SOUTHERN PINES, N.C.,
April 29, 2015 /PRNewswire/ -- First
Bancorp (NASDAQ - FBNC), the parent company of First Bank,
announced today net income available to common shareholders of
$6.8 million, or $0.33 per diluted common share, for the three
months ended March 31, 2015, an
increase of 24.0% compared to the $5.5
million, or $0.27 per diluted
common share, recorded in the first quarter of 2014. The
higher earnings were primarily the result of a lower provision for
loan losses.
Net Interest Income and Net Interest Margin
Net interest income for the first quarter of 2015 amounted to
$29.7 million, a 16.4% decrease from
the $35.5 million recorded in the
first quarter of 2014.
The Company's net interest margin (tax-equivalent net interest
income divided by average earning assets) in the first quarter of
2015 was 4.19% compared to 5.13% for the first quarter of
2014. The 4.19% net interest margin was a six basis point
decrease from the 4.25% margin realized in the fourth quarter of
2014. The lower margins are primarily due to lower amounts of
discount accretion on loans purchased in failed-bank acquisitions
and lower average asset yields – see additional discussion
below. As shown in the accompanying tables, loan discount
accretion amounted to $1.6 million in
the first quarter of 2015, $2.2
million in the fourth quarter of 2014, and $6.4 million in the first quarter of 2014.
The lower amount of accretion is due to the unaccreted discount
amount that resulted from prior acquisitions continuing to wind
down.
Excluding the effects of discount accretion on purchased loans,
the Company's net interest margin amounted to 3.98% for the first
quarter of 2015, 3.96% for the fourth quarter of 2014, and 4.22%
for the first quarter of 2014. The lower margin realized for
the first quarter of 2015 compared to the first quarter of 2014 was
primarily the result of lower loan yields, which are being impacted
by the prolonged low interest rate environment. The two basis
point increase in net interest margin compared to the fourth
quarter of 2014 was primarily the result of the Company investing
approximately $125 million of excess
cash balances into higher yielding investment securities late in
the fourth quarter of 2014. See the Financial Summary for a
table that presents the impact of loan discount accretion, as well
as other purchase accounting adjustments affecting net interest
income. Also see the Financial Summary for a reconciliation of the
Company's net interest margin to the net interest margin excluding
loan discount accretion, and other information regarding this
ratio.
The Company's cost of funds has steadily declined from 0.31% in
the first quarter of 2014 to 0.26% in the first quarter of 2015,
which has had a positive impact on the Company's net interest
margin.
Provision for Loan Losses and Asset Quality
The Company recorded a negative provision for loan losses
(reduction of the allowance for loan losses) of $0.2 million in the first quarter of 2015
compared to a provision for loan losses of $3.6 million in the first quarter of 2014.
As discussed below, the Company records provisions for loan losses
related to both non-covered and covered loan portfolios – see
explanation of the terms "non-covered" and "covered" in the section
below entitled "Note Regarding Components of Earnings."
The provision for loan losses on non-covered loans amounted to
$0.1 million in the first quarter of
2015 compared to $3.4 million in the
first quarter of 2014. The lower provision recorded in 2015 was
primarily a result of improved credit quality trends, minimal loan
growth, and generally improving economic trends.
The Company recorded a negative provision for loan losses on
covered loans of $0.3 million in the
first quarter of 2015 compared to a $0.2
million in provision for loan losses in the first quarter of
2014. The negative provision in 2015 primarily resulted from
lower levels of covered nonperforming loans, declining levels of
total covered loans and net loan recoveries (recoveries, net of
charge-offs) of $0.2 million realized
during the quarter.
Total non-covered nonperforming assets amounted to $90.4 million at March 31,
2015 (2.92% of total non-covered assets), $95.3 million at December
31, 2014 (3.09% of total non-covered assets), and
$82.2 million at March 31, 2014 (2.65% of total non-covered
assets). The increase in non-covered nonperforming assets
when comparing March 31, 2015 to
March 31, 2014 was primarily due to
the Company transferring $14.8
million in nonperforming assets from covered status to
non-covered status on July 1, 2014
upon the scheduled expiration of a loss share agreement with the
FDIC associated with those assets.
Total covered nonperforming assets have declined in the past
year, amounting to $14.5 million at
March 31, 2015, $18.7 million at December
31, 2014 and $58.9 million at
March 31, 2014. Over the past
twelve months, the Company has resolved a significant amount of
covered loans and has experienced strong property sales along the
North Carolina coast, which is
where most of the Company's covered assets are located. Also, as
discussed in the preceding paragraph, on July 1, 2014 the Company transferred $14.8 million in nonperforming assets from
covered status to non-covered status upon the expiration of a loss
share agreement.
