Porter Bancorp, Inc. (NASDAQ: PBIB) (“the Company”), parent
company of Limestone Bank (“the Bank”), today reported
unaudited results for the first quarter of 2018. The Company
reported net income available to common shareholders for the first
quarter of 2018 of $1.9 million, or $0.31 per basic and diluted
common share, compared to net income available to common
shareholders of $1.6 million, or $0.27 per basic and diluted share,
for the first quarter of 2017.
“We are pleased with the favorable financial results for the
first quarter of 2018 which were largely driven by quality loan
production, net interest income growth, and expense management,”
said John T. Taylor, President and CEO. “We are also pleased with
the $14.95 million private placement of common stock completed on
March 30, 2018, which will provide capital to support the growth of
our banking franchise.”
Rebranding – Effective February, 20, 2018, the Bank
changed its name to Limestone Bank. We believe the new name
reflects the Bank’s Kentucky heritage, which can be traced back
more than 110 years. Changing the name of Porter Bancorp, Inc. to
Limestone Bancorp, Inc. is on the agenda for the 2018 annual
meeting of shareholders.
Net Interest Income – Net interest income before
provision expense increased to $8.2 million for the first quarter
of 2018, compared with $8.0 million in the fourth quarter of 2017,
and $7.7 million in the first quarter of 2017. Average loans
increased to $724.2 million for the first quarter of 2018, compared
with $695.6 million in the fourth quarter of 2017 and $649.3
million in the first quarter of 2017. Net interest margin increased
to 3.63% in the first quarter of 2018, compared with 3.50% in the
fourth quarter of 2017 and 3.55% in the first quarter of 2017.
Our yield on earning assets improved to 4.45% in the first
quarter of 2018, compared to 4.24% in the fourth quarter of 2017
and 4.23% in the first quarter of 2017. The cost of interest
bearing liabilities was 0.96% in the first quarter of 2018,
compared to 0.88% for the fourth quarter of 2017, and 0.78% in the
first quarter of 2017.
Provision and Allowance for Loan Losses – There
was no provision for loan losses in the first quarter of 2017 or
2018 due to ongoing improvements in asset quality and management’s
assessment of risk in the loan portfolio.
The allowance for loan losses to total loans was 1.17% at March
31, 2018, compared to 1.15% at December 31, 2017, and 1.35% at
March 31, 2017. The reduced level of the allowance from a year over
year comparison is primarily driven by declining historical
charge-off levels and improving trends in credit quality. Net loan
recoveries were $324,000 for the first quarter of 2018, compared to
net recoveries of $25,000 for the fourth quarter of 2017, and net
charge-offs of $1,000 for the first quarter of 2017.
Non-performing Assets – Non-performing assets, which
include loans past due 90 days and still accruing, loans on
nonaccrual, and other real estate owned (“OREO”), decreased to $8.8
million, or 0.88% of total assets at March 31, 2018, compared with
$9.9 million, or 1.02% of total assets at December 31, 2017,
and $14.7 million, or 1.56% of total assets at March 31, 2017.
Non-performing loans decreased to $4.4 million, or 0.60% of
total loans at March 31, 2018, compared with $5.5 million, or
0.77% of total loans at December 31, 2017, and decreased from $8.1
million, or 1.22% of total loans at March 31, 2017. The decrease
from the previous quarter was primarily driven by $995,000 in
principal payments received on nonaccrual loans. OREO remained
unchanged at March 31, 2018, at $4.4 million, compared to December
31, 2017, and decreased compared to $6.6 million at March 31, 2017.
The Company acquired $110,000 in OREO and sold $70,000 in OREO
during the first quarter of 2018. Fair value write-downs arising
from lower marketing prices or new appraisals totaled $60,000 in
the first quarter of 2018, compared with $1.9 million in the fourth
quarter of 2017, and no write-downs in the first quarter of
2017.
In addition to nonaccrual loans and OREO, loans classified as
Troubled Debt Restructures (TDRs) and on accrual totaled $922,000
at March 31, 2018, compared to $1.2 million at December 31, 2017
and March 31, 2017.
