First National Community Bancorp, Inc. Reports Second Quarter 2016 Net Income

DUNMORE, Pa, July 29, 2016 (GLOBE NEWSWIRE) -- First National Community Bancorp, Inc. (OTCQX:FNCB), the parent company of Dunmore-based FNCB Bank (the “Bank”), announced net income for the three months ended June 30, 2016 was $1.6 million, or $0.10 per basic and diluted share. Net income for the comparable period of 2015 was $0.8 million, or $0.05 per basic and diluted share. The $0.8 million, or 98.4%, improvement in second quarter earnings reflected increases in net interest income and non-interest income, partially offset by higher provisions for loan and lease losses, income taxes and an increase in non-interest expense. Net income for the six months ended June 30, 2016 was $2.8 million, or $0.17 per basic and diluted share, compared to net income of $4.3 million, or $0.26 per basic and diluted share, for the same period of 2015. Annualized return on average assets was 0.60% and 0.51%, respectively, for the three and six months ended June 30, 2016, compared to 0.34% and 0.89%, for the respective periods of 2015. Annualized return on average equity was 7.12% and 6.15%, respectively, for the three- and six-month periods ended June 30, 2016, compared to 5.89% and 15.84%, respectively, for the comparable periods in 2015. FNCB paid holders of its common stock dividends of $0.02 for the second quarter of 2016, totaling $0.04 per share for the year-to-date period of 2016. FNCB did not pay a dividend during the first six months of 2015.

Effective June 30, 2016, the Bank, formerly known as First National Community Bank, completed a charter conversion from a national bank to a Pennsylvania state bank. The conversion followed receipt of required regulatory approvals from the Pennsylvania Department of Banking and Securities. Effective with the conversion, the Bank changed its legal name to FNCB Bank.

Performance Highlights:

  • Reinstated dividend reinvestment and stock purchase plan;
  • Year over year growth in net interest income of $2.5 million, or 20.2%;
  • 29 basis point improvement in tax-equivalent net interest margin comparing the second quarters of 2016 and 2015; and
  • 23.3% decrease in non-performing loans from prior quarter end; 52.4% decrease from one year ago.

“During the second quarter we were able to create meaningful value for our shareholders by reinstituting the dividend reinvestment and stock purchase plan,” stated Gerard A. Champi, President and Chief Executive Officer. “Through the plan, shareholders once again have the ability to increase their investment in FNCB at a discounted price,” mentioned Champi. “I am also happy to say that, during the second quarter, the Bank successfully completed a charter conversion from a national bank to a Pennsylvania state bank. In addition to reducing our annual regulatory assessment costs, becoming a state-chartered institution provides FNCB with greater flexibility to execute strategies for long-term growth and increase bank profitability going forward. The conversion was a seamless transition and had no change in FDIC deposit insurance coverage for our customers. We are committed to and will continue to offer and deliver the same high level products and quality services our customers are accustomed to receiving,” concluded Champi.

Summary Results for the Three and Six Months Ended June 30, 2016

Net interest income before provision (credit) for loan and lease losses was $7.6 million for the second quarter, and $15.2 million for the six months ended June 30, 2016 compared to $6.3 million and $12.6 million for the same periods in 2015. The improvement for both the quarter and year-to-date periods primarily reflected significant growth in earning assets, higher earning asset yields and reduced funding costs. Average earning assets grew $83.0 million, or 9.1%, and $83.9 million, or 9.2%, comparing the quarter and year-to-date periods ended June 30, 2016 and 2015, respectively. Tax-equivalent earning asset yields improved 11 basis points for the second quarter and 7 basis points for the six months ended June 30, 2016 over the same periods of 2015. Comparing the three months and six months ended June 30, 2016 and 2015, FNCB’s cost of funds decreased 23 basis points and 25 basis points, respectively. Causing the greatest impact in funding costs was a decrease in the cost of borrowed funds, which resulted from a modification of the interest rate on FNCB’s subordinated notes from 9.00% to 4.50% in mid-2015. The tax-equivalent net interest margin for second quarter 2016 was 3.14%, a 3 basis point improvement from the first quarter of 2016, and 29 basis points higher than the same prior year period.

