Sunshine Bancorp, Inc. (the “Company”) (NASDAQ:SBCP), the holding company for Sunshine Bank (the “Bank”), has released its unaudited financial results for the first quarter of 2016.

Net income for the three months ended March 31, 2016 was $154,000 compared to a net loss of $1.8 million for the three months ended December 31, 2015 and compared to a net loss of $353,000 for the three months ended March 31, 2015.

Total assets were $523.1 million at March 31, 2016 compared to $507.3 million at December 31, 2015 and $247.6 million at March 31, 2015. The Bank continued to experience strong organic loan and deposit growth for the first quarter of 2016. The loan and deposit portfolios as of March 31, 2016 totaled $337.8 million and $415.2 million, respectively, compared to $326.3 million and $399.1 million, respectively, at December 31, 2015. Loan growth for the first quarter 2016 was $11.5 million, or 14.0% annualized. Additionally, organic deposit growth for the first quarter 2016 was $16.1 million, or 12.0% annualized. The Bank has continued to allow municipal deposits that do not have a corresponding lending relationship to runoff. During the first quarter of 2016, the balance of public funds deposits decreased by $6.3 million.

Heading into the second quarter the Company is seeing its strongest loan pipeline in the past five quarters. However, the Company is still experiencing significant competitive pressures even as the Florida economy continues to expand. These competitive pressures include below market pricing and an apparent loosening of credit underwriting standards. In response, the Company remains focused on its disciplined credit underwriting standards and has focused its growth on relationship banking and targeted asset class diversification.

The Bank’s non-performing assets as of March 31, 2016 were $985,000 compared to $783,000 as of December 31, 2015. The increase was due to one commercial real estate loan being placed on nonaccrual status. The Bank’s non-performing assets to total asset ratio as of March 31, 2016 was 0.19% compared to 0.15% as of December 31, 2015. In addition, the allowance for loan losses was 265.7% of non-performing loans at March 31, 2016.

Non-interest income for the three months ended March 31, 2016 was $667,000 compared to $409,000 for the three months ended March 31, 2015. The increase of $258,000 was attributable to increases in service charges on deposit, mortgage broker fees and wealth management income.

Non-interest expense was $4.5 million for the three months ended March 31, 2016 compared to $2.7 million for the three months ended March 31, 2015. During the first quarter of 2016, the Bank had a robbery that resulted in a $50,000 loss which is the retention amount of its financial institution bond. The Company believes there are additional opportunities to reduce operational expenses and is currently evaluating further steps necessary to implement cost savings.

Andrew Samuel, President and CEO, commented, “In the first quarter of 2016, we made decisions to walk away from some organic growth opportunities that did not fit our focus on relationship oriented growth. We are confident that this distinction will provide enhanced long term value for our organization. Strategic opportunities continue to present themselves with seller pricing expectations remaining high. We have evaluated and continue to evaluate different strategic options while remaining focused on our disciplined acquisition criteria.”

Net interest income for the first quarter of 2016 increased $2.5 million, compared to the prior year period as a result of balance sheet growth.

In March 2016 the Company successfully completed a private issuance of subordinated debt totaling $11 million. The total amount was contributed to the Bank to support ongoing loan growth. Stockholders’ equity increased $542,000 to $71.9 million at March 31, 2016 compared to $71.4 million at December 31, 2015. Sunshine Bank exceeds the well-capitalized levels with a March 31, 2016 leverage ratio of 11.3% compared to 9.8% at December 31, 2015 and 16.6% at March 31, 2015.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the federal securities laws. Statements in this release that are not strictly historical are forward-looking and are based upon current expectations that may differ materially from actual results. These forward-looking statements, identified by words such as “will,” “expected,” “believe,” and “prospects,” involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the statements made herein. These risks and uncertainties involve general economic trends and changes in interest rates, increased competition, changes in consumer demand for financial services, the possibility of unforeseen events affecting the industry generally, the uncertainties associated with newly developed or acquired operations, and market disruptions. The Company undertakes no obligation to release revisions to these forward-looking statements publicly to reflect events or circumstances after the date hereof or to reflect the occurrence of unforeseen events, except as required to be reported under the rules and regulations of the Securities and Exchange Commission.

About Sunshine Bancorp, Inc.

Sunshine Bancorp, Inc. was formed in 2014 as the holding company for Sunshine Bank. The bank was first organized in 1954 in Plant City. In 2014 after converting from the mutual form of organization to the stock form, the current name of Sunshine Bank was adopted. Operations are conducted from the main office in Plant City, Florida and eleven additional offices in Hillsborough, Polk, Manatee, Orange, and Pasco Counties, Florida. The Company provides community bank financial services to individuals, families, and business customers. Sunshine’s common stock is traded on the NASDAQ Capital Market under the symbol “SBCP.” For further information, visit the Company website www.mysunshinebank.com.

