CITIZENS FIRST CORP. 
By BOWLING GREEN, Ky., Jan. 16, 2014 /PRNewswire/ -- Citizens First Corporation (NASDAQ: CZFC) today reported results for the fourth quarter and year ending December 31, 2013, which include the following:
-- For the quarter ended December 31, 2013, the Company reported net income
of $702,000, or $0.25 per diluted common share. This represents an
increase of $469,000, or $0.23 per diluted common share, from the linked
quarter ended September 30, 2013. Compared to the quarter ended
December 31 a year ago, net income increased $5,000 or $0.02 per diluted
common share.
-- For the twelve months ended December 31, 2013, net income totaled $1.8
million, or $0.52 per diluted common share. This represents a decrease
of $1.4 million or $0.59 per diluted common share, from the net income
of $3.2 million in the previous year.
-- The Company's net interest margin was 4.03% for the quarter ended
December 31, 2013 compared to 3.88% for the quarter ended September 30,
2013 and 4.24% for the quarter ended December 31, 2012, an increase of
15 basis points for the linked quarter and a decrease of 21 basis points
from the prior year. The Company's net interest margin increased from
the prior quarter primarily due to a decline in non-accrual loans and
the collection of interest on loans which were previously in a
non-accrual status.
-- Nonperforming assets decreased to $2.0 million at December 31, 2013
compared to $6.3 million at December 31, 2012. Nonperforming assets
reached a high of $10.9 million at March 31, 2013. President and CEO
Todd Kanipe commented, "Reducing our nonperforming assets was a priority
in 2013. Our concentrated efforts to resolve these loans resulted in
significantly improved levels of both restructured and non-performing
loans at year end."
-- Provision for loan losses was $450,000 for the fourth quarter of 2013
compared to $900,000 for the linked quarter ended September 30, 2013 and
$580,000 for the quarter ended December 31, 2012. Provision expense for
2013 totaled $2.7 million compared to $1.7 million in 2012. Net
charge-offs for 2013 total $3.7 million compared to $1.8 million in
2012.
-- On January 15, 2014, the Company repurchased the remaining 93 shares of
the Series A Fixed Rate Cumulative Perpetual Preferred (CPP) Stock that
the Company had issued to the Treasury on December 19, 2008 under the
TARP Capital Purchase Program of the Emergency Economic Stabilization
Act of 2008. The Company had previously repurchased 157 shares of the
original 250 shares issued. The Company paid approximately $3.3
million, which was 100% of par value, to repurchase the preferred shares
along with the accrued dividend for the shares repurchased. The
preferred dividend rate was scheduled to increase from 5% to 9% during
2014, which would have resulted in preferred dividends of $294,000
annually. The warrants associated with the CPP investment remain
outstanding at the present time.
Fourth Quarter 2013 Compared to Third Quarter 2013
Net interest income for the quarter ended December 31, 2013 improved $95,000 from the previous quarter due to an increase in loan income as the level of non-accrual loans declined.
Non-interest income for the three months ended December 31, 2013 decreased $85,000, or 10.7%, compared to the previous quarter, primarily due to a decrease in the gain on sale of mortgage loans of $45,000. Non-interest expense for the three months ended December 31, 2013 decreased $218,000, or 6.6%, compared to the previous quarter due to a decrease in legal and collection expenses.
A $450,000 provision for loan losses was recorded for the fourth quarter of 2013, compared to a $900,000 provision in the previous quarter. The provision expense was lower in the fourth quarter of 2013 as a result of a decrease in net charge-offs. Net charge-offs were $617,000 for the fourth quarter of 2013 compared to $2.1 million in the third quarter of 2013.
Fourth Quarter 2013 Compared to Fourth Quarter 2012
Net interest income for the quarter ended December 31, 2013 decreased $126,000, or 3.3%, compared to the previous year. The decrease in net interest income was impacted by a reduction in interest expense of $127,000 combined with a decrease in interest income of $253,000. The decrease in interest income was created by a decline in the yield on loans from 5.71% in the fourth quarter of 2012 to 5.42% in the fourth quarter of 2013. Loan yields have declined as maturing loans were repriced at a lower rate.
