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TheStreet Open House

DNB Financial Corporation Reports Third Quarter, Nine Month 2013 Results

Stocks in this article: DNBF

DOWNINGTOWN, Pa., Oct. 24, 2013 (GLOBE NEWSWIRE) -- DNB Financial Corporation (Nasdaq:DNBF), parent of DNB First, National Association, the oldest nationally-chartered community bank serving the greater Philadelphia region, today reported financial results for the three months and nine months ended September 30, 2013.

William S. Latoff, Chairman and CEO, commented: "Our year-over-year operating performance reflects our commitment to growing loans, deposits and revenue from a diversified mix of commercial, retail, and wealth management services. We continued to build shareholder value, as evidenced by our third quarter 2013 earnings, which was our 17 th consecutive quarterly profit. We continue to diversify our revenue and funding mix, and to expand our business on a number of fronts."

"Through the actions we've taken during the quarter to write-down three legacy non-performing credits, we have strengthened our balance sheet. Further, we expect this action will have a positive impact on our financial results and performance ratios in future quarters."

"Our growth, combined with a strong focus on risk management and asset quality, has made us a stronger company. We made significant strides toward improving asset quality during the third quarter. Non-performing loans to total loans fell to 1.40%, down from 2.60% at June 30, 2013 and 4.05% at March 31, 2013. Our earnings in the third quarter of 2013 reflect a $1.6 million provision for credit losses, following a $3.6 million write-down of three legacy non-performing commercial credits. By fully addressing these problem credits, we believe we are better positioned to demonstrate our ability to flow revenue growth to the bottom line."

Highlights:

  • Improved asset quality was reflected in several key performance ratios, including a non-performing loans to total loans ratio of 1.40% and a ratio of non-performing assets to total assets of 1.51% at September 30, 2013, compared with 2.63% and 1.82%, respectively, at December 31, 2012.
  • Net income available to common shareholders for the three months ended September 30, 2013 was $295,542 or $0.10 per diluted share compared with $1.38 million or $0.50 per diluted share for the three months ended September 30, 2012.
  • Net income available to common shareholders for the nine months ended September 30, 2013 was $2.65 million or $0.95 per diluted share compared with $3.62 million or $1.32 per diluted share for the nine months ended September 30, 2012.
  • Total non-performing assets declined to $9.78 million at September 30, 2013 compared with $11.67 million at December 31, 2012 and $13.69 million at September 30, 2012.
  • Total assets were $649.81 million, a $10.24 million increase compared with $639.57 million at December 31, 2012 and up from $626.19 million at September 30, 2012.
  • Total interest expense for the nine months ended September 30, 2013 declined 23% compared with the first nine months of 2012, reflecting both ongoing interest rate management practices and the growth of core deposits. Low-cost core deposit growth contributed to the company's ability to reduce its reliance on FHLB borrowings by half, to $10 million.
  • Wealth management continued to record strong growth in assets under care, which generated 55% more fee income in the third quarter of 2013 compared with the third quarter of 2012.
  • Total deposits were $551.86 million at September 30, 2013 compared with $530.42 million at December 31, 2012.
  • Total loans and leases before allowance for credit losses were $399.24 million at September 30, 2013 compared with $396.50 million at December 31, 2012, reflecting organic loan growth.
  • Total stockholders' equity was $57.75 million at September 30, 2013, compared to $56.71 million at December 31, 2012 and the company's book value per common share was $16.28 at September 30, 2013 compared to $16.08 at December 31, 2012.
  • Tier 1 leverage ratio of 10.39%, Tier 1 risk-based capital ratio of 15.18% and a total risk-based capital ratio of 16.16% as of September 30, 2013 exceeded regulatory definitions for a well-capitalized institution.

"DNB continues to leverage its reputation for providing high quality personalized banking products and services to grow the bank's balance sheet and enhance value for shareholders," Latoff said. "Deposit growth, which includes a 12% increase in business-related accounts, enabled DNB to maintain low funding costs, while continuing its expansion of relationship banking. This reflects successful execution of a prudent strategy to grow our commercial banking business."

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