Non-interest Income and Expense – Non-interest income for
the first quarter of 2018 increased $59,000 to $1.3 million,
compared with $1.2 million for the first quarter of 2017. The
increase from the first quarter of 2017 was primarily due to an
increase in bank card interchange fees of $64,000 as well as an
increase in service charges on deposit accounts of $67,000. These
increases were partially offset by a decrease in other non-interest
income of $69,000.
Non-interest expense decreased $84,000, or 1.20% to $7.2 million
for the first quarter of 2018, compared with $7.3 million for the
first quarter of 2017.
Capital – The Company completed a private placement of
common stock on March 30, 2018. In the transaction, the Company
issued 150,000 common shares and 1.0 million non-voting common
shares to Patriot Financial Partners III, L.P. at $13.00 per share
resulting in total proceeds of $14.950 million of which $5.0
million was contributed as capital to the Bank. The balance of the
proceeds will be used for general corporate purposes and to support
the growth of the Bank.
At March 31, 2018, the Bank’s Tier 1 leverage ratio was 9.31%,
compared with 8.70% at December 31, 2017, and its Total risk-based
capital ratio was 12.43% at March 31, 2018, compared with 11.61% at
December 31, 2017. At March 31, 2018, the Bank’s Common equity Tier
1 risk-based capital ratio was 11.18%, compared with 10.35% at
December 31, 2017. At March 31, 2018, the Company’s Tier 1 leverage
ratio was 9.18%, compared with 7.11% at December 31, 2017, and its
Total risk-based capital ratio was 12.56%, compared with 10.55% at
December 31, 2017. At March 31, 2018, the Company’s Common equity
Tier 1 risk-based capital ratio was 8.98%, compared with 6.92% at
December 31, 2017.
Deferred Tax Assets and Liabilities – The Company
has a net deferred tax asset of $31.0 million at March 31, 2018.
Deferred tax assets and liabilities are shown below:
March 31,
December 31, 2018 2017 (in thousands)
Deferred tax assets: Net operating loss carry-forward $ 25,362 $
25,645 Allowance for loan losses 1,790 1,723 Other real estate
owned write-down 2,445 2,432 Other 2,269 2,388
31,866 32,188 Deferred tax liabilities: FHLB stock
dividends 557 557 Other 312 318 869 875
Net deferred tax asset $ 30,997 $ 31,313
About Porter Bancorp, Inc.
Porter Bancorp, Inc. (NASDAQ: PBIB) is a Louisville,
Kentucky-based bank holding company which operates banking centers
in 12 counties through its wholly-owned subsidiary Limestone Bank.
Our markets include metropolitan Louisville in Jefferson County and
the surrounding counties of Henry and Bullitt, and extend south
along the Interstate 65 corridor. We serve southern and south
central Kentucky from banking centers in Butler, Green, Hart,
Edmonson, Barren, Warren, Ohio and Daviess counties. We also have a
banking center in Lexington, Kentucky, the second largest city in
the state. Limestone Bank is a traditional community bank with a
wide range of personal and business banking products and
services.
Forward-Looking Statements
Statements in this press release relating to Porter Bancorp’s
plans, objectives, expectations or future performance are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. The words “believe,”
“may,” “should,” “anticipate,” “estimate,” “expect,” “intend,”
“objective,” “possible,” “seek,” “plan,” “strive” or similar words,
or negatives of these words, identify forward-looking statements
that involve risks and uncertainties. Although the Company's
management believes the assumptions underlying the forward-looking
statements contained herein are reasonable, any of these
assumptions could be inaccurate. Therefore, there can be no
assurance the forward-looking statements included herein will prove
to be accurate. Factors that could cause actual results to differ
from those discussed in forward-looking statements include, but are
not limited to: economic conditions both generally and more
specifically in the markets in which the Company and its
subsidiaries operate; competition for the Company's customers from
other providers of financial services; government legislation and
regulation, which change from time to time and over which the
Company has no control; changes in interest rates; material
unforeseen changes in liquidity, results of operations, or
financial condition of the Company's customers; and other risks
detailed in the Company's filings with the Securities and Exchange
Commission, all of which are difficult to predict and many of which
are beyond the control of the Company. See Risk Factors outlined in
the Company's Form 10-K for the year ended December 31, 2017.
Additional Information
Unaudited supplemental financial information for the first
quarter ending March 31, 2018, follows.
PORTER BANCORP, INC.