Non-interest income totaled $2.1 million for the three months ended June 30, 2016, compared to $1.5 million for the comparable period of 2015. The $0.6 million, or 35.5%, increase primarily reflected an increase in net gains on the sale of securities of $0.8 million, partially offset by a reduction due to a legal settlement of $0.2 million received in the second quarter of 2015. For the six months ended June 30, 2016, non-interest income totaled $3.4 million, a decrease of $1.6 million, or 31.0%, compared to $5.0 million for the same six months of 2015. The change resulted primarily from decreases in net gains on the sale of securities, legal settlements and other income of $1.3 million, $0.2 million and $0.1 million, respectively.

For the three months ended June 30, 2016, non-interest expense totaled $7.0 million, an increase of $0.3 million, or 5.2%, from $6.7 million for the same three months of 2015. The increase in 2016 was due primarily to higher salaries and benefits expense of $0.4 million, which resulted from additions to staff and increases in health insurance costs. Also affecting non-interest expense were increases in regulatory assessments, expense of other real estate owned and Bank shares tax. Expenses of other real estate owned included a valuation adjustment of $0.1 million on a Bank property that was previously held for expansion. These increases were partially mitigated by decreases in occupancy expense and insurance expense. On a year-to-date basis, non-interest expense increased $0.3 million, or 2.7%, to $13.8 million in 2016 from $13.5 million in 2015. The increase in the first half of 2016 as compared to the same period of 2015 was due primarily to increases in salaries and benefits expenses of $0.8 million and data processing expense of $0.1 million. These increases were partially offset by lower occupancy expense, regulatory assessments, and insurance expense.

Asset Quality

Total non-performing loans were $2.7 million at June 30, 2016, a decrease of $0.8 million, or 23.3%, from $3.6 million at March 31, 2016, and $1.0 million, or 27.7%, from December 31, 2015. The ratio of non-performing loans to total loans was 0.37% at June 30, 2016 compared to 0.49% at March 31, 2016 and 0.52% at December 31, 2015. (At March 31, 2016, the most recent data available, the FDIC average for commercial banks with assets between $1.0 billion and $3.0 billion was 0.81%.) The allowance for loan and lease losses as a percentage of gross loans was 1.17% at June 30, 2016, 1.19% at March 31, 2016 and 1.21% at the end of 2015. (The above described FDIC peer group average was 1.25% at March 31, 2016.)

Financial Condition

Total assets were relatively stable, decreasing $3.1 million, or 0.3%, to $1.088 billion at June 30, 2016 from $1.091 billion at December 31, 2015. The change in total assets primarily reflected an $8.4 million, or 3.3%, increase in available-for-sale securities, which was more than offset by reductions of $4.5 million in net deferred tax assets, $1.1 million in FHLB of Pittsburgh stock, $1.5 million in OREO and $3.4 million in cash and cash equivalents. Total deposits grew $14.3 million, or 1.7%, to $835.8 million at June 30, 2016 from $821.5 million at December 31, 2015. The deposit growth was used to repay $15.0 million in advances from the FHLB of Pittsburgh. In addition, on March 1, 2016, FNCB repaid in its entirety $10.8 million in accrued interest that it had previously been deferring on the subordinated debentures (“Notes”) for the period September 1, 2010 through May 31, 2015.

Total shareholders’ equity increased $9.3 million, or 10.8%, to $95.5 million at June 30, 2016 from $86.2 million at December 31, 2015. The capital improvement resulted primarily from a $7.0 million increase in accumulated other comprehensive income, which resulted from appreciation in the fair value of available-for-sale securities net of the tax impact of the appreciation, coupled with net income for the first six months of 2016 of $2.8 million.

At June 30, 2016, the Company’s total risk-based capital and Tier I leverage ratios were 12.00% and 7.31%, respectively. The respective ratios for the Bank at June 30, 2016 were 12.97% and 8.82%. The ratios well 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.

Availability of Filings

Copies of FNCB’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. All of FNCB’s filings with the Securities and Exchange Commission are also available on the Investor Relations page of FNCB’s website, www.fncb.com/investorrelations.

