WashingtonFirst Bankshares, Inc. (NASDAQ: WFBI) (the "Company"), announced today consolidated net income of $4.4 million and $8.3 million (or $0.35 and $0.67 per diluted common share) for the three and six months ended June 30, 2016, respectively. Net income during the second quarter of 2016 increased 60.3% over the $2.7 million in net income (or $0.28 per diluted common share) earned during the three months ended June 30, 2015, and increased 12.1% over the prior quarter ended March 31, 2016. Year to date earnings for the six months ended June 30, 2016, increased 51.1% over the $5.5 million (or $0.57 per diluted common share) earned during the six months ended June 30, 2015. Additionally, the Company paid its 11 th consecutive quarterly dividend of $0.06 on July 1, 2016.

Shaza Andersen, the Company's President and CEO, said, "We made the strategic decision this year to focus on increasing our return on assets, and so far we've been successful. Our ROA was 0.98% for the second quarter 2016, compared to 0.78% for the same period last year. Earnings per share are trending positively as well, enhanced by the mortgage and wealth management operations acquired last year from 1 st Portfolio. Both businesses are performing at or above our initial expectations. As always, asset quality remains a key priority for us - we reduced our NPAs from 0.87% as of December 31, 2015, to 0.71% as of June 30, 2016. And in June, we were added to the Russell 2000, an index of the largest public companies by market capitalization in the country! As we turn toward the second half of the year, we remain focused on premier customer service and strong financial performance, core principles that will continue to produce long-term value for our shareholders."

The net interest margin was 3.37% and 3.44% for the three and six months ended June 30, 2016, respectively, as compared to 3.75% and 3.74% for the same periods in 2015. This decrease is primarily attributable to the addition of $25 million in subordinated debt added in the fourth quarter of 2015 and competitive pressure for incremental loans and deposits. On a linked quarter basis, the net interest margin decreased 14 basis points during the three months ended June 30, 2016, from a net interest margin of 3.51% for the three months ended March 31, 2016. The Company remains focused on its pricing discipline on both sides of the balance sheet and on all factors contributing to net income.

In June, the Company executed on a strategic deleveraging activity. The Company prepaid a long-term FHLB advance that was assumed during the Alliance acquisition which was completed in late 2012. This $25 million advance had a coupon interest rate of 3.99% but an effective cost of 2.04% after considering the purchase accounting mark on the instrument. The instrument had a final maturity of February 26, 2021. The effective cost (prepayment penalty less release of the purchase accounting mark) to terminate the debt instrument was $1.04 million. The Company sold approximately $29.7 million of investment securities at a gain of $1.08 million during the quarter to offset the cost of the prepayment penalty. The overall objectives of these transactions was to delever the balance sheet, produce a net neutral effect of the termination penalty and aid long-term performance metrics. The Company anticipates positive contributions to its net interest margin and return on average assets in future quarters as a result.

Non-interest income grew during both the three and six months ended June 30, 2016, by $7.9 million and $12.1 million, respectively, compared to the same periods ended June 30, 2015, as a result of the successful integration of the 1 st Portfolio companies acquired in July 2015. The mortgage subsidiary acquired in the 1 st Portfolio acquisition contributed $5.3 million and $8.0 million to non-interest income via gain on sale of loans, respectively, during the three and six months ended June 30, 2016, compared to $0.1 million and $0.2 million generated by the Bank's legacy mortgage operation for the same periods ending June 30, 2015. Additional fee income of $1.4 million and $2.6 million was generated by the mortgage subsidiary for the quarter and six months ended June 30, 2016, respectively. Wealth management activities began as a result of the 1 st Portfolio acquisition. During the three and six months ended June 30, 2016, $0.4 million and $0.9 million, respectively, of non-interest income was derived from the wealth division. Prior to July 2015, no such income was generated. In addition, the gain on sale of available-for-sale investment securities was $1.08 million for the three months ended June 30, 2016, bringing the total to $1.2 million for the six months ended June 30, 2016. As previously discussed, the significant gains during the current quarter were part of a strategic deleveraging activity noted above.

