Bnccorp Inc (QX) (BNCC)

Special dividend + buyback news good odds fer clear 40break with quickness if thesis works - see if it can hit 46-50+ as dividend payout approaches


BNCC

News: $BNCC BNCCORP, INC. Reports Second-Quarter Net Income Of $14.2 Million, Or $3.97 Per Diluted Share

BISMARCK, N.D. , July 31, 2020 /PRNewswire/ -- Highlights Net income in the second quarter of 2020 was $14.2 million , resulted in earnings per diluted share of $3.97 , compared to $2.7 million , or $0.75 per diluted share, in the 2019 period. Company deliv...

Got this from BNCC - BNCCORP, INC. Reports Second-Quarter Net Income Of $14.2 Million, Or $3.97 Per Diluted Share

Proxy fight coming?
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PL Capital Group Announces Its Intent to Nominate Martin Alwin as a Director of BNCCORP, INC. - https://www.prnewswire.com/news-releases/the-pl-capital-group-announces-its-intent-to-nominate-martin-alwin-as-a-director-of-bnccorp-inc-300813238.html




NAPLES, Fla., March 15, 2019 /PRNewswire/ -- The PL Capital Group is pleased to announce their intent to nominate Martin Alwin for election as a director of BNCCORP, INC. (OTCQX Markets: BNCC) (the "Company"), in opposition to a director nominee who will be nominated by BNCCORP, INC. at the Company's 2019 Annual Meeting of Stockholders. It is expected that the Company's 2019 Annual Meeting of Stockholders will be held in the second quarter of 2019. The PL Capital Group beneficially owns 340,800 shares of common stock, or 9.7%, of the Company. In addition to filing proxy materials asking for stockholders to vote for Martin Alwin, the PL Capital Group also plans to present several important stockholder proposals on its white proxy card.

PL Capital Group principal Richard Lashley noted, "Martin is a key member of the PL Capital Group team and a highly qualified board candidate. Prior to joining the PL Capital Group, he was a successful financial analyst and investment banker at several investment banks specializing in the banking industry. We believe he will make a great addition to the Company's board of directors."

PL Capital Group principal John Palmer noted, "We believe stockholders who are disappointed by the Company's lackluster financial performance and frustrated with the Company's anti-stockholder corporate governance policies, including a staggered board of directors and poison pill plan, will strongly support our nominee and proposals."

Mr. Palmer added, "We also plan to ask stockholders to support a proposal requesting that the Company hire an investment banking firm to assist the board and management in evaluating all strategic alternatives available to the Company."

BNCCORP, INC. is a bank holding company headquartered in Bismarck, North Dakota. As of December 31, 2018 it had approximately $1.0 billion in assets.

PL Capital Advisors, LLC, a registered investment advisory firm dedicated to investments in the banking sector and stockholder activism, is among the largest stockholders of BNCCORP, INC. PL Capital Advisors, LLC and its various affiliates are referred to herein as the "PL Capital Group." The PL Capital Group has been investing in the banking sector since 1996.

Mr. Alwin is a Senior Analyst with the PL Capital Group. Prior to joining the PL Capital Group, Mr. Alwin worked as an investment banker with a focus on mergers & acquisitions, capital raising, balance sheet management, and other advisory services for the banking sector, most recently at Piper Jaffray & Co. Mr. Alwin earned a BA in Economics from Lawrence University and an MBA from the University of Chicago's Booth School of Business.

Important Information

This press release does not constitute a solicitation of proxies for any meeting of BNCCORP, INC.'s stockholders. Such solicitation is being made only pursuant to proxy materials, as discussed below.

PL Capital Advisors, LLC managing member John Palmer intends to nominate Martin P. Alwin as a nominee to the board of directors of BNCCORP, INC. (the "Company") and the PL Capital Group intends to solicit votes for the election of Mr. Alwin to the board. The PL Capital Group (whose members are identified below) will send a definitive proxy statement, WHITE proxy card and related proxy materials to stockholders of the Company seeking their support for Mr. Alwin and its stockholder proposals at the Company's 2019 Annual Meeting of Stockholders. Stockholders are urged to read the definitive proxy statement and WHITE proxy card when they become available, because they will contain important information about the PL Capital Group, Mr. Alwin, the Company and related matters. The definitive proxy statement (when available) and other related documents may be obtained free of charge from the PL Capital Group by calling 630-848-1340.

Participants in the Solicitation

The PL Capital Group currently consists of the following: PL Capital, LLC; Goodbody/PL Capital, LLC; Financial Edge Fund, L.P.; Financial Edge-Strategic Fund, L.P.; PL Capital/Focused Fund, L.P.; Goodbody/PL Capital, L.P.; PL Capital Advisors, LLC; Richard J. Lashley; and John W. Palmer. All of the above, along with Mr. Alwin, will be participants in the solicitation from the Company's stockholders of proxies in favor of the election of Mr. Alwin to the board of directors of the Company and the PL Capital Group's stockholder proposals at the 2019 Annual Meeting. Such participants may have interests in the solicitation, including as a result of holding shares of the Company's common stock, which will be discussed in the definitive proxy statement.

Contact John Palmer at 239-777-0187

Standstill agreement with PL Capital expires today. Maybe coincidence, but PL is freeing up $ from another bank tomorrow.

Statement of Audited '17 and '16 financials has been posted-

http://www.bnccorp.com/54304/mirror/files/2017_Audited_Financials_Final_Secured.pdf

BNCCORP, INC. Reports Third Quarter Net Income Of $2.1 Million, Or $0.58 Per Diluted Share

PR Newswire

BISMARCK, N.D., Oct. 27, 2017 /PRNewswire/ --

2017 Third Quarter Highlights

-- Net income in the 2017 third quarter was $2.1 million, a decrease of $206 thousand compared to the third quarter of 2016


-- Net interest income increased $625 thousand, or 9.4%, compared to the third quarter of 2016


-- Non-interest expense decreased by $1.1 million, or 10.7%, compared to the third quarter of 2016


-- Non-interest income decreased by $2.6 million due to lower mortgage banking revenues


-- Total assets rose $55.8 million and total deposits increased $84.4 million since year-end 2016


-- Loans held for investment increased $14.1 million from year-end 2016


-- Non-performing assets were 0.21% of total assets as of September 30, 2017


-- Book value per share increased $1.69, or 7.9%, to $23.16 at September 30, 2017, compared to $21.47 at December 31, 2016


BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the third quarter ended September 30, 2017.

Net income in the third quarter of 2017 was $2.053 million, a decrease of $206 thousand versus $2.259 million in the same period of 2016. Third quarter 2017 diluted earnings per share was $0.58, compared to $0.64 in the third quarter of 2016. The comparison between the third quarters of 2017 and 2016 mainly reflect higher net interest income and lower non-interest expenses, offset by lower non-interest income largely due to lower mortgage banking revenues.

Net interest income in the 2017 third quarter increased by $625 thousand, or 9.4%, from the same quarter in 2016, due primarily to the growth of loans held for investment and higher yields and balances on investment securities.

Non-interest income in the third quarter of 2017 decreased by $2.579 million, or 33.2%, from the same period in 2016, primarily due to lower mortgage banking revenues.

Non-interest expense in the third quarter of 2017 decreased $1.142 million, or 10.7%, compared to the third quarter of the prior year due to decreases in costs related to salaries and employee benefits, professional services, and marketing and promotions.

The provision for credit losses was $100 thousand in the third quarter of 2017 and $400 thousand in the third quarter of 2016. The ratio of nonperforming assets to total assets decreased to 0.21% at September 30, 2017, from 0.29% at December 31, 2016. The allowance for loan losses was 1.83% of loans held for investment at September 30, 2017, compared to 2.00% at December 31, 2016.

Book value per common share at September 30, 2017 rose to $23.16, from $21.47 at December 31, 2016 and $22.51 at September 30, 2016. Excluding accumulated other comprehensive income, book value per common share at September 30, 2017 was $22.27, compared to $20.98 at December 31, 2016 and $20.49 at September 30, 2016.

Management Comments

Timothy J. Franz, BNC President and Chief Executive Officer, said, "The third quarter was our best quarter in 2017. All parts of our business are improved since earlier in the year, driven by a continued focus on profitable growth and good control over expenses and asset quality. Net interest income was 9.4% better than the same quarter in 2016 reflecting continued growth of loans and investments, along with higher yields. The 10.7% decrease in non-interest expenses resulted from our work to control costs throughout BNC, particularly in mortgage banking which is operating in an environment quite different from a year ago. Importantly, our credit quality metrics remain very good."

Mr. Franz continued, "We announced a branch sale in the third quarter and anticipate the transaction will close in the fourth quarter resulting in a gain on sale. Our book value per share has increased by 7.9% since the beginning of the year and we will continue working to increase shareholder value.

Third Quarter 2017 Comparison to Third Quarter 2016

Net interest income for the third quarter of 2017 was $7.257 million, an increase of $625 thousand, or 9.4%, from $6.632 million in the same period of 2016. Overall, the net interest margin increased to 3.08% in the third quarter of 2017 from 3.05% in the third quarter of 2016.

Interest income increased by $811 thousand, or 10.9%, to $8.219 million, for the quarter ended September 30, 2017, compared to $7.408 million in the third quarter of 2016. This increase is the result of higher yields and average balances of taxable investments, loans held for investment, and funds held at the Federal Reserve resulting from successful deposit generation. The average balance of interest earning assets increased by $70.8 million. The average balance of loans held for investment increased by $22.0 million, resulting in $318 thousand more interest income. The average balance of investment securities increased by $44.9 million, resulting in $594 thousand more interest income. These increases were partially offset by the $25.4 million decrease in the average balances of mortgage loans held for sale. The $30.4 million increase in the average balance of interest bearing cash balances yielded 1.26% and earned $100 thousand in the third quarter 2017. The yield on average interest earning assets increased to 3.46% in the third quarter of 2017 from 3.41% in the third quarter of 2016 as yields rose in all asset classes.

Interest expense in the third quarter of 2017 was $962 thousand, an increase of $186 thousand from the same period in 2016 due to increased average deposit balances, partially offset by lower borrowings. Average interest bearing deposit balances increased $106.3 million while the average balance of FHLB short-term advances decreased $45.9 million. The cost of total interest bearing liabilities increased to 0.51% in the current quarter compared to 0.45% in the same period of 2016. The cost of core deposits in the third quarters of 2017 and 2016 was 0.32% and 0.24%, respectively. The higher cost of funds is a result of higher balances and rates of money market accounts and consumer certificates of deposits.

Provision for credit losses was $100 thousand in the third quarter of 2017 and $400 thousand in the third quarter of 2016.

Non-interest income in the third quarter of 2017 was $5.180 million, a decrease of $2.579 million, or 33.2%, from $7.759 million in the third quarter of 2016. Mortgage banking revenues were $3.062 million in the third quarter of 2017, compared to $6.163 million in the third quarter of 2016, as higher interest rates had a dampening effect on mortgage demand. During the third quarter 2017, slightly higher margins and cost reductions improved the results of mortgage banking operations. Gains on sales of loans and investment securities aggregated $876 thousand in the third quarter 2017, compared to $302 thousand in the prior year third quarter, as these revenues can vary significantly from period to period.

Non-interest expense decreased $1.142 million, or 10.7%, to $9.576 million in the third quarter of 2017, from $10.718 million in the third quarter of 2016. Salaries and employee benefits decreased $585 thousand from the third quarter 2016. The number of full time equivalent employees ("FTEs") at September 30, 2017 was 263, down by 28 FTE's, or 9.6%, since December 31, 2016. Employee headcount decreased by 43, or 14%, since December 31, 2016; headcount decreased by 6 during the third quarter of 2017. Much of the headcount decrease related to mortgage support staff as the business is being right-sized to fit current revenues. Professional services in the third quarter of 2017 were down $276 thousand, or 22.3%, primarily due to reduced mortgage banking activities and legal expenses. Marketing costs decreased $145 thousand or 15.7% quarter to quarter.

