CITIZENS FIRST CORP. 
By BOWLING GREEN, Ky., April 17, 2014 /PRNewswire/ -- Citizens First Corporation (NASDAQ: CZFC) today reported results for the first quarter ending March 31, 2014, which include the following:
-- For the quarter ended March 31, 2014, the Company reported net income of
$691,000, which represents a decrease of $11,000 from the linked quarter
ended December 31, 2013 and an increase of $576,000 from March 31, 2013.
Earnings per diluted common share for the current quarter were $0.27, an
increase of $0.02 from the linked quarter ended December 31, 2013 and an
increase of $0.32 for the quarter ended March 31, 2013.
-- The Company's net interest margin was 3.81% for the quarter ended March
31, 2014 compared to 4.03% for the linked quarter ended December 31,
2013 and 3.96% for the quarter ended March 31, 2013, a decrease of 22
basis points for the linked quarter and a decrease of 15 basis points
from the prior year. The Company's net interest margin decreased from
prior periods due to a decline in the yield on loans.
-- Total loans increased 2.2% to $301.6 million at March 31, 2014 compared
to $295.1 million at December 31, 2013. Total deposits increased 2.7% to
$352.2 million at March 31, 2014 compared to $343.0 million at December
31, 2013. Todd Kanipe, President & CEO of Citizens First commented, "We
are encouraged by the growth of loans on our balance sheet. Loan growth
is vital to improve our net interest income while interest rates
continue to remain at historically low levels. We have added to both our
lending and credit administration staff to focus on loan growth while
maintaining credit quality in our loan portfolio."
First Quarter 2014 Compared to Fourth Quarter 2013
Net interest income for the quarter ended March 31, 2014 declined $231,000 from the previous quarter as the yield on loans declined.
Non-interest income for the three months ended March 31, 2014 decreased $82,000, or 11.5%, compared to the previous quarter, primarily due to a decrease in service charges on deposits of $58,000. Non-interest expense for the three months ended March 31, 2014 increased $1,000, or .03%, compared to the previous quarter.
A $125,000 provision for loan losses was recorded for the first quarter of 2014, compared to a $450,000 provision in the previous quarter, a decrease of $325,000. The allowance for loan losses to total loans increased slightly from 1.58% to 1.60%. Net charge-offs (recoveries) were $(49,000) for the first quarter of 2014 compared to $617,000 in the fourth quarter of 2013.
First Quarter 2014 Compared to First Quarter 2013
Net interest income for the quarter ended March 31, 2014 decreased $168,000, or 4.6%, compared to the previous year. The decrease in net interest income was impacted by a reduction in interest expense of $79,000 combined with a decrease in interest income of $247,000. The decrease in interest income was created by a decline in the yield on loans from 5.50% in the first quarter of 2013 to 5.14% in the first quarter of 2014. Loan yields have declined as maturing loans were repriced at a lower rate.
Non-interest income for the three months ended March 31, 2014 decreased $90,000, or 12.5%, compared to the three months ended March 31, 2013, primarily due to a decline in gains on sale of mortgage loans of $58,000 from the prior year.
Non-interest expense for the three months ended March 31, 2014 decreased $20,000, or 0.6%, compared to the three months ended March 31, 2013, due to a decrease in legal and collection expenses.
A $125,000 provision for loan losses was recorded for the first quarter of 2014, a decrease of $1.1 million, from $1.3 million in the first quarter of 2013. The allowance for loan losses to total loans decreased from 2.21% of total loans at March 31, 2013 to 1.60% at March 31, 2014, primarily due to charge-offs of specific allocations which were included in the allowance at March 31, 2013. Net charge-offs (recoveries) were $(49,000) for the first quarter of 2014 compared to net charge-offs of $321,000 in the first quarter of 2013.