Unaudited Financial Information
(in thousands, except share and per share
data)
Three Months Ended 3/31/18 12/31/17
3/31/17
Income Statement Data Interest income $ 10,015 $ 9,717 $
9,225 Interest expense 1,834 1,716 1,484
Net interest income 8,181 8,001 7,741 Provision (negative
provision) for loan losses — (800
)
—
Net interest income after provision 8,181 8,801 7,741
Service charges on deposit accounts 568 636 501 Bank card
interchange fees 401 403 337 Bank owned life insurance income 99
103 102 Gains (loss) on sales and calls of securities, net — 293 —
Other 183 207 252
Non-interest income 1,251 1,642 1,192 Salaries &
employee benefits 3,788 3,657 3,947 Occupancy and equipment 895 919
821 Professional fees 205 202 303 Marketing expense 300 218 254
FDIC insurance 182 357 342 Data processing expense 324 325 292
State franchise and deposit tax 282 281 225 Other real estate owned
expense 82 1,881 (16
)
Litigation and loan collection expense 53 58 3 Other 1,058 1,174
1,082
Non-interest expense 7,169 9,072 7,253 Income before income
taxes 2,263 1,371 1,680 Income tax expense (benefit) 329 (31,899 )
—
Net income 1,934 33,270 1,680 Less: Earnings allocated to
participating securities 34 797 44 Net income
attributable to common $ 1,900 $ 32,473 $ 1,636
Weighted average shares – Basic 6,173,397 6,109,991
6,063,026 Weighted average shares – Diluted 6,173,397 6,109,991
6,063,026 Basic earnings per common share $ 0.31 $ 5.31 $
0.27 Diluted earnings per common share $ 0.31 $ 5.31 $ 0.27 Cash
dividends declared per common share $ 0.00 $ 0.00 $ 0.00
PORTER BANCORP, INC.
Unaudited Financial Information
(in thousands, except share and per share
data)
Three Months Ended 3/31/18
12/31/17 3/31/17
Average Balance Sheet Data Assets $ 987,390 $ 960,269 $
937,616 Loans 724,203 695,646 649,325 Earning assets 915,762
916,561 892,292 Deposits 834,695 862,625 853,556 Long-term debt and
advances 74,063 50,335 35,956 Interest bearing liabilities 777,140
774,507 767,461 Stockholders’ equity 73,205 41,397 33,732
Performance Ratios Return on average assets 0.79 %
13.75 % 0.73 % Return on average equity 10.71 318.85 20.20 Yield on
average earning assets (tax equivalent) 4.45 4.24 4.23 Cost of
interest bearing liabilities 0.96 0.88 0.78 Net interest margin
(tax equivalent) 3.63 3.50 3.55 Efficiency ratio 76.01 97.03 81.19
Loan Charge-off Data Loans charged-off $ (47 )
$ (201 ) $ (326 ) Recoveries 371 226
325 Net recoveries (charge-offs) $ 324 $ 25 $ (1 )
Nonaccrual Loan Activity Nonaccrual loans at
beginning of period $ 5,457 $ 5,769 $ 9,216 Net principal pay-downs
(995 ) (488 ) (1,452 ) Charge-offs (1 ) (137 ) (229 ) Loans
foreclosed and transferred to OREO (110 ) — (100 ) Loans returned
to accrual status — — (136 ) Loans placed on nonaccrual during the
period 19 313 803
Nonaccrual loans at end of period $ 4,370 $ 5,457 $
8,102
Troubled Debt Restructurings
(TDRs) Accruing $ 922 $ 1,217 $ 1,244 Nonaccrual 1,362
1,829 3,374 Total $ 2,284 $
3,046 $ 4,618
Other Real Estate Owned (OREO) Activity
OREO at beginning of period $ 4,409 $ 6,330 $ 6,821 Real estate
acquired 110 — 100 Valuation adjustment write-downs (60 ) (1,865 )
— Proceeds from sales of properties (70 ) (55 ) (388 ) Gain (loss)
on sales, net (4 ) (1 ) 38 OREO at end
of period $ 4,385 $ 4,409 $ 6,571
PORTER BANCORP, INC.