In the third quarter of 2017, income tax expense was $708 thousand, compared to $1.014 million in the third quarter of 2016. The effective tax rate was 25.6% in the third quarter of 2017, compared to 31.0% in the same period of 2016. The decrease in the effective tax rate is primarily due to a higher percentage of pretax income from tax-exempt securities as compared to the prior year third quarter.

Net income was $2.053 million, or $0.58 per diluted share, in the third quarter of 2017. Net income in the third quarter of 2016 was $2.259 million, or $0.64 per diluted share.

Nine Months Ended 2017 Comparison to Nine Months Ended 2016

Net interest income in the first nine months of 2017 was $20.829 million, an increase of $1.439 million, or 7.4%, from $19.390 million in the same period of 2016. Overall, the net interest margin increased to 3.04% in the first nine months of 2017 from 3.02% in the first nine months of 2016.

Interest income increased by $1.505 million, or 6.9%, to $23.434 million, in the nine-month period ended September 30, 2017, compared to $21.929 million in the nine-month period ended September 30, 2016. This increase is the result of higher yields on taxable investments, higher average balances of loans held for investment, and increased funds held at the Federal Reserve. The yield on average interest earning assets decreased to 3.41% in the nine-month period ended September 30, 2017 compared to 3.42% in the same period of 2016 due to the higher proportion of earning assets being held at the Federal Reserve compared to the prior year. The average balance of interest earning assets increased by $59.0 million. The average balance of loans held for investment increased by $22.6 million, yielding $693 thousand of additional interest income, while the average balance of mortgage loans held for sale was $19.9 million lower than the same period of 2016. The average balance of investment securities was $14.3 million higher in the first nine months

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of 2017 compared to the first nine months of 2016. The average balance of cash held at the Federal Reserve increased by $42.8 million when comparing the two periods, and yielded an additional $350 thousand during the first nine months of 2017.

Interest expense in the first nine months of 2017 was $2.605 million, an increase of $66 thousand from the same period in 2016. The cost of interest bearing liabilities decreased to 0.48% in the first nine months of 2017 compared to 0.50% in the same period of 2016. In the first nine months of 2016, the Company redeemed the remaining balances of outstanding brokered certificates of deposit; resulting in brokered certificate of deposit interest expense of $477 thousand during the first nine months of 2016 that did not recur in 2017. Interest expense increased in other categories of deposits, driven largely by increased volume and cost of consumer certificates of deposit and money market accounts. The cost of core deposits in the first 9 months of 2017 and 2016 was 0.28% and 0.22%, respectively. Due to lower mortgage loan funding levels and increased deposit balances in the first nine months of 2017, the Company's FHLB short-term advances outstanding averaged $2.5 million compared to $35.8 million in the first nine months of 2016.

Provision for credit losses was $250 thousand in the first nine months of 2017 and $800 thousand in the first nine months of 2016.

Non-interest income for the first nine months of 2017 was $15.084 million, a decrease of $5.821 million, or 27.8%, from $20.905 million in the first nine months of 2016. Mortgage banking revenues were $8.638 million in the first nine months of 2017, compared to $15.892 million in the first nine months of 2016, a decrease of $7.254 million, or 45.6%. During 2016, we experienced higher loan volume, as interest rates were generally lower. Mortgage banking revenues have been lower in 2017 as rates moved higher, dampening demand and compressing margins. While margins improved in the third quarter, our margins and volumes remain subdued compared to 2016. Mortgage banking revenues tend to decline in the fourth quarter due to seasonally related matters. Gains on sales of loans and investment securities aggregated $1.935 million in the first nine months of 2017, compared to $962 thousand in the first nine months of the prior year impacted by increased SBA loan production and the timing of sales of investment securities. Gains on sale of assets can vary significantly from period to period.

Non-interest expense for the first nine months of 2017 decreased $1.627 million, or 5.2%, to $29.565 million, from $31.192 million in the first nine months of 2016. Salaries and employee benefits decreased $997 thousand from the first nine months of 2016 due to lower staffing levels as noted above. Professional services decreased compared to the first nine months of 2016 by approximately $331 thousand, or 9.6%, primarily due reduce mortgage banking volumes while marketing and promotion expenses are down $264 thousand, or 9.3%.

During the nine-month period ended September 30, 2017, income tax expense was $1.549 million, compared to $2.594 million in the first nine months of 2016. The effective tax rate was 25.4% in the first nine months of 2017, compared to 31.2% in the same period of 2016. The decrease is primarily due to a higher percentage of pretax income from tax-exempt securities.

Net income was $4.549 million, or $1.28 per diluted share, for the nine months ended September 30, 2017. Net income in the first nine months of 2016 was $5.709 million, or $1.62 per diluted share.

Assets, Liabilities and Equity

Total assets were $966.2 million at September 30, 2017, an increase of $55.8 million, or 6.1%, compared to $910.4 million at December 31, 2016. Loans held for investment aggregated $428.8 million at September 30, 2017, an increase of $14.1 million, or 3.4%, since December 31, 2016. Loans held for investment in North Dakota are experiencing notable prepayments as our borrowers with excess liquidity are deleveraging. Loans held for sale as of September 30, 2017 were down $7.6 million from December 31, 2016 due to reduced mortgage banking volume. Investment balances increased $50.0 million from year-end 2016 as we deployed funds related to higher deposits.

Total deposits were $837.0 million at September 30, 2017, compared to $752.6 million at December 31, 2016. Core deposits, which include recurring customer repurchase agreement balances, have increased by $87.9 million, or 11.5%, to $853.1 million at September 30, 2017 from $765.1 million as of December 31, 2016. The growth in deposits during 2017 has notably improved the results of operations and created value for shareholders. Core deposit growth in the non-Bakken North Dakota branches was $57.7 million, or 15.0%, since December 31, 2016, and a significant portion of this growth was predominantly the result of significant cash generating transactions by our customers during the first quarter of 2017. During the third quarter, core deposits decreased by $38.1 million; we converted more than $20 million of deposits to wealth management assets under management and customers have begun to redeploy deposits made earlier in 2017. In 2016, BNC generally utilized Federal Home Loan Bank short-term advances as flexible borrowings. In early 2017, such advances were paid down as deposits increased.

The table below shows total deposits since 2013:

tables deleted

http://www.bnccorp.com/54304/mirror/

Press Release: BNCCORP, INC. Reports Second Quarter Net Income Of $1.4 Million, Or $0.41 Per Diluted Share


BNCCORP, INC. Reports Second Quarter Net Income Of $1.4 Million, Or $0.41 Per Diluted Share

PR Newswire

BISMARCK, N.D., July 27, 2017



2017 Second Quarter Highlights

-- Net income in the 2017 second quarter was $1.4 million, compared to $2.0 million in the second quarter of 2016



-- Net interest income increased $557 thousand, or 8.6%, compared to the second quarter of 2016



-- Non-interest expense decreased by $497 thousand compared to the second quarter of 2016



-- Non-interest income decreased by $2.3 million due to lower mortgage banking revenues



-- Loans held for investment increased $26.5 million, or 6.6%, from June 30, 2016 to June 30, 2017



-- Total assets remain above $1.0 billion at June 30, 2017 due to robust deposit growth of $124.4 million in 2017



-- Non-performing assets were 0.22% of total assets as of June 30, 2017



-- Book value per share at June 30, 2017 was $22.80, compared to $21.47 at December 31, 2016


BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the second quarter ended June 30, 2017.

Net income in the second quarter of 2017 was $1.435 million, a decrease of $600 thousand versus $2.035 million in the same period of 2016. Second quarter 2017 diluted earnings per share was $0.41, compared to $0.58 in the second quarter of 2016. The comparison between the second quarters of 2017 and 2016 mainly reflect higher net interest income and lower expenses, offset by lower non-interest income.

Net interest income in the 2017 second quarter increased by $557 thousand, or 8.6%, from the same quarter in 2016, due primarily to the growth of loans held for investment and higher yields on higher investment balances.

Non-interest income in the second quarter of 2017 decreased by $2.338 million, or 31.2%, from the same period in 2016, due to lower mortgage revenues and lower gains on sales of assets. Other income increased due to the confidential settlement of a litigation matter.

Non-interest expense in the second quarter of 2017 decreased $497 thousand, or 4.7%, compared to the second quarter of the prior year primarily due to decreases in salary and benefits and professional services costs.

The provision for credit losses was $150 thousand in the second quarter of 2017, a reduction from $400 thousand in the second quarter of 2016. The ratio of nonperforming assets to total assets decreased to 0.22% at June 30, 2017, from 0.29% at December 31, 2016. The allowance for loan losses was 1.85% of loans held for investment at June 30, 2017, compared to 2.00% at December 31, 2016.

Book value per common share at June 30, 2017 rose to $22.80, from $21.47 at December 31, 2016 and $22.35 at June 30, 2016. Excluding accumulated other comprehensive income, book value per common share at June 30, 2017 was $21.71, compared to $20.98 at December 31, 2016 and $19.87 at June 30, 2016.

Management Comments

Timothy J. Franz, BNC President and Chief Executive Officer, said, "The fundamentals of BNC's banking business were stronger, reflected in growth of total assets, loans and deposits. In particular, the exceptional growth in deposits during the first half of 2017 benefited shareholders as the value of a banking franchise increases when deposits grow. Growth in loans held for investment accelerated toward the end of the second quarter, resulting in a 6.6% increase since the middle of 2016. The growth in our banking operation pushed total assets above $1 billion and resulted in an 8.6% increase in net interest income in the second quarter when compared to the second quarter in 2016. We continue to focus on mortgage banking results and these operations improved as the second quarter of 2017 progressed."

Mr. Franz continued, "Overall, we are pleased that earnings in the second quarter improved compared to the first quarter of 2017 and that our credit quality remains good. Our book value per share has increased $1.33 since the beginning of the year. In fact, from year-end 2010 to June 30, 2017, book value per common share has increased $17.71, or 347.9%, equating to a 23.7% compound annual rate of growth, and we look forward to continue creating value for our shareholders."

Second Quarter 2017 Comparison to Second Quarter 2016

Net interest income for the second quarter of 2017 was $7.039 million, an increase of $557 thousand, or 8.6%, from $6.482 million in the same period of 2016. Overall, the net interest margin decreased slightly to 2.96% in the second quarter of 2017 from 3.01% in the second quarter of 2016.

Interest income increased by $555 thousand, or 7.6%, to $7.901 million, for the quarter ended June 30, 2017, compared to $7.346 million in the second quarter of 2016. This increase is the result of higher yields and balances of taxable investments, loans held for investment, and funds held at the Federal Reserve resulting from successful deposit generation. The average balance of interest earning assets increased by $87.0 million. The average balance of loans held for investment increased by $13.5 million, resulting in $105 thousand more interest income. The average balance of investment securities increased by $16.7 million, while the yield on such investments increased 0.44%, resulting in $397 thousand more interest income. These increases were partially offset by the $21.4 million decrease in the average balances of mortgage loans held for sale. The $79.7 million increase in the average balance of interest bearing cash balances yielded 1.07% and earned $216 thousand in the second quarter 2017. The yield on average interest earning assets decreased to 3.31% in the second quarter of 2017 from 3.42% in the second quarter of 2016 due to the higher percentage of earning assets held at the Federal Reserve than in the prior year second quarter.

Interest expense in the second quarter of 2017 was $862 thousand, approximately flat from the same period in 2016 despite a significant increase in deposits. Average interest bearing deposit balances increased $106.6 million while the average balance of FHLB short-term advances decreased $49.7 million. The cost of interest bearing liabilities decreased to 0.46% in the current quarter compared to 0.50% in the same period of 2016. The lower cost of funds is a product of redeeming brokered certificates of deposits in 2016 and no outstanding FHLB advances in the quarter, which collectively offset the impact of higher balances and rates of money market accounts and consumer certificates of deposits.

Provision for credit losses was $150 thousand in the second quarter of 2017 and $400 thousand in the second quarter of 2016.