About FNCB Bank:
First National Community Bancorp, Inc. is the bank holding company of FNCB 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 had been operating under the name First National Community Bank from 1988 through June 2016. Effective June 30, 2016, the institution changed its name to FNCB Bank upon its conversion from a national charter to a Pennsylvania state charter. For more information about FNCB, visit www.fncb.com.

FNCB may from time to time make written or oral “forward-looking statements,” including statements contained in our filings with the Securities and Exchange Commission (“SEC”), in its reports to shareholders, and in other communications, which are made in good faith by us pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include statements with respect to FNCB’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 our 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 FNCB’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 our 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 FNCB to compete with other institutions for business; the composition and concentrations of FNCB’s lending risk and the adequacy of FNCB’s reserves to manage those risks; the valuation of FNCB’s investment securities; the ability of FNCB to pay dividends or repurchase common shares; the ability of FNCB to retain key personnel; the impact of any pending or threatened litigation against FNCB; the marketability of shares of FNCB and fluctuations in the value of FNCB’s share price; the effectiveness of FNCB’s system of internal controls; the ability of FNCB 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 our information technology systems; changes in consumer spending and saving habits; the nature, extent, and timing of governmental actions and reforms, and the success of FNCB at managing the risks involved in the foregoing and other risks and uncertainties, including those detailed in FNCB’s filings with the SEC.

FNCB 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 FNCB on its website or otherwise. FNCB 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 FNCB 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 FNCB periodically files with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2015.

[The Company provides tabular information as follows]

First National Community Bancorp, Inc.
Selected Financial Data
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
2016 2016 2015 2015 2015
Per share data:
Net income (fully diluted) $0.10 $0.07 $1.77 $0.14 $0.05
Cash dividends declared $0.02 $0.02 $- $- $-
Book value $5.76 $5.57 $5.22 $3.61 $3.33
Tangible book value $5.75 $5.56 $5.21 $3.60 $3.31
Market value:
High $6.12 $6.90 $5.50 $6.05 $6.55
Low $5.50 $5.11 $5.06 $5.02 $5.15
Close $5.60 $6.12 $5.25 $5.19 $6.05
Common shares outstanding 16,586,868 16,530,432 16,514,245 16,500,945 16,500,945
Selected ratios:
Annualized return on average assets 0.60% 0.42% 10.99% 0.91% 0.34%
Annualized return on average shareholders' equity 7.12% 5.15% 192.68% 16.38% 5.89%
Tier I leverage ratio 7.31% 7.08% 7.27% 6.57% 6.64%
Total risk-based capital to risk-adjusted assets 12.00% 11.81% 11.79% 11.20% 11.60%
Average shareholders' equity to average total assets 8.40% 8.15% 5.70% 5.55% 5.73%
Yield on earning assets (FTE) 3.56% 3.52% 3.56% 3.50% 3.45%
Cost of funds 0.50% 0.48% 0.48% 0.51% 0.73%
Net interest spread (FTE) 3.06% 3.04% 3.08% 2.98% 2.72%
Net interest margin (FTE) 3.14% 3.11% 3.15% 3.07% 2.85%
Total delinquent loans/total loans 0.74% 0.82% 0.84% 1.29% 1.34%
Allowance for loan and lease losses/total loans 1.17% 1.19% 1.20% 1.36% 1.51%
Non-performing loans/total loans 0.37% 0.49% 0.52% 0.93% 0.84%
Annualized net charge-offs/average loans 0.26% 0.47% 0.02% 0.04% 0.14%