Non-interest expense grew during both the three and six months ended June 30, 2016, by $6.9 million and $11.6 million, respectively, compared to the same periods ended June 30, 2015, as a result of the new mortgage and wealth companies that resulted from the 1 st Portfolio acquisition and further expansion of the retail branch banking footprint across our market. In addition, the Company incurred a debt termination expense of $1.4 million during the second quarter of 2016 related to the strategic deleveraging activity noted above.
   
For the three months ended For the six months ended
June 30, 2016   June 30, 2015   June 30, 2016   June 30, 2015
($ in thousands, except per share data)

Performance Ratios:
   
Return on average assets 0.98 % 0.78 % 0.96 % 0.81 %
Return on average shareholders' equity 9.42 % 8.17 % 9.01 % 8.25 %
Yield on average interest-earning assets 4.09 % 4.35 % 4.17 % 4.34 %
Rate on average interest-earning liabilities 1.03 % 0.86 % 1.02 % 0.86 %
Net interest spread 3.06 % 3.49 % 3.15 % 3.48 %
Net interest margin 3.37 % 3.75 % 3.44 % 3.74 %
Efficiency ratio (1) 64.65 % 62.46 % 64.77 % 61.78 %
Net charge-offs to average loans held for investment (2) 0.20 % 0.03 % 0.19 % 0.03 %
 
Mortgage origination volume $ 216,927 $ 4,672 $ 339,563 $ 10,428
 
Assets under management $ 245,074 $ $ 245,074 $
 

Per Share Data:
Basic earnings per common share $ 0.36 $ 0.28 $ 0.68 $ 0.57
Fully diluted earnings per common share $ 0.35 $ 0.28 $ 0.67 $ 0.57
Weighted average basic shares outstanding 12,240,278 9,596,558 12,225,484 9,583,376
Weighted average diluted shares outstanding 12,453,688 9,753,335 12,442,945 9,732,914

 

(1) Total non-interest expense (less debt extinguishment costs) divided by the sum of net interest income and total non-interest income (less gain on sale of AFS securities)

(2) Annualized
 

As of June 30, 2016, the Company reported total assets of $1.9 billion, compared to $1.7 billion as of December 31, 2015, and $1.5 billion as of June 30, 2016. Total loans held for investment increased $83.4 million or 6.4% to $1.4 billion as of June 30, 2016. This increase is attributable to organic loan growth from our existing lending team. During the first two quarters of 2016, total deposits increased $215.6 million or 16.2% to $1.5 billion. The increase in deposits is due to core deposit growth in our branch network and commercial customers.
 
Composition of Loans Held for Investment by Loan Class
  June 30, 2016   December 31, 2015   June 30, 2015
($ in thousands)
Construction and development $ 270,476 $ 249,433 $ 195,242
Commercial real estate 692,394 657,110 710,205
Residential real estate   254,520   241,395   132,218
Real estate loans 1,217,390 1,147,938 1,037,665
Commercial and industrial 166,941 153,860 133,650
Consumer   7,192   6,285   9,087
Total loans 1,391,523 1,308,083 1,180,402
Less: allowance for loan losses   12,595   12,289   10,626
Net loans $ 1,378,928 $ 1,295,794 $ 1,169,776
 
 
Composition of Deposits
    June 30, 2016   December 31, 2015   June 30, 2015
($ in thousands)
Demand deposit accounts $ 418,404 $ 304,425 $ 386,006
NOW accounts 153,261 115,459 125,833
Money market accounts 253,207 309,940 198,217
Savings accounts 231,934 163,289 124,521
Time deposits up to $250,000 349,306 324,454 302,043
Time deposits over $250,000   142,765   115,675   112,247
Total deposits $ 1,548,877 $ 1,333,242 $ 1,248,867
 

During the first six months of 2016, total shareholders' equity increased $9.7 million from $178.6 million to $188.3 million an increase driven primarily by retained earnings offset by dividends of $1.5 million. Tangible book value per common share increased to $14.30 as of June 30, 2016, compared to $13.55 as of December 31, 2015, and $12.44 as of June 30, 2015. The capital ratios as of June 30, 2016 are listed below. The Company remains " well-capitalized" under the regulatory framework for prompt corrective action.
     