Non-interest income for the second quarter of 2017 was $5.157 million, a decrease of $2.338 million, or 31.2%, from $7.495 million in the second quarter of 2016. Mortgage banking revenues were $3.072 million in the second quarter of 2017, compared to $5.354 million in the second quarter of 2016. During the second quarter 2017, periods of interest rate volatility had the dual effects of dampening mortgage volume and compressing loan margins. Mortgage volume and margins began to show improvement toward the latter part of the second quarter 2017. Gains on sales of loans and investment securities aggregated $246 thousand in the second quarter 2017, compared to $615 thousand in the prior year second quarter, as these revenues can vary significantly from period to period. Other income increased due to the confidential settlement of a litigation matter.

Non-interest expense for the second quarter of 2017 decreased $497 thousand, or 4.7%, to $10.131 million, from $10.628 million in the second quarter of 2016. Salaries and benefits decreased $399 thousand from the second quarter 2016. The number of full time equivalent employees ("FTEs") at June 30, 2017 was 268, down by 23 FTE's, or 7.9%, since December 31, 2016. Employee headcount decreased 15 during the second quarter of 2017 and 37, or 8.8%, since December 31, 2016. Much of the headcount decrease related to mortgage support staff as the business is being right-sized to fit current revenues. Professional services in the second quarter of 2017 were down $150 thousand, or 11.8%, due to reduced mortgage banking activities.

In the second quarter of 2017, income tax expense was $480 thousand, compared to $914 thousand in the second quarter of 2016. The effective tax rate was 25.1% in the second quarter of 2017, compared to 31.0% in the same period of 2016. The decrease in the effective tax rate is primarily due to a higher percentage of pretax income from tax-exempt securities as compared to the prior year second quarter.

Net income was $1.435 million, or $0.41 per diluted share, for the second quarter of 2017. Net income in the second quarter of 2016 was $2.035 million, or $0.58 per diluted share.

Six Months Ended 2017 Comparison to Six Months Ended 2016

Net interest income in the first half of 2017 was $13.572 million, an increase of $814 thousand, or 6.4%, from $12.758 million in the same period of 2016. Overall, the net interest margin increased to 3.02% in the first six months of 2017 from 3.01% in the first six months of 2016.

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Interest income increased by $694 thousand, or 4.8%, to $15.215 million, in the six-month period ended June 30, 2017, compared to $14.521 million in the six-month period ended June 30, 2016. This increase is the result of higher yields on taxable investments, higher average balances of loans held for investment, and increased funds held at the Federal Reserve. The yield on average interest earning assets decreased to 3.38% in the six-month period ended June 30, 2017 from 3.43% in the same period of 2016 due to the higher proportion of earning assets being held at the Federal Reserve compared to the prior year. The average balance of interest earning assets increased by $52.9 million. The average balance of loans held for investment increased by $22.9 million, equating to $375 thousand of additional interest income, while the average balance of mortgage loans held for sale was $17.2 million lower than the same period of 2016. The average balance of investment securities was $1.1 million lower in the first half of 2017 compared to the first half of 2016. The average balance of cash held at the Federal Reserve increased by $49 million when comparing the two periods, and yielded an additional $250 thousand during the first half of 2017.

Interest expense in the first half of 2017 was $1.643 million, a decrease of $120 thousand from the same period in 2016. The cost of interest bearing liabilities decreased to 0.46% in the first half of 2017 compared to 0.52% in the same period of 2016. In the first half of 2016, the Company redeemed the remaining balances of outstanding brokered certificates of deposit; thus, we incurred brokered certificate of deposit interest expense of $461 thousand during the first half of 2016 that did not recur in 2017. Interest expense increased in other categories of deposits, driven largely by increased volume and cost of consumer certificates of deposit and money market accounts. Due to lower mortgage loan funding levels and increased deposit balances in the first half of 2017, the Company's FHLB short-term advances outstanding averaged only $3.8 million compared to $30.8 million in the first half of 2016.

Provision for credit losses was $150 in the first half of 2017 and $400 thousand in the first half of 2016.

Non-interest income for the first six months of 2017 was $9.904 million, a decrease of $3.242 million, or 24.7%, from $13.146 million in the first six months of 2016. Mortgage banking revenues were $5.576 million in the first half of 2017, compared to $9.729 million in the first half of 2016, a decrease of $4.153 million, or 42.7%. During the first half of 2016, we experienced historically higher loan volume, as interest rates were favorable. Mortgage banking revenues were lower in the first half of 2017 as rates moved higher, dampening demand and compressing margins. Mortgage volume began to rise in the first quarter 2017, and margins began to show improvement toward the latter part of the second quarter of 2017. Gains on sales of loans and investment securities aggregated $1.059 million in the first six months of 2017, compared to $660 thousand in the first six months of the prior year due to increased SBA loan production. Gains on sale of assets can vary significantly from period to period.

Non-interest expense for the first six months of 2017 decreased $485 thousand, or 2.4%, to $19.989 million, from $20.474 million in the first six months of 2016. Salaries and employee benefits decreased $412 thousand from the first six months of 2016. The number of full time equivalent employees ("FTEs") at June 30, 2017 was 268, down by 23 FTE's, or 7.9%, since December 31, 2016. In the first half of 2017 employee headcount was reduced by 37 or 8.8%, as the company is reducing staff in the mortgage banking operations. Mortgage related professional expenses decreased compared to the first half of 2016 by approximately $392 thousand.

During the six-month period ended June 30, 2017, income tax expense was $841 thousand, compared to $1.580 million in the first half of 2016. The effective tax rate was 25.2% in the first half of 2017, compared to 31.4% in the same period of 2016. The decrease is primarily due to a higher percentage of pretax income from tax-exempt securities.

Net income was $2.496 million, or $0.70 per diluted share, for the six months ended June 30, 2017. Net income in the first six months of 2016 was $3.450 million, or $0.98 per diluted share.

Assets, Liabilities and Equity

Total assets were $1.0 billion at June 30, 2017, an increase of $91.1 million, or 10.0%, compared to $910.4 million at December 31, 2016. Loans held for investment aggregated $426.2 million at June 30, 2017, an increase of $11.5 million, or 2.8%, since December 31, 2016, while loans held for sale as of June 30, 2017 were down $1.9 million from December 31, 2016. Investment balances increased $40.4 million from year-end 2016. Cash and cash equivalents balances increased $44.1 million due to a significant deposit received in the first quarter 2017.

Total deposits were $877.1 million at June 30, 2017, compared to $752.6 million at December 31, 2016. Core deposits, which include recurring customer repurchase agreement balances, have increased by $126.0 million, or 16.5%, to $891.2 million at June 30, 2017 from $765.1 million as of December 31, 2016. Core deposit growth in the non-Bakken North Dakota branches was $103.0 million, or 25.9%, and a significant portion of this growth was predominantly the result of significant cash generating transactions by our customers during the first quarter of 2017. BNC anticipates that a substantial portion of these deposit balances will be redeployed by our customers as 2017 continues. In 2016, BNC generally utilized Federal Home Loan Bank short-term advances as flexible borrowings. In early 2017, such advances were paid down as deposits increased.

The table below shows total deposits since 2013:





December December December December

June 30, 31, 31, 31, 31,

(In Thousands) 2017 2016 2015 2014 2013



ND Bakken

Branches $184,692 $178,677 $190,670 $178,565 $166,904

ND Non-Bakken

Branches 485,876 384,476 388,630 433,129 382,225

Total ND

Branches 670,568 563,153 579,300 611,694 549,129

Brokered

Deposits - - 33,363 53,955 64,525

Other 206,485 189,474 167,786 145,582 109,575

Total Deposits $877,053 $752,627 $780,449 $811,231 $723,229



Trust assets under management or administration increased 8.6%, or $22.5 million, to $285.6 million at June 30, 2017, compared to $263.1 million at June 30, 2016.

Capital

Banks and bank holding companies operate under separate regulatory capital requirements.

At June 30, 2017, our capital ratios exceeded all regulatory capital thresholds, including thresholds that incorporate fully phased-in conservation buffers.

Due to significant deposit growth and related increase in funds held at the Federal Reserve, our Tier 1 leverage ratios and tangible common equity decreased since the beginning of the year. Risk based capital ratios did not experience similar decreases as funds held at the Federal Reserve are assigned a zero percent risk weighting in determining risk-weighted assets. A summary of our capital ratios at June 30, 2017 and December 31, 2016 is presented below:



June 30, December 31,

2017 2016

BNCCORP, INC (Consolidated)

Tier 1 leverage 8.90% 9.47%

Total risk based capital 19.77% 19.96%

Common equity tier 1 risk based capital 13.87% 13.90%

Tier 1 risk based capital 16.66% 16.78%

Tangible common equity 7.85% 8.13%



BNC National Bank

Tier 1 leverage 9.15% 9.67%

Total risk based capital 18.37% 18.41%

Common equity tier 1 risk based capital 17.12% 17.16%

Tier 1 risk based capital 17.12% 17.16%



The common equity tier 1 ratio, which is generally a comparison of a bank's core equity capital to its total risk weighted assets, is a measure of the current risk profile of our asset base from a regulatory perspective. The Tier 1 leverage ratio, which is based on average assets, does not consider the mix of risk-weighted assets. In recent periods, regulators have required Tier 1 leverage ratios that significantly exceed "Well Capitalized" ratio levels. As a result, management believes the Bank's Tier 1 leverage ratio is our most restrictive capital measurement and we are managing the Tier 1 leverage ratio to levels significantly above the "Well Capitalized" ratio threshold.

In addition to regulatory risk based capital standards, we believe that regulators and investors also monitor the capital ratio of tangible common equity to total period end assets. As this ratio is based on total period end assets, it has decreased from prior periods due the significant deposit growth.

The Company routinely evaluates the sufficiency of capital in order to ensure compliance with regulatory capital standards and to provide a source of strength for the Bank. We manage capital by assessing the composition of capital and the amounts available for growth, risk or other purposes.

Book value per common share of the Company was $22.80 as of June 30, 2017, compared to $21.47 at December 31, 2016. Book value per common share, excluding accumulated other comprehensive income, was $21.71 as of June 30, 2017, compared to $20.98 at December 31, 2016.

Asset Quality

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The allowance for credit losses was $7.9 million at June 30, 2017, compared to $8.3 million at December 31, 2016. The allowance for credit losses as a percentage of total loans at June 30, 2017 was 1.70%, compared to 1.82% at December 31, 2016. The allowance as a percentage of loans and leases held for investment at June 30, 2017 was 1.85%, and at December 31, 2016 was 2.00%.

Nonperforming assets were $2.2 million at June 30, 2017, down from $2.7 million at December 31, 2016. The ratio of nonperforming assets to total assets was 0.22% at June 30, 2017 and 0.29% at December 31, 2016. Nonperforming loans were $2.1 million at June 30, 2017, down from $2.4 million at December 31, 2016.

At June 30, 2017, BNC had $11.7 million of classified loans, $2.1 million of loans on non-accrual, and no other real estate owned. At December 31, 2016, BNC had $12.9 million of classified loans, $2.4 million of loans on non-accrual, $214 thousand of other real estate owned, and $4 thousand of repossessed assets. BNC had $7.3 million of potentially problematic loans, which are risk rated "watch list", at June 30, 2017, compared with $9.4 million as of December 31, 2016.

The economic activity in western North Dakota continues to be affected by challenging conditions in the agricultural and energy industries. Prolonged periods of lower agricultural and energy prices as well as more recent drought conditions in the region could have an adverse economic impact on the North Dakota economy, commodity dependent businesses, and our loan portfolio.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 17 locations. BNC also conducts mortgage banking from 14 offices in Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota.

