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Select Bancorp Reports Third Quarter 2016 Earnings

DUNN, N.C., Nov. 03, 2016 (GLOBE NEWSWIRE) -- Select Bancorp, Inc. (the “Company” (NASDAQ:SLCT), the holding company for Select Bank & Trust, reported net income for the quarter ended September 30, 2016 of $1.7 million compared to $1.4 million for the same period in 2015. Basic and diluted earnings per share for the third quarter were $0.15, compared to basic and diluted earnings per share for the third quarter 2015 of $0.12.

For the nine months ended September 30, 2016, net income for the Company was $5.1 million compared to $4.9 million for the same period in 2015. Basic and diluted earnings per share for the first nine months of 2016 were $0.44, compared to basic and diluted earnings per share for the first nine months of 2015 of $0.42.

As of September 30, 2016, the Company reported total assets of $844.8 million compared to $786.5 million at September 30, 2015, an increase of 10.4%. Total deposits were $677.1 million and total net loans were $643.9 million at the end of the third quarter 2016, compared to total deposits of $619.9 million and total net loans of $590.9 million as of the end of the third quarter 2015, increases of 9.2% and 9.0% respectively.

Return on average assets was 0.85% and return on average equity was 6.71% for the third quarter of 2016, compared to 0.69% and 5.21%, respectively, for the same quarter ended September 30, 2015.

Non-performing loans were $7.6 million and $10.9 million at September 30, 2016 and September 30, 2015, respectively. Non-performing loans equaled 1.16% of total loans at September 30, 2016, decreasing from 1.82% of total loans at September 30, 2015. Foreclosed real estate equaled $548,000 at September 30, 2016, compared to $1.0 million at September 30, 2015. For the third quarter 2016, net recoveries were ($22,000), or (0.01%), of average loans, compared to net charge-offs of $204,000, or 0.14% of average loans in the third quarter 2015. At September 30, 2016, the allowance for loan losses was $7.9 million, or 1.21% of total loans, as compared to $7.0 million or 1.18% of total loans at September 30, 2015.

Net interest margin was 4.27% for the quarter ending September 30, 2016, as compared to 4.34% for the quarter ended September 30, 2015.

“The third quarter of 2016 was a very good quarter for Select Bancorp as net income increased 28.7% over the third quarter of 2015,” President and CEO William L. Hedgepeth II said. “During the third quarter we celebrated the grand opening of our new office space in Raleigh.” The Company relocated its Raleigh branch to 4505 Falls of Neuse Road on August 1 and celebrated a grand opening with the Raleigh Chamber of Commerce on August 24. The new branch is conveniently located just north of the beltline past Wake Forest Road.

Select Bank & Trust maintained the number one position in deposit market share in Dunn, our headquarters city, and the number two position in Harnett County, for the 14th consecutive year.

“We are very proud of our performance this year,” said Hedgepeth. “We continue to enhance and improve our product and service offerings as well as our operations area. We believe that is evident by our success over the last few quarters. That success has allowed us to be able to attract experienced and knowledgeable personnel to Select Bank & Trust. We believe in doing business the old-fashioned way, through ‘common sense’ banking, hard work and providing great service to our customers and prospects.”

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 September 30, 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. Except as required by law, the Company assumes no obligation to update the forward-looking statements publicly or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future.