Balance Sheet
Total assets at March 31, 2014 were $420.1 million, an increase of $9.9 million from $410.2 million at December 31, 2013. Average assets during the first quarter were $414.1 million, a decrease of 0.9%, or $3.7 million, from $417.8 million in the first quarter of 2013. Average interest earning assets decreased 0.8%, or $3.1 million, from $384.6 million in the first quarter of 2013 to $381.5 million in the first quarter of 2014.
Loans increased $6.5 million, or 2.2%, from $295.1 million at December 31, 2013 to $301.6 million at March 31, 2014. Total loans averaged $303.4 million the first quarter of 2014, compared to $303.9 million the first quarter of 2013, a decrease of $0.5 million, or 0.2%.
Deposits at March 31, 2014 were $352.2 million, an increase of $9.2 million, or 2.7%, compared to $343.0 million at December 31, 2013. Total deposits averaged $346.1 million the first quarter of 2014, an increase of $3.6 million, or 1.1%, compared to $342.5 million during the first quarter of 2013. 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 $2.6 million at March 31, 2014 compared to $2.0 million at December 31, 2013, an increase of $593,000. A summary of nonperforming assets is presented below:
(In thousands) March December September June March
31, 31, 30, 30, 31,
2014 2013 2013 2013 2013
--- ---- ---- ---- ---- ----
Nonaccrual loans $1,104 $1,026 $3,784 $6,141 $7,097
Loans 90+ days past due/
accruing 56 - 19 - 23
Restructured loans 815 154 2,041 3,340 3,528
------------------ --- --- ----- ----- -----
Total non-performing loans 1,975 1,180 5,844 9,481 10,648
Other real estate owned 631 833 547 517 232
Total non-performing
assets $2,606 $2,013 $6,391 $9,998 $10,880
-------------------- ------ ------ ------ ------ -------
Non-performing assets to
total assets 0.62% 0.49% 1.56% 2.43% 2.58%
------------------------ ---- ---- ---- ---- ----
The allowance for loan losses at March 31, 2014 was $4.8 million, or 1.60% of total loans, compared to $4.7 million, or 1.58% of total loans as of December 31, 2013. The allowance increased due to an increase in nonperforming assets. A summary of the allowance for loan losses is presented below:
(In thousands) March December September June March
31, 31, 30, 30, 31,
2014 2013 2013 2013 2013
--- ---- ---- ---- ---- ----
Balance at beginning
of period $4,653 $4,820 $6,064 $6,650 $5,721
Provision for loan
losses 125 450 900 50 1,250
Charged-off loans 22 788 2,198 678 358
Recoveries of
previously charged-
off loans 71 171 54 42 37
-------------------- --- --- --- --- ---
Balance at end of
period $4,827 $4,653 $4,820 $6,064 $6,650
Allowance for loan
losses to total loans 1.60% 1.58% 1.60% 1.98% 2.21%
---------------------- ---- ---- ---- ---- ----
At March 31, 2014, total shareholders' equity was $35.9 million compared to $38.3 million at December 31, 2013, a decrease of $2.4 million. During the first quarter of 2014, the Company paid $3.3 million to repurchase the remaining 93 shares of the Series A preferred stock that the Company had issued to the Treasury in 2008 under the TARP Capital Purchase Program.