This news release may contain "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of BNC. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management are generally identifiable by the use of words such as "expect", "believe", "anticipate", "plan", "intend", "estimate", "may", "will", "would", "could", "should", "future" and other expressions relating to future periods. Examples of forward-looking statements include, among others, statements we make regarding our belief that we have exceptional liquidity, our expectations regarding future market conditions and our ability to capture opportunities and pursue growth strategies, our expected operating results such as revenue growth and earnings and our expectations of the effects of the regulatory environment on our earnings for the foreseeable future. Forward-looking statements are neither historical facts nor assurances of future performance. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, but are not limited to: the impact of current and future regulation; the risks of loans and investments, including dependence on local and regional economic conditions; competition for our customers from other providers of financial services; possible adverse effects of changes in interest rates, including the effects of such changes on mortgage banking revenues and derivative contracts and associated accounting consequences; risks associated with our acquisition and growth strategies; and other risks which are difficult to predict and many of which are beyond our control. In addition, all statements in this news release, including forward-looking statements, speak only of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

This press release contains references to financial measures which are not defined in U.S. generally accepted accounting principles ("GAAP"). Such non-GAAP financial measures include the Company's tangible equity to assets ratio and information presented excluding nonrecurring transactions. These non-GAAP financial measures have been included as the Company believes they are helpful for investors to analyze and evaluate the Company's financial condition.

(Financial tables attached)



BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Six Months

Ended June 30, Ended June 30,

(In thousands,

except per share

data) 2017 2016 2017 2016

SELECTED INCOME

STATEMENT DATA

Interest income $ 7,901 $7,346 $ 15,215 $14,521

Interest expense 862 864 1,643 1,763

Net interest income 7,039 6,482 13,572 12,758

Provision for credit

losses 150 400 150 400

Non-interest income 5,157 7,495 9,904 13,146

Non-interest expense 10,131 10,628 19,989 20,474

Income before income

taxes 1,915 2,949 3,337 5,030

Income tax expense 480 914 841 1,580

Net income $ 1,435 $2,035 $ 2,496 $3,450

EARNINGS PER SHARE

DATA

Basic earnings per

common share $ 0.41 $0.59 $ 0.72 $1.00

Diluted earnings per

common share $ 0.41 $0.58 $ 0.70 $0.98









BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Six Months

Ended June 30, Ended June 30,

(In thousands,

except per

share data) 2017 2016 2017 2016

ANALYSIS OF

NON-INTEREST

INCOME

Bank charges and

service fees $671 $689 $1,359 $1,363

Wealth

management

revenues 411 395 872 783

Mortgage banking

revenues 3,072 5,354 5,576 9,729

Gains on sales

of loans, net 69 178 612 223

Gains on sales

of investments,

net 177 437 447 437

Other 757 442 1,038 611

Total

non-interest

income $5,157 $7,495 $9,904 $13,146

ANALYSIS OF

NON-INTEREST

EXPENSE

Salaries and

employee

benefits $5,130 $5,529 $10,369 $10,781

Professional

services 1,116 1,266 2,169 2,224

Data processing

fees 990 947 1,870 1,807

Marketing and

promotion 1,057 979 1,783 1,902

Occupancy 574 545 1,194 1,069

Regulatory costs 131 167 263 334

Depreciation and

amortization 409 378 809 721

Office supplies

and postage 160 173 327 349

Other real

estate costs (23) 20 (21) 22

Other 587 624 1,226 1,265

Total

non-interest

expense $10,131 $10,628 $19,989 $20,474

WEIGHTED

AVERAGE SHARES

Common shares

outstanding

(a) 3,473,025 3,447,687 3,472,379 3,444,242

Incremental

shares from

assumed

conversion of

options and

contingent

shares 67,239 74,346 68,042 74,702

Adjusted

weighted

average shares

(b) 3,540,264 3,522,033 3,540,421 3,518,944







(a) Denominator for basic earnings per common share

(b) Denominator for diluted earnings per common share









BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



As of

(In thousands, except

share, per share and full June 30, December 31, June 30,

time equivalent data) 2017 2016 2016

SELECTED BALANCE SHEET DATA

Total assets $1,001,505 $ 910,400 $926,978

Loans held for sale-mortgage

banking 37,745 39,641 59,141

Loans and leases held for

investment 426,210 414,673 399,671

Total loans 463,955 454,314 458,812

Allowance for credit losses (7,898) (8,285) (8,725)

Investment securities

available for sale 440,542 400,136 415,499

Other real estate, net and

repossessed assets 13 218 225

Earning assets 945,108 851,564 871,479

Total deposits 877,053 752,627 757,039

Core deposits (1) 891,175 765,138 756,520

Other borrowings 39,135 75,523 81,549

Cash and cash equivalents 55,173 11,113 9,855

OTHER SELECTED DATA

Net unrealized gains in

accumulated other

comprehensive income $3,764 $ 1,683 $8,539

Trust assets under

supervision $285,627 $ 273,643 $263,087

Total common stockholders'

equity $78,808 $ 74,195 $77,047

Book value per common share $22.80 $ 21.47 $22.35

Book value per common share

excluding accumulated other

comprehensive income, net $21.71 $ 20.98 $19.87

Full time equivalent

employees 268 291 288

Common shares outstanding 3,456,192 3,456,008 3,447,061

CAPITAL RATIOS

Common equity Tier 1

risk-based capital

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(Consolidated) 13.87% 13.90% 13.34%

Tier 1 leverage

(Consolidated) 8.90% 9.47% 9.07%

Tier 1 risk-based capital

(Consolidated) 16.66% 16.78% 16.28%

Total risk-based capital

(Consolidated) 19.77% 19.96% 19.48%

Tangible common equity

(Consolidated) 7.85% 8.13% 8.29%



Common equity Tier 1

risk-based capital (Bank) 17.12% 17.16% 17.04%

Tier 1 leverage (Bank) 9.15% 9.67% 9.50%

Tier 1 risk-based capital

(Bank) 17.12% 17.16% 17.04%

Total risk-based capital

(Bank) 18.37% 18.41% 18.30%

Tangible common equity

(Bank) 9.63% 10.04% 10.39%









(1) Core deposits consist of all deposits and repurchase agreements with

customers and exclude certain brokered certificates of deposit.











BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Six Months

Ended June 30, Ended June 30,

(In thousands) 2017 2016 2017 2016

AVERAGE BALANCES

Total assets $1,008,782 $919,300 $ 961,531 $905,823

Loans held for

sale-mortgage

banking 28,667 50,096 26,462 43,634

Loans and leases

held for

investment 413,674 400,158 414,899 391,976

Total loans 442,341 450,254 441,361 435,610

Investment

securities

available for

sale 433,823 417,171 416,916 418,053

Earning assets 952,133 865,164 904,943 852,014

Total deposits 886,365 748,049 837,478 754,579

Core deposits 899,994 746,370 850,291 746,385

Total equity 77,344 74,555 75,979 73,361

Cash and cash

equivalents 89,745 9,900 60,317 11,412

KEY RATIOS

Return on average

common

stockholders'

equity (a) 7.75% 12.05% 6.83% 10.37%

Return on average

assets (b) 0.57% 0.89% 0.52% 0.77%

Net interest

margin 2.96% 3.01% 3.02% 3.01%

Efficiency ratio 83.15% 76.04% 85.19% 79.04%

Efficiency ratio

(BNC National

Bank) 80.05% 73.41% 81.80% 75.66%





(a) Return on average common stockholders' equity is calculated by using the

net income available to common shareholders as the numerator and average

common equity (less preferred stock and accumulated other comprehensive

income) as the denominator.

(b) Return on average assets is calculated by using net income as the

numerator and average total assets as the denominator.











BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



As of

June 30, December 31, June 30,

(In thousands) 2017 2016 2016

ASSET QUALITY

Loans 90 days or more delinquent

and still accruing interest $ - $ 20 $ -

Non-accrual loans 2,142 2,425 2,341

Total nonperforming loans $ 2,142 $ 2,445 $ 2,341

Other real estate, net and

repossessed assets 13 218 225

Total nonperforming assets $ 2,155 $ 2,663 $ 2,566

Allowance for credit losses $ 7,898 $ 8,285 $ 8,725

Troubled debt restructured loans $ 1,932 $ 2,038 $ 2,084

Ratio of total nonperforming

loans to total loans 0.46% 0.54% 0.51%

Ratio of total nonperforming

assets to total assets 0.22% 0.29% 0.28%

Ratio of nonperforming loans to

total assets 0.21% 0.27% 0.25%

Ratio of allowance for credit

losses to loans and leases held

for investment 1.85% 2.00% 2.18%

Ratio of allowance for credit

losses to total loans 1.70% 1.82% 1.90%

Ratio of allowance for credit

losses to nonperforming loans 369% 339% 373%











For the Quarter For the Six Months

Ended June 30, Ended June 30,

(In thousands) 2017 2016 2017 2016

Changes in

Nonperforming

Loans:

Balance, beginning of

period $ 2,672 $672 $ 2,445 $565

Additions to

nonperforming 159 1,980 716 2,135

Charge-offs (330) (64) (536) (95)

Reclassified back to

performing - (175) - (175)

Principal payments

received (319) (72) (443) (89)

Transferred to other

real estate owned (40) - (40) -

Balance, end of

period $ 2,142 $2,341 $ 2,142 $2,341











BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Six Months

Ended June 30, Ended June 30,

(In thousands) 2017 2016 2017 2016

Changes in

Allowance for

Credit Losses:

Balance,

beginning of

period $8,040 $8,479 $ 8,285 $8,611

Provision 150 400 150 400

Loans charged

off (337) (174) (590) (313)

Loan recoveries 45 20 53 27

Balance, end of

period $7,898 $8,725 $ 7,898 $8,725



Ratio of net

charge-offs to

average total

loans (0.066)% (0.034)% (0.122)% (0.066)%

Ratio of net

charge-offs to

average total

loans,

annualized (0.264)% (0.137)% (0.243)% (0.131)%



For the Quarter For the Six Months

Ended June 30, Ended June 30,

(In thousands) 2017 2016 2017 2016

Changes in

Other Real

Estate:

Balance,

beginning of

period $214 $242 $ 214 $242

Transfers from

nonperforming

loans 40 - 40 -

Real estate sold (264) - (264) (4)

Net gains on

sale of assets - - - 4

(Reduction)

Provision 10 (17) 10 (17)

Balance, end of

period $- $225 $ - $225



As of

June 30, December 31, June 30,

(In thousands) 2017 2016 2016

Other Real

Estate:

Other real

estate $- $ 954 $954

Valuation

allowance - (740) (729)

Other real

estate, net $- $ 214 $225





BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



As of

June 30, June 30,

(In thousands) 2017 December 31, 2016 2016

CREDIT CONCENTRATIONS

North Dakota

Commercial and industrial $41,824 $ 41,769 $44,661

Construction 3,908 6,819 10,259

Agricultural 24,558 19,351 16,972

Land and land development 9,112 9,674 10,405

Owner-occupied commercial

real estate 44,885 45,350 37,864

Commercial real estate 106,541 100,975 87,673

Small business

administration 4,406 4,512 4,825

Consumer 50,652 44,267 43,043

Subtotal loans held for

investment $285,886 $ 272,717 $255,702

Consolidated

Commercial and industrial $53,953 $ 54,037 $61,892

Construction 11,365 12,215 14,259

Agricultural 25,240 20,273 17,496

Land and land development 15,178 15,982 16,189

Owner-occupied commercial

real estate 49,518 49,294 44,035

Commercial real estate 176,210 171,972 165,891

Small business

administration 27,446 31,518 27,512

Consumer 66,902 59,183 52,074

Total loans held for

investment $425,812 $ 414,474 $399,348



View original content:http://www.prnewswire.com/news-releases/bnccorp-inc-reports-second-quarter-net-income-of-14-million-or-041-per-diluted-share-300495124.html

SOURCE BNCCORP, INC.