June 30, 2016 December 31, 2015 June 30, 2015

Capital Ratios:
Total risk-based capital ratio 14.56 % 14.86 % 11.41 %
Tier 1 risk-based capital ratio 12.04 % 12.22 % 10.38 %
Common equity tier 1 risk-based capital ratio 11.51 % 11.66 % 9.08 %
Tier 1 leverage ratio 10.06 % 10.67 % 9.32 %
Tangible common equity to tangible assets 9.52 % 9.95 % 7.88 %
 

Per Share Capital Data:
Book value per common share $ 15.37 $ 14.64 $ 13.15
Tangible book value per common share $ 14.30 $ 13.55 $ 12.44
Common shares outstanding 12,248,858 12,195,823 9,599,406
 

Overall, non-performing assets continue to decline, however, during the three months ended June 30, 2016, we charged off $0.7 million in non-performing loans which were fully reserved in previous periods. Our team continues to focus diligently on the management of criticized assets, and as such, our ratio of non-performing assets to total assets has decreased from 0.87% as of December 31, 2015, to 0.71% as of June 30, 2016.
 
Non-Performing Assets
  June 30, 2016   December 31, 2015   June 30, 2015
($ in thousands)
Non-accrual loans $ 7,417 $ 10,201 $ 5,920
90+ days still accruing 13 28 113
Trouble debt restructurings still accruing 3,616 4,269 4,362
Other real estate owned   2,159         291  
Total non-performing assets $ 13,205   $ 14,498   $ 10,686  
 
 
June 30, 2016 December 31, 2015 June 30, 2015

Allowance and Asset Quality Ratios:
Allowance for loan losses to loans held for investment 0.91 % 0.94 % 0.90 %
Non-GAAP adjusted allowance for loan losses to loans held for investment 1.22 % 1.30 % 1.36 %
Allowance for loan losses to non-accrual loans 169.81 % 120.47 % 179.49 %
Allowance for loan losses to non-performing assets 95.38 % 84.76 % 99.44 %
Non-performing assets to total assets 0.71 % 0.87 % 0.70 %
 

In connection with various past acquisition activities, the Company recorded acquired loans at fair market value which consisted of pricing and credit marks. The credit marks are negative purchase marks which are comparable to an allowance for loan losses. Therefore, the non-GAAP adjusted allowance for loan losses to non-GAAP adjusted total loans held for investment, which considers these marks similar to allowance for loan losses, was 1.22% as of June 30, 2016, compared to 1.30% and 1.36% as of December 31, 2015 and June 30, 2015, respectively. A reconciliation of the allowance for loan losses and related ratios to the non-GAAP adjusted allowance for loan losses and related ratios as of June 30, 2016, December 31, 2015, and June 30, 2015, is below.
 
Reconciliation of GAAP Allowance Ratio to Non-GAAP Allowance Ratio
  June 30, 2016   December 31, 2015   June 30, 2015
($ in thousands)
GAAP allowance for loan losses $ 12,595 $ 12,289 $ 10,626
GAAP loans held for investment, at amortized cost 1,391,523 1,308,083 1,180,402
 
GAAP allowance for loan losses to total loans held for investment 0.91 % 0.94 % 0.90 %
 
GAAP allowance for loan losses $ 12,595 $ 12,289 $ 10,626
Plus: Credit purchase accounting marks   4,383     4,721     5,549  
Non-GAAP adjusted allowance for loan losses $ 16,978   $ 17,010   $ 16,175  
 
GAAP loans held for investment, at amortized cost $ 1,391,523 $ 1,308,083 $ 1,180,402
Plus: Credit purchase accounting marks   4,383     4,721     5,549  
Non-GAAP loans held for investment, at amortized cost $ 1,395,906   $ 1,312,804   $ 1,185,951  
 
Non-GAAP adjusted allowance for loan losses to total loans held for investment 1.22 % 1.30 % 1.36 %
 
 
Reconciliation of Tangible Common Equity to Tangible Assets Ratio
  June 30, 2016   December 31, 2015   June 30, 2015
($ in thousands)

Tangible Common Equity:
Common Stock Voting $ 104 $ 103 $ 77
Common Stock Non-Voting 18 18 18
Additional paid-in capital - common 161,679 160,861 113,384
Accumulated earnings 24,594 17,740 12,321
Accumulated other comprehensive income/(loss)   1,905     (127 )   457  
Total Common Equity $ 188,300   $ 178,595   $ 126,257  
 