The Company's tangible equity ratio declined to 7.51% as of March 31, 2014 compared to 8.28% at December 31, 2013 due to the repayment of the TARP Capital Purchase Program funds. The tangible book value per common share improved from $11.51 at December 31, 2013, to $11.97 at March 31, 2014. 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
March 31 Dec 31 Sept 30 June 30 March 31
2014 2013 2013 2013 2013
---- ---- ---- ---- ----
Interest income $4,181 $4,411 $4,381 $4,325 $4,428
Interest expense 683 682 747 770 762
--- --- --- --- ---
Net interest income 3,498 3,729 3,634 3,555 3,666
Provision for loan losses 125 450 900 50 1,250
Non-interest income:
Service charges on deposits 261 319 341 321 291
Other service charges and fees 153 133 156 158 138
Gain on sale of mortgage loans 24 36 81 78 82
Non-deposit brokerage fees 69 72 91 78 65
Lease income 75 75 74 75 74
BOLI income 47 49 53 56 61
Securities gains - 27 - 29 8
Total 629 711 796 795 719
--- --- --- --- ---
Non-interest expenses:
Personnel expense 1,527 1,419 1,382 1,417 1,441
Net occupancy expense 482 485 499 465 461
Advertising and public relations 83 65 70 110 78
Professional fees 153 141 201 174 164
Data processing services 233 266 280 272 265
Franchise shares and deposit tax 146 145 146 141 141
FDIC insurance 77 119 150 26 85
Core deposit intangible amortization 84 79 84 85 84
Postage and office supplies 51 38 35 35 43
Other real estate owned expenses 10 46 7 20 11
Other 216 258 425 434 309
--- --- --- --- ---
Total 3,062 3,061 3,279 3,179 3,082
----- ----- ----- ----- -----
Income before income taxes 940 929 251 1,121 53
Provision for income taxes 249 227 18 333 (62)
--- --- --- --- ---
Net income 691 702 233 788 115
Preferred dividends and discount accretion 132 184 178 176 217
--- --- --- --- ---
Net income (loss) available for common shareholders $559 $518 $55 $612 $(102)
==== ==== === ==== =====
Basic earnings (loss) per common share $0.28 $0.26 $0.03 $0.31 $(0.05)
===== ===== ===== ===== ======
Diluted earnings (loss) per common share $0.27 $0.25 $0.02 $0.30 $(0.05)
===== ===== ===== ===== ======
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Key Operating Statistics:
Three Months Ended
March December September June March
31 31 30 30 31
2014 2013 2013 2013 2013
---- ---- ---- ---- ----
Average assets $414,089 $408,792 $413,293 $419,240 $417,804
Average earning assets 381,485 375,658 380,154 387,663 384,614
Average loans 303,438 298,833 307,618 305,532 303,942
Average deposits 346,089 340,938 340,067 345,738 342,475
Average equity 36,213 38,469 37,937 38,353 40,164
Average common equity 28,046 27,548 27,023 27,445 27,695
Return on average assets 0.68% 0.68% 0.22% 0.75% 0.11%
Return on average equity 7.74% 7.24% 2.44% 8.24% 1.16%
Efficiency ratio 72.73% 68.07% 72.66% 72.17% 68.96%
Non-interest income to average assets 0.62% 0.69% 0.77% 0.76% 0.70%
Non-interest expenses to average assets 3.00% 2.97% 3.15% 3.04% 2.99%
Net overhead to average assets 2.38% 2.28% 2.38% 2.28% 2.29%
Yield on loans 5.14% 5.42% 5.26% 5.28% 5.50%
Yield on investment securities (TE) 3.02% 2.97% 2.87% 2.78% 2.97%
Yield on average earning assets (TE) 4.53% 4.75% 4.66% 4.56% 4.76%
Cost of average interest bearing liabilities 0.83% 0.83% 0.89% 0.92% 0.93%
Net interest margin (tax equivalent) 3.81% 4.03% 3.88% 3.77% 3.96%
Number of FTE employees 98 100 100 98 99
Asset Quality Ratios:
Non-performing loans to total loans 0.65% 0.40% 1.94% 3.09% 3.54%