/CONTACT: TIMOTHY J. FRANZ, CEO, TELEPHONE: (612) 305-2213, DANIEL COLLINS, CFO, TELEPHONE: (612) 305-2210



/Web site: http://www.bnccorp.com



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http://www.bnccorp.com/54304/mirror/

BNCCORP, INC. Reports First Quarter Net Income Of $1.1 Million, Or $0.30 Per Diluted Share, Assets Top $1 Billion And Deposits Surge

BISMARCK, N.D., April 28, 2017


2017 First Quarter Highlights

-- Net income in the 2017 first quarter was $1.1 million, compared to $1.4 million in the first quarter of 2016


-- Total assets grew to $1.0 billion at March 31, 2017 as deposits grew $135 million, or 18%, in the first quarter of 2017


-- Loans held for investment increased $12 million, or 3.1%, to $411 million at March 31, 2017 from a year ago


-- Non-performing assets were 0.29% of total assets as of March 31, 2017


-- Book value per share at March 31, 2017 was $21.84 compared to $21.47 at December 31, 2016


-- Book value per common share (excluding OCI) rose to $21.29 at March 31, 2017 from $19.26 at March 31, 2016


BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC),which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the first quarter ended March 31, 2017.

Net income in the 2017 first quarter was $1.061 million, a decrease of $354 thousand versus $1.415 million in the same period of 2016. First quarter 2017 diluted earnings per share was $0.30, compared to $0.40 in the first quarter of 2016. The comparison between the first quarters of 2017 and 2016 mainly reflected decreased non-interest income, largely due to lower mortgage revenue resulting predominantly from the effects of higher interest rates on the mortgage refinance market, partially offset by higher net interest income.

Net interest income in the 2017 first quarter increased by $257 thousand, or 4.1%, from the same quarter in 2016, due to the growth of loans held for investment, higher yields on earning assets, reduced interest expense, and improved net interest margin.

Non-interest income in the first quarter of 2017 decreased by $904 thousand, or 16.0%, from the same period in 2016, as higher wealth management revenue and gains on sales of assets were offset by lower mortgage revenues.

Non-interest expense in the first quarter of 2017 was essentially flat when compared to the first quarter of the prior year.

The provision for credit losses was $0 in the first quarters of 2017 and 2016. The ratio of nonperforming assets to total assets was unchanged at 0.29% at March 31, 2017 and December 31, 2016. The allowance for loan losses was 1.96% of loans held for investment at March 31, 2017, compared to 2.00% at December 31, 2016.

....

http://www.bnccorp.com/54304/mirror/

Michael Vekich Joins BNCCORP Board of Directors

BISMARCK, N.D., March 23, 2017 -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banks and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported that Michael M. Vekich has joined BNC's Board of Directors and is expected to stand for re-election to BNC's Board of Directors at the Company's 2017 Annual Meeting of Stockholders.

Timothy J. Franz, the BNC's President and Chief Executive Officer, said, "We are looking forward to welcoming Mike to BNC's Board of Directors. He brings extensive business, financial and banking industry experience to the board as the Company continues to focus on growing the value of BNC for its shareholders. We think that he will be a fine addition to the board as an independent director."

PL Capital Advisors, LLC and its affiliates (collectively, the "PL Capital Group"), an investment firm which owns approximately 9.7% of the Company's outstanding stock, had previously provided notice to the Company of its intent to nominate Mr. Vekich for election to the Company's board of directors at the Company's 2017 Annual Meeting of Stockholders. The PL Capital Group has agreed to vote its shares in support of all of the Company's nominees for election at the Company's 2017 and 2018 Annual Meetings of Stockholders and to abide by certain standstill provisions until 30 days before the end of the notice period for director nominations at the 2019 Annual Meeting of Stockholders. Under certain circumstances, the agreement may be terminated before that date. The complete agreement between BNC and PL Capital will be posted on the Company's website at www.bnccorp.com.

About Michael M. Vekich:

Mr. Vekich is the chief executive officer of Vekich Chartered, management advisors specializing in strategic planning, and was from 2000-2010 Executive Chairman, President and Chief Executive Officer of Skyline Exhibits, designers of trade show exhibits. In 2016, Mr. Vekich was appointed by the Governor of Minnesota to serve as Acting Director of the Minnesota State Lottery as it seeks a new director and he is currently Chair of the Board of Trustees of Minnesota State Colleges and Universities.

Mr. Vekich has significant prior experience serving as a board member of a number of banking companies including HF Financial Corp. (Chair) and Tradition Capital Bank. He received a Bachelor of Arts Degree in Accounting and Business Administration from the University of Minnesota and is a Certified Public Accountant.


Link: http://www.bnccorp.com/54304/mirror/files/DOCS-142060-v3-BNCC_Vekich_Press_Release_final.pdf

Full standstill agreement with PL Capital-
http://www.bnccorp.com/54304/mirror/files/DOCS-141456-v8-BNCC_-_Nomination_and_Standstill_Agreement.pdf

BNCCORP, INC. Reports 2016 Fourth Quarter Net Income To Common Shareholders Of $1.4 Million, Or $0.41 Per Diluted Share

BISMARCK, N.D., Jan. 30, 2017

2016 Highlights

-- Full year net income to common shareholders was $7.2 million, or $2.03 per diluted share

-- Total assets at 2016 year-end were $910.4 million

-- Loans held for investment increased $34.7 million, or 9.1%, to $414.6 million at December 31, 2016

-- Deposits were $752.6 million at 2016 year-end

-- Provision for credit losses was $0 in the fourth quarter and $800 thousand for the full year 2016

-- Non-performing assets were 0.29% of total assets at year-end 2016

-- Book value per common share at December 31, 2016 rose to $21.47 from $20.12 at December 31, 2015


BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the fourth quarter and year ended December 31, 2016.

Net income available to common shareholders in the 2016 fourth quarter was $1.447 million, a decrease of $151 thousand versus $1.598 million in the same period of 2015. Fourth quarter 2016 diluted earnings per share were $0.41, compared to $0.46 in the fourth quarter of 2015. The comparison between the fourth quarters of 2016 and 2015 mainly reflected increased net interest income, decreased non-interest income largely due to lower revenue on sales of loans and Small Business Investment Company (SBIC) revenue, and higher non-interest expense primarily related to mortgage banking growth, legal costs, and investments in technology.

Net interest income in the 2016 fourth quarter increased by $396 thousand, or 6.4%, from the same quarter in 2015, due to the growth of loans held for investment, higher yields on earning assets, and improved net interest margin.

Non-interest income in the fourth quarter of 2016 decreased by $455 thousand, or 8.5%, from the same period in 2015, as higher mortgage banking revenues were offset by lower gains on sales of loans and SBIC revenues, both of which can vary significantly from period to period.

Non-interest expense increased by $761 thousand, or 8.2%, in the fourth quarter of 2016 compared to the prior year period, due to higher mortgage volume related costs, investments in technology, which improved services to customers, and continued investment in talent to support future revenue growth.

The provision for credit losses was $0 in the fourth quarters of 2016 and 2015. The ratio of nonperforming assets to total assets was 0.29% at December 31, 2016, compared to 0.09% at December 31, 2015. The allowance for loan losses was 2.00% of loans held for investment at December 31, 2016, compared to 2.27% at December 31, 2015.

Book value per common share at December 31, 2016 rose to $21.47 from $20.12 at December 31, 2015. Excluding accumulated other comprehensive income, book value per common share at December 31, 2016 was $20.98 compared to $18.93 at December 31, 2015. Since year-end 2010, book value per common share has increased $16.38, or 321.8%, equating to a 27% annual compounded rate of growth.

Management Comments

Timothy J. Franz, BNC President and Chief Executive Officer, said, "In a challenging year for the national economy and our region, BNC exhibited profitability, capital strength and asset quality. Our net interest income continued to improve and credit losses remained low in the fourth quarter of a year during which BNC's longer term shareholders were significantly rewarded."

Mr. Franz continued, "In 2016 we continued to improve our core banking by growing loans held for investment by approximately 9% while maintaining exceptional credit quality metrics. The growth in loans and credit quality successes were achieved despite the challenging economic conditions in western North Dakota. We captured value with our mortgage banking operations and continued to fortify our balance sheet by growing capital. We are pleased to see our shareholder value increase as a result of our performance in recent years and look forward to continued success."

Fourth Quarter Results

Net interest income for the fourth quarter of 2016 was $6.613 million, an increase of $396 thousand, or 6.4%, from $6.217 million in the same period of 2015. Overall, the net interest margin increased to 3.04% in the fourth quarter of 2016 from 2.96% in the fourth quarter of 2015.

Interest income increased 7.1%, to $7.417 million, for the quarter ended December 31, 2016, compared to $6.923 million in the fourth quarter of 2015. This increase is the result of higher yields on higher average earning assets. The yield on average interest earning assets increased to 3.41% in the fourth quarter of 2016 from 3.30% in the fourth quarter of 2015. The average balance of interest earning assets increased by $32.9 million. Average loans held for investment increased by $59.7 million year-over-year, and the average balance of loans held for sale was $21.6 million higher, while investments were $32.8 million lower. Despite the overall decrease in average investments, we have increased our investment in tax-exempt municipal securities in recent years, which aggregated $87.7 million at December 31, 2016, due to the relatively attractive attributes of these securities in the context of our overall portfolio, balance sheet management activities, and the value provided via reduced income tax expense.

Interest expense in the fourth quarter of 2016 was $804 thousand, an increase of $98 thousand from the same period in 2015. The cost of interest bearing liabilities remained essentially flat at 0.47% in the current quarter compared to 0.44% in the same period of 2015. Management increased its utilization of short-term FHLB advances as flexible borrowings in 2016.

Provision for credit losses was $0 in the fourth quarters of 2016 and 2015.

Non-interest income for the fourth quarter of 2016 was $4.872 million, a decrease of $455 thousand, or 8.5%, from $5.327 million in the fourth quarter of 2015. Mortgage banking revenue increased during the quarter when compared to the fourth quarter of 2015, although this was offset by lower revenues such as gains on the sale of loans and SBIC revenues, which can vary significantly from period-to-period. Mortgage banking production resulted in revenues of $3.573 million in the fourth quarter of 2016, compared to $3.067 million in the fourth quarter of 2015. Gains on sales of SBA loans were $1 thousand in the fourth quarter 2016, compared to $433 thousand in the prior year fourth quarter. SBIC revenues were $111 thousand in the fourth quarter of 2016 versus $709 thousand during the same period of 2015.

Non-interest expense for the fourth quarter of 2016 increased $761 thousand to $10.001 million, from $9.240 million in the fourth quarter of 2015. This increase is primarily related to mortgage banking, legal costs, and investments in technology and personnel to serve our customers and support growth.

In the fourth quarter of 2016, income tax expense was $37 thousand, compared to $474 thousand in the fourth quarter of 2015. The effective tax rate was 2.5% in the fourth quarter of 2016, compared to 20.6% in the same period of 2015. The decrease in the effective tax rate in the fourth quarter of 2016 is due to the relatively high proportion of tax-exempt income to pre-tax income in the period, as previously anticipated gains on sales of loans and SBIC revenues were delayed to periods later than anticipated.

Net income available to common shareholders was $1.447 million, or $0.41 per diluted share, for the fourth quarter of 2016. Net income available to common shareholders in the fourth quarter of 2015 was $1.598 million, or $0.46 per diluted share, after accounting for dividends paid on preferred stock. There were no preferred stock costs in the fourth quarter of 2016, due to the redemption of the preferred stock in the fourth quarter of 2015, versus $232 thousand in the fourth quarter of 2015.

Year Ended December 31, 2016

Net interest income in 2016 was $26.003 million, an increase of $658 thousand from $25.345 million in 2015. Interest income grew by $1.431 million in 2016 compared to 2015. Overall, yields on earning assets increased to 3.42% in 2016, compared to 3.26% in the same period of 2015, along with slightly higher average earning assets in 2016 compared to 2015. Average loans held for sale and loans held for investment increased by $3.1 million and $48.8 million, respectively, while cash and investments decreased by $52.0 million on a year-over-year basis. Overall, the net interest margin increased to 3.03% in 2016 from 2.96% in 2015.