Less Intangibles:
Goodwill $ 11,420 $ 11,431 $ 6,240
Identifiable intangibles   1,753     1,888     568  
Total Intangibles $ 13,173   $ 13,319   $ 6,808  
 
Tangible Common Equity $ 175,127   $ 165,276   $ 119,449  
 

Tangible Assets:
Total Assets $ 1,853,666 $ 1,674,466 $ 1,521,790
 

Less Intangibles:
Goodwill $ 11,420 $ 11,431 $ 6,240
Identifiable intangibles   1,753     1,888     568  
Total Intangibles $ 13,173   $ 13,319   $ 6,808  
 
Tangible Assets $ 1,840,493   $ 1,661,147   $ 1,514,982  
 
Tangible Common Equity to Tangible Assets 9.52 % 9.95 % 7.88 %
 
 
Segment Reporting (QTD)
  For the Three Months Ended June 30, 2016

CommercialBanking
 

MortgageBanking
 

WealthManagement
  Other (1)  

ConsolidatedTotals
($ in thousands)
Revenues:
Interest income 18,035 439 (292 ) 18,182
Gain on sale of loans 5,287 5,287
Other revenues 1,416 1,344 450 (7 ) 3,203
Total income 19,451 7,070 450 (299 ) 26,672
 
Expenses:
Interest expense 2,662 292 1 226 3,181
Salaries and employee benefits 4,834 4,053 248 218 9,353
Other expenses 8,165 1,578 145 (148 ) 9,740
Total expenses 15,661 5,923 394 296   22,274
 
Net Income (loss) 3,790 1,147 56 (595 ) 4,398
 
Total assets 1,851,149 65,550 3,527 (66,560 ) 1,853,666
(1) Includes parent company and intercompany eliminations
 
 
Segment Reporting (YTD)
  For the Six Months Ended June 30, 2016

CommercialBanking
 

MortgageBanking
 

WealthManagement
  Other (1)  

ConsolidatedTotals
($ in thousands)
Revenues:
Interest income 35,457 729 (460 ) 35,726
Gain on sale of loans 8,029 8,029
Other revenues 1,802 2,564 886 (10 ) 5,242
Total income 37,259 11,322 886 (470 ) 48,997
 
Expenses:
Interest expense 5,130 460 2 580 6,172
Salaries and employee benefits 9,561 6,674 486 436 17,157
Other expenses 14,849 2,513 283 (299 ) 17,346
Total expenses 29,540 9,647 771 717   40,675
 
Net Income (loss) 7,719 1,675 115 (1,187 ) 8,322
 
Total assets 1,851,149 65,550 3,527 (66,560 ) 1,853,666
(1) Includes parent company and intercompany eliminations
 

During the three and six months ended June 30, 2016, the mortgage subsidiary originated $216.9 million and $339.6 million, respectively, of total loan volume. Assets under management grew to $245.1 million as of June 30, 2016, at the wealth management subsidiary. The Company did not have segments during the first half of 2015.

About The Company

WashingtonFirst Bankshares, Inc., headquartered in Reston, Virginia, is the holding company for WashingtonFirst Bank, which operates 19 full-service banking offices throughout the Washington, DC, metropolitan area. In addition, the Company provides wealth management services through its subsidiary, 1 st Portfolio Wealth Advisors, and mortgage banking services through the Bank's subsidiary, WashingtonFirst Mortgage Corporation. The Company's common stock is traded on the NASDAQ Stock Market under the quotation symbol "WFBI" and is included in the ABA NASDAQ Community Bank Index and the Russell 2000® index. For more information about the Company, please visit: www.wfbi.com.

Cautionary Statements About Forward-Looking Information

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements of the goals, intentions, and expectations of the Company as to future trends, plans, events, results of operations and policies and regarding general economic conditions. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors which include, but are not limited to, factors discussed in our Annual Report on Form 10-K and in other documents we file with the Securities and Exchange Commission from time to time. In some cases, forward-looking statements can be identified by use of words such as "may," "will," "anticipates," "believes," "expects," "plans," "estimates," "potential," "continue," "should," and similar words or phrases. These statements are based upon the beliefs of the management of the Company as to the expected outcome of future events, current and anticipated economic conditions, nationally and in the Company's market, and their impact on the operations, assets and earnings of the Company, interest rates and interest rate policy, competitive factors, judgments about the ability of the Company to successfully integrate its operations following significant transactions including, but not limited to, mergers and acquisitions, the ability to avoid customer dislocation during the period leading up to and following such transactions, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Readers are cautioned against placing undue reliance on such forward-looking statements. The Company assumes no obligation to revise, update, or clarify forward-looking statements to reflect events or conditions after the date of this release.

