SOUTH HILL, Va., April 22 /PRNewswire-FirstCall/ -- Citizens Community
Bank (OTC Bulletin Board: CZYB) today reported first quarter results for the
three-month period ended Mar. 31, 2008. Quarterly net income was $152,596, an
increase of 33.7% or $38,485, over first quarter 2007. Earnings per share,
both basic and diluted, equaled $.11 compared to $.08 for the three months
ended March 31, 2007. Return on average assets increased 6 basis points to
.41%, while return on average equity improved to 3.39% from 2.70% over the
comparable period.
As of March 31, 2008, totaled assets stood at $147.7 million, which was
down $1.1 million from year end 2007. Since March 31, 2007, total assets grew
$14.3 million, with net loans increasing $12.1 million or 11.8%. With a
typical slow first quarter for loan demand, net loans were virtually flat from
December 31, 2007 at $114.8 million. With expected slow loan growth for the
first quarter of 2008, deposit balances were reduced by $1.4 million to $127.9
million. Consequently, the Bank increased its net loan to deposit ratio from
88.9% at December 31, 2007 to 89.8% as of March 31, 2008. Available for sale
securities totaled $14.5 million as of March 31, 2008, a decrease of $1.9
million, as the Bank continued to reposition its balance sheet.
"We are pleased with our performance for the first three months of 2008
with net income increasing 33.7% over the first quarter of 2007," stated Tom
Manson, president and CEO. "Like most financial institutions, our net interest
margin was under pressure; however, we have fared well due to the balance
sheet strategies that were implemented. These results were achieved in a
difficult economy and during a volatile rate environment. The bank remains
'well-capitalized,' and we continue to monitor credit quality closely."
"New this year, we're also happy to announce the addition of a 'branch
capture' system which offers improved customer convenience. This new program
ensures all deposits made during the business day (until 6:00 p.m. or when the
branch closes, whichever is earlier) are posted the same day. In addition,
final preparations are underway to open our fifth branch in Roanoke Rapids,
N.C. We are on target to open the facility in May and look forward to
bringing our 'personal touch' service to this new market," adds Manson.
Net interest income increased $56,778 or 4.8% to $1,249,983 over the first
quarter of 2007 due to the volume of loan growth experienced over the past
twelve months and a higher-yielding investment portfolio. For the first three
months of 2008, the net interest margin decreased 18 basis points to 3.65%
compared to the first quarter of 2007. The yield on average earning assets
decreased 26 basis points to 7.06%, while the Bank's funding costs declined by
24 basis points. The net loan-to-deposit ratio averaged 89.1% for the first
quarter of 2008 versus 88.6% for the first three months of 2007. With the
current margin compression and expected near-term tightening of the margin,
management's strategy is to continue increasing the loan-to-deposit ratio
along with further diversification of the bank's deposit base. Management's
balance sheet strategies deployed early in 2007, along with existing
practices, should continue to assist in alleviating some near-term net
interest margin pressure.
Noninterest income increased a solid $25,223 or 18.5% to $161,474 as the
Bank expanded its ATM network and customer base. The Bank also benefited from
additional income by increasing the amount of bank-owned life insurance over
the comparable periods. Noninterest expense rose by $133,520 to $1,166,717
for the three-month period ended March 31, 2008, due to heightened audit and
compliance costs, increased salaries and benefits, higher operating costs
associated with asset growth and the costs of offering improved products and
services (e.g. branch capture). Additionally, the new Roanoke Rapids branch -
expected to open during second quarter 2008-also will impact overall future
operating costs as a significant portion of these expenses were not reflected
in first quarter 2008 results.
The Bank provided $41,200 to the loan loss reserve compared to $124,600
for the first three months of 2007. This produced a loan loss reserve ratio of
1.15% as of March 31, 2008 versus 1.14% at March 31, 2007. As of March 31,
2008, nonperforming loans stood at .47% of total loans, compared to .50% at
December 31, 2007 and .09% on March 31, 2007.
Citizens Community Bank is a Virginia state chartered bank headquartered
in South Hill, Va. Opened in December 1999, it operates additional branches
in Boydton and Gasburg, Va., as well as its newest branch in Gaston, NC, all
serving the Lake Country Area of Virginia and North Carolina. An additional
North Carolina branch in Roanoke Rapids is currently under construction with
plans to open this spring. For more information and additional financial
data, please visit www.ccbsite.com.
This press release contains "forward-looking statements" that concern
future events which are subject to risks and uncertainties. Any such
statements are based on certain assumptions and analyses by the Bank and other
factors it believes are appropriate in the circumstances. The Bank's actual
results, events and developments may differ materially from those contemplated
by any forward-looking statement.
SOURCE Citizens Community Bank