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Select Bancorp Reports Fourth Quarter and Year-End 2016 Earnings

DUNN, N.C., Jan. 27, 2017 (GLOBE NEWSWIRE) -- Select Bancorp, Inc. (the “Company”) (NASDAQ:SLCT), the holding company for Select Bank & Trust, today reported net income for the year ended December 31, 2016 of $6.8 million and basic and diluted earnings per share of $0.58, compared to net income of $6.6 million and basic and diluted earnings per share of $0.56 for the year ended December 31, 2015.

For the fourth quarter of 2016, the Company reported net income of $1.6 million, and basic and diluted earnings per share of $0.14, compared to net income of $1.6 million and basic and diluted earnings per share of $0.14 for the fourth quarter of 2015.

Total assets, deposits, and total loans for the Company as of December 31, 2016 were $846.6 million, $679.7 million, and $677.2 million, respectively, compared to total assets of $817.0 million, total deposits of $651.2 million, and total loans of $617.4 million as of the same date in 2015.

For the twelve months ended December 31, 2016, return on average assets was 0.81% and return on average equity was 6.61%, compared to 0.86% and 6.42%, respectively, for the twelve months ended December 31, 2015.

Non-performing loans decreased to $6.9 million at December 31, 2016 from $8.3 million at December 31, 2015. Non-performing loans equaled 1.02% of loans at December 31, 2016, decreasing from 1.41% of loans at December 31, 2015. Foreclosed real estate equaled $599,000 at December 31, 2016, compared to $1.4 million at December 31, 2015. For the year ended December 31, 2016, net charge-offs were $126,000, or 0.08% of average loans, compared to net charge offs of $714,000, or 0.12% of average loans in 2015. At December 31, 2016, the allowance for loan losses was $8.4 million, or 1.24% of total loans, as compared to $7.0 million, or 1.14% of total loans, at December 31, 2015.

Net interest margin was 4.06% and 3.98% for the year and quarter ending December 31, 2016, as compared to 4.38% and 4.18% for the year and quarter ending December 31, 2015.

“We are pleased to report another year of record earnings,” President and CEO William L. Hedgepeth II said. “Our strategy has been growth-oriented and efficiency driven, while delivering value to our shareholders.”

Among the highlights of 2016, Hedgepeth said, “We strategically combined branches in our Greenville market and relocated our Raleigh branch. We increased loans by approximately 10% over the previous year and improved our return on equity and efficiency ratio while our asset quality remains solid.”

Mr. Hedgepeth added, "We continue to actively expand our market footprint, focusing on higher growth North Carolina markets. We recently completed our branch restructuring, and anticipate growing in the Raleigh and Wilmington areas as we move forward. Our new location in the Raleigh market, along with our recent entrance in the Leland/Wilmington market and the Morehead City area, should help with growth in new markets in addition to our proactive effort to grow our existing footprint. We believe we have the capital necessary to focus on continued growth in these promising markets. As consolidation in our industry continues, we are attracting new customers who are not happy with a larger financial institution, and we are also attracting experienced and knowledgeable employees from these consolidations.”