First National Community Bancorp, Inc.
Year-to-Date Consolidated Statements of Income
Six Months Ended
June 30,
(in thousands, except share data) 2016 2015
Interest income
Interest and fees on loans $14,001 $12,947
Interest and dividends on securities
U.S. government agencies 1,830 1,983
State and political subdivisions, tax-free 21 72
State and political subdivisions, taxable 1,159 123
Other securities 190 239
Total interest and dividends on securities 3,200 2,417
Interest on interest-bearing deposits in other banks 6 32
Total interest income 17,207 15,396
Interest expense
Interest on deposits 1,305 1,326
Interest on borrowed funds
Interest on Federal Home Loan Bank of Pittsburgh advances 315 239
Interest on subordinated debentures 318 1,128
Interest on junior subordinated debentures 118 100
Total interest on borrowed funds 751 1,467
Total interest expense 2,056 2,793
Net interest income before provision (credit) for loan and lease losses 15,151 12,603
Provision (credit) for loan and lease losses 1,092 (149)
Net interest income after provision (credit) for loan and lease losses 14,059 12,752
Non-interest income
Deposit service charges 1,418 1,419
Net gain on the sale of securities 960 2,298
Net gain on the sale of mortgage loans held for sale 139 56
Net (loss) gain on the sale of other real estate owned (3) 16
Loan-related fees 202 196
Income from bank-owned life insurance 289 270
420 709
Total non-interest income 3,425 4,964
Non-interest expense
Salaries and employee benefits 7,103 6,342
Occupancy expense 822 1,165
Equipment expense 848 826
Data processing expense 1,017 949
Regulatory assessments 430 508
Bank shares tax 493 435
Expense of other real estate owned 240 247
Legal expense 206 251
Professional fees 559 587
Insurance expense 253 400
Other operating expenses 1,858 1,752
Total non-interest expense 13,829 13,462
Income before income taxes 3,655 4,254
Income tax expense (benefit) 887 (40)
$2,768 $4,294
Income per share
Basic $0.17 $0.26
Diluted $0.17 $0.26
Cash dividends declared per common share $0.04 $-
Weighted average number of shares outstanding:
Basic 16,534,464 16,495,558
Diluted 16,534,464 16,495,558

First National Community Bancorp, Inc.
Quarter-to-Date Consolidated Statements of Income
Three Months Ended
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(in thousands, except share data) 2016 2016 2015 2015 2015
Interest income
Interest and fees on loans $7,032 $6,969 $7,032 $6,693 $6,475
Interest and dividends on securities
U.S. government agencies 900 930 992 1,061 1,012
State and political subdivisions, tax-free 11 10 18 19 22
State and political subdivisions, taxable 624 535 458 324 97
Other securities 94 96 102 92 82
Total interest and dividends on securities 1,629 1,571 1,570 1,496 1,213
Interest on interest-bearing deposits in other banks 2 4 4 10 11
Total interest income 8,663 8,544 8,606 8,199 7,699
Interest expense
Interest on deposits 663 642 628 677 643
Interest on borrowed funds
Interest on Federal Home Loan Bank of Pittsburgh advances 167 148 147 128 119
Interest on subordinated debentures 159 159 160 162 565
Interest on junior subordinated debentures 61 57 56 50 51
Total interest on borrowed funds 387 364 363 340 735
Total interest expense 1,050 1,006 991 1,017 1,378
Net interest income before provision (credit) for loan and lease losses 7,613 7,538 7,615 7,182 6,321
Provision (credit) for loan and lease losses 396 696 (1,005) (191) 345
Net interest income after provision (credit) for loan and lease losses 7,217 6,842 8,620 7,373 5,976
Non-interest income
Deposit service charges 717 701 742 799 745
Net gain (loss) on the sale of securities 857 103 (6) 4 74
Net gain on the sale of mortgage loans held for sale 71 68 223 13 16
Net gain (loss) on the sale of other real estate owned 2 (5) 17 129 11
Loan-related fees 95 107 152 94 106
Income from bank-owned life insurance 143 146 149 145 135
Legal settlements - - - - 184
209 211 180 195 274
Total non-interest income 2,094 1,331 1,457 1,379 1,545
Non-interest expense
Salaries and employee benefits 3,589 3,514 4,228 3,240 3,203
Occupancy expense 329 493 619 500 532
Equipment expense 425 423 423 408 442
Data processing expense 494 523 556 471 501
Regulatory assessments 193 237 239 203 99
Bank shares tax 252 241 53 217 218
Expense of other real estate owned 194 46 62 91 147
Legal expense 86 120 106 80 88
Professional fees 272 287 234 193 286
Insurance expense 125 128 131 128 202
Legal settlement - - 777 - -
Other operating expenses 1,066 792 1,159 884 962
Total non-interest expense 7,025 6,804 8,587 6,415 6,680
Income before income taxes 2,286 1,369 1,490 2,337 841
Income tax expense (benefit) 661 226 (27,719) - 22
$1,625 $1,143 $29,209 $2,337 $819
Income per share
Basic $0.10 $0.07 $1.77 $0.14 $0.05
Diluted $0.10 $0.07 $1.77 $0.14 $0.05
Cash dividends declared per common share $0.02 $0.02 $- $- $-
Weighted average number of shares outstanding:
Basic 16,549,169 16,519,759 16,506,294 16,500,945 16,500,945
Diluted 16,549,169 16,519,759 16,506,294 16,500,945 16,500,945