Noninterest Income
Total noninterest income for the three months ended March 31, 2015 was $4.5
million compared to $0.3
million for the comparable period of 2014.
Core noninterest income for the first quarter of 2015 was
$7.2 million, a decrease of 3.9% from
the $7.5 million reported for the
first quarter of 2014. Core noninterest income includes i)
service charges on deposit accounts, ii) other service charges,
commissions, and fees, iii) fees from presold mortgages, iv)
commissions from financial product sales, and v) bank-owned life
insurance income. The primary reason for the decrease in core
noninterest income in 2015 was lower service charges on deposit
accounts, which declined from $3.6
million in the first quarter of 2014 to $2.9 million in the first quarter of 2015.
After the elimination of free checking for most customers with low
balances in late 2013, monthly fees earned on deposit accounts have
gradually declined over the past several quarters as a result of
more customers meeting the requirements to have the monthly service
charge waived. Fewer instances of fees earned from customers
overdrawing their accounts have also impacted this line item.
Noncore components of noninterest income resulted in net losses
of $2.6 million in the first quarter
of 2015 and net losses of $7.2
million in the first quarter of 2014. The largest
variances in noncore noninterest income related to gains (losses)
on covered foreclosed properties and indemnification asset income
(expense) – see discussion below.
Gains on covered foreclosed properties were $0.2 million for the three months ended
March 31, 2015 compared to losses of
$2.1 million recorded for the three
months ended March 31, 2014.
Losses on covered foreclosed properties have generally declined in
recent quarters as a result of significantly lower levels of
covered foreclosed properties held by the Company and stabilization
in property values.
Indemnification asset income (expense) is recorded to reflect
additional (decreased) amounts expected to be received from the
FDIC during the period related to covered assets. The three
primary items that result in recording indemnification asset income
(expense) are 1) income from loan discount accretion, which results
in indemnification expense, 2) provisions for loan losses on
covered loans, which result in indemnification income and 3)
foreclosed property gains (losses) on covered assets, which also
result in indemnification expense (income). In the first
quarter of 2015, the Company recorded $2.4
million in indemnification asset expense compared to
$4.9 million in indemnification asset
expense in the first quarter of 2014. This variance is
primarily due to lower indemnification asset expense associated
with the lower loan discount accretion income in the first quarter
of 2015. See additional discussion related to this matter in
the section below entitled "Note Regarding Components of
Earnings."
Noninterest Expenses
Noninterest expenses amounted to $23.7
million in the first quarter of 2015 compared to
$23.6 million recorded in the first
quarter of 2014. In 2015, a lower level of salary expense,
resulting from a decline in the number of employees, was offset by
miscellaneous items of other operating expense.
Balance Sheet and Capital
Total assets at March 31, 2015
amounted to $3.2 billion, a 2.9%
decrease from a year earlier. Total loans at March 31, 2015 amounted to $2.4 billion, a 2.1% decrease from a year
earlier, and total deposits amounted to $2.7
billion at March 31, 2015, a
3.3% decrease from a year earlier.
Investment securities totaled $349.0
million at March 31, 2015
compared to $234.1 million at
March 31, 2014. In the fourth
quarter of 2014, the Company used a portion of its excess cash
balances to purchase approximately $125
million in investment securities.
Non-covered loans amounted to $2.3
billion at March 31, 2015, an
increase of $18.8 million from
March 31, 2014. The increase
was due to the reclassification of $39.7
million in loans from covered status to non-covered status
in connection with the July 1, 2014
expiration of a loss share agreement. Non-covered loans
increased $7 million during the first
quarter of 2015 as a result of ongoing internal initiatives to
drive loan growth. Loans covered by FDIC loss share
agreements are expected to continue to decline as those loans
continue to pay down.
The lower amount of deposits at March 31,
2015 compared to March 31,
2014 was primarily due to declines in retail time deposits
("other time deposits > $100,000"
and "other time deposits" in the accompanying tables) and brokered
deposits, with increases in checking accounts offsetting a large
portion of the decline. Time deposits are generally one of
the Company's most expensive funding sources, and thus the shift
from this category has benefited the Company's overall cost of
funds.
The Company remains well-capitalized by all regulatory
standards, with a Total Risk-Based Capital Ratio at March 31, 2015 of 17.66% compared to the 10.00%
minimum to be considered well-capitalized. The Company's
tangible common equity to tangible assets ratio was 8.08% at
March 31, 2015, an increase of 78
basis points from a year earlier.
Comments of the President and Other Business Matters
Richard H. Moore, President and
CEO of First Bancorp, commented on today's report, "I am pleased to
report another quarter of strong earnings for the Company. We
have now reported eight consecutive quarters of earnings of more
than $5 million. Asset quality
continues to improve and we are focused on strategic initiatives
that we expect will result in future increases in profitability and
market share."
