Carolina Bank Holdings, Inc. Reports A 55.6% Increase In First Quarter EPS To $0.42

GREENSBORO, N.C., April 29, 2013 (GLOBE NEWSWIRE) -- Carolina Bank Holdings, Inc. (Nasdaq:CLBH) today reported first quarter 2013 results with highlights as follows:

First Quarter 2013 Financial Highlights
  • Diluted net income per common share increased 55.6% to $0.42 in the first quarter of 2013 from $0.27 in the first quarter of 2012.
  • Net income for the first quarter of 2013 was $1,718,000, an increase of 39.9% from net income of $1,228,000 reported in the first quarter of 2012.
  • Net income available to common shareholders was $1,413,000 in the first quarter of 2013 compared to $926,000 in the first quarter of 2012.
  • The net interest margin, computed on a fully taxable basis, decreased to 3.94% in the first quarter of 2013 compared to 3.98% in the first quarter of 2012.
  • Mortgage banking revenues increased 22.9% to $3,895,000 in the first quarter of 2013 from $3,169,000 in the first quarter of 2012.
  • Carolina Bank, the subsidiary of Carolina Bank Holdings, Inc., continued to maintain 'Well Capitalized' status, the highest regulatory capital measure. Capital ratios at March 31, 2013 for Carolina Bank improved to 9.34% for Tier 1 leverage, 12.23% for Tier 1 risk-based, and 15.28% for total risk-based.
  • Average non-interest-bearing demand deposits increased 34.0% in the first quarter of 2013 from the same quarter in 2012.
  • Net loan charge-offs declined to $105,000, or 0.09% of average loans (annualized), in the first quarter of 2013 from $762,000, or 0.64% of average loans (annualized), in the first quarter of 2012.
  • Non-performing assets to total assets decreased to 2.72% at March 31, 2013 from 4.62% at March 31, 2012

"We continued our goal of building shareholder value in 2013 by increasing net income and by strengthening our relationships with customers despite a challenging lending environment," said President and Chief Executive Officer Robert T. Braswell. "Average loans declined during the first quarter of 2013 due to irrational terms being offered by some of our competitors and lackluster demand by borrowers, but we continued our focus on increasing our commercial relationships as evidenced by a 34% increase in average non-interest-bearing demand deposits in the first quarter of 2013 from the first quarter of last year."

"We expanded our residential mortgage operation in Raleigh in the first quarter of 2013 and are pleased to report that our residential mortgage division experienced higher originations and increased profitability in the first quarter of 2013 over the first quarter of 2012. The mortgage division experienced slowing originations and lower profitability on a sequential quarter basis due to reduced refinancing activity by borrowers."

"We are continuing our focus in reducing non-performing assets in 2013 and are pleased that loan charge-offs and non-performing assets declined substantially in 2013," said Braswell. "Our provision for loan losses declined to $400,000 in the first quarter of 2013 from $1,460,000 in the first quarter of 2012 due to the improvement in the quality of our loan portfolio, reduced loan charge-offs, and lower loan balances."

About the Company

Carolina Bank, the banking subsidiary of Carolina Bank Holdings, Inc. began banking operations on November 25, 1996. The parent company is a North Carolina corporation organized in 2000. The bank is engaged in lending and deposit gathering activities in the Piedmont Triad of North Carolina, with operations in four counties: Guilford, Alamance, Forsyth and Randolph. The bank has eight full-service banking locations, four in Greensboro, one in Asheboro, one in High Point, one in Burlington, and one in Winston-Salem. Residential mortgage loan production offices are located in Burlington, Hillsborough, and Raleigh in addition to a wholesale residential mortgage operation in Greensboro. The Company's stock is listed on the NASDAQ Global Market under the symbol CLBH. Further information is available on the Company's web site: www.carolinabank.com.