Additional documents are available free of charge at the SEC's website, www.sec.gov and on the Company's website at www.wfbi.com under the tab "Investor Relations" or by contacting the Company's Investor Relations Department at 11921 Freedom Drive, Suite 250, Reston, VA 20190. You may also read and copy any reports, statements and other information filed with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, D.C. Information about the operation of the SEC Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330.

       
WashingtonFirst Bankshares, Inc.
Consolidated Balance Sheets
 
 
June 30, 2016

December 31,2015
June 30, 2015
($ in thousands)
Assets:
Cash and cash equivalents:
Cash and due from bank balances $ 3,164 $ 3,739 $ 3,859
Federal funds sold 96,177 59,014 105,566
Interest bearing deposits   100          
Cash and cash equivalents 99,441 62,753 109,425
Investment securities, available-for-sale, at fair value 260,675 220,113 193,739
Restricted stock, at cost 4,481 6,128 6,021
Loans held for sale, at lower of cost or fair value 52,198 36,494 822
Loans held for investment:
Loans held for investment, at amortized cost 1,391,523 1,308,083 1,180,402
Allowance for loan losses   (12,595 )   (12,289 )   (10,626 )
Total loans held for investment, net of allowance 1,378,928 1,295,794 1,169,776
Premises and equipment, net 7,476 7,374 5,956
Goodwill 11,420 11,431 6,240
Identifiable intangibles 1,753 1,888 568
Deferred tax asset, net 6,901 8,116 7,653
Accrued interest receivable 4,546 4,502 3,898
Other real estate owned 2,159 291
Bank-owned life insurance 13,701 13,521 13,336
Other assets   9,987     6,352     4,065  
Total Assets $ 1,853,666   $ 1,674,466   $ 1,521,790  
Liabilities and Shareholders' Equity:
Liabilities:
Non-interest bearing deposits $ 418,404 $ 304,425 $ 386,006
Interest bearing deposits   1,130,473     1,028,817     862,861  
Total deposits 1,548,877 1,333,242 1,248,867
Other borrowings 9,021 6,942 11,649
FHLB advances 61,589 110,087 107,818
Long-term borrowings 32,953 32,884 10,112
Accrued interest payable 969 912 633
Other liabilities   11,957     11,804     7,556  
Total Liabilities 1,665,366 1,495,871 1,386,635
Commitments and contingent liabilities
Shareholders' Equity:
Preferred stock:
Series D, $5.00 par value, 0, 0, and 8,898 shares issued and outstanding, respectively, 1% dividend 44
Additional paid-in capital - preferred 8,854
Common stock:
Common Stock Voting, $0.01 par value, 50,000,000 shares authorized, 10,431,016; 10,377,981 and 7,781,564 shares issued and outstanding, respectively 104 103 77
Common Stock Non-Voting, $0.01 par value, 10,000,000 shares authorized; 1,817,842 shares issued and outstanding for all periods presented 18 18 18
Additional paid-in capital 161,679 160,861 113,384
Accumulated earnings 24,594 17,740 12,321
Accumulated other comprehensive income/(loss)   1,905     (127 )   457  
Total Shareholders' Equity   188,300     178,595     135,155  
Total Liabilities and Shareholders' Equity $ 1,853,666   $ 1,674,466   $ 1,521,790  
 
         
WashingtonFirst Bankshares, Inc.
Consolidated Statements of Income

(unaudited)
 