The following is a list of business development and other
miscellaneous matters affecting the Company:
- On March 16, 2015, the Company
announced a quarterly cash dividend of $0.08
cents per share payable on April 24,
2015 to shareholders of record on March 31, 2015. This is the same dividend
rate as the Company declared in the first quarter of 2014.
- The Company is currently constructing a new branch facility at
4110 Bradham Drive, Jacksonville,
North Carolina. Upon completion, the First Bank branch
located on Western Boulevard will be closed and the accounts
serviced at that branch will be reassigned to the new and improved
branch. This is expected to occur in the second quarter of
2015.
Note Regarding Components of Earnings
The Company's results of operation are significantly affected by
the on-going accounting for two FDIC-assisted failed bank
acquisitions. In the discussion above, the term "covered" is
used to describe assets included as part of FDIC loss share
agreements, which generally result in the FDIC reimbursing the
Company for 80% of losses incurred on those assets. The term
"non-covered" refers to the Company's legacy assets, which are not
included in any type of loss share arrangement.
For covered loans that deteriorate in terms of repayment
expectations, the Company records immediate allowances through the
provision for loan losses. For covered loans that experience
favorable changes in credit quality compared to what was expected
at the acquisition date, including loans that pay off, the Company
records positive adjustments to interest income over the life of
the respective loan – also referred to as loan discount
accretion. For covered foreclosed properties that are sold at
gains or losses or that are written down to lower values, the
Company records the gains/losses within noninterest
income.
The adjustments discussed above are recorded within the income
statement line items noted without consideration of the FDIC loss
share agreements. Because favorable changes in covered assets
result in lower expected FDIC claims, and unfavorable changes in
covered assets result in higher expected FDIC claims, the FDIC
indemnification asset is adjusted to reflect those
expectations. The net increase or decrease in the
indemnification asset is reflected within noninterest income.
The adjustments noted above can result in volatility within
individual income statement line items. Because of the FDIC
loss share agreements and the associated indemnification asset,
pretax income resulting from amounts recorded as provisions for
loan losses on covered loans, discount accretion, and losses from
covered foreclosed properties is generally only impacted by 20% of
these amounts due to the corresponding adjustments made to the
indemnification asset.
First Bancorp is a bank holding company headquartered in
Southern Pines, North Carolina
with total assets of approximately $3.2
billion. Its principal activity is the ownership and
operation of First Bank, a state-chartered community bank that
operates 87 branches, with 73 branches operating in North Carolina, 6 branches in South Carolina (Cheraw, Dillon, Florence, and Latta), and 7 branches in Virginia (Abingdon, Blacksburg, Christiansburg, Fort Chiswell, Radford, Salem and Wytheville), where First Bank does business as
First Bank of Virginia. First Bank
also has loan production offices in Fayetteville, North Carolina, and Greenville, North Carolina. First Bancorp's
common stock is traded on the NASDAQ Global Select Market under the
symbol "FBNC."
Please visit our website at www.LocalFirstBank.com.
This press release contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934
and the Private Securities Litigation Reform Act of 1995, which
statements are inherently subject to risks and uncertainties.
Forward-looking statements are statements that include projections,
predictions, expectations or beliefs about future events or results
or otherwise are not statements of historical fact. Such
statements are often characterized by the use of qualifying words
(and their derivatives) such as "expect," "believe," "estimate,"
"plan," "project," "anticipate," or other statements concerning
opinions or judgments of the Company and its management about
future events. Factors that could influence the accuracy of
such forward-looking statements include, but are not limited to,
the financial success or changing strategies of the Company's
customers, the Company's level of success in integrating
acquisitions, actions of government regulators, the level of market
interest rates, and general economic conditions. For
additional information about the factors that could affect the
matters discussed in this paragraph, see the "Risk Factors" section
of the Company's most recent annual report on Form 10-K available
at www.sec.gov. Forward-looking statements speak only as of
the date they are made, and the Company undertakes no obligation to
update or revise forward-looking statements. The Company is
also not responsible for changes made to the press release by wire
services, internet services or other media.