This press release contains forward-looking statements regarding future events. These statements are only predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include risks of managing our growth, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to be materially different from those in the forward-looking statements is contained in the Company's filings with the Securities and Exchange Commission. Carolina Bank Holdings, Inc. undertakes no obligation to update or clarify forward-looking statements, whether as a result of new information, future events or otherwise.
Carolina Bank Holdings, Inc. and Subsidiary  
Consolidated Balance Sheets   
     
  March 31, 2013 December 31, 2012  
  (unaudited)    
  (in thousands, except share data)    
Assets      
Cash and due from banks  $ 6,613  $ 7,913  
Interest-bearing deposits with banks  72,243  7,186  
Securities available-for-sale, at fair value  46,931 42,036  
Securities held-to-maturity  -- 211  
Loans held for sale  77,440 131,762  
Loans   431,754 461,728  
Less allowance for loan losses  (10,239) (9,944)  
Net loans   421,515 451,784  
Premises and equipment, net  17,551 17,732  
Other real estate owned  7,555 5,940  
Bank-owned life insurance  10,858 10,765  
Other assets  14,058 16,539  
Total assets  $ 674,764  $ 691,868  
       
Liabilities and Stockholders' Equity      
Deposits      
Non-interest bearing demand  $ 74,432  $ 73,032  
NOW, money market and savings  338,133 343,740  
Time  173,389 174,153  
Total deposits  585,954 590,925  
       
Advances from the Federal Home Loan Bank  2,958 15,982  
Securities sold under agreements to repurchase  3,112 1,950  
Subordinated debentures  19,582 19,563  
Other liabilities and accrued expenses  7,769 9,586  
Total liabilities  619,375 638,006  
       
Stockholders' equity      
Preferred stock, no par value, authorized 1,000,000 shares; issued and outstanding 16,000 shares   15,677 15,573  
Common stock, $1 par value; authorized 20,000,000 shares; issued and outstanding 3,388,773 in 2013 and 3,387,045 in 2012  3,389 3,387  
Common stock warrants  1,841 1,841  
Additional paid-in capital  15,917 15,906  
Retained earnings   16,822 15,408  
Stock in directors' rabbi trust  (1,128) (1,050)  
Directors' deferred fees obligation  1,128 1,050  
Accumulated other comprehensive income   1,743 1,747  
Total stockholders' equity  55,389 53,862  
Total liabilities and stockholders' equity  $ 674,764  $ 691,868  
 
 
Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Statements of Income (unaudited)
   
  Three Months Ended March 31, 
  2013 2012
  (in thousands, except per share data)
Interest income    
Loans  $ 6,719  $ 7,085
Investment securities, taxable  248  306
Investment securities, non taxable  106  107
Interest from deposits in banks  18  10
Total interest income  7,091  7,508
     
Interest expense    
NOW, money market, savings  320  548
Time deposits  520  709
Other borrowed funds  188  202
Total interest expense  1,028  1,459
     
Net interest income  6,063  6,049
Provision for loan losses  400  1,460
Net interest income after provision for loan losses  5,663  4,589
Non-interest income    
Service charges  252  283
Mortgage banking income  3,895  3,169
Gain on sale of investment securities available-for-sale  22  --
Other  145  167
Total non-interest income  4,314  3,619
     
Non-interest expense    
Salaries and benefits  4,748  4,030
Occupancy and equipment  747  682
Foreclosed property expense  331  399
Professional fees  186  257
Outside data processing  259  206
FDIC insurance  169  215
Advertising and promotion  206  175
Stationery, printing and supplies  153  135
Other  583  411
Total non-interest expense 7,382 6,510
     
Income before income taxes  2,595  1,698
Income tax expense   877  470
Net income   1,718  1,228
Dividends and accretion on preferred stock  305  302
Net income available to common stockholders  $ 1,413  $ 926
Net income per common share    
Basic  $ 0.42  $ 0.27
Diluted  $ 0.42  $ 0.27
 
 
Carolina Bank Holdings, Inc.
Consolidated Financial Highlights
First Quarter 2013
(unaudited)
  Quarterly  Years Ended
($ in thousands except for share data) 1st Qtr 2013 4th Qtr 2012 3rd Qtr 2012 2nd Qtr 2012 1st Qtr 2012 2012 2011
               