In 2016, interest expense increased $773 thousand, to $3.343 million from $2.570 million in 2015. In 2016 and 2015, BNC redeemed $33.4 million and $20.0 million, respectively, of callable brokered certificates of deposit, at a cost of $233 thousand and $87 thousand, respectively. Excluding the costs to redeem these brokered deposits, interest expense increased by $627 thousand in 2016 compared to 2015. The cost of interest bearing liabilities increased to 0.49% in 2016, from 0.40%, in 2015. The increase in interest expense was primarily due to the issuance of subordinated debt in the fourth quarter of 2015, an increase in retail certificates of deposit balances, partially offset by the effects of redeeming brokered deposits, and increased utilization of short-term FHLB advances as flexible borrowings in periods of higher mortgage lending volume. The cost of core deposits increased to 0.23% in 2016, from 0.16% in 2015, as retail certificates of deposits have increased in recent quarters.

Provision credit losses was $800 thousand in 2016. A reversal of previous provisions for credit losses increased pre-tax earnings by $400 thousand in 2015.

Non-interest income in 2016 was $25.777 million, an increase of $827 thousand, or 3.3%, from $24.950 million in 2015. The increase primarily relates to a $3.251 million, or 20.1%, increase in mortgage revenue, which was partially offset by a decrease in gains on sales of assets of $1.830 million. Mortgage banking revenues were $19.465 million and $16.214 million in 2016 and 2015, respectively. Mortgage revenue can be influenced significantly by interest rates and seasonal factors. During 2016, we recorded a net gain on sales of investments and loans aggregating $963 thousand, compared to a $2.793 million net gain on sales of such assets in the same period of 2015. Excluding gains on sales of investments and loans, non-interest income increased $2.657 million or 12.0%.
Non-interest expense in 2016 was $41.193 million, an increase of $3.649 million, or 9.7%, from $37.544 million in the same period of 2015. This increase is primarily related to mortgage banking, legal costs, and investments in technology and personnel to serve our customers and support growth.

During 2016, we recorded a tax expense of $2.631 million, equating to an effective tax rate of 26.9%. We recorded tax expense of $3.945 million during 2015, which resulted in an effective tax rate of 30.0%. The decrease in the effective tax rate in 2016 is due to tax-exempt income being higher relative to pre-tax income during the recent year.

There were no preferred stock costs in 2016, due to the redemption of the preferred stock in the fourth quarter of 2015, versus $1.656 million in 2015.

Net income available to common shareholders was $7.156 million, or $2.03 per diluted share, in 2016. Net income available to common shareholders in 2015 was $7.550 million, or $2.16 per diluted share, after accounting for dividends paid on preferred stock.

Assets, Liabilities and Equity

Total assets were $910.4 million at December 31, 2016, an increase of $6.2 million, or 0.7%, compared to $904.2 million at December 31, 2015. Loans held for investment aggregated $414.7 million at December 31, 2016, an increase of $34.8 million, or 9.2%, since December 31, 2015. In addition, mortgage loans held for sale as of December 31, 2016 were down $10.8 million from December 31, 2015. Investment balances decreased $19.2 million from year-end 2015.

Total deposits were $752.6 million at December 31, 2016, compared to $780.4 million at December 31, 2015, as BNC redeemed $33.4 million of brokered deposits in 2016. Core deposits, which include recurring customer repurchase agreement balances, have increased by $4.2 million, or 1.0%, to $765.1 million at December 31, 2016 from $760.9 million as of December 31, 2015. The continued growth of our Arizona core deposits was partially offset by a decrease in North Dakota deposits. The Company has generally utilized Federal Home Loan Bank short term advances, with an average cost of 0.58%, as flexible borrowings in 2016.

-tables deleted-

Trust assets under management or administration increased 10.1% to $273.6 million at December 31, 2016, compared to $248.4 million at December 31, 2015.

Capital

Banks and bank holding companies operate under separate regulatory capital requirements.

At December 31, 2016, our capital ratios exceeded all regulatory capital thresholds, including thresholds that incorporate fully phased in conservation buffers.

A summary of our capital ratios at December 31, 2016 and December 31, 2015 is presented below:


December 31 2016, December 31 2015



BNCCORP, INC (Consolidated)

Tier 1 leverage 9.47% 9.00%

Total risk based capital 19.96% 20.07%

Common equity tier 1 risk based capital 13.90% 13.57%

Tier 1 risk based capital 16.78% 16.72%

Tangible common equity 8.13% 7.62%



BNC National Bank

Tier 1 leverage 9.67% 9.45%

Total risk based capital 18.41% 18.71%

Common equity tier 1 risk based capital 17.16% 17.45%

Tier 1 risk based capital 17.16% 17.45%



The CET 1 ratio, which is generally a comparison of a bank's core equity capital to its total risk weighted assets, is a measure of the current risk profile of our asset base from a regulatory perspective. The Tier 1 leverage ratio, which is based on average assets, does not consider the mix of risk-weighted assets. In recent periods, regulators have required Tier 1 leverage ratios that significantly exceed "Well Capitalized" ratio levels. As a result, management believes the Bank's Tier 1 leverage ratio is our most restrictive capital measurement and we are managing the Tier 1 leverage ratio to levels significantly above the "Well Capitalized" ratio threshold.

In addition to regulatory risk based capital standards, we believe that regulators and investors also monitor the capital ratio of tangible common equity to total period end assets.

The Company routinely evaluates the sufficiency of capital in order to ensure compliance with regulatory capital standards and be a source of strength for the Bank. We manage capital by assessing the composition of capital and the amounts available for growth, risk or other purposes.

Book value per common share of the Company was $21.47 as of December 31, 2016, compared to $20.12 at December 31, 2015. Book value per common share, excluding accumulated other comprehensive income, was $20.98 as of December 31, 2016, compared to $18.93 at December 31, 2015.

Asset Quality

The allowance for credit losses was $8.3 million at December 31, 2016, compared to $8.6 million at December 31, 2015. The allowance for credit losses as a percentage of total loans at December 31, 2016 was 1.82%, compared to 2.00% at December 31, 2015. The allowance as a percentage of loans and leases held for investment at December 31, 2016 was 2.00%, and at December 31, 2015 was 2.27%.

Nonperforming assets of $2.7 million at December 31, 2016, are up from $2.1 million at September 30, 2016, and up from $807 thousand at December 31, 2015. The ratio of nonperforming assets to total assets was 0.29% at December 31, 2016, 0.23% at September 30, 2016, and 0.09% at December 31, 2015. Nonperforming loans of $2.4 million at December 31, 2016, are up from $1.9 million at September 30, 2016, and up from $565 thousand at December 31, 2015. The increase in nonperforming assets during 2016 relates to one relationship greater than $1 million in the energy sector, which was partially charged off in the third quarter, and several other relationships which were deemed to be non-performing during the fourth quarter.

At December 31, 2016, BNC had $12.9 million of classified loans, $2.4 million of loans on non-accrual, $214 thousand of other real estate owned, and $4 thousand of repossessed assets. At December 31, 2015, BNC had $9.8 million of classified loans, $390 thousand of loans on non-accrual, and $242 thousand of other real estate owned. BNC had $9.4 million of potentially problematic loans, which are risk rated "watch list", at December 31, 2016, compared with $7.9 million as of December 31, 2015. The increase in classified loans since the beginning of the year relates primarily to three relationships in western North Dakota.

As evidenced by our nonperforming asset ratios and delinquency rates, as of December 31, 2016, the decrease in oil and agricultural commodity prices have yet to have a significant negative effect on our credit quality. However, the economic activity in western North Dakota is subdued relative to a few years ago. Prolonged periods of lower agricultural and oil prices could have an adverse economic impact on the North Dakota economy, commodity dependent businesses, and our loan portfolio. Oil prices most directly impact the underlying collateral for our oil exploration and production (E&P) loans. Loans outstanding for the purpose of and secured by E&P in North Dakota were approximately $9.7 million, or 2.4% of total loans held for investment, at December 31, 2016, compared to $11.7 million, or 3.1%, of loans held for investment, at December 31, 2015. In addition to E&P loans, loans to customers serving the energy industries in western North Dakota are impacted by protracted low energy prices, as depressed energy prices in recent periods have reduced economic activity and collateral values in western North Dakota. Customers in, or serving the North Dakota agricultural sector have been experiencing lower commodity prices for multiple years, which has had a dampening effect on economic activity in the region.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 17 locations. BNC also conducts mortgage banking from 14 offices in Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota.


http://www.bnccorp.com/54304/mirror/

BNCC $24 new 52week high

http://seekingalpha.com/article/4025938-1-stock-world

Rangeley Capital Calls For Full Review Of Strategic Alternatives For BNCC

http://seekingalpha.com/article/4017284-rangeley-capital-calls-full-review-strategic-alternatives-bncc


Summary


•BNCC's board needs a shareholder representative.

•They should also launch a full review of strategic alternatives.

•Owners interested in maximizing their shares' value should contact the board.




Rangeley Capital ("Rangeley") believes BNCCORP (OTCQX:BNCC) is deeply undervalued and that the company should immediately begin an exploration of all strategic alternatives. We also call on the board to immediately explore adding a director with significant share ownership and financial expertise to help oversee the process.

Rangeley Capital owns over 200,000 shares of BNCC, or just shy of 6% of the bank. We are long-term shareholders in BNCC, as we have held shares in the bank for years and, in December 2014, we called the bank our best investment idea for 2015.

In addition to our significant shareholdings, we also have significant experience investing in other deeply undervalued community banks. We were major shareholders in OBA Financial (NASDAQ:OBAF) before their sale to F.N.B. Corporation, and we remain major shareholders in Ocean Shore Financial (NASDAQ:OSHC), which is currently undergoing a sale to OceanFirst Financial Corp. (NASDAQ:OCFC). Our experience with both of those banks as well as our individual diligence on BNCC suggests that now is an ideal time to pursue strategic alternatives, as BNCC's small size creates operational inefficiencies in dealing with a growing regulatory cost burden.

In addition to the operational inefficiencies brought on by the bank's small size, we are concerned by BNCC's investment portfolio. As of June 30th, BNCC had $375m in fair value available-for-sale securities that have more than ten years until they are due. While many of these securities have benefited from the significant declines in interest rates over the past few years, any future rate increases would result in a decline in fair value and could severely impair shareholder value.


We have communicated these concerns to both management and the board several times, and we would have preferred to keep both the communications and our concerns private. While we believe the likely outcome of any strategic evaluation would be the sale of BNCC to a strategic buyer for a significant premium, we remain open to any outcome provided all options are explored with a goal of maximizing long-term shareholder value. Our one request to date has been for the board to add a major shareholder of their choice to the board to help oversee the process; however, the board has refused to engage in any form of dialogue with us, leaving us no choice but to take our thoughts and concerns public.

While we would continue to prefer to work constructively with the current board and management, our significant shareholdings demand that we act like good owners and continue to review all options for maximizing the bank's value, including running an alternative slate of directors at the next annual meeting. Until then, we would encourage any like-minded shareholders to make their voices heard by mailing the board at the address below.

“
Tracy J. Scott

Chairman of the BNCCORP Inc. Board of Directors

322 East Main PO Box 4050

Bismarck, ND 58502

Disclosure: I am/we are long BNCC, OSHC.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: Chris DeMuth Jr and Andrew Walker are portfolio managers at Rangeley Capital. We invest with a margin of safety by buying securities at discounts to their intrinsic value and unlocking that value through corporate events. To maximize returns for our investors, we reserve the right to make investment decisions regarding any security without notification except where notification is required by law. This post may contain affiliate links, consistent with the disclosure in such links. We manage diversified portfolios with a multi-year time horizon. Positions disclosed in articles may vary in sizing, hedges, and place within the capital structure. Disclosed ideas are related to a specific price, value, and time. If any of these attributes change, then the position might change (and probably will).


Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.