Non-interest income for the three months ended December 31, 2013 decreased $53,000, or 6.9%, compared to the three months ended December 31, 2012, primarily due to a decline in gains on sale of mortgage loans of $46,000 from the prior year.
Non-interest expense for the three months ended December 31, 2013 decreased $30,000, or 0.1%, compared to the three months ended December 31 2012, due to a decrease in personnel expenses.
A $450,000 provision for loan losses was recorded for the fourth quarter of 2013, a decrease of $130,000, from $580,000 in the fourth quarter of 2012. Net charge-offs were $617,000 for the fourth quarter of 2013 compared to net charge-offs of $827,000 in the fourth quarter of 2012.
Balance Sheet
Total assets at December 31, 2013 were $410.2 million, an increase of $3.6 million from $406.6 million at December 31, 2012. Average assets during the fourth quarter were $408.8 million, an increase of 1.2%, or $4.8 million, from $404.0 million in the fourth quarter of 2012. Average interest earning assets increased 1.5%, or $5.8 million, from $369.9 million in the fourth quarter of 2012 to $375.7 million in the fourth quarter of 2013.
Loans decreased $3.7 million, or 1.2%, from $298.8 million at December 31, 2012 to $295.1 million at December 31, 2013. Total loans averaged $298.8 million the fourth quarter of 2013, compared to $304.2 million the fourth quarter of 2012, a decrease of $5.4 million, or 1.8%. For the year of 2013, loans averaged $304.0 million, an increase of $2.7 million, or 0.9%, from $301.3 million in 2012.
Deposits at December 31, 2013 were $343.0 million, an increase of $11.3 million, or 3.4%, compared to $331.7 million at December 31, 2012. Total deposits averaged $340.9 million the fourth quarter of 2013, an increase of $15.3 million, or 4.7%, compared to $325.6 million during the fourth quarter of 2012. Average deposits increased during the year, but the cost of funds declined as higher cost deposits matured and were renewed at lower rates.
Non-performing assets totaled $2.0 million at December 31, 2013 compared to $6.3 million at December 31, 2012, a decrease of $4.3 million. Compared to the prior quarter at September 30, 2013, non-performing assets decreased $4.4 million. During the fourth quarter of 2013, $4.1 million in non-performing assets were collected or returned to accrual status, $609,000 of non-performing assets were charged-off, and $368,000 of loans became non-performing during the quarter.
The allowance for loan losses at December 31, 2013 was $4.7 million, or 1.58% of total loans, compared to $5.7 million, or 1.91% of total loans as of December 31, 2012. The allowance decreased as a result of charging off specific allocations of the allowance that had been established in previous quarters.
A summary of nonperforming assets is presented below:
(In thousands) December September June March December
31, 31,
31, 30, 30,
2013 2012
2013 2013 2013
--- ---- ---- ----
Nonaccrual loans $1,026 $3,784 $6,141 $7,097 $5,384
Loans 90+ days past
due/accruing - 19 - 23 -
Restructured loans 154 2,041 3,340 3,528 758
------------------ --- ----- ----- ----- ---
Total non-performing
loans 1,180 5,844 9,481 10,648 6,142
Other real estate
owned 833 547 517 232 191
Total non-performing
assets $2,013 $6,391 $9,998 $10,880 $6,333
-------------------- ------ ------ ------ ------- ------
Non-performing
assets to total
assets 0.49% 1.56% 2.43% 2.58% 1.56%
---------------- ---- ---- ---- ---- ----
A summary of the allowance for loan losses is presented below:
(In thousands) December September June March December
31, 31,
31, 30, 30,
2013 2012
2013 2013 2013
--- ---- ---- ----
Balance at beginning of
period $4,820 $6,064 $6,650 $5,721 $5,968
Provision for loan
losses 450 900 50 1,250 580
Charged-off loans 788 2,198 678 358 838
Recoveries of
previously charged-
off loans 171 54 42 37 11
-------------------- --- --- --- --- ---
Balance at end of
period $4,653 $4,820 $6,064 $6,650 $5,721
Allowance for loan
losses to total loans 1.58% 1.60% 1.98% 2.21% 1.91%
---------------------- ---- ---- ---- ---- ----
At December 31, 2013, total shareholders' equity was $38.3 million compared to $41.6 million at December 31, 2012, a decrease of $3.3 million. During the first quarter of 2013, the Company paid $3.3 million to repurchase 94 of the 250 shares of the Series A preferred stock that the Company had issued to the Treasury on December 19, 2008 under the TARP Capital Purchase Program. At December 31, 2013, the Company had 93 shares of the Series A preferred stock outstanding with a balance of approximately $3.3 million.
