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MBT Financial Corp. Announces First Quarter 2017 Earnings and Dividend

MONROE, Mich., April 27, 2017 (GLOBE NEWSWIRE) -- MBT Financial Corp., (Nasdaq:MBTF), the parent company of Monroe Bank & Trust, reported a preliminary net profit of $3,180,000 ($0.14 per share, basic and diluted), in the first quarter of 2017, compared to a profit of $2,997,000 ($0.13 per share, basic and diluted), in the first quarter of 2016. This represents a 6.1% increase in net income compared to last year.

The Company also announced that it will pay a quarterly dividend of $0.05 on May 18, 2017 to shareholders of record as of May 11, 2017. This is an increase of $0.02, or 66.7% compared to the dividend paid in the same quarter last year.

The core earnings components of Net Interest Income, Non Interest Income excluding securities gains, and Non Interest Expense each improved compared to the first quarter of 2016. The net interest margin increased from 3.09% to 3.21% and the average amount of interest earning assets increased $2.2 million. Even though the quarter was one day shorter this year, the net interest income increased $305,000, or 3.3% in the first quarter of 2017 compared to the first quarter of 2016.

The provision for loan losses increased $100,000 compared to last year from a negative expense of $300,000 in the first quarter of 2016 to a negative expense of $200,000 recorded this quarter. Recoveries exceeded charge offs, classified assets decreased, and historical loss ratios improved, but the amount that the Allowance for Loan Losses could be reduced was impacted by the loan growth. Total Loans increased $10.5 million during the first quarter, and the Allowance for Loan and Lease Losses was reduced from $8.5 million, or 1.30% of loans at the end of 2016 to $8.3 million, or 1.26% as of the end of the first quarter of 2017.

Non-interest income, excluding gains and losses on securities transactions increased slightly from $3,794,000 to $3,810,000 in the first quarter of 2017 compared to the first quarter of 2016. Securities gains and losses decreased $310,000 and total non-interest income decreased $294,000 or 7.1%.

Total non-interest expenses decreased $421,000, or 4.4% in the first quarter of 2017 compared to the first quarter of 2016. Salaries and benefits decreased $184,000 or 3.3%, professional fees decreased $63,000, the FDIC deposit insurance assessment decreased $62,000 and all other non-interest expenses decreased $112,000.

Total assets of the company decreased $10.7 million, or 0.8% compared to December 31, 2016. Capital decreased $11.6 million during the quarter as the payment of the special and regular dividends exceeded the net income and the increase in the Accumulated Other Comprehensive Loss (AOCL) component of capital. The ratio of equity to assets decreased from 10.40% at the end of 2016 to 9.62% at the end of the first quarter of 2017. The Bank’s Tier 1 Leverage ratio decreased from 10.75% as of December 31, 2016 to 9.65% as of March 31, 2017.

H. Douglas Chaffin, President and CEO, commented, “We are off to a good start in 2017, with the loan growth, the improvement in the net interest margin, the reduction in classified assets, and the reduction in non-interest expenses. We plan to continue our focus on each of these items in 2017, as well as improving our non-interest income. Today’s dividend declaration represents a conservative 36% payout of our profits for the quarter, reflecting our efforts to actively manage our capital while we look for the right opportunities to grow throughout our existing branch network and strategic acquisitions. We remain confident in our ability to maintain our position as the premier independent provider of financial services in the communities we serve, despite challenges in our current environment.”

Conference Call
MBT Financial Corp. will hold a conference call to discuss the First Quarter 2017 results on Friday, April 28, 2017, at 10:00 a.m. Eastern Time. The call will be webcast and can be accessed at the Investor Relations/Corporate Profile page of MBT Financial Corp.’s web site www.mbandt.com. The call can also be accessed in the United States by calling toll free (877) 510-3783. The toll free number for callers in Canada is (855) 669-9657 and international callers can access the call at (412) 902-4136. A replay will be available one hour after the conclusion of the call at (877) 344-7529, Conference #10104449. The replay will be available until May 28, 2017 at 9:00 a.m. Eastern. The webcast will be archived on the Company’s web site and available for twelve months following the call.

