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MT. PLEASANT, S.C., Oct. 15, 2012 (GLOBE NEWSWIRE) -- Southcoast Financial Corporation (Nasdaq:SOCB) announced unaudited net income of $2,590,000, or $.49 per basic share, for the nine months ended September 30, 2012. This compares to an unaudited net loss of $11,678,000, or $2.21 per basic share, for the nine months ended September 30, 2011. The per share amounts are based on 5,326,552 basic average shares compared to 5,280,533 basic average shares for the nine months ended September 30, 2011.
The ratio of nonperforming assets to total assets improved from 7.40% as of December 31, 2011 to 5.08% as of September 30, 2012. The allowance for loan losses as a percentage of loans was 2.59% as of September 30, 2012, compared to 3.34% as of December 31, 2011. The allowance for loan losses as a percentage of total non-performing loans totaled 62.7% as of September 30, 2012, compared to 47.9% as of December 31, 2011.
"The 2012 results were benefited by the reduction in our loan loss provision and expenses associated with other real estate owned, both of which were the result of lower nonperforming assets as compared to the same period of 2011, and increases in the net interest margin and core earnings," said L. Wayne Pearson, Chairman and Chief Executive Officer. "While we continue to work diligently on our non-performing assets, we also continue to focus on improving our profitable core business and maintaining strong capital levels."
The nine months ended September 30, 2011 loss included a $6,623,000 provision for loan losses and $4,397,000 of income tax expense related to a write down of the Company's deferred tax asset. The provision for loan losses for the first nine months of 2012 was $880,000 and there was no deferred tax write-down.
Net interest income for the first nine months of 2012 increased $500,000 to $9,880,000 from $9,380,000 for the same period of 2011. The reduction in interest income, which was due to the decrease in average earning assets and the reduction of yield in those assets, was completely offset by the reduction of interest cost as existing liabilities were repriced. The Company's annualized net interest margin improved by 36 basis points to 3.51% for the nine months of 2012 from 3.15% for the same period of 2011, due to the significant reduction in our cost of funds.