The Company's tangible equity ratio was 8.28% as of December 31, 2013 compared to 9.08% at December 31, 2012. The tangible book value per common share improved slightly from $11.32 at December 31, 2012, to $11.51 at December 31, 2013. The Company and Citizens First Bank are categorized as "well capitalized" under regulatory guidelines.
About Citizens First Corporation
Citizens First Corporation is a bank holding company headquartered in Bowling Green, Kentucky and established in 1999. The Company has branch offices located in Barren, Hart, Simpson and Warren Counties in Kentucky.
Forward-Looking Statements
Statements in this press release relating to Citizens First Corporation's plans, objectives, expectations or future performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based upon the Company's current expectations, but are subject to certain risks and uncertainties that may cause actual results to differ materially. Among the risks and uncertainties that could cause actual results to differ materially are economic conditions generally and in the market areas of the Company, a continuation or worsening of the current disruption in credit and other markets, goodwill impairment, overall loan demand, increased competition in the financial services industry which could negatively impact the Company's ability to increase total earning assets, and the retention of key personnel. Actions by the Department of the Treasury and federal and state bank regulators in response to changing economic conditions, changes in interest rates, loan prepayments by and the financial health of the Company's borrowers, and other factors described in the reports filed by the Company with the Securities and Exchange Commission could also impact current expectations.
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Consolidated Statement of Income:
Three Months Ended
Dec 31 Sept 30 June 30 March 31 Dec 31
2013 2013 2013 2013 2012
---- ---- ---- ---- ----
Interest
income $4,411 $4,381 $4,325 $4,428 $4,664
Interest
expense 682 747 770 762 809
--- --- --- --- ---
Net
interest
income 3,729 3,634 3,555 3,666 3,855
Provision
for
loan
losses 450 900 50 1,250 580
Non-interest income:
Service
charges
on
deposits 319 341 321 291 351
Other
service
charges
and
fees 133 156 158 138 129
Gain
on
sale
of
mortgage
loans 36 81 78 82 82
Non-
deposit
brokerage
fees 72 91 78 65 61
Lease
income 75 74 75 74 76
BOLI
income 49 53 56 61 65
Securities
gains 27 - 29 8 -
Total 711 796 795 719 764
--- --- --- --- ---
Non-interest expenses:
Personnel
expense 1,419 1,382 1,417 1,441 1,489
Net
occupancy
expense 485 499 465 461 491
Advertising
and
public
relations 65 70 110 78 91
Professional
fees 141 201 174 164 176
Data
processing
services 266 280 272 265 241
Franchise
shares
and
deposit
tax 145 146 141 141 141
FDIC
insurance 119 150 26 85 87
Core
deposit
intangible
amortization 79 84 85 84 84
Postage
and
office
supplies 38 35 35 43 40
Other
real
estate
owned
expenses 46 7 20 11 15
Other 258 425 434 309 236
--- --- --- --- ---
Total 3,061 3,279 3,179 3,082 3,091
----- ----- ----- ----- -----
Income
before
income
taxes 929 251 1,121 53 948
Provision
for
income
taxes 227 18 333 (62) 251
--- --- --- --- ---
Net
income 702 233 788 115 697
Preferred
dividends
and
discount
accretion 184 178 176 217 225
--- --- --- --- ---
Net
income
available
for
common
shareholders $518 $55 $612 $(102) $472
==== === ==== ===== ====
Basic
earnings
per
common
share $0.26 $0.03 $0.31 $(0.05) $0.24
===== ===== ===== ====== =====
Diluted
earnings
per
common
share $0.25 $0.02 $0.30 $(0.05) $0.23
===== ===== ===== ====== =====
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Key