|
First Bancorp and
Subsidiaries
Financial
Summary – Page 1
|
|
|
|
|
Three Months
Ended
March 31,
|
Percent
|
|
($ in thousands
except per share data – unaudited)
|
2015
|
|
2014
|
Change
|
|
|
|
|
|
|
INCOME
STATEMENT
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
|
|
|
Interest
and fees on loans
|
$
29,441
|
|
36,086
|
|
|
Interest
on investment securities
|
1,822
|
|
1,471
|
|
|
Other
interest income
|
195
|
|
119
|
|
|
Total interest
income
|
31,458
|
|
37,676
|
(16.5%)
|
|
Interest
expense
|
|
|
|
|
|
Interest
on deposits
|
1,458
|
|
1,891
|
|
|
Interest
on borrowings
|
297
|
|
250
|
|
|
Total interest
expense
|
1,755
|
|
2,141
|
(18.0%)
|
|
Net
interest income
|
29,703
|
|
35,535
|
(16.4%)
|
|
Provision for loan
losses – non-covered loans
|
104
|
|
3,365
|
(96.9%)
|
|
Provision (reversal)
for loan losses – covered loans
|
(268)
|
|
210
|
n/m
|
|
Total provision for
loan losses
|
(164)
|
|
3,575
|
n/m
|
|
Net interest income
after provision for loan losses
|
29,867
|
|
31,960
|
(6.5%)
|
|
Noninterest
income
|
|
|
|
|
|
Service
charges on deposit accounts
|
2,892
|
|
3,573
|
|
|
Other
service charges, commissions, and fees
|
2,542
|
|
2,367
|
|
|
Fees
from presold mortgages
|
808
|
|
607
|
|
|
Commissions from financial product sales
|
561
|
|
594
|
|
|
Bank-owned life insurance income
|
371
|
|
327
|
|
|
Foreclosed property gains (losses) – non-covered
|
(494)
|
|
(156)
|
|
|
Foreclosed property gains (losses) – covered
|
237
|
|
(2,117)
|
|
|
FDIC
indemnification asset income (expense), net
|
(2,392)
|
|
(4,916)
|
|
|
Other
gains (losses)
|
4
|
|
19
|
|
|
Total noninterest
income
|
4,529
|
|
298
|
1,419.8%
|
|
Noninterest
expenses
|
|
|
|
|
|
Salaries
expense
|
11,497
|
|
11,648
|
|
|
Employee
benefit expense
|
2,183
|
|
2,311
|
|
|
Occupancy and equipment expense
|
2,825
|
|
2,808
|
|
|
Intangibles amortization
|
180
|
|
194
|
|
|
Other
operating expenses
|
7,029
|
|
6,590
|
|
|
Total noninterest
expenses
|
23,714
|
|
23,551
|
0.7%
|
|
Income before income
taxes
|
10,682
|
|
8,707
|
22.7%
|
|
Income
taxes
|
3,694
|
|
3,031
|
21.9%
|
|
Net income
|
6,988
|
|
5,676
|
23.1%
|
|
|
|
|
|
|
Preferred stock
dividends
|
(217)
|
|
(217)
|
|
|
|
|
|
|
|
Net income available
to common shareholders
|
$
6,771
|
|
5,459
|
24.0%
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share – basic
|
$
0.34
|
|
0.28
|
21.4%
|
|
Earnings per common
share – diluted
|
0.33
|
|
0.27
|
22.2%
|
|
|
|
|
|
|
ADDITIONAL INCOME
STATEMENT INFORMATION
|
|
|
|
|
|
Net
interest income, as reported
|
$
29,703
|
|
35,535
|
|
|
Tax-equivalent adjustment (1)
|
390
|
|
373
|
|
|
Net
interest income, tax-equivalent
|
$
30,093
|
|
35,908
|
(16.2%)
|
|
|
|
|
|
|
|
|
|
(1)
|
This amount reflects
the tax benefit that the Company receives related to its tax-exempt
loans and
securities, which carry interest rates lower than similar taxable
investments due to their tax-exempt
status. This amount has been computed assuming a 39% tax rate
and is reduced by the related
nondeductible portion of interest expense.
|
|
|
n/m = not
meaningful
|
|
First Bancorp and
Subsidiaries
Financial
Summary – Page 2
|
|
|
|
|
Three Months
Ended
March 31,
|
|
|
PERFORMANCE
RATIOS (annualized)
|
2015
|
2014
|
|
|
Return on average
assets (1)
|
0.86%
|
0.70%
|
|
|
Return on average
common equity (2)
|
8.54%
|
7.24%
|
|
|
Net interest margin –
tax-equivalent (3)
|
4.19%
|
5.13%
|
|
|
Net charge-offs to
average loans – non-covered
|
0.84%
|
0.52%
|
|
|
|
|
|
|
COMMON SHARE
DATA
|
|
|
|
|
Cash dividends
declared – common
|
$ 0.08
|
0.08
|
|
|
Stated book value –
common
|
16.34
|
15.50
|
|
|
Tangible book value –
common
|
12.90
|
12.02
|
|
|
Common shares
outstanding at end of period
|
19,740,183
|
19,695,316
|
|
|
Weighted average
shares outstanding – basic
|
19,721,992
|
19,688,183
|
|
|
Weighted average
shares outstanding – diluted
|
20,454,614
|
20,424,475
|
|
|
|
|
|
|
CAPITAL
RATIOS
|
|
|
|
|
Tangible equity to
tangible assets
|
10.33%
|
9.48%
|
|
|
Tangible common
equity to tangible assets
|
8.08%
|
7.30%
|
|
|
Tier I leverage
ratio
|
12.18%
|
11.27%
|
|
|
Tier I risk-based
capital ratio
|
16.40%
|
15.57%
|
|
|
Total risk-based
capital ratio
|
17.66%
|
16.83%
|
|
|
|
|
|
|
AVERAGE
BALANCES ($ in thousands)
|
|
|
|
|
Total
assets
|
$ 3,194,570
|
3,178,848
|
|
|
Loans
|
2,391,071
|
2,459,368
|
|
|
Earning
assets
|
2,910,732
|
2,836,806
|
|
|
Deposits
|
2,688,973
|
2,739,194
|
|
|
Interest-bearing
liabilities
|
2,210,302
|
2,294,138
|
|
|
Shareholders'
equity
|
392,173
|
376,418
|
|
|
|
|
|
|
(1)
|
Calculated by
dividing annualized net income (loss) available to common
shareholders by average assets.
