Porter Bancorp, Inc. (NASDAQ: PBIB), parent company of PBI Bank, announced today that it filed its 10-Q with the Securities and Exchange Commission for the second quarter ended June 30, 2010. The filing included an ‘other than temporary impairment’ (OTTI) charge of $465,000 for the second quarter ended June 30, 2010, that was not included in the Company’s financial results previously reported on July 23, 2010. The addition of the OTTI charge for the quarter ended June 30, 2010, reduced non-interest income to $1,497,000 from the previously reported $1,962,000, increased the net loss to $1,131,000 from the previously reported $829,000, and increased the net loss available to common shareholders to $1,614,000, or $0.19 per fully diluted share, from the previously reported $1,310,000, or $0.15 per fully diluted share. The OTTI charge is reflected in the revised income statement included with this release for the three and six months ended June 30, 2010. For a more detailed review of the second quarter 2010 OTTI charge, please refer to Porter Bancorp’s 10-Q for the quarter ending June 30, 2010, as filed with the Securities and Exchange Commission.

The Company determined that the OTTI charge should be included in its second quarter 2010 results after reviewing stock price trends in June, July and August following the release of its financial results on July 23, 2010. After the review, the Company determined that it could not objectively assert that its basis in these equity securities that have been in an unrealized loss position greater than 12 months was recoverable in the near term. As such, for the second quarter, the Company recorded an OTTI charge totaling $465,000 for equity securities held in its portfolio with an original cost of $1.6 million. The market prices of the stocks have been below the Company’s initial investment for more than twelve months and after consideration of the issuers’ financial conditions and the likelihood the market value would recover to the Company’s cost basis in a reasonable period of time, the investments were written down to fair value.

About Porter Bancorp, Inc.

Porter Bancorp, Inc., a bank holding company headquartered in Louisville, Kentucky, had $1.8 billion in assets as of June 30, 2010. Through Porter’s subsidiary PBI Bank, it operates 18 full service banking offices in Kentucky. Porter Bancorp’s common stock is traded on the Nasdaq Global Market under the symbol “PBIB.”

Forward-Looking Statements

Statements in this press release relating to Porter Bancorp’s plans, objectives, expectations or future performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations. Porter Bancorp’s actual results in future periods may differ materially from those currently expected due to various risks and uncertainties, including those discussed under “Risk Factors” in the Company’s Form 10-K and subsequent periodic reports filed with the Securities and Exchange Commission. The forward-looking statements in this press release are made as of the date of the release and Porter Bancorp does not assume any responsibility to update these statements.

PBIB-F PBIB-G
 
 
 
 
 

PORTER BANCORP, INC. AND SUBSIDIARY

Unaudited Consolidated Statements of Income
(dollars in thousands, except per share data)
 
    Three Months Ended     Six Months Ended
June 30, June 30,
2010     2009 2010     2009
Interest income
Loans, including fees $ 19,771 $ 21,102 $ 39,644 $ 42,372
Taxable securities 1,999 2,152 4,334 4,014
Tax exempt securities 215 223 431 444
Fed funds sold and other   141     168   343    

317
 

22,126
   

23,645
 

44,752
   

47,147
Interest expense
Deposits 6,543 9,468 13,926 19,386
Federal Home Loan Bank advances 500 937 1,220 2,086
Subordinated capital note 77 98 152 200
Junior subordinated debentures 159 209 311 460
Federal funds purchased and other   120     120   239     235
  7,399     10,832   15,848     22,367
Net interest income 14,727 12,813 28,904 24,780
Provision for loan losses   6,600     1,600   9,600     3,200
Net interest income after provision for loan losses 8,127 11,213 19,304 21,580
 
Non-interest income
Service charges on deposit accounts 793 788 1,513 1,476
Income from fiduciary activities 273 198 525 418
Secondary market brokerage fees 130 73 190 131
Title insurance commissions 39 44 76 64
Net gain on sales of loans originated for sale 184 241 275 241
Net gain on sales of securities 24 81 1
Other than temporary impairment on securities (465 ) (465 )
Other   519     551   994     1,050
  1,497     1,895   3,189     3,381
Non-interest expense
Salaries and employee benefits 3,931 3,813 7,878 7,691
Occupancy and equipment 1,015 981 2,037 1,979
Other real estate owned expense 3,854 226 4,232 353
FDIC Insurance 706 503 1,411 962
FDIC special assessment 781 781
State franchise tax 543 450 1,086 900
Professional fees 292 203 558 431
Postage and delivery 198 184 386 368
Communications 173 230 359 385
Advertising 77 125 173 283
Other   724     732   1,442     1,371
  11,513     8,228   19,562     15,504
Income (loss) before income taxes (1,889 ) 4,880 2,931 9,457
Income tax expense (benefit)   (758 )   1,635   806     3,151
Net income (loss) (1,131 ) 3,245 2,125 6,306
Less:
Dividends on preferred stock 437 437 875 875
Accretion on Series A preferred stock 44 44 88 88
Earnings allocated to participating securities   2       83    
Net income (loss) available to common shareholders $ (1,614 ) $ 2,764 $ 1,079   $ 5,343
Basic and diluted earnings (loss) per common share $ (0.19 ) $ 0.31 $ 0.13   $ 0.61
 
 

Copyright Business Wire 2010

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