Unaudited Financial Information
(in thousands, except share and per share
data)
As of 3/31/18 12/31/17
9/30/17 6/30/17 3/31/17
Assets Loans $ 729,432 $ 712,115 $ 682,511 $
654,938 $ 664,183 Allowance for loan losses (8,526 )
(8,202 ) (8,977 ) (8,885 ) (8,966 ) Net loans
720,906 703,913 673,534 646,053 655,217 Loans held for sale — 70 —
— — Securities held to maturity — — 41,424 41,635 41,752 Securities
available for sale 160,812 152,720 149,797 154,993 156,001 Federal
funds sold & interest bearing deposits 30,073 25,966 37,812
51,413 32,329 Cash and due from financial institutions 7,610 8,137
9,557 9,297 5,456 Premises and equipment 16,789 16,789 16,975
17,164 17,687 Bank owned life insurance 15,323 15,229 15,131 15,033
14,935 FHLB Stock 7,323 7,323 7,323 7,323 7,323 Other real estate
owned 4,385 4,409 6,330 6,318 6,571 Deferred taxes, net 30,997
31,313 — — — Accrued interest receivable and other assets
5,886 4,932 5,082 5,228
5,083
Total Assets $ 1,000,104 $
970,801 $ 962,965 $ 954,457 $ 942,354
Liabilities and Equity Certificates of deposit $
431,921 $ 424,235 $ 445,577 $ 458,068 $ 470,029 Interest checking
92,048 99,383 94,523 97,169 104,811 Money market 150,974 151,388
156,905 153,700 122,434 Savings 35,984 34,632
35,946 36,363 36,380
Total interest bearing deposits 710,927 709,638 732,951
745,300 733,654 Demand deposits 135,984
137,386 133,896 129,518
127,049 Total deposits 846,911 847,024 866,847 874,818
860,703 FHLB advances 26,752 11,797 16,847 2,158 17,313 Junior
subordinated debentures 23,025 23,250 23,475 23,700 23,925 Senior
debt 10,000 10,000 10,000 10,000 — Accrued interest payable and
other liabilities 5,186 6,057
5,728 5,388 4,908 Total
liabilities 911,874 898,128 922,897 916,064 906,849
Preferred stockholders’ equity 2,771 2,771 2,771 2,771 2,771 Common
stockholders’ equity 85,459 69,902
37,297 35,622 32,734
Total stockholders’ equity 88,230 72,673
40,068 38,393 35,505
Total Liabilities and Stockholders’ Equity $
1,000,104 $ 970,801 $ 962,965 $ 954,457
$ 942,354
Ending shares outstanding 7,409,864
6,259,864 6,259,864 6,259,864 6,247,520
Book value per common
share $ 11.53 $ 11.17 $ 5.96 $ 5.69 $ 5.24
Tangible book
value per common share 11.53 11.17 5.96 5.69 5.23
PORTER BANCORP, INC.
Unaudited Financial Information
(in thousands, except share and per share
data)
As of 3/31/18 12/31/17
9/30/17 6/30/17 3/31/17
Asset
Quality Data Loan 90 days or more past due still on accrual $ —
$ 1 $ — $ — $ — Nonaccrual loans 4,370 5,457
5,769 6,509 8,102
Total non-performing loans 4,370 5,458 5,769 6,509 8,102 Real
estate acquired through foreclosures 4,385 4,409 6,330 6,318 6,571
Other repossessed assets — — —
— — Total non-performing assets
$ 8,755 $ 9,867 $ 12,099 $ 12,827 $
14,673 Non-performing loans to total loans 0.60 %
0.77 % 0.85 % 0.99 % 1.22 % Non-performing assets to total assets
0.88 1.02 1.26 1.34 1.56 Allowance for loan losses to
non-performing loans 195.10 150.27 155.61 136.50 110.66
Allowance for loans evaluated individually $ 282 $ 219 $ 425 $ 254
$ 332 Loans evaluated individually for impairment 5,775 7,173 7,509
8,273 9,891 Allowance as % of loans evaluated individually 4.88 %
3.05 % 5.66 % 3.07 % 3.36 % Allowance for loans evaluated
collectively $ 8,244 $ 7,983 $ 8,552 $ 8,631 $ 8,634 Loans
evaluated collectively for impairment 723,657 704,942 675,002
646,665 654,292 Allowance as % of loans evaluated collectively 1.14
% 1.13 % 1.27 % 1.33 % 1.32 % Allowance for loan losses to