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
September June March December September December December December
30, 30, 31, 31,30, 31, 31, 31,
20162016201620152015201520142013
Summary of Operations:
Total interest income$ 8,755 $ 8,645 $ 8,432 $ 8,425 $ 8,412 $ 33,341 $ 26,104 $ 22,903
Total interest expense 909 912 927 890 878 3,542 4,519 5,258
Net interest income 7,846 7,733 7,505 7,535 7,534 29,799 21,585 17,645
Provision for (recovery of) loan losses 337 158 352 506 393 890 (194) (325)
Net interest income after provision 7,509 7,575 7,153 7,029 7,141 28,909 21,779 17,970
Noninterest income 785 831 866 916 572 3,292 2,675 2,629
Merger/Acquisition related expenses - - - 240 103 378 1,941 -
Noninterest expense 5,631 5,519 5,620 5,497 5,467 21,852 18,719 15,855
Income before income taxes 2,887 2,887 2,399 2,208 2,143 9,971 3,794 4,744
Provision for income taxes 924 980 896 570 792 3,418 1,437 1,803
Net Income 1,739 1,907 1,503 1,638 1,351 6,553 2,357 2,941
Dividends on Preferred Stock - - 4 20 19 77 38 -
Net income available to common shareholders$ 1,739 $ 1,907 $ 1,499 $ 1,618 $ 1,332 $ 6,476 $ 2,319 $ 2,941
Share and Per Share Data:
Earnings per share - basic$ 0.15 $ 0.16 $ 0.13 $ 0.14 $ 0.12 $ 0.56 $ 0.26 $ 0.43
Earnings per share - diluted$ 0.15 $ 0.16 $ 0.13 $ 0.14 $ 0.12 $ 0.56 $ 0.26 $ 0.43
Book value per share$ 8.87 $ 8.74 $ 8.56 $ 8.38 $ 8.28 $ 8.38 $ 8.59 $ 8.09
Tangible book value per share$ 8.20 $ 8.05 $ 7.87 $ 7.67 $ 7.58 $ 7.67 $ 7.83 $ 8.07
Ending shares outstanding 11,632,192 11,619,184 11,584,011 11,583,011 11,577,111 11,583,011 11,377,980 6,921,352
Weighted average shares outstanding:
Basic 11,627,270 11,594,995 11,583,440 11,580,745 11,521,043 11,502,800 8,870,114 6,918,814
Diluted 11,666,280 11,642,726 11,626,609 11,627,974 11,582,724 11,567,811 8,974,384 6,919,760
Selected Performance Ratios:
Return on average assets(2) 0.85% 0.93% 0.73% 0.82% 0.69% 0.86% 0.37% 0.53%
Return on average equity(2) 6.71% 7.62% 6.03% 6.20% 5.21% 6.42% 3.12% 5.28%
Net interest margin 4.27% 4.24% 4.14% 4.18% 4.34% 4.38% 3.88% 3.46%
Efficiency ratio (1) 65.24% 64.44% 67.14% 65.05% 67.44% 66.04% 77.16% 78.20%
Period End Balance Sheet Data:
Gross Loans$ 651,743 $ 632,187 $ 629,619 $ 617,398 $ 597,969 $ 617,398 $ 552,038 $ 346,500
Total Earning Assets 746,349 749,956 753,726 726,408 711,622 726,408 698,266 483,054
Goodwill 6,931 6,931 6,931 6,931 6,931 6,931 6,931 -
Core Deposit Intangible 909 1,014 1,125 1,241 1,196 1,241 1,625 182
Total Assets 844,774 826,588 830,395 817,015 786,495 817,015 766,121 525,646
Deposits 677,121 661,274 667,654 651,161 619,935 651,161 618,902 448,458
Short term debt 38,175 40,714 32,218 24,594 30,722 24,594 20,733 6,305
Long term debt 22,372 18,205 28,559 33,782 28,846 33,782 25,591 12,372
Shareholders' equity 103,191 101,531 99,210 104,702 103,545 104,702 97,685 56,004
Selected Average Balances:
Gross Loans$ 641,531 $ 629,333 $ 623,286 $ 601,966 $ 585,541 $ 578,759 $ 430,571 $ 354,871
Total Earning Assets 737,295 739,002 734,859 714,755 689,166 686,663 565,264 511,597
Core Deposit Intangible 965 1,072 1,186 1,139 1,251 1,330 884 237
Total Assets 818,284 822,036 832,738 796,414 771,913 765,284 631,905 555,354
Deposits 653,016 658,476 672,151 631,855 607,722 607,214 523,954 470,526
Short term debt 34,982 37,883 36,039 35,303 35,012 32,316 9,957 13,879
Long term debt 22,780 20,772 20,822 20,872 22,631 20,147 20,494 12,372
Shareholders' equity 103,026 100,664 100,312 104,732 102,879 102,068 74,365 55,701
Asset Quality Ratios:
Nonperforming loans$ 7,565 $ 8,788 $ 8,750 $ 8,280 $ 10,899 $ 8,280 $ 11,876 $ 15,856
Other real estate owned 548 716 1,888 1,401 1,007 1,401 1,585 2,008
Allowance for loan losses 7,889 7,692 7,527 7,021 7,032 7,021 6,844 7,054
Nonperforming loans (3) to period-end loans 1.16% 1.39% 1.39% 1.34% 1.82% 1.34% 2.15% 4.58%
Allowance for loan losses to period-end loans 1.21% 1.22% 1.20% 1.14% 1.18% 1.14% 1.24% 2.04%
Delinquency Ratio (4) 0.16% 0.23% 0.45% 0.41% 0.36% 0.41% 0.91% 0.25%
Net loan charge-offs (recoveries) to average loans -0.01% 0.00% -0.10% 0.34% 0.14% 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.