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TIB Financial's Net Loss Widens

Increased provisions for loan losses hurt the bank in the first quarter.

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On May 4, 2009, TIB Financial Corp. (TIBB) reported that its Q1 FY09 net loss widened, hurt by increased provisions for loan losses. Net loss increased to $4.17 million, or $0.29 per share, from $1.45 million, or $0.11 per share, in the same quarter of last year. The quarterly consensus estimate was for a loss of $0.43 per share.

Total interest and dividend income declined 9.2% to $20.82 million from $22.92 million during Q1 FY08. Total average interest earning assets were $1.65 billion, including loans of $1.22 billion and investments of $287.83 million. Yield on average interest earnings was 5.12%, reflecting 5.91% on loans and 4.10% on investments. Total interest expense shrunk 16.6% to $10.07 million from $12.07 million a year ago. Total average interest bearing liabilities were $1.48 billion, including interest-bearing deposits of $1.16 billion and short-term borrowings and FHLB advances of $252.16 million. The rate paid on interest bearing liabilities was 2.76%, reflecting 2.76% on interest-bearing deposits and 2.30% on short-term borrowings and FHLB advances. Subsequently, net interest income declined marginally to $10.76 million from $10.86 million a year ago. As a result, net interest margin contracted to 2.65% from 3.13%, while net interest spread stood at 2.36%. Non-interest income edged down 3.3% to $2.38 million from $2.46 million in the year-ago quarter.

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TIBB's provision for credit losses doubled to $5.31 million from $2.65 million, and net loan charge-offs jumped more than two-fold to $3.60 million from $1.77 million in the year ago quarter. Furthermore, allowance for loan losses as a percentage of total loans advanced to 2.09% from 1.39% in Q1 FY08. Finally, non-performing loans (NPL) soared 69.9% to $45.65 million from $26.87 million, while NPLs as a percentage of gross loans jumped to 3.74% from 2.36% a year ago. Moreover, the bank remains well-capitalized, as its Tier 1 and total capital to risk weighted assets stood at 9.1% and 10.4% as of March 31, 2009.