|
|
(2)
|
Calculated by
dividing annualized net income (loss) available to common
shareholders by average common equity.
|
|
(3)
|
See footnote 1 on
page 1 of Financial Summary for discussion of
tax-equivalent adjustments.
|
|
TREND
INFORMATION
|
|
($ in thousands
except per share data)
|
For the Three Months
Ended
|
|
INCOME
STATEMENT
|
March 31,
2015
|
December
31,
2014
|
September
30,
2014
|
June 30,
2014
|
March 31,
2014
|
|
|
|
|
|
|
|
Net interest income –
tax-equivalent (1)
|
$ 30,093
|
31,299
|
31,721
|
34,183
|
35,908
|
|
Taxable equivalent
adjustment (1)
|
390
|
376
|
378
|
375
|
373
|
|
Net interest
income
|
29,703
|
30,923
|
31,343
|
33,808
|
35,535
|
|
Provision for
loan losses – non-covered
|
104
|
1,285
|
1,279
|
1,158
|
3,365
|
|
Provision
(reversal) for loan losses – covered
|
(268)
|
191
|
206
|
2,501
|
210
|
|
Noninterest
income
|
4,529
|
4,492
|
4,608
|
4,970
|
298
|
|
Noninterest
expense
|
23,714
|
22,989
|
25,931
|
24,780
|
23,551
|
|
Income before income
taxes
|
10,682
|
10,950
|
8,535
|
10,339
|
8,707
|
|
Income tax
expense
|
3,694
|
3,855
|
2,956
|
3,693
|
3,031
|
|
Net income
|
6,988
|
7,095
|
5,579
|
6,646
|
5,676
|
|
Preferred stock
dividends
|
(217)
|
(217)
|
(217)
|
(217)
|
(217)
|
|
Net income available
to common shareholders
|
6,771
|
6,878
|
5,362
|
6,429
|
5,459
|
|
|
|
|
|
|
|
Earnings per common
share – basic
|
0.34
|
0.35
|
0.27
|
0.33
|
0.28
|
|
Earnings per common
share – diluted
|
0.33
|
0.34
|
0.27
|
0.32
|
0.27
|
|
|
|
|
|
|
|
See footnote 1 on
page 1 of Financial Summary for discussion of tax-equivalent
adjustments.
|
|
First Bancorp and
Subsidiaries
Financial
Summary – Page 3
|
|
|
CONSOLIDATED
BALANCE SHEETS
($ in thousands -
unaudited)
|
At March 31,
2015
|
|
At Dec.