Sunshine Bancorp, Inc.
Consolidated Balance Sheet
(Dollars in thousands, except per share information)
  As of March 31,       As of December 31,       As of March 31,
  2016     2015     2015  
(Unaudited) (Unaudited)
Assets
Cash and due from banks $ 12,490 $ 13,220 $ 5,110
Interest-earning deposits in financial institutions 30,686 16,523 10,822
Federal funds sold   18,443     29,601     28,933  
Cash and cash equivalents 61,619 59,344 44,865
Time deposits with banks 3,920 4,410 5,390
Securities available for sale 70,005 65,944 60,039
Loans held for sale 453 790 347
Loans, net of allowance for loan losses of $2,532 and $2,511 337,784 326,266 118,675
Premises and equipment, net 17,613 17,612 6,751
Federal Home Loan Bank stock, at cost 1,306 1,597 211
Cash surrender value of bank-owned life insurance 12,203 12,122 7,317
Deferred income tax asset 6,272 6,426 2,825
Goodwill and other intangibles 10,071 10,101 -
Accrued interest receivable 1,050 1,048 543
Other real estate owned 32 32 41
Other assets   739     1,573     573  
Total assets $ 523,067   $ 507,265   $ 247,577  
 
Liabilities and Stockholders’ Equity
Liabilities:
Noninterest-bearing demand accounts $ 101,490 $ 89,114 $ 47,344
Interest-bearing demand and savings accounts 207,410 198,977 99,732
Time deposits   106,300     111,020     35,997  
Total deposits 415,200 399,111 183,073
Short-term borrowings 21,238 28,927 -
Long-term borrowings 11,000 - -
Other liabilities   3,693     7,833     3,074  
Total liabilities 451,131 435,871 186,147
 
Stockholders’ equity:
Common stock 53 53 42
Additional paid in capital 52,975 52,763 40,766
Retained income 22,000 21,846 23,738
Unearned employee stock ownership plan (“ESOP”) shares (3,160 ) (3,160 ) (3,273 )
Accumulated other comprehensive income   68     (108 )   157  
Total stockholders’ equity   71,936     71,394     61,430  
Total liabilities and stockholders’ equity $ 523,067   $ 507,265   $ 247,577  
 
Sunshine Bancorp, Inc.
Consolidated Statement of Operations
(Unaudited),(in thousands, except per share information)
      Three months Ended
March 31,
  2016         2015  
Interest income:
Loans $ 4,055 $ 1,529
Securities 221 223
Other   78   33  
Total interest income 4,354 1,785
Interest Expense:
Deposits 315 67
Borrowed funds   25   -  
Total interest expense   340   67  
Net interest income 4,014 1,718
Provision for loan losses   -   -  
Net interest income after provision for loan losses   4,014   1,718  
Noninterest income:
Fees and service charges on deposit accounts 326 139
Gain on sale of other real estate owned - -
Mortgage Broker Fees 47 16
Gain on sale of securities 26 142
Income from bank-owned life insurance 95 58
Other   173   54  
Total noninterest income 667 409
Noninterest expenses:
Salaries and employee benefits 2,576 1,564
Occupancy and equipment 576 299
Data and item processing services 341 120
Professional fees 171 124
Advertising and promotion 45 38
Stationery and supplies 46 25
FDIC Deposit insurance 102 56
Merger related - 258
Other   621   262  
Total noninterest expenses 4,478 2,746
Income (Loss) before income taxes 203 (619 )
Income tax (benefit) expense   49   (266 )
Net income (loss) $ 154 $ (353 )
 
Basic and Dilutive earnings (loss) per share $ 0.03 $ (0.09 )
 
  Quarter Ended *
  3/31/2016       12/31/2015       9/30/2015       6/30/2015       3/31/2015  
Operating Highlights (Unaudited)
Net Income $ 154 $ (1,776 ) $ 35 $ (151 ) $ (353 )
Net interest income 4,014 3,938 3,786 1,724 1,718
Provision for loan losses - - - - -
Non-Interest Income 667 471 425 324 409
Non-Interest Expense 4,478 6,863 4,141 3,526 2,746
 
Financial Condition Data:
Total Assets $ 523,067 $ 507,265 $ 442,085 $ 476,989 $ 247,577
Loans, Net 337,784 326,266 320,356 307,002 118,675
Deposits:
Noninterest-bearing demand accounts 101,490 89,114 68,297 71,539 43,798
Interest-bearing demand and savings accounts 207,410 198,977 184,958 168,859 99,732
Time deposits   106,300     111,020     100,724     108,899     35,997  
Total Deposits 415,200 399,111 353,979 349,297 179,527
 
Selected Ratios
Net interest margin 3.64 % 3.78 % 3.72 % 2.78 % 3.24 %
Annualized return on average assets 0.1 % (1.5 %) 0.0 % (0.3 %) (0.6 %)
Annualized return on average equity 0.9 % (11.2 %) 0.1 % (1.0 %) (2.3 %)
 
Capital Ratios **
Total Capital Ratio 15.6 % 13.1 % 14.3 % 15.1 % 31.3 %
Tier 1 capital ratio 14.9 % 12.4 % 13.8 % 14.5 % 30.0 %
Common equity tier 1 capital ratio 14.9 % 12.4 % 13.8 % 14.5 % 30.0 %
Leverage ratio 11.3 % 9.8 % 10.6 % 20.1 % 16.6 %
 
 
Asset Quality Ratios
Non-performing assets $ 985 $ 783 $ 1,055 $ 1,666 $ 413
Non-performing assets to total assets 0.19 % 0.15 % 0.24 % 0.35 % 0.17 %
Non-performing loans to total loans 0.28 % 0.24 % 0.32 % 0.53 % 0.31 %
Allowance for loan losses(AFLL) $ 2,532 $ 2,511 $ 1,947 $ 1,883 $ 1,743
AFLL to total loans 0.74 % 0.76 % 0.60 % 0.61 % 1.45 %
AFLL to non-performing loans 265.7 % 334.4 % 190.3 % 115.2 % 468.6 %
 
* Dollars in thousands
** Capital Ratios for Sunshine Bank only