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 and year ended December 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 market share growth, 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 endedAt or for the twelve months ended
December September December December December December
31, 30, June 30, March 31, 31, 31, 31, 31,
2016 2016 2016 2016 2015 2016 2015 2014
Summary of Operations:
Total interest income$8,877 $8,755 $8,645 $8,432 $8,425 $34,709 $33,341 $26,104
Total interest expense 985 909 912 927 890 3,733 3,542 4,519
Net interest income 7,892 7,846 7,733 7,505 7,535 30,976 29,799 21,585
Provision for (recovery of) loan losses 669 337 158 352 506 1,516 890 (194)
Net interest income after provision 7,223 7,509 7,575 7,153 7,029 29,460 28,909 21,779
Noninterest income 740 785 831 866 916 3,222 3,292 2,675
Merger/Acquisition related expenses - - - - 240 - 378 1,941
Noninterest expense 5,511 5,631 5,519 5,620 5,497 22,281 21,852 18,719
Income before income taxes 2,452 2,663 2,887 2,399 2,208 10,401 9,971 3,794
Provision for income taxes 847 924 980 896 570 3,647 3,418 1,437
Net Income 1,605 1,739 1,907 1,503 1,638 6,754 6,553 2,357
Dividends on Preferred Stock - - - 4 20 4 77 38
Net income available to common shareholders$1,605 $1,739 $1,907 $1,499 $1,618 $6,750 $6,476 $2,319
Share and Per Share Data:
Earnings per share - basic$0.14 $0.15 $0.16 $0.13 $0.14 $0.58 $0.56 $0.26
Earnings per share - diluted$0.14 $0.15 $0.16 $0.13 $0.14 $0.58 $0.56 $0.26
Book value per share$8.95 $8.87 $8.74 $8.56 $8.38 $8.95 $8.38 $8.59
Tangible book value per share$8.29 $8.20 $8.05 $7.87 $7.67 $8.29 $7.67 $7.83
Ending shares outstanding 11,645,413 11,632,192 11,619,184 11,584,011 11,583,011 11,645,413 11,583,011 11,377,980
Weighted average shares outstanding:
Basic 11,636,647 11,627,270 11,594,995 11,583,440 11,580,745 11,610,705 11,502,800 8,870,114
Diluted 11,677,958 11,666,280 11,642,726 11,626,609 11,627,974 11,655,111 11,567,811 8,974,384
Selected Performance Ratios:
Return on average assets(2) 0.76% 0.85% 0.93% 0.73% 0.82% 0.81% 0.86% 0.37%
Return on average equity(2) 6.12% 6.71% 7.62% 6.03% 6.20% 6.61% 6.42% 3.12%
Net interest margin 3.98% 4.27% 4.24% 4.14% 4.18% 4.06% 4.38% 3.88%
Efficiency ratio (1) 63.84% 65.24% 64.44% 67.14% 65.05% 65.15% 66.04% 77.16%
Period End Balance Sheet Data:
Gross Loans$677,195 $651,743 $632,187 $629,619 $617,398 $677,195 $617,398 $552,038
Total Earning Assets 770,288 746,349 749,956 753,726 726,408 770,288 726,408 698,266
Goodwill 6,931 6,931 6,931 6,931 6,931 6,931 6,931 6,931
Core Deposit Intangible 810 909 1,014 1,125 1,241 810 1,241 1,625
Total Assets 846,640 844,774 826,588 830,395 817,015 846,640 817,015 766,121
Deposits 679,661 677,121 661,274 667,654 651,161 679,661 651,161 618,902
Short term debt 37,090 38,175 40,714 32,218 24,594 37,090 29,673 20,733
Long term debt 23,039 22,372 18,205 28,559 33,782 23,039 28,703 25,591
Shareholders' equity 104,273 103,191 101,531 99,210 104,702 104,273 104,702 97,685
Selected Average Balances:
Gross Loans$663,213 $641,531 $629,333 $623,286 $601,966 $639,412 $578,759 $430,571
Total Earning Assets 778,477 737,295 739,002 734,859 714,755 744,024 686,663 565,264
Core Deposit Intangible 862 965 1,072 1,186 1,139 1,020 1,330 884
Total Assets 844,162 818,284 822,036 832,738 796,414 829,315 765,284 631,905
Deposits 679,404 653,016 658,476 672,151 631,855 665,764 607,214 523,954
Short term debt 33,032 34,573 30,366 30,472 27,686 32,111 32,316 9,957
Long term debt 23,089 23,189 28,289 28,389 28,489 25,739 20,147 20,494
Shareholders' equity 104,404 103,026 100,664 100,312 104,732 102,110 102,068 74,365
Asset Quality Ratios:
Nonperforming loans$6,881 $7,565 $8,788 $8,750 $8,280 $6,881 $8,712 $11,876
Other real estate owned 599 548 716 1,888 1,401 599 1,401 1,585
Allowance for loan losses 8,411 7,889 7,692 7,527 7,021 8,411 7,021 6,844
Nonperforming loans (3) to period-end loans 1.02% 1.16% 1.39% 1.39% 1.34% 1.02% 1.41% 2.15%
Allowance for loan losses to period-end loans 1.24% 1.21% 1.22% 1.20% 1.14% 1.24% 1.14% 1.24%
Delinquency Ratio (4) 0.44% 0.16% 0.23% 0.45% 0.41% 0.44% 0.40% 0.91%
Net loan charge-offs (recoveries) to average loans 0.08% -0.01% -0.00% -0.10% 0.34% 0.02% 0.12% -0.03%


(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 past due 30-89 days and still accruing 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.