About the Company:
MBT Financial Corp. (NASDAQ:MBTF), a bank holding company headquartered in Monroe, Michigan, is the parent company of Monroe Bank & Trust (“MBT”). Founded in 1858, MBT is one of the largest independently owned community banks in Southeast Michigan. With over $1.3 billion in assets, MBT is a full-service bank, offering a complete range of business and personal accounts, credit and mortgage options, investment and retirement services and award-winning financial literacy outreach. MBT employee volunteers contribute between 8,000 to 9,000 hours of community service annually. MBT’s Commercial Lending Group is a top SBA lending partner. MBT’s Wealth Management Group (“WMG”) is one of the largest and most respected in Michigan. The Michigan Bankers Association ranks MBT fourth among all Michigan banks for total trust assets. With offices and ATMs in Monroe, Lenawee, and Wayne Counties, convenient mobile and online banking, a robust online and social media presence and a comprehensive array of products and services, MBT prides itself in offering World Class Banking with a Local Address. Visit MBT’s website at www.mbandt.com.

Forward-Looking Statements
Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of Section 21A of the Securities Exchange Act of 1934. Forward-looking statements which are based on various assumptions (some of which are beyond the Company's control), may be identified by reference to a future period or periods, or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "estimate," "anticipate," "continue," or similar terms or variations on those terms, or the negative of these terms. Actual results could differ materially from those set forth in forward-looking statements, due to a variety of factors, including, but not limited to, those related to the economic environment, particularly in the market areas in which the Company operates, competitive products and pricing, fiscal and monetary policies of the U.S. Government, changes in government regulations affecting financial institutions, including regulatory fees and capital requirements, changes in prevailing interest rates, acquisitions and the integration of acquired businesses, credit risk management, asset/liability management, change in the financial and securities markets, including changes with respect to the market value of our financial assets, the availability of and costs associated with sources of liquidity, and the ability of the Company to resolve or dispose of problem loans. The Company undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.