Operating
Statistics:
Three Months Ended
December September June March December
31
31 30 30 31
2013 2013 2013 2013 2012
---- ---- ---- ---- ----
Average
assets $408,792 $413,293 $419,240 $417,804 $403,975
Average
earning
assets 375,658 380,154 387,663 384,614 369,927
Average
loans 298,833 307,618 305,532 303,942 304,249
Average
deposits 340,938 340,067 345,738 342,475 325,644
Average
equity 38,469 37,937 38,353 40,164 41,629
Average
common
equity 27,548 27,023 27,445 27,695 27,458
Return
on
average
assets 0.68% 0.22% 0.75% 0.11% 0.69%
Return
on
average
equity 7.24% 2.44% 8.24% 1.16% 6.66%
Efficiency
ratio 68.07% 72.66% 72.17% 68.96% 65.70%
Non-
interest
income
to
average
assets 0.69% 0.77% 0.76% 0.70% 0.75%
Non-
interest
expenses
to
average
assets 2.97% 3.15% 3.04% 2.99% 3.04%
Yield
on
loans 5.42% 5.26% 5.28% 5.50% 5.71%
Yield
on
investment
securities
(TE) 2.97% 2.87% 2.78% 2.97% 2.96%
Yield
on
average
earning
assets
(TE) 4.75% 4.66% 4.56% 4.76% 5.11%
Cost
of
average
interest
bearing
liabilities 0.83% 0.89% 0.92% 0.93% 1.01%
Net
interest
margin
(tax
equivalent) 4.03% 3.88% 3.77% 3.96% 4.24%
Number
of
FTE
employees 100 100 98 99 102
Asset
Quality
Ratios:
Non-
performing
loans
to
total
loans 0.40% 1.94% 3.09% 3.54% 2.06%
Non-
performing
assets
to
total
assets 0.49% 1.56% 2.43% 2.58% 1.56%
Allowance
for
loan
losses
to
total
loans 1.58% 1.60% 1.98% 2.21% 1.91%
YTD
net
charge-
offs
to
average
loans,
annualized 1.22% 1.36% 0.63% 0.43% 0.60%
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Twelve Months Ended
December December
31 31
2013 2012
---- ----
Interest income $17,545 $18,528
Interest expense 2,961 3,450
----- -----
Net interest income 14,584 15,078
Provision for loan losses 2,650 1,700
Non-interest income:
Service charges on
deposits 1,272 1,365
Other service charges and
fees 585 529
Gain on sale of mortgage
loans 277 301
Non-deposit brokerage
fees 306 206
Lease income 298 279
BOLI income 219 263
Securities gains 64 55
---
Total 3,021 2,998
----- -----
Non-interest expenses:
Personnel expense 5,659 5,718
Net occupancy expense 1,910 1,918
Advertising and public
relations 323 352
Professional fees 680 627
Data processing services 1,083 916
Franchise shares and
deposit tax 573 548
FDIC insurance 380 314
Core deposit intangible
amortization 332 349
Postage and office
supplies 151 189
Other real estate owned
expenses 84 170
Other 1,426 954
----- ---
Total 12,601 12,055
------ ------
Income before income taxes 2,354 4,321
Provision for income taxes 516 1,148
--- -----
Net income 1,838 3,173
Preferred dividends and
discount accretion 755 896
--- ---
Net income available for
common shareholders $1,083 $2,277
====== ======
Basic earnings per common
share $0.55 $1.16
===== =====
Diluted earnings per
common share $0.52 $1.11
===== =====
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Key Operating Statistics:
Twelve Months Ended
December December
31 31
2013 2012
---- ----
Average assets $414,753 $402,958
Average earning assets 381,992 367,379
Average loans 303,977 301,292
Average deposits 342,294 327,651
Average equity 38,724 40,454
Average common equity 27,426 26,301
Return on average assets 0.44% 0.79%
Return on average equity 4.75% 7.84%
Efficiency ratio 70.48% 65.67%
Non-interest income to
average assets 0.73% 0.74%
Non-interest expenses to
average assets 3.04% 2.99%
Yield on average earning
assets (tax equivalent) 4.68% 5.13%
Cost of average interest
bearing liabilities 0.89% 1.08%
Net interest margin (tax
equivalent) 3.91% 4.20%
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Consolidated Statement of Condition: As of As of As of
December 31, December 31, December 31,