First National Community Bancorp, Inc.
Consolidated Balance Sheets
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(in thousands) 2016 2016 2015 2015 2015
Assets
Cash and cash equivalents:
Cash and due from banks $15,847 $16,367 $19,544 $20,631 $22,443
Interest-bearing deposits in other banks 1,825 1,847 1,539 10,383 49,872
Total cash and cash equivalents 17,672 18,214 21,083 31,014 72,315
Securities available for sale, at fair value 262,190 263,523 253,773 249,228 226,539
Stock in Federal Home Loan Bank of Pittsburgh at cost 5,219 3,932 6,344 4,298 2,684
Loans held for sale 563 455 683 4,634 138
Loans, net of net deferred costs and unearned income 733,720 728,158 733,716 723,166 683,588
Allowance for loan and lease losses (8,559) (8,635) (8,790) (9,825) (10,328)
Net loans 725,161 719,523 724,926 713,341 673,260
Bank premises and equipment, net 10,793 10,904 11,193 11,258 11,059
Accrued interest receivable 2,511 2,854 2,475 2,618 2,174
Intangible assets 55 96 137 179 220
Bank-owned life insurance 29,670 29,527 29,381 29,232 29,087
Other real estate owned 1,628 1,806 3,154 1,618 1,740
Other assets 32,076 34,181 37,469 7,799 8,455
Total assets $1,087,538 $1,085,015 $1,090,618 $1,055,219 $1,027,671
Liabilities
Demand (non-interest-bearing) $144,082 $162,882 $154,531 $152,038 $144,075
Interest-bearing 691,751 720,243 667,015 700,004 721,293
Total deposits 835,833 883,125 821,546 852,042 865,368
Borrowed funds:
Federal Home Loan Bank of Pittsburgh advances 120,771 74,511 135,802 93,058 57,771
Subordinated debentures 14,000 14,000 14,000 14,000 14,000
Junior subordinated debentures 10,310 10,310 10,310 10,310 10,310
Total borrowed funds 145,081 98,821 160,112 117,368 82,081
Accrued interest payable 311 333 11,165 11,187 11,344
Other liabilities 10,813 10,695 11,617 14,989 13,935
Total liabilities 992,038 992,974 1,004,440 995,586 972,728
Shareholders' equity
Preferred stock - - - - -
Common stock 20,734 20,663 20,643 20,626 20,626
Additional paid-in capital 62,210 62,069 62,059 61,939 61,870
Retained earnings (accumulated deficit) 5,820 4,527 3,714 (25,495) (27,832)
Accumulated other comprehensive income (loss) 6,736 4,782 (238) 2,563 279
Total shareholders' equity 95,500 92,041 86,178 59,633 54,943
Total liabilities and shareholders’ equity $1,087,538 $1,085,015 $1,090,618 $1,055,219 $1,027,671