31,
2014
|
|
At March
31,
2014
|
|
One
Year
Change
|
|
Assets
|
|
|
|
|
|
|
|
|
Cash and due from
banks
|
$ 84,208
|
|
81,068
|
|
219,779
|
|
(61.7%)
|
|
Interest bearing
deposits with banks
|
160,279
|
|
172,016
|
|
164,310
|
|
(2.5%)
|
|
Total cash and cash
equivalents
|
244,487
|
|
253,084
|
|
384,089
|
|
(36.3%)
|
|
|
|
|
|
|
|
|
|
Investment
securities
|
348,994
|
|
342,721
|
|
234,127
|
|
49.1%
|
|
Presold
mortgages
|
8,273
|
|
6,019
|
|
4,587
|
|
80.4%
|
|
|
|
|
|
|
|
|
|
Loans –
non-covered
|
2,275,570
|
|
2,268,580
|
|
2,256,726
|
|
0.8%
|
|
Loans – covered by
FDIC loss share agreements
|
119,829
|
|
127,594
|
|
190,551
|
|
(37.1%)
|
|
Total loans
|
2,395,399
|
|
2,396,174
|
|
2,447,277
|
|
(2.1%)
|
|
Allowance for loan
losses – non-covered
|
(33,770)
|
|
(38,345)
|
|
(44,706)
|
|
(24.5%)
|
|
Allowance for loan
losses – covered
|
(2,226)
|
|
(2,281)
|
|
(3,421)
|
|
(34.9%)
|
|
Total allowance for loan
losses
|
(35,996)
|
|
(40,626)
|
|
(48,127)
|
|
(25.2%)
|
|
Net loans
|
2,359,403
|
|
2,355,548
|
|
2,399,150
|
|
(1.7%)
|
|
|
|
|
|
|
|
|
|
Premises and
equipment
|
75,573
|
|
75,113
|
|
76,970
|
|
(1.8%)
|
|
FDIC indemnification
asset
|
18,452
|
|
22,569
|
|
35,504
|
|
(48.0%)
|
|
Intangible
assets
|
67,712
|
|
67,893
|
|
68,475
|
|
(1.1%)
|
|
Foreclosed real
estate – non-covered
|
8,978
|
|
9,771
|
|
11,740
|
|
(23.5%)
|
|
Foreclosed real
estate – covered
|
2,055
|
|
2,350
|
|
19,504
|
|
(89.5%)
|
|
Bank-owned life
insurance
|
55,793
|
|
55,421
|
|
44,367
|
|
25.8%
|
|
Other
assets
|
29,868
|
|
27,894
|
|
36,310
|
|
(17.7%)
|
|
Total assets
|
$ 3,219,588
|
|
3,218,383
|
|
3,314,823
|
|
(2.9%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
Non-interest bearing
checking accounts
|
$ 591,283
|
|
560,230
|
|
511,612
|
|
15.6%
|
|
Interest bearing checking
accounts
|
578,784
|
|
583,903
|
|
550,702
|
|
5.1%
|
|
Money market
accounts
|
568,752
|
|
548,255
|
|
553,935
|
|
2.7%
|
|
Savings accounts
|
183,036
|
|
180,317
|
|
177,744
|
|
3.0%
|
|
Brokered deposits
|
62,801
|
|
88,375
|
|
150,272
|
|
(58.2%)
|
|
Internet time
deposits
|
249
|
|
747
|
|
1,967
|
|
(87.3%)
|
|
Other time deposits >
$100,000
|
373,599
|
|
384,127
|
|
436,245
|
|
(14.4%)
|
|
Other time
deposits
|
335,110
|
|
349,952
|
|
404,247
|
|
(17.1%)
|
|
Total deposits
|
2,693,614
|
|
2,695,906
|
|
2,786,724
|
|
(3.3%)
|
|
|
|
|
|
|
|
|
|
Borrowings
|
116,394
|
|
116,394
|
|
136,394
|
|
(14.7%)
|
|
Other
liabilities
|
16,336
|
|
18,384
|
|
15,618
|
|
4.6%
|
|
Total liabilities
|
2,826,344
|
|
2,830,684
|
|
2,938,736
|
|
(3.8%)
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
|
|
Preferred
stock
|
70,787
|
|
70,787
|
|
70,787
|
|
0.0%
|
|
Common
stock
|
132,752
|
|
132,532
|
|
132,215
|
|
0.4%
|
|
Retained
earnings
|
190,150
|
|
184,958
|
|
171,021
|
|
11.2%
|
|
Accumulated other
comprehensive income (loss)
|
(445)
|
|
(578)
|
|
2,064
|
|
n/m
|
|
Total shareholders' equity
|
393,244
|
|
387,699
|
|
376,087
|
|
4.6%
|
|
Total liabilities and
shareholders' equity
|
$ 3,219,588
|
|
3,218,383
|
|
3,314,823
|
|
(2.9%)
|
|
|
|
|
|
|
|
|
|
n/m = not
meaningful
|
|
First Bancorp and
Subsidiaries
Financial
Summary - Page 4
|
|
|
|
For the Three Months
Ended
|
|
YIELD
INFORMATION
|
March 31,
2015
|
December 31,
2014
|
September 30,
2014
|
June 30,
2014
|
March 31,
2014
|
|
|
|
|
|
|
|
Yield on
loans
|
4.99%
|
5.13%
|
5.23%
|
5.65%
|
5.95%
|
|
Yield on securities –
tax-equivalent (1)
|
2.67%
|
2.95%
|
3.25%
|
3.00%
|
3.19%
|
|
Yield on other
earning assets
|
0.43%
|
0.38%
|
0.30%
|
0.33%
|
0.34%
|
|
Yield on
all interest earning assets
|
4.44%
|
4.51%
|
4.58%
|
4.95%
|
5.44%
|
|
|
|
|
|
|
|
Rate on interest
bearing deposits
|
0.28%
|
0.30%
|
0.32%
|
0.33%
|
0.34%
|
|
Rate on other
interest bearing liabilities
|
1.03%
|
1.03%
|
1.03%
|
1.02%
|
2.14%
|
|
Rate on
all interest bearing liabilities
|
0.32%
|
0.34%
|
0.35%
|
0.37%
|
0.38%
|
|
Total cost of
funds
|
0.26%
|
0.27%
|
0.28%
|
0.30%
|
0.31%
|
|
|
|
|
|
|
|
Net
interest margin – tax-equivalent (2)
|
4.19%
|
4.25%
|
4.30%
|
4.65%
|
5.13%
|
|
Average
prime rate
|
3.25%
|
3.25%
|
3.25%
|
3.25%
|
3.25%
|
|
|
(1)
|
See footnote 1 on
page 1 of Financial Summary for discussion of tax-equivalent
adjustments.