2013 2012 2011
---- ---- ----
Cash and cash equivalents $37,062 $34,799 $30,549
Available for sale securities 51,633 46,639 50,718
Loans held for sale - 61 180
Loans 295,068 298,754 294,352
Allowance for loan losses (4,653) (5,721) (5,865)
Premises and equipment, net 11,054 11,568 11,849
Bank owned life insurance (BOLI) 7,806 7,587 7,324
Federal Home Loan Bank Stock, at cost 2,025 2,025 2,025
Accrued interest receivable 1,554 1,660 1,858
Deferred income taxes 2,279 2,180 2,973
Intangible assets 4,762 5,094 5,443
Other real estate owned 833 191 637
Other assets 752 1,719 1,751
--- ----- -----
Total Assets $410,175 $406,556 $403,794
======== ======== ========
Deposits:
Noninterest bearing $39,967 $41,725 $38,352
Savings, NOW and money market 143,602 111,194 116,968
Time 159,382 178,814 177,411
------- ------- -------
Total deposits $342,951 $331,733 $332,731
FHLB advances and other borrowings 22,000 26,000 25,000
Subordinated debentures 5,000 5,000 5,000
Other liabilities 1,877 2,257 2,191
----- ----- -----
Total Liabilities 371,828 364,990 364,922
6.5% Cumulative preferred stock 7,659 7,659 7,659
Series A preferred stock 3,266 6,519 6,471
Common stock 27,072 27,072 27,072
Retained earnings (deficit) 653 (430) (2,706)
Accumulated other comprehensive income
(loss) (303) 746 376
---- --- ---
Total Stockholders' Equity 38,347 41,566 38,872
------ ------ ------
Total Liabilities and Stockholders'
Equity $410,175 $406,556 $403,794
======== ======== ========
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
December December December
31, 2013 31, 2012 31, 2011
-------- -------- --------
Capital
Ratios:
Tier
1
leverage 9.57% 10.20% 9.46%
Tier
1
risk-
based
capital 12.56% 13.16% 11.94%
Total
risk
based
capital 13.81% 14.41% 13.19%
Tangible
equity
ratio
(1) 8.28% 9.08% 8.39%
Tangible
common
equity
ratio
(1) 5.59% 5.55% 4.84%
Book
value
per
common
share $13.93 $13.91 $12.57
Tangible
book
value
per
common
share
(1) $11.51 $11.32 $9.80
Shares
outstanding
(in
thousands) 1,969 1,969 1,969
_____________
(1) The tangible equity ratio, tangible common equity ratio and tangible book value per common share, while not required by accounting principles generally accepted in the United States of America (GAAP), are considered critical metrics with which to analyze banks. The ratio and per share amount have been included to facilitate a greater understanding of the Company's capital structure and financial condition. See the Regulation G Non-GAAP Reconciliation table for reconciliation of this ratio and per share amount to GAAP.
Regulation G Non-GAAP
Reconciliation: December December December
31, 2013 31, 2012 31, 2011
-------- -------- --------
Total shareholders' equity (a) $38,348 $41,566 $38,872
Less:
Preferred stock (10,925) (14,178) (14,130)
------- ------- -------
Common equity (b) 27,423 27,388 24,742
Goodwill (4,097) (4,097) (4,097)
Intangible assets (665) (997) (1,346)
---- ---- ------
Tangible common equity (c) 22,661 22,294 19,299
Add:
Preferred stock 10,925 14,178 14,130
------ ------ ------
Tangible equity (d) $33,586 $36,472 $33,429
Total assets (e) $410,175 $406,556 $403,794
Less:
Goodwill (4,097) (4,097) (4,097)
Intangible assets (665) (997) (1,346)
---- ---- ------
Tangible assets (f) $405,413 $401,462 $398,351
Shares outstanding (in thousands)
(g) 1,969 1,969 1,969
Book value per common share (b/g) $13.93 $13.91 $12.57
Tangible book value per common
share (c/g) $11.51 $11.32 $9.80
Total shareholders' equity to total
assets ratio (a/e) 9.35% 10.22% 9.63%
Tangible equity ratio (d/f) 8.28% 9.08% 8.39%
Tangible common equity ratio (c/f) 5.59% 5.55% 4.84%
SOURCE Citizens First Corporation