total loans 1.17 % 1.15 % 1.32 % 1.36 % 1.35 %
Loans by
Risk Category Pass $ 695,507 $ 673,033 $ 633,203 $ 610,356 $
617,361 Watch 17,938 25,715 35,167 29,433 26,442 Special Mention
162 164 598 604 492 Substandard 15,825 13,203 13,543 14,545 19,888
Doubtful — — — —
—
Total $ 729,432 $ 712,115 $ 682,511 $
654,938 $ 664,183
Loans by Past Due Status Past due
loans: 30 – 59 days $ 6,402 $ 1,478 $ 872 $ 1,328 $ 972 60 – 89
days 472 171 612 765 289 90 days or more — 1 — — — Nonaccrual loans
4,370 5,457 5,769
6,509 8,102
Total past due and nonaccrual
loans $ 11,244 $ 7,107 $ 7,253 $ 8,602 $ 9,363
Risk-based Capital Ratios - Company Tier I leverage ratio
9.18 % 7.11 % 5.85 % 5.65 % 5.43 % Common equity Tier I risk-based
capital ratio 8.98 6.92 5.49 5.58 5.29 Tier I risk-based capital
ratio 11.03 8.44 7.31 7.46 7.09 Total risk-based capital ratio
12.56 10.55 10.05 10.44 10.15
Risk-based Capital Ratios –
Limestone Bank Tier I leverage ratio 9.31 % 8.70 % 7.73 % 7.54
% 6.37 % Common equity Tier I risk-based capital ratio 11.18 10.35
9.66 9.97 8.33 Tier I risk-based capital ratio 11.18 10.35 9.66
9.97 8.33 Total risk-based capital ratio 12.43 11.61 11.10 11.50
9.89
FTE employees 214 217 217 221 230
Non-GAAP Financial Measures Reconciliation
Tangible book value per common share is a non-GAAP financial
measure derived from GAAP-based amounts. We calculate tangible book
value per common share by excluding the balance of intangible
assets from common stockholders’ equity. We calculate tangible book
value per common share by dividing tangible common equity by common
shares outstanding, as compared to book value per common share,
which we calculate by dividing common stockholders’ equity by
common shares outstanding. We believe this is consistent with bank
regulatory agency treatment, which excludes tangible assets from
the calculation of risk-based capital.
The efficiency ratio is a non-GAAP measure of expense control
relative to revenue from net interest income and fee income. We
calculate the efficiency ratio by dividing total non-interest
expenses as determined under GAAP by net interest income and total
non-interest income, but excluding net gains on the sale of
securities from the calculation. We believe this provides a
reasonable measure of primary banking expenses relative to primary
banking revenue.
As of 3/31/18 12/31/17
9/30/17 6/30/17 3/31/17
Tangible
Book Value Per Share (in thousands, except share and per share
data) Common stockholder’s equity $ 85,459 $ 69,902 $ 37,297
$ 35,622 $ 32,734 Less: Intangible assets — —
— — 42 Tangible common equity 85,459 69,902 37,297
35,622 32,692 Shares Outstanding 7,409,864
6,259,864 6,259,864 6,259,864 6,247,520
Tangible book value per common share $ 11.53 $ 11.17 $ 5.96 $ 5.69
$ 5.23 Book value per common share 11.53 11.17 5.96 5.69 5.24
Three Months Ended 3/31/18 12/31/17
3/31/17
Efficiency Ratio (in thousands) Net interest income $
8,181 $ 8,001 $ 7,741 Non-interest income 1,251 1,642 1,192 Less:
Net gain on securities — 293 — Revenue used
for efficiency ratio 9,432 9,350 8,933
Non-interest expense 7,169 9,072 7,253 Efficiency ratio
76.01 % 97.03 % 81.19 %
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180418006310/en/
Porter Bancorp, Inc.John T. Taylor, 502-499-4800Chief Executive
Officer
Porter Bancorp, Inc. (delisted) (NASDAQ:PBIB)
Historical Stock Chart
From Oct 2024 to Oct 2024
Porter Bancorp, Inc. (delisted) (NASDAQ:PBIB)
Historical Stock Chart
From Oct 2023 to Oct 2024