 5,169
Income before income taxes 852 463 1,508 920
Income tax 325 136 546 271
Net income $ 527 $ 327 $ 962 $ 649
Basic and Diluted earnings per share$ 0.40 $ 0.25 $ 0.73 $ 0.50















Contact: Harold T. Keen President and Chief Executive Officer (919) 938-3101 Regina J Smith Chief Financial Officer (919) 938-3101

Source:KS Bancorp