|
|
(2)
|
Calculated by
dividing annualized tax-equivalent net interest income by average
earning assets for the period.
See footnote 1 on page 1 of Financial Summary for discussion of
tax-equivalent adjustments.
|
|
For the Three Months
Ended
|
|
NET INTEREST
INCOME PURCHASE
ACCOUNTING ADJUSTMENTS
($ in
thousands)
|
March 31,
2015
|
|
December 31,
2014
|
|
September 30,
2014
|
|
June 30,
2014
|
|
March 31,
2014
|
|
|
|
|
|
|
|
|
|
|
|
Interest income –
reduced by premium
amortization on loans
|
$
−
|
|
−
|
|
−
|
|
(49)
|
|
(49)
|
|
Interest income –
increased by accretion of
loan discount (1)
|
1,557
|
|
2,173
|
|
2,577
|
|
4,851
|
|
6,408
|
|
Interest expense –
reduced by premium
amortization of deposits
|
−
|
|
−
|
|
−
|
|
4
|
|
3
|
|
Impact on net interest
income
|
$ 1,557
|
|
2,173
|
|
2,577
|
|
4,806
|
|
6,362
|
|
|
|
(1)
|
Corresponding
indemnification asset expense is recorded for approximately 80% of
this amount, and therefore the net effect is that
pretax income is positively impacted by 20% of the amounts in this
line item.
|
|
First Bancorp and
Subsidiaries
Financial
Summary - Page 5
|
|
|
|
|
|
|
|
|
|
|
|
ASSET QUALITY
DATA ($ in thousands)
|
March 31,
2015
|
|
Dec. 31,
2014
|
|
Sept. 30,
2014
|
|
June 30,
2014
|
|
March 31,
2014
|
|
|
|
|
|
|
|
|
|
|
|
Non-covered
nonperforming assets
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual
loans
|
$ 47,416
|
|
50,066
|
|
53,620
|
|
47,533
|
|
44,129
|
|
Troubled debt
restructurings - accruing
|
33,997
|
|
35,493
|
|
31,501
|
|
27,250
|
|
26,335
|
|
Accruing loans > 90
days past due
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total non-covered
nonperforming loans
|
81,413
|
|
85,559
|
|
85,121
|
|
74,783
|
|
70,464
|
|
Foreclosed real
estate
|
8,978
|
|
9,771
|
|
11,705
|
|
9,346
|
|
11,740
|
|
Total non-covered
nonperforming assets
|
$ 90,391
|
|
95,330
|
|
96,826
|
|
84,129
|
|
82,204
|
|
|
|
|
|
|
|
|
|
|
|
Covered
nonperforming assets (1)
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual
loans
|
$ 8,596
|
|
10,508
|
|
10,478
|
|
20,938
|
|
31,986
|
|
Troubled debt
restructurings - accruing
|
3,874
|
|
5,823
|
|
6,273
|
|
8,193
|
|
7,429
|
|
Accruing loans > 90
days past due
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total covered nonperforming
loans
|
12,470
|
|
16,331
|
|
16,751
|
|
29,131
|
|
39,415
|
|
Foreclosed real
estate
|
2,055
|
|
2,350
|
|
3,237
|
|
9,934
|
|
19,504
|
|
Total covered
nonperforming assets
|
$ 14,525
|
|
18,681
|
|
19,988
|
|
39,065
|
|
58,919
|
|
|
|
|
|
|
|
|
|
|
|
Total nonperforming
assets
|
$ 104,916
|
|
114,011
|
|
116,814
|
|
123,194
|
|
141,123
|
|
Asset Quality
Ratios – All Assets
|
|
|
|
|
|
|
|
|
|
|
Net quarterly
charge-offs to average loans - annualized
|
0.76%
|
|
0.82%
|
|
0.51%
|
|
0.99%
|
|
0.65%
|
|
Nonperforming loans
to total loans
|
3.92%
|
|
4.25%
|
|
4.20%
|
|
4.27%
|
|
4.49%
|
|
Nonperforming assets
to total assets
|
3.26%
|
|
3.54%
|
|
3.66%
|
|
3.77%
|
|
4.26%
|
|
Allowance for loan
losses to total loans
|
1.50%
|
|
1.70%
|
|
1.82%
|
|
1.88%
|
|
1.97%
|
|
|
|
|
|
|
|
|
|
|
|
Asset Quality
Ratios – Based on Non-covered Assets only
|
|
|
|
|
|
|
|
|
|
|
Net quarterly
charge-offs to average non-covered loans - annualized
|
0.84%
|
|
0.78%
|
|
0.60%
|
|
0.69%
|
|
0.52%
|
|
Non-covered