MBT FINANCIAL CORP.
CONSOLIDATED FINANCIAL HIGHLIGHTS - UNAUDITED
Quarterly
2017 2016 2016 2016 2016
(dollars in thousands except per share data) 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr 1st Qtr
EARNINGS
Net interest income $ 9,595 $ 9,574 $ 9,515 $ 9,244 $ 9,290
FTE Net interest income $ 9,749 $ 9,731 $ 9,671 $ 9,393 $ 9,438
Provision for loan and lease losses $ (200) $ (1,000) $ (700) $ (200) $ (300)
Non interest income $ 3,820 $ 3,805 $ 4,039 $ 5,555 $ 4,114
Non interest expense $ 9,062 $ 9,269 $ 8,974 $ 8,872 $ 9,483
Net income $ 3,180 $ 3,578 $ 3,687 $ 4,239 $ 2,997
Basic earnings per share $ 0.14 $ 0.16 $ 0.16 $ 0.19 $ 0.13
Diluted earnings per share $ 0.14 $ 0.16 $ 0.16 $ 0.18 $ 0.13
Average shares outstanding 22,821,273 22,738,718 22,733,134 22,884,350 22,854,556
Average diluted shares outstanding 22,961,425 22,905,786 22,915,278 23,049,718 23,014,957
PERFORMANCE RATIOS
Return on average assets 0.97% 1.07% 1.10% 1.28% 0.91%
Return on average common equity 9.83% 9.57% 9.98% 11.87% 8.57%
Base Margin 3.16% 3.07% 3.07% 3.03% 3.04%
FTE Adjustment 0.05% 0.05% 0.05% 0.05% 0.05%
Loan Fees 0.00% 0.02% -0.01% 0.02% 0.00%
FTE Net Interest Margin 3.21% 3.14% 3.11% 3.10% 3.09%
Efficiency ratio 66.43% 68.18% 65.59% 67.83% 69.75%
Full-time equivalent employees 287 277 281 288 288
CAPITAL
Average equity to average assets 9.87% 11.21% 11.05% 10.80% 10.65%
Book value per share $ 5.67 $ 6.20 $ 6.49 $ 6.41 $ 6.22
Cash dividend per share $ 0.75 $ 0.04 $ 0.04 $ 0.03 $ 0.53
ASSET QUALITY
Loan Charge-Offs $ 112 $ 522 $ 114 $ 618 $ 209
Loan Recoveries $ 188 $ 575 $ 316 $ 184 $ 150
Net Charge-Offs $ (76) $ (53) $ (202) $ 434 $ 59
Allowance for loan and lease losses $ 8,334 $ 8,458 $ 9,405 $ 9,903 $ 10,537
Nonaccrual Loans $ 5,001 $ 4,656 $ 6,545 $ 7,522 $ 8,079
Loans 90 days past due $ 9 $ 10 $ 32 $ 41 $ 17
Restructured loans $ 10,318 $ 14,161 $ 15,923 $ 16,701 $ 17,828
Total non performing loans $ 15,328 $ 18,827 $ 22,500 $ 24,264 $ 25,924
Other real estate owned & other assets $ 1,400 $ 1,634 $ 1,696 $ 1,818 $ 1,608
Total non performing assets $ 16,728 $ 20,461 $ 24,196 $ 26,082 $ 27,532
Classified Loans $ 14,030 $ 14,971 $ 20,151 $ 24,365 $ 26,768
Other real estate owned & other assets $ 1,400 $ 1,634 $ 1,696 $ 1,818 $ 1,608
Total classified assets $ 15,430 $ 16,605 $ 21,847 $ 26,183 $ 28,376
Net loan charge-offs to average loans -0.05% -0.03% -0.12% 0.28% 0.04%
Allowance for loan losses to total loans 1.26% 1.30% 1.43% 1.55% 1.70%
Non performing loans to gross loans 2.31% 2.88% 3.43% 3.80% 4.19%
Non performing assets to total assets 1.24% 1.51% 1.80% 1.97% 2.06%
Classified assets to total capital 11.16% 10.95% 14.61% 17.70% 19.65%
Allowance to non performing loans 54.37% 44.92% 41.80% 40.81% 40.65%
END OF PERIOD BALANCES
Loans and leases $ 663,449 $ 652,948 $ 656,445 $ 639,199 $ 618,613
Total earning assets $ 1,232,350 $ 1,239,439 $ 1,232,863 $ 1,214,557 $ 1,227,990
Total assets $ 1,346,554 $ 1,357,283 $ 1,343,026 $ 1,323,415 $ 1,334,131
Deposits $ 1,203,072 $ 1,199,717 $ 1,180,461 $ 1,163,418 $ 1,162,733
Interest Bearing Liabilities $ 918,126 $ 920,716 $ 894,697 $ 893,027 $ 918,593
Shareholders' equity $ 129,553 $ 141,114 $ 147,662 $ 145,623 $ 142,424
Tier 1 Capital (Bank) $ 129,935 $ 143,123 $ 140,131 $ 138,059 $ 133,870
Total Shares Outstanding 22,860,794 22,777,882 22,736,116 22,728,558 22,902,198
AVERAGE BALANCES
Loans and leases $ 656,550 $ 654,077 $ 652,163 $ 625,435 $ 620,010
Total earning assets $ 1,229,947 $ 1,230,134 $ 1,234,255 $ 1,218,569 $ 1,227,703
Total assets $ 1,329,128 $ 1,326,623 $ 1,329,284 $ 1,329,935 $ 1,320,975
Deposits $ 1,194,296 $ 1,174,024 $ 1,178,941 $ 1,173,998 $ 1,164,320
Interest Bearing Liabilities $ 917,125 $ 891,510 $ 905,082 $ 920,340 $ 926,618
Shareholders' equity $ 131,171 $ 148,765 $ 146,926 $ 143,685 $ 140,684