 
For the Three Months Ended For the Six Months Ended
June 30, 2016   June 30, 2015   June 30, 2016   June 30, 2015
($ in thousands, except per share data)
Interest and dividend income:
Interest and fees on loans $ 16,836 $ 14,314 $ 33,227 $ 27,754
Interest and dividends on investments:
Taxable 1,178 786 2,170 1,502
Tax-exempt 19 17 41 36
Dividends on other equity securities 81 56 152 117
Interest on Federal funds sold and other short-term investments   68   79     136   153  
Total interest and dividend income 18,182 15,252 35,726 29,562
Interest expense:
Interest on deposits 2,200 1,518 4,195 2,969
Interest on borrowings   981   562     1,977   1,115  
Total interest expense   3,181   2,080     6,172   4,084  

Net interest income
15,001 13,172 29,554 25,478
Provision for loan losses   980   850     1,605   1,550  
Net interest income after provision for loan losses 14,021 12,322 27,949 23,928
Non-interest income:
Service charges on deposit accounts 81 122 160 231
Earnings on bank-owned life insurance 90 94 180 189
Gain on sale of other real estate owned, net 117 117
Gain on sale of loans, net 5,287 97 8,029 166
Mortgage banking activities 1,358 2,557
Wealth management income 443 871
Gain on sale of available-for-sale investment securities, net 1,077 7 1,152 22
Other operating income   154   169     322   438  
Total non-interest income 8,490 606 13,271 1,163
Non-interest expense:
Compensation and employee benefits 9,353 4,570 17,157 8,703
Premises and equipment 1,863 1,506 3,680 2,989
Data processing 1,121 913 2,125 1,736
Professional fees 350 325 669 663
Merger expenses 241 241
Mortgage loan processing expenses 354 550
Debt extinguishment 1,044 1,044
Other operating expenses   1,450   1,046     2,811   2,114  
Total non-interest expense   15,535   8,601     28,036   16,446  
Income before provision for income taxes 6,976 4,327 13,184 8,645
Provision for income taxes   2,578   1,560     4,862   3,088  
Net income 4,398 2,767 8,322 5,557
Preferred stock dividends     (23 )     (51 )
Net income available to common shareholders $ 4,398 $ 2,744   $ 8,322 $ 5,506  
 
Earnings per common share:
Basic earnings per common share $ 0.36 $ 0.28 $ 0.68 $ 0.57
Diluted earnings per common share $ 0.35 $ 0.28 $ 0.67 $ 0.57
 
Average Balances, Interest Income and Expense and Average Yield and Rates (QTD)
  For the Three Months Ended
June 30, 2016   June 30, 2015
AverageBalance   Income/Expense   Yield/Rate (6) AverageBalance   Income/Expense   Yield/Rate (6)
($ in thousands)
Assets
Interest-earning assets:
Loans (1) $ 1,412,294 $ 16,836 4.72 % $ 1,127,847 $ 14,314 5.02 %
Investment securities - taxable 278,690 1,178 1.67 % 181,885 786 1.71 %
Investment securities - tax-exempt (2) 3,822 24 2.48 % 2,495 21 3.22 %
Other equity securities 6,636 81 4.89 % 5,581 56 4.02 %
Interest-bearing balances 100 0.60 % 6,649 11 0.66 %
Federal funds sold 55,722   68   0.49 % 63,845   68   0.43 %
Total interest earning assets 1,757,264 18,187 4.09 % 1,388,302 15,256 4.35 %
Non-interest earning assets:
Cash and due from banks 2,712 3,378
Premises and equipment 7,713 6,094
Other real estate owned 2,044 376
Other assets (3) 45,829 37,218
Less: allowance for loan losses (12,153 ) (9,856 )
Total non-interest earning assets 46,145   37,210  
Total Assets $ 1,803,409   $ 1,425,512  
 
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Interest-bearing demand deposits $ 124,079 $ 90 0.29 % $ 105,712 $ 61 0.23 %
Money market deposit accounts 265,727 393 0.59 % 206,856 251 0.49 %
Savings accounts 215,544 382 0.71 % 124,738 212 0.68 %
Time deposits 485,482   1,335   1.11 % 411,645   994   0.97 %
Total interest-bearing deposits 1,090,832 2,200 0.81 % 848,951 1,518 0.72 %
FHLB advances 114,435 445 1.54 % 97,517 378 1.53 %
Other borrowings and long-term borrowings 38,895   536   5.52 % 17,907   184   4.07 %
Total interest-bearing liabilities 1,244,162 3,181 1.03 % 964,375 2,080 0.86 %
Non-interest-bearing liabilities:
Demand deposits 361,191 315,894
Other liabilities 10,263   9,390  
Total non-interest-bearing liabilities 371,454   325,284  
Total Liabilities 1,615,616 1,289,659
Shareholders' Equity 187,793   135,853  
Total Liabilities and Shareholders' Equity $ 1,803,409   $ 1,425,512  
 
Interest Spread (4)   3.06 %   3.49 %
Net Interest Margin (2)(5) $ 15,006   3.37 % $ 13,176   3.75 %
 

(1)

Includes loans held for sale and loans placed on non-accrual status.

