Porter Bancorp, Inc. Announces Fourth Quarter And 2010 Results
Fourth Quarter Results
- Net loss available to common shareholders was $9.0 million for the three months ended December 31, 2010, compared with a net loss of $256,000 for the fourth quarter of 2009. Net loss per fully diluted common share was $(0.77) in the fourth quarter of 2010 compared with $(0.03) per share in the fourth quarter of 2009.
- Net interest margin increased 3 basis points to 3.60% in the fourth quarter of 2010 compared with 3.57% in the fourth quarter of 2009. The increase in margin since last year benefited from a lower average cost of funds.
- We recorded a gain on sale of securities totaling $2.9 million during the fourth quarter. We made a strategic decision to liquidate certain mortgage backed securities and corporate bonds during the quarter.
- Average loans decreased 5.5% to $1.32 billion in the fourth quarter of 2010 compared with $1.39 billion in the fourth quarter of 2009. Net loans decreased 8.5% to $1.27 billion in the fourth quarter of 2010, compared with $1.39 billion at December 31, 2009. The decrease in loans is due to a slowdown in new loan originations in certain markets, loan charge-offs and transfers to OREO.
- Deposits decreased 4.1% to $1.47 billion compared with $1.53 billion at December 31, 2009. The decrease in deposits follows management’s strategy to match liability funding levels with lower loan balances.
- Total assets decreased 6.1% to $1.72 billion compared with $1.84 billion at December 31, 2009.
- Efficiency ratio was 107.5% in the fourth quarter of 2010, compared with 44.4% in the prior year fourth quarter. Our efficiency ratio increased due to higher non-interest expense, primarily OREO expense. Despite the higher credit-related costs, the Company continues to control its discretionary expenses.
- Non-performing loans increased $14.6 million, or 31.8%, during the fourth quarter to $60.4 million at December 31, 2010, compared with $45.8 million at September 30, 2010. The increase was primarily in the construction and land development segment of our business.
- Non-performing assets increased $8.6 million, or 7.2%, during the fourth quarter to $128.1 million at December 31, 2010, from $119.5 million at September 30, 2010. The increase was primarily attributable to non-performing loans moving through the collection, foreclosure and disposition process.
Net Interest Income
Net interest income decreased 5.5% to $14.1 million for the three months ended December 31, 2010, a decrease of $814,000, compared with $14.9 million for the same period in 2009. The decrease in net interest income was primarily attributable to lower average interest earning assets coupled with the impact of non-accrual loan levels. Net interest income rose 6.5% to $57.6 million for the year ended December 31, 2010, an increase of $3.5 million, compared with $54.1 million for the same period in 2009. The increase in net interest income was primarily attributable to an increase in net interest margin compared with 2009.
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