MBT FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Quarter Ended March 31,
Dollars in thousands (except per share data) 2017 2016
Interest Income
Interest and fees on loans$ 7,364 $ 7,035
Interest on investment securities-
Tax-exempt 310 305
Taxable 2,268 2,526
Interest on balances due from banks 109 117
Total interest income 10,051 9,983
Interest Expense
Interest on deposits 456 517
Interest on borrowed funds - 176
Total interest expense 456 693
Net Interest Income 9,595 9,290
Provision For Loan Losses (200) (300)
Net Interest Income After
Provision For Loan Losses 9,795 9,590
Other Income
Income from wealth management services 1,128 1,097
Service charges and other fees 1,014 1,008
Debit Card income 680 674
Net gain on sales of securities 10 320
Net gain (loss) on other real estate owned (34) (56)
Origination fees on mortgage loans sold 59 130
Bank Owned Life Insurance income 341 355
Other 622 586
Total other income 3,820 4,114
Other Expenses
Salaries and employee benefits 5,434 5,618
Occupancy expense 748 701
Equipment expense 697 684
Marketing expense 284 259
Professional fees 589 652
EFT/ATM expense 248 309
Other real estate owned expense 32 64
FDIC deposit insurance assessment 107 169
Bonding and other insurance expense 122 122
Telephone expense 116 126
Other 685 779
Total other expenses 9,062 9,483
Profit Before Income Taxes 4,553 4,221
Income Tax Expense 1,373 1,224
Net Profit$ 3,180 $ 2,997
Basic Earnings Per Common Share$ 0.14 $ 0.13
Diluted Earnings Per Common Share$ 0.14 $ 0.13
Dividends Declared Per Common Share$ 0.75 $ 0.53

MBT FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
Dollars in thousandsMarch 31, 2017 December 31, 2016
Assets
Cash and Cash Equivalents
Cash and due from banks
Non-interest bearing$ 16,277 $ 18,183
Interest bearing 24,396 34,589
Total cash and cash equivalents 40,673 52,772
Interest Bearing Time Deposits in Other Banks 18,696 18,946
Securities - Held to Maturity 41,452 40,741
Securities - Available for Sale 480,209 488,067
Federal Home Loan Bank stock - at cost 4,148 4,148
Loans held for sale 525 611
Loans 662,924 652,337
Allowance for Loan Losses (8,334) (8,458)
Loans - Net 654,590 643,879
Accrued interest receivable and other assets 23,260 24,901
Other Real Estate Owned 1,360 1,634
Bank Owned Life Insurance 54,759 54,415
Premises and Equipment - Net 26,882 27,169
Total assets$ 1,346,554 $ 1,357,283
Liabilities
Deposits:
Non-interest bearing$ 284,946 $ 279,001
Interest-bearing 918,126 920,716
Total deposits 1,203,072 1,199,717
Accrued interest payable and other liabilities 13,929 16,452
Total liabilities 1,217,001 1,216,169
Shareholders' Equity
Common stock (no par value) 22,385 22,562
Retained Earnings 112,944 126,079
Unearned Compensation (60) (4)
Accumulated other comprehensive income (loss) (5,716) (7,523)
Total shareholders' equity 129,553 141,114
Total liabilities and shareholders' equity$ 1,346,554 $ 1,357,283


FOR FURTHER INFORMATION: H. Douglas Chaffin Chief Executive Officer (734) 384-8123 doug.chaffin@mbandt.com John L. Skibski Chief Financial Officer (734) 242-1879 john.skibski@mbandt.com Julian J. Broggio Director of Marketing (734) 240-2341 julian.broggio@mbandt.com

Source:MBT Financial Corp.