BNCC hits new 52week high $21.65

- strong volume/action all day
- chewed through 3k block and 3x 5k blocks @ ask
- strong BID of 25k shares @ $21.20 EOD

looking for continued strength after strong 3rd qtr. results released last Friday.

http://stockcharts.com/freecharts/gallery.html?BNCC

BNCCORP, INC. Reports Third Quarter Net Income To Common Shareholders Of $2.3 Million, Or $0.64 Per Diluted Share

BNCCORP, INC. Reports Third Quarter Net Income To Common Shareholders Of $2.3 Million, Or $0.64 Per Diluted Share
2016 Third Quarter Highlights

- 2016 third quarter results reflect continued strong financial performance

- Net income available to common shareholders increased 61.4% to $2.3 million, from $1.4 million in the third quarter of 2015, primarily due to higher net interest income and non-interest income, and the beneficial impact of deleveraging

- Book value per common share was $22.51 at September 30, 2016 compared to $20.12 at December 31, 2015, an increase of 11.9%

- Return on equity was 12.75% in the third quarter of 2016 and 11.20% for the nine months ended September 30, 2016

- Basic and diluted earnings per share in the first nine months of 2016 were $1.66 and $1.62, respectively

- Loans Held for Investment increased $69.5 million or 20.2% since September 30, 2015.

PR Newswire

BISMARCK, N.D., Oct. 27, 2016

BISMARCK, N.D., Oct. 27, 2016 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Arkansas, Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the third quarter ended September 30, 2016.

Net income available to common shareholders in the 2016 third quarter was $2.259 million, or $0.64 per diluted share, compared to $1.400 million, or $0.40 per diluted share, in the third quarter of 2015. The increase in net income available to common shareholders is primarily attributable to higher net interest income, higher non-interest income, and the impact of deleveraging BNC in the fourth quarter of 2015.

Net interest income in the 2016 third quarter increased by $527 thousand, or 8.6%, from the same quarter in 2015, due to growth of loans held for investment, higher yields on earning assets and improved net interest margin.

Non-interest income in the third quarter of 2016 increased by $2.527 million, or 48.3%, from the same period in 2015 driven by growth in mortgage banking revenue. Non-interest expense increased by $1.738 million, or 19.4%, in the third quarter of 2016, compared to the prior year period, due to higher mortgage volume related costs and investments in technology as BNC strives to improve its customers' experience and keep pace with advancements in banking.

The provision for credit losses was $400 thousand in the third quarter of 2016, compared to a reversal of previous provisions for credit losses of $400 thousand which increased earnings in the same period of 2015. The ratio of nonperforming assets to total assets was 0.23% at September 30, 2016 compared to 0.09% at December 31, 2015.

Book value per common share at September 30, 2016 rose to $22.51 compared to $20.12 and $20.09 at December 31, 2015 and September 30, 2015, respectively. Excluding accumulated other comprehensive income, book value per common share at September 30, 2016 was $20.49 compared to $18.93 and $18.49 at December 31, 2015 and September 30, 2015, respectively. Since year-end 2010, book value per common share has increased $17.42 or 342%.

Timothy J. Franz, BNC President and Chief Executive Officer, said, "We delivered strong performance in the third quarter as demonstrated by higher net income available to common shareholders, earnings per share and a 12.75% return on common equity. Importantly, we have grown our loans held for investment by 20% in the past year and core deposits grew by more than 5% in the same period while our mortgage banking operations continued to capitalize on conditions that are favorable to the housing market. Overall, we are pleased with the value that BNC created this quarter, which is the most recent of several consecutive good quarters, and we look forward to continuing to build shareholder value."

Third Quarter Results

Net interest income for the third quarter of 2016 was $6.632 million, an increase of $527 thousand, or 8.6%, from $6.105 million in the same period of 2015. Overall, the net interest margin increased to 3.05% in the third quarter of 2016 from 2.91% in the third quarter of 2015.

Interest income was $7.408 million for the quarter ended September 30, 2016 compared to $6.662 million in the third quarter of 2015. This increase is the result of higher yields on higher average earning assets. The yield on average interest earning assets increased to 3.41% in the third quarter of 2016 from 3.17% in the third quarter of 2015. The average balance of interest earning assets increased by $32.7 million. Our average loans held for investment increased by $57.8 million year-over-year, and the average balances of loans held for sale was $16.1 million higher, while investments were $26.0 million lower. Despite the overall decrease in average investments, we have increased our investment in tax exempt municipal securities in recent periods, which aggregated $92.4 million at September 30, 2016, due to the relatively attractive attributes of these securities in the context of our overall portfolio and balance sheet management activities and the value provided via reduced income tax expense.

Interest expense in the third quarter of 2016 was $776 thousand, an increase of $219 thousand from the same period in 2015. The cost of interest bearing liabilities increased to 0.45% in the current quarter from 0.35% in the same period of 2015, primarily due to the issuance of subordinated debt in the fourth quarter of 2015, and an increase in retail certificates of deposit balances in recent quarters. The cost of these liabilities was partially offset by redeeming callable brokered certificates of deposit in the second quarter of 2015 and first half of 2016. The costs related to the redemptions of brokered deposits aggregated $233 thousand in 2016. The cost of core deposits was 0.24% in the third quarter of 2016 and 0.16% in the third quarter of 2015, due largely to higher balances of retail certificates of deposit, which generally have higher rates than non-maturity deposits. Average interest bearing core deposits, which excludes brokered deposits, increased $33.5 million, or 5.8%, during the third quarter of 2016 compared to the third quarter of 2015.

Provision for credit losses was $400 thousand in the third quarter of 2016. As a result, our allowance for credit losses has remained essentially flat in 2016. A reversal of previous provisions for credit losses increased pre-tax earnings by $400 thousand for the same period in 2015.

Non-interest income for the third quarter of 2016 was $7.759 million, an increase of $2.527 million, or 48.3%, from $5.232 million in the third quarter of 2015, primarily due to an increase in mortgage revenue. Mortgage banking production resulted in revenues of $6.163 million in the third quarter of 2016 compared to $3.663 million in the third quarter of 2015. Gains on sales of SBA loans have declined as the Company's loan growth has recently favored conventional loans. Gains and losses on sales of assets can vary significantly from period to period.

Non-interest expense for the third quarter of 2016 increased $1.738 million to $10.718 million from $8.980 million in the third quarter of 2015. This increase is primarily related to mortgage banking, legal costs, and investments to serve our customers and support growth.

In the third quarter of 2016, income tax expense was $1.014 million compared to $882 thousand in the third quarter of 2015. The effective tax rate was 31.0% in the third quarter of 2016 compared to 32.0% in the same period of 2015. The decrease in the effective tax rate in the third quarter of 2016 is due to a higher percentage of tax exempt income than in the third quarter 2015.

Net income available to common shareholders was $2.259 million, or $0.64 per diluted share, for the third quarter of 2016. Net income available to common shareholders in the third quarter of 2015 was $1.400 million, or $0.40 per diluted share after accounting for dividends paid on preferred stock. There were no preferred stock costs in the third quarter of 2016 due to the redemption of the preferred stock in the fourth quarter of 2015, versus $475 thousand in the third quarter of 2015.

Nine Months Ended September 30, 2016

Net interest income in the first nine months of 2016 was $19.390 million, an increase of $262 thousand from $19.128 million in the first nine months of 2015. Yields on earning assets overall increased to 3.42% in the nine-month period ended September 30, 2016 compared to 3.24% in the same period of 2015, while the average balance of earning assets was $8.6 million lower in the first nine months of 2016 compared to the same period of 2015. Average loans held for investment were higher by $45.2 million while cash and investments were lower by $52.5 million. Overall, the net interest margin increased to 3.02% in the first nine months of 2016 from 2.96% in the first nine months of 2015.

Interest expense during the first nine months of 2016 increased to $2.539 million from $1.864 million, or 36.2%, in the same period of 2015. In the first nine months of 2016 and 2015, BNC submitted notices to redeem $33.4 million and $20.0 million, respectively, of callable brokered certificates of deposit, at a cost of $233 thousand and $87 thousand, respectively. Excluding the costs to redeem these brokered deposits, interest expense increased by $529 thousand in 2016 compared to 2015. The cost of interest bearing liabilities increased to 0.50% in the first nine months of 2016 from 0.38% in the same period of 2015, primarily due to the issuance of subordinated debt in the fourth quarter of 2015, and an increase in retail certificates of deposit balances, partially offset by the effects of redeeming brokered deposits. The cost of core deposits increased to 0.22% in the first nine months of 2016 from 0.16% in the first nine months of 2015 as retail certificates of deposits have increased in recent quarters.

Provision for credit losses was $800 thousand in the first nine months of 2016. A reversal of previous provisions for credit losses increased pre-tax earnings by $400 thousand in the first nine months of 2015.
Non-interest income for the first nine months of 2016 was $20.905 million, an increase of $1.282 million, or 6.5% from $19.623 million in the same period of 2015. The increase primarily relates to a $2.745 million, or 20.9%, increase in mortgage revenue, which is offset by a decrease in gains on sales of assets of $1.475 million. During the nine-month period ended September 30, 2016, we recorded a net gain on sales of investments and loans aggregating $962 thousand, compared to a $2.437 million net gain on sales of such assets in the same period of 2015. Excluding gains on sales of investments and loans, non-interest income increased 16.0%.

Non-interest expense for the first nine months of 2016 was $31.192 million, an increase of $2.888 million, or 10.2%, from $28.304 million in the same period of 2015. This increase is primarily related to mortgage banking, legal costs, and investments to serve our customers and support growth.

During the nine-month period ended September 30, 2016, we recorded a tax expense of $2.594 million, equating to an effective tax rate of 31.2%. We recorded tax expense of $3.471 million during the nine-month period ended September 30, 2015, which resulted in an effective tax rate of 32.0%.

Preferred stock costs were $0 in the first nine months of 2016 due to the redemption of the preferred stock in the fourth quarter of 2015, versus $1.424 million in the first nine months of 2015.

Net income available to common shareholders was $5.709 million, or $1.62 per diluted share, for the nine months ended September 30, 2016. Net income available to common shareholders in the first nine months of 2015 was $5.952 million, or $1.70 per diluted share, after accounting for dividends paid on preferred stock.

Assets, Liabilities and Equity

Total assets were $942.6 million at September 30, 2016, an increase of $38.3 million, or 4.2%, compared to $904.2 million at December 31, 2015. Loans held for investment aggregated $413.2 million at September 30, 2016, an increase of $33.2 million, or 8.8% since December 31, 2015. Since September 30, 2015, loans held for investment have increased $69.5 million or 20.2%. In addition, mortgage loans held for sale as of September 30, 2016 were up $13.2 million from December 31, 2015 as mortgage volume continues to remain strong. Investment balances remained relatively unchanged from year-end 2015.

Total deposits were $755.4 million at September 30, 2016 compared to $780.4 million at December 31, 2015 as BNC redeemed all remaining brokered deposits ($33.4 million) in 2016. Core deposits, which include recurring customer repurchase agreement balances, have increased by $42.7 million, or 5.9%, to $770.6 million at September 30, 2016 from $727.9 million as of September 30, 2015. This increase in core deposits occurred despite relatively subdued economic activity in North Dakota which has been impacted by lower energy and agricultural prices during this period. The Company has generally utilized Federal Home Loan Bank short term advances, with an average cost of 0.51%, to fund mortgage banking loans held for sale.

The table below shows total deposits since 2012:


September December December December December
30, 31, 31, 31, 31,
(In Thousands) 2016 2015 2014 2013 2012

ND Bakken

Branches $177,866 $190,670 $178,565 $166,904 $144,662

ND Non-Bakken

Branches 372,898 388,630 433,129 382,225 335,452

Total ND

Branches 550,764 579,300 611,694 549,129 480,114

Brokered

Deposits - 33,363 53,955 64,525 65,000

Other 204,600 167,786 145,582 109,575 104,490

Total Deposits $755,364 $780,449 $811,231 $723,229 $649,604



Trust assets under management or administration increased to $272.1 million at September 30, 2016, compared to $248.4 million at December 31, 2015.

Capital

Banks and bank holding companies operate under separate regulatory capital requirements.

At September 30, 2016, our capital ratios exceeded all regulatory capital thresholds and maintained sufficient capital conservation buffers to avoid limitations on certain types of capital distributions.