(2)

Yield and income presented on a fully taxable equivalent basis using a federal statutory rate of 35 percent.

(3)

Includes intangibles, deferred tax asset, accrued interest receivable, bank-owned life insurance and other assets.

(4)

Interest spread is the average yield earned on earning assets, less the average rate incurred on interest bearing liabilities.

(5)

Net interest margin is net interest income, expressed as a percentage of average earning assets.

(6)

Annualized income/expense is used for the yield/rate.
 
Average Balances, Interest Income and Expense and Average Yield and Rates (YTD)
  For the Six Months Ended
June 30, 2016   June 30, 2015
AverageBalance   Income/Expense   Yield/Rate (6) AverageBalance   Income/Expense   Yield/Rate (6)
($ in thousands)
Assets
Interest-earning assets:
Loans (1) $ 1,386,923 $ 33,227 4.74 % $ 1,099,723 $ 27,754 5.02 %
Investment securities - taxable 250,511 2,170 1.71 % 174,584 1,502 1.71 %
Investment securities - tax-exempt (2) 3,955 50 2.50 % 2,779 46 3.21 %
Other equity securities 6,429 152 4.77 % 5,829 117 4.04 %
Interest-bearing balances 71 1 2.96 % 8,549 27 0.65 %
Federal funds sold 48,656   135   0.56 % 63,248   126   0.40 %
Total interest earning assets 1,696,545 35,735 4.17 % 1,354,712 29,572 4.34 %
Non-interest earning assets:
Cash and due from banks 2,346 3,173
Premises and equipment 7,672 6,136
Other real estate owned 1,238 369
Other assets (3) 47,376 36,131
Less: allowance for loan losses (12,283 ) (9,608 )
Total non-interest earning assets 46,349   36,201  
Total Assets $ 1,742,894   $ 1,390,913  
 
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Interest-bearing demand deposits $ 119,396 $ 176 0.30 % $ 101,477 $ 118 0.23 %
Money market deposit accounts 281,590 831 0.59 % 208,964 505 0.49 %
Savings accounts 193,493 681 0.71 % 126,433 428 0.68 %
Time deposits 462,137   2,507   1.09 % 394,880   1,918   0.98 %
Total interest-bearing deposits 1,056,616 4,195 0.80 % 831,754 2,969 0.72 %
FHLB advances 113,072 899 1.57 % 101,495 749 1.47 %
Other borrowings and long-term borrowings 39,004   1,078   5.54 % 17,814   366   4.11 %
Total interest-bearing liabilities 1,208,692 6,172 1.02 % 951,063 4,084 0.86 %
Non-interest-bearing liabilities:
Demand deposits 335,292 295,561
Other liabilities 13,268   8,524  
Total non-interest-bearing liabilities 348,560   304,085  
Total Liabilities 1,557,252 1,255,148
Shareholders' Equity 185,642   135,765  
Total Liabilities and Shareholders' Equity $ 1,742,894   $ 1,390,913  
 
Interest Spread (4)   3.15 %   3.48 %
Net Interest Margin (2)(5) $ 29,563   3.44 % $ 25,488   3.74 %
 

(1)

Includes loans held for sale and loans placed on non-accrual status.

(2)

Yield and income presented on a fully taxable equivalent basis using a federal statutory rate of 35 percent.

(3)

Includes intangibles, deferred tax asset, accrued interest receivable, bank-owned life insurance and other assets.

(4)

Interest spread is the average yield earned on earning assets, less the average rate incurred on interest bearing liabilities.

(5)

Net interest margin is net interest income, expressed as a percentage of average earning assets.

(6)

Annualized income/expense is used for the yield/rate.

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