BancTrust Financial Group, Inc. Reports Improved Fourth Quarter Results

MOBILE, Ala., Jan. 29 /PRNewswire-FirstCall/ -- BancTrust Financial Group, Inc. (Nasdaq: BTFG) today reported its financial results for the fourth quarter and year ended December 31, 2009. The Company reported that fourth quarter 2009 net income, before the preferred dividend, rose to $1.1 million compared with a net loss of $3.5 million in the fourth quarter or 2008.  Net income available to common shareholders rose to $349,000, or $0.02 per diluted share, in the fourth quarter of 2009 compared with a net loss available to common shareholders of $3.6 million, or $0.21 per share, in the fourth quarter of 2008.  The fourth quarter net income (loss) available to common shareholders included a preferred stock dividend of $764,000 in 2009 and $111,000 in 2008.

"BancTrust's fourth quarter results highlight the progress we have made in growing our net interest income, expanding our net interest margin and improving credit quality this year," stated W. Bibb Lamar, Jr., President and Chief Executive Officer of BancTrust Financial Group, Inc.  "Our fourth quarter marked our highest levels of net interest income, net interest margin and net income in 2009, even though average loan volume was down slightly."

"We enter 2010 with a more positive outlook based on recent credit trends and additional signs that the economy is beginning to stabilize in our markets.  We remain focused on reducing the level of non-performing assets and believe this will be a key part of our strategy to build our earnings in future quarters," continued Mr. Lamar.

Fourth Quarter Results

Net interest revenue increased 11.9% to $15.1 million in the fourth quarter of 2009 compared with $13.5 million in the fourth quarter of 2008. The increase was largely due to the continued increase in net interest margin since last year.  Net interest margin rose to 3.32% in the fourth quarter of 2009, up 40 basis points from the third quarter 2009 margin of 2.92% and a 24 basis point improvement from 3.08% reported in the fourth quarter of 2008. The fourth quarter of 2009 marked the second consecutive quarterly increase in BancTrust's net interest margin.  

Total loans were $1.5 billion at December 31, 2009.  Loans were down $65.2 million at year-end 2009 compared with year-end 2008 as result of the weak economy's effect on loan demand and the transfer of some loans to OREO through the foreclosure process.  

"Our non-performing assets have stabilized since mid-year and have been a primary factor in our reduced provision for loan losses compared with the first half of 2009," noted Mr. Lamar.  Loans that were 30 days past due and accruing interest declined to 1.18% of total loans compared with 1.35% at September 30, 2009.  Non-performing assets were $177.6 million at year-end 2009.  Renegotiated loans, all of which were accruing interest, accounted for 6.0% of this amount.    

The provision for loan losses was reduced to $2.5 million in the fourth quarter of 2009 compared with $8.1 million in the fourth quarter of 2008 and was up from $1.7 million in the linked third quarter of 2009.  Net charge-offs were $4.5 million for the fourth quarter of 2009 compared with $2.5 million in the fourth quarter of 2008.  The allowance for loan losses grew to 3.13% of total loans at December 31, 2009, compared with 2.00% at year-end 2008.  

"BancTrust increased its reserves during the first half of 2009 to account for the higher level of non-performing loans earlier in the year," stated Mr. Lamar.  "Later in the year we utilized a portion of our reserves by charging off some loans previously provided for in our allowance."