nonperforming loans to non-covered loans
|
3.58%
|
|
3.77%
|
|
3.71%
|
|
3.31%
|
|
3.12%
|
|
Non-covered
nonperforming assets to total non-covered assets
|
2.92%
|
|
3.09%
|
|
3.17%
|
|
2.73%
|
|
2.65%
|
|
Allowance for loan
losses to non-covered loans
|
1.48%
|
|
1.69%
|
|
1.81%
|
|
1.86%
|
|
1.98%
|
|
|
|
|
|
|
|
|
|
|
|
(1) Covered
nonperforming assets consist of assets that are included in
loss-share agreements with the FDIC.
|
|
|
First Bancorp and
Subsidiaries
Financial
Summary - Page 6
|
|
|
|
For the Three Months
Ended
|
|
NET INTEREST
MARGIN, EXCLUDING
LOAN DISCOUNT ACCRETION –
RECONCILIATION
($ in
thousands)
|
March 31,
2015
|
|
Dec. 31,
2014
|
|
Sept. 30,
2014
|
|
June 30,
2014
|
|
March 31,
2014
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income,
as reported
|
$ 29,703
|
|
30,923
|
|
31,343
|
|
33,808
|
|
35,535
|
|
Tax-equivalent
adjustment
|
390
|
|
376
|
|
378
|
|
375
|
|
373
|
|
Net interest income,
tax-equivalent (A)
|
$ 30,093
|
|
31,299
|
|
31,721
|
|
34,183
|
|
35,908
|
|
Average earning
assets (B)
|
$ 2,910,732
|
|
2,920,295
|
|
2,924,705
|
|
2,946,586
|
|
2,836,806
|
|
Tax-equivalent net
interest
margin, annualized – as reported –
(A)/(B)
|
4.19%
|
|
4.25%
|
|
4.30%
|
|
4.65%
|
|
5.13%
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income,
tax-equivalent
|
$ 30,093
|
|
31,299
|
|
31,721
|
|
34,183
|
|
35,908
|
|
Loan discount
accretion
|
1,557
|
|
2,173
|
|
2,577
|
|
4,851
|
|
6,408
|
|
Net interest income,
tax-equivalent, excluding
loan discount accretion (A)
|
$ 28,536
|
|
29,126
|
|
29,144
|
|
29,332
|
|
29,500
|
|
Average earnings
assets (B)
|
$ 2,910,732
|
|
2,920,295
|
|
2,924,705
|
|
2,946,586
|
|
2,836,806
|
|
Tax-equivalent net
interest margin, excluding
impact of loan discount accretion,
annualized – (A) / (B)
|
3.98%
|
|
3.96%
|
|
3.95%
|
|
3.99%
|
|
4.22%
|
Note: The measure "tax-equivalent net interest margin,
excluding impact of loan discount accretion" is a non-GAAP
performance measure. Management of the Company believes that
it is useful to calculate and present the Company's net interest
margin without the impact of loan discount accretion for the
reasons explained in the remainder of this paragraph. Loan
discount accretion is a non-cash interest income adjustment related
to the Company's acquisition of two failed banks and represents the
portion of the fair value discount that was initially recorded on
the acquired loans that is being recognized into income over the
lives of the loans. At March 31,
2015, the Company had a remaining loan discount balance of
$19.1 million compared to
$31.2 million at March 31, 2014. For the related loans that
perform and pay-down over time, the loan discount will also be
reduced, with a corresponding increase to interest income.
Therefore management of the Company believes it is useful to also
present this ratio to reflect the Company's net interest margin
excluding this non-cash, temporary loan discount accretion
adjustment to aid investors in comparing financial results between
periods. The Company cautions that non-GAAP financial
measures should be considered in addition to, but not as a
substitute for, the Company's reported GAAP results.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/first-bancorp-reports-first-quarter-results-300074607.html
SOURCE First Bancorp