Non-performing assets to total assets 0.62% 0.49% 1.56% 2.43% 2.58%
Allowance for loan losses to total loans 1.60% 1.58% 1.60% 1.98% 2.21%
YTD net charge-offs (recoveries) to average loans, annualized (0.06)% 1.22% 1.36% 0.63% 0.43%
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Consolidated
Statement
of
Condition: As of As of As of
March 31, December 31, December 31,
2014 2013 2012
---- ---- ----
Cash
and
due
from
financial
institutions $8,166 $8,572 $9,549
Federal
funds
sold 30,095 28,490 25,250
Available
for
sale
securities 54,675 51,633 46,639
Loans
held
for
sale 85 - 61
Loans 301,598 295,068 298,754
Allowance
for
loan
losses (4,827) (4,653) (5,721)
Premises
and
equipment,
net 10,970 11,054 11,568
Bank
owned
life
insurance
(BOLI) 7,853 7,806 7,587
Federal
Home
Loan
Bank
Stock,
at
cost 2,025 2,025 2,025
Accrued
interest
receivable 1,444 1,554 1,660
Deferred
income
taxes 1,759 2,279 2,180
Intangible
assets 4,678 4,762 5,094
Other
real
estate
owned 631 833 191
Other
assets 976 752 1,719
--- --- -----
Total
Assets $420,128 $410,175 $406,556
======== ======== ========
Deposits:
Noninterest
bearing $41,653 $39,967 $41,725
Savings,
NOW
and
money
market 146,130 143,602 111,194
Time 164,414 159,382 178,814
------- ------- -------
Total
deposits $352,197 $342,951 $331,733
FHLB
advances
and
other
borrowings 25,300 22,000 26,000
Subordinated
debentures 5,000 5,000 5,000
Accrued
interest
payable 241 243 238
Other
liabilities 1,477 1,634 2,019
----- ----- -----
Total
Liabilities 384,215 371,828 364,990
6.5%
Cumulative
preferred
stock 7,659 7,659 7,659
Series
A
preferred
stock - 3,266 6,519
Common
stock 27,072 27,072 27,072
Retained
earnings
(deficit) 1,212 653 (430)
Accumulated
other
comprehensive
income
(loss) (30) (303) 746
--- ---- ---
Total
Stockholders'
Equity 35,913 38,347 41,566
------ ------ ------
Total
Liabilities
and
Stockholders'
Equity $420,128 $410,175 $406,556
======== ======== ========
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
March 31, December 31, December 31,
2014 2013 2012
---- ---- ----
Capital Ratios:
Tier 1 leverage 8.86% 9.57% 10.20%
Tier 1 risk-based capital 11.48% 12.56% 13.16%
Total risk based capital 12.73% 13.81% 14.41%
Tangible equity ratio (1) 7.51% 8.28% 9.08%
Tangible common equity ratio (1) 5.67% 5.59% 5.55%
Book value per common share $14.35 $13.93 $13.91
Tangible book value per common share (1) $11.97 $11.51 $11.32
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: March 31, December 31, December 31,
2014 2013 2012
---- ---- ----
Total shareholders' equity (a) $35,913 $38,348 $41,566
Less:
Preferred stock (7,659) (10,925) (14,178)
------ ------- -------
Common equity (b) 28,254 27,423 27,388
Goodwill (4,097) (4,097) (4,097)
Intangible assets (581) (665) (997)
---- ---- ----
Tangible common equity (c) 23,576 22,661 22,294
Add:
Preferred stock 7,659 10,925 14,178
----- ------ ------
Tangible equity (d) $31,235 $33,586 $36,472
Total assets (e) $420,435 $410,175 $406,556
Less:
Goodwill (4,097) (4,097) (4,097)
Intangible assets (581) (665) (997)
---- ---- ----
Tangible assets (f) $415,757 $405,413 $401,462
Shares outstanding (in thousands) (g) 1,969 1,969 1,969
Book value per common share (b/g) $14.35 $13.93 $13.91
Tangible book value per common share (c/g) $11.97 $11.51 $11.32
Total shareholders' equity to total assets ratio (a/e) 8.54% 9.35% 10.22%
Tangible equity ratio (d/f) 7.51% 8.28% 9.08%
Tangible common equity ratio (c/f) 5.67% 5.59% 5.55%
SOURCE Citizens First Corporation