First National Community Bancorp, Inc.
Summary Tax-equivalent Net Interest Income
Three Months Ended
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(dollars in thousands) 2016 2016 2015 2015 2015
Interest income
Loans:
Loans - taxable $6,674 $6,603 $6,694 $6,371 $6,148
Loans - tax-free 542 555 512 488 495
Total loans 7,216 7,158 7,206 6,859 6,643
Securities:
Securities, taxable 1,618 1,561 1,552 1,477 1,191
Securities, tax-free 17 15 27 29 33
Total interest and dividends on securities 1,635 1,576 1,579 1,506 1,224
Interest-bearing deposits in other banks 2 4 4 10 11
Total interest income 8,853 8,738 8,789 8,375 7,878
Interest expense
Deposits 663 642 628 677 643
Borrowed funds 387 364 363 340 735
Total interest expense 1,050 1,006 991 1,017 1,378
Net interest income $7,803 $7,732 $7,798 $7,358 $6,500
Average balances
Earning assets:
Loans:
Loans - taxable $682,642 $683,198 $685,795 $660,709 $637,005
Loans - tax-free 48,131 48,433 43,429 41,746 42,225
Total loans 730,773 731,631 729,224 702,455 679,230
Securities:
Securities, taxable 260,835 256,555 251,108 241,799 211,833
Securities, tax-free 1,090 1,107 1,713 1,707 2,007
Total securities 261,925 257,662 252,821 243,506 213,840
Interest-bearing deposits in other banks 2,347 3,746 6,797 12,185 18,984
Total interest-earning assets 995,045 993,039 988,842 958,146 912,054
Non-earning assets 97,271 101,958 65,633 62,063 62,254
Total assets $1,092,316 $1,094,997 $1,054,475 $1,020,209 $974,308
Interest-bearing liabilities:
Deposits $725,552 $725,369 $702,783 $690,039 $646,656
Borrowed funds 117,229 113,386 119,281 105,109 108,234
Total interest-bearing liabilities 842,781 838,755 822,064 795,148 754,890
Demand deposits 146,622 146,994 146,457 143,140 137,674
Other liabilities 11,125 19,967 25,811 25,303 25,964
Shareholders' equity 91,788 89,281 60,143 56,618 55,780
Total liabilities and shareholders' equity $1,092,316 $1,094,997 $1,054,475 $1,020,209 $974,308
Yield/Cost
Earning assets:
Loans:
Interest and fees on loans - taxable 3.91% 3.87% 3.90% 3.86% 3.86%
Interest and fees on loans - tax-free 4.50% 4.58% 4.72% 4.67% 4.69%
Total loans 3.95% 3.91% 3.95% 3.91% 3.91%
Securities:
Securities, taxable 2.48% 2.43% 2.47% 2.44% 2.25%
Securities, tax-free 6.11% 5.48% 6.37% 6.75% 6.64%
Total securities 2.50% 2.45% 2.50% 2.47% 2.29%
Interest-bearing deposits in other banks 0.34% 0.43% 0.24% 0.33% 0.23%
Total earning assets 3.56% 3.52% 3.56% 3.50% 3.45%
Interest-bearing liabilities:
Interest on deposits 0.37% 0.35% 0.36% 0.39% 0.40%
Interest on borrowed funds 1.32% 1.28% 1.22% 1.29% 2.72%
Total interest-bearing liabilities 0.50% 0.48% 0.48% 0.51% 0.73%
Net interest spread 3.06% 3.04% 3.08% 2.98% 2.72%
Net interest margin 3.14% 3.11% 3.15% 3.07% 2.85%

First National Community Bancorp, Inc.
Asset Quality Data
Jun 30, Mar 31, Dec 31, Sept 30, Jun 30,
(in thousands) 2016 2016 2015 2015 2015
At period end
Non-accrual loans, including non-accruing troubled debt restructured loans (TDRs) $2,739 $3,569 $3,788 $6,741 $5,757
Loans past due 90 days or more and still accruing - - - - -
Total non-performing loans 2,739 3,569 3,788 6,741 5,757
Other real estate owned (OREO) 1,628 1,806 3,154 1,618 1,740
Total non-performing loans and OREO $4,367 $5,375 $6,942 $8,359 $7,497
Accruing TDRs $4,043 $4,623 $4,982 $5,065 $5,289
For the three months ended
Allowance for loan and lease losses
Beginning balance $8,635 $8,790 $9,825 $10,328 $10,944
Loans charged-off 709 1,148 198 968 1,192
Recoveries of charged-off loans 237 297 168 656 231
Net charge-offs 472 851 30 312 961
Provision (credit) for loan and lease losses 396 696 (1,005) (191) 345
Ending balance $8,559 $8,635 $8,790 $9,825 $10,328



INVESTOR CONTACT: James M. Bone, Jr., CPA Executive Vice President and Chief Financial Officer FNCB Bank (570) 348-6419 james.bone@fncb.com

Source:First National Community Bancorp