EARNINGS              
Net interest income  $ 6,063 6,351 5,848 5,939 6,049  24,187  24,095
Provision for loan loss  $ 400 300 600  -- 1,460  2,360  6,850
NonInterest income  $ 4,314 5,655 5,568 4,806 3,619  19,650  11,182
NonInterest expense  $ 7,382 8,323 8,085 7,323 6,510  30,243  25,473
Net income  $ 1,718 2,187 1,819 2,268 1,228  7,502  2,397
Net income available to common stockholders  $ 1,413 1,884 1,505 1,961 926  6,276  1,223
Basic earnings per share  $ 0.42 0.56 0.44 0.58 0.27  1.85  0.36
Diluted earnings per share  $ 0.42 0.55 0.44 0.58 0.27  1.85  0.36
Average common shares outstanding 3,387,813 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045
Average diluted common shares outstanding 3,398,070 3,420,396 3,387,045 3,387,045 3,387,045 3,395,383 3,387,045
               
PERFORMANCE RATIOS              
Return on average assets * 0.84% 1.11% 0.89% 1.18% 0.56% 0.93% 0.18%
Return on average common equity * 14.68% 19.99% 16.75% 23.44% 11.58% 18.05% 4.03%
Net interest margin (fully-tax equivalent) * 3.94% 4.01% 3.71% 3.86% 3.98% 3.89% 3.92%
Efficiency ratio 70.78% 69.02% 70.55% 67.84% 66.97% 68.68% 71.66%
# full-time equivalent employees - period end 215 208 206 200 184 208 174
               
CAPITAL              
Equity to period-end assets 8.21% 7.79% 7.68% 7.40% 7.18% 7.79% 6.91%
Common tangible equity to assets 5.89% 5.53% 5.39% 5.13% 4.89% 5.53% 4.66%
Tier 1 leverage capital ratio - Bank 9.34% 9.23% 9.00% 8.79% 8.35% 9.23% 8.02%
Tier 1 risk-based capital ratio - Bank 12.23% 11.27% 11.14% 11.12% 9.92% 11.27% 9.60%
Total risk-based capital ratio - Bank 15.28% 14.18% 14.09% 14.12% 12.83% 14.18% 12.50%
Book value per common share  $ 11.72  11.30  10.75  10.27  9.65  11.30 9.26
               
ASSET QUALITY              
Net charge-offs  $ 105 1,080 988 1,379 762  4,209  7,416
Net charge-offs to average loans * 0.09% 0.95% 0.86% 1.18% 0.64% 0.90% 1.49%
Allowance for loan losses  $ 10,239 9,944 10,725 11,112 12,491 9,944 11,793
Allowance for loan losses to loans held invst. 2.37% 2.15% 2.33% 2.42% 2.60% 2.15% 2.42%
Nonperforming loans  $ 10,806  13,067  21,387  21,771  23,187  13,067  22,915
Performing restructured loans  $ 14,391 13,822 11,192 12,207 15,728 13,822 18,502
Other real estate owned  $ 7,555 5,940 4,751 6,384 7,708 5,940 6,728
Nonperforming loans to loans held for investment 2.50% 2.83% 4.66% 4.74% 4.82% 2.83% 4.71%
Nonperforming assets to total assets 2.72% 2.75% 3.87% 4.16% 4.62% 2.75% 4.40%
               
END OF PERIOD BALANCES              
Total assets  $ 674,764 691,868 675,746 677,476 668,009 691,868 673,325
Total loans held for investment  $ 431,754 461,728 459,323 459,144 480,888 461,728 487,031
Total deposits  $ 585,954 590,925 588,672 592,103 588,500 590,925 596,639
Stockholders' equity  $ 55,389 53,862 51,879 50,143 47,943 53,862 46,558
               
AVERAGE BALANCES              
Total assets  $ 678,373 675,573 675,569 670,339 663,932 671,376 668,753
Total earning assets  $ 629,687 635,170 631,347 624,183 616,101 626,736 621,889
Total loans held for investment  $ 449,704 456,738 459,800 466,412 479,121 465,478 498,683
Total interest-bearing deposits  $ 512,562 519,595 527,545 528,463 529,405 526,237 542,402
Common stockholders' equity  $ 39,044 37,487 35,750 33,649 32,159 34,778 30,337
               
* annualized for all periods presented
   return on average assets and on average common equity are computed using net income available to common stockholders
CONTACT: Carolina Bank Holdings, Inc.         T. Allen Liles, EVP and CFO         Telephone: 336-286-8746         Email: a.liles@carolinabank.com

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