A summary of our capital ratios at September 30, 2016 and December 31, 2015 is presented below:

September 30, December 31,
2016 2015

BNCCORP, INC (Consolidated)

Tier 1 leverage 9.30% 9.00%

Total risk based capital 19.24% 20.07%

Common equity tier 1 risk based capital 13.28% 13.57%

Tier 1 risk based capital 16.10% 16.72%

Tangible common equity 8.24% 7.62%



BNC National Bank

Tier 1 leverage 9.76% 9.45%

Total risk based capital 18.16% 18.71%

Common equity tier 1 risk based capital 16.90% 17.45%

Tier 1 risk based capital 16.90% 17.45%



The CET 1 ratio, which is generally a comparison of a bank's core equity capital to its total risk weighted assets, is a measure of the current risk profile of our asset base from a regulatory perspective. The Tier 1 leverage ratio, which is based on average assets, does not consider the mix of risk weighted assets. In recent periods, regulators have required Tier 1 leverage ratios that significantly exceed "Well Capitalized" ratio levels. As a result, management believes the Bank's Tier 1 leverage ratio is our most restrictive capital measurement and we are managing the Tier 1 leverage ratio to levels significantly above the "Well Capitalized" ratio threshold.

In addition to regulatory risk based capital standards, we believe that regulators and investors also monitor the capital ratio of tangible common equity to total period end assets.

The Company routinely evaluates the sufficiency of capital in order to ensure compliance with regulatory capital standards and be a source of strength for the Bank. We manage capital by assessing the composition of capital and the amounts available for growth, risk or other purposes.

Book value per common share of the Company was $22.51 as of September 30, 2016, compared to $20.12 at December 31, 2015. Book value per common share, excluding accumulated other comprehensive income, was $20.49 as of September 30, 2016, compared to $18.93 at December 31, 2015.

Asset Quality

The allowance for credit losses was $8.7 million at September 30, 2016, compared to $8.6 million at December 31, 2015. The allowance for credit losses as a percentage of total loans at September 30, 2016 was 1.82%, compared to 2.00% at December 31, 2015. The allowance as a percentage of loans and leases held for investment at September 30, 2016 was 2.10% and at December 31, 2015 was 2.27%.

Nonperforming assets of $2.1 million at September 30, 2016, are down from $2.6 million at June 30, 2016, although they are up from $807 thousand at December 31, 2015. The ratio of nonperforming assets to total assets was 0.23% at September 30, 2016, 0.28% at June 30, 2016, and 0.09% at December 31, 2015. Nonperforming loans of $1.9 million at September 30, 2016, are down from $2.3 million at June 30, 2016, although they are up from $565 thousand at December 31, 2015. The increase in nonperforming assets since the beginning of the year relates to one relationship in the energy sector which was partially charged off in the third quarter.

Since the beginning of 2016, our classified loans have decreased, however, classified assets have increased since June 30, 2016. At September 30, 2016, BNC had $9.2 million of classified loans, $1.9 million of loans on non-accrual and $225 thousand of other real estate owned. At December 31, 2015, BNC had $9.8 million of classified loans, $390 thousand of loans on non-accrual and $242 thousand of other real estate owned. BNC had $11.9 million of potentially problematic loans, which are risk rated "watch list", at September 30, 2016 compared with $7.9 million as of December 31, 2015. The decrease in classified loans since the beginning of the year relates primarily to one relationship in North Dakota that was upgraded after sustained performance.

As evidenced by our nonperforming asset ratios and delinquency rates, as of September 30, 2016, the decrease in oil and agricultural commodity prices have yet to have a significant negative effect on our credit quality. However, the economic activity in western North Dakota is subdued relative to a few years ago. Prolonged periods of lower agricultural and oil prices could have an adverse economic impact on the North Dakota economy, commodity dependent businesses, and our loan portfolio. Oil prices most directly impact the underlying collateral for our oil exploration and production (E&P) loans. Loans outstanding for the purpose of and secured by E&P in North Dakota were approximately $9.6 million, or 2.3% of total loans held for investment at September 30, 2016, compared to $11.7 million, or 3.1%, of loans held for investment at December 31, 2015. Advances on E&P lines are generally limited to 50% of the value of proven, developed and producing oil reserves with valuations generally being performed on a semi-annual basis. In addition to E&P loans, loans to customers serving the energy industries in western North Dakota will be impacted by protracted low energy prices. Customers in, or serving the North Dakota agricultural sector have been experiencing lower commodity prices for multiple years which has had a dampening effect on economic activity in the region.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 16 locations. BNC also conducts mortgage banking from 17 offices in Arkansas, Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota.
This news release may contain "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of BNC. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management are generally identifiable by the use of words such as "expect", "believe", "anticipate", "plan", "intend", "estimate", "may", "will", "would", "could", "should", "future" and other expressions relating to future periods. Examples of forward-looking statements include, among others, statements we make regarding our belief that we have exceptional liquidity, our expectations regarding future market conditions and our ability to capture opportunities and pursue growth strategies, our expected operating results such as revenue growth and earnings and our expectations of the effects of the regulatory environment on our earnings for the foreseeable future. Forward-looking statements are neither historical facts nor assurances of future performance. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, but are not limited to: the impact of current and future regulation; the risks of loans and investments, including dependence on local and regional economic conditions; competition for our customers from other providers of financial services; possible adverse effects of changes in interest rates, including the effects of such changes on mortgage banking revenues and derivative contracts and associated accounting consequences; risks associated with our acquisition and growth strategies; and other risks which are difficult to predict and many of which are beyond our control. In addition, all statements in this news release, including forward-looking statements, speak only of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

This press release contains references to financial measures which are not defined in generally accepted accounting principles ("GAAP"). Such non-GAAP financial measures include the Company's tangible equity to assets ratio and information presented excluding nonrecurring transactions. These non-GAAP financial measures have been included as the Company believes they are helpful for investors to analyze and evaluate the Company's financial condition.

(Financial tables deleted)

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/bnccorp-inc-reports-third-quarter-net-income-to-common-shareholders-of-23-million-or-064-per-diluted-share-300352225.html

SOURCE BNCCORP, INC.

/CONTACT: WEBSITE: www.bnccorp.com, TIMOTHY J. FRANZ, CEO, TELEPHONE: (612) 305-2213; or DANIEL COLLINS, CFO, TELEPHONE: (612) 305-2210



/Web site: http://www.bnccorp.com



(END) Dow Jones Newswires

BNCC $18.10

impressive 312,500 share block crosses @ 52week high of $18.25.

FYI, 100d avg. volume slightly above 2000 shares.

http://stockcharts.com/freecharts/gallery.html?s=BNCC

BNCCORP, INC. Reports Second Quarter Net Income To Common Shareholders Of $2.0 Million, Or $0.58 Per Diluted Share

2016 Second Quarter Highlights

- 2016 second quarter results reflect continued strong financial performance and growing shareholder value

- Net income available to common shareholders increased 12.2% to $2.0 million, from $1.8 million in the second quarter of 2015, primarily due to higher net interest income and non-interest income, and the beneficial impact of deleveraging

- Basic and diluted earnings per share in the first half of 2016 were $1.00 and $0.98, respectively

- Book value per common share was $22.35 at June 30, 2016 compared to $20.12 at December 31, 2015, an increase of 11.1%

- Return on equity was 12.05% in the second quarter of 2016 and 10.37% year to date

- Nonperforming assets were 0.28% of total assets as of June 30, 2016, comparable to 0.10% of total assets at March 31, 2016

--------------------------------------------------------------------------------

BISMARCK, N.D., July 27, 2016 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Arkansas, Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the second quarter ended June 30, 2016.

Net income available to common shareholders in the 2016 second quarter was $2.035 million, or $0.58 per diluted share, compared to $1.813 million, or $0.52 per diluted share, in the second quarter of 2015. The increase in net income to common shareholders is primarily attributable to higher net interest income, higher non-interest income, and the impact of deleveraging BNC in the fourth quarter of 2015.


Net interest income in the 2016 second quarter increased by $66 thousand from the same quarter in 2015, as growth of loans held for investment resulted in higher yields on earning assets and improved the net interest margin.

Non-interest income in the second quarter of 2016 increased by $755 thousand, or 11.2%, from the same period in 2015 driven by growth in mortgage banking revenue. Excluding the impact of gains on the sale of securities, non-interest income increased $1.282 million, or 22.2%, when compared to the second quarter of 2015. Non-interest expense increased by $970 thousand, or 10.0%, in the second quarter of 2016 due to higher mortgage volume related costs and investments in technology as BNC strives to improve its customers' experience and keep pace with advancements in technology.

The provision for credit losses was $400 thousand in the second quarter of 2016 and $0 for the same period in 2015. The ratio of nonperforming assets to total assets was 0.28% at June 30, 2016 compared to 0.09% at December 31, 2015.

Book value per common share at June 30, 2016 rose to $22.35 compared to $20.12 and $19.23 at December 31, 2015 and June 30, 2015, respectively. Excluding accumulated other comprehensive income, book value per common share at June 30, 2016 was $19.87 compared to $18.93 and $18.06 at December 31, 2015 and June 30, 2015, respectively.

Timothy J. Franz, BNC President and Chief Executive Officer, said, "Our 2016 second quarter continued the extended sequence of quarters where BNC has delivered strong performance and built value. In the last ten quarters BNC's book value per share has increased by 54.7% and since the beginning of 2012 our book value per share has increased by 248.1%. Our earnings per share in recent periods reflect the value we are building. We look forward to continuing our recent history of quarterly earnings that builds shareholder value."

Mr. Franz continued, "The North Dakota economy is notably influenced by the energy and agricultural sectors which have been challenged in recent periods. Despite a small increase in the nonperforming assets ratio this quarter; we have successfully managed these economic challenges as our credit quality metrics remain excellent. In the second quarter, we recognized a provision for credit losses for the first time in two and half years. We believe maintaining our allowance for credit losses results in a balance sheet that is resistant to global and regional economic risks. Our strong balance sheet can provide a solid foundation as we continue building our franchise and creating value for shareholders."

Second Quarter Results

Net interest income for the second quarter of 2016 was $6.482 million, an increase of $66 thousand, or 1.0%, from $6.416 million in the same period of 2015. Overall, the net interest margin increased to 3.01% in the second quarter of 2016 from 2.93% in the second quarter of 2015.

Interest income was $7.346 million for the quarter ended June 30, 2016 compared to $7.112 million in the second quarter of 2015. This increase is the result of higher yields on earning assets partially offset by lower average balances. The yield on assets increased to 3.42% in the second quarter of 2016 from 3.25% in the second quarter of 2015, while the average balance of interest earning assets decreased by $12.3 million. Our average loans held for investment increased by $44.6 million year-over-year while the average balances of loans held for sale and investments were $15.4 million and $31.4 million lower, respectively. Despite the overall decrease in average investments, we have increased our investment in tax exempt municipal securities, which aggregated $90.7 million at June 30, 2016, due to the relatively attractive attributes of these securities in the context of our overall portfolio and balance sheet management activities and value provided via reduced income tax expense.

Interest expense in the second quarter of 2016 was $864 thousand, an increase of $168 thousand from the same period in 2015. In the second quarters of 2016 and 2015, BNC submitted notices to redeem $14.6 million and $20.0 million, respectively, of higher rate callable brokered certificates of deposit, at a cost of $92 thousand and $87 thousand, respectively. The cost of interest bearing liabilities increased to 0.50% in the current quarter from 0.42% in the same period of 2015, primarily due to the issuance of subordinated debt in the fourth quarter of 2015, and an increase in retail certificates of deposit balances in recent quarters. The cost of these liabilities were partially offset by redeeming higher cost brokered certificates of deposit in the second quarter of 2015 and first quarter of 2016. The cost of core deposits was 0.22% in the second quarter of 2016 and 0.16% in the second quarter of 2015, due largely to higher balances of retail certificates of deposits which generally have higher rates than non-maturity deposits. Average interest bearing deposits decreased $23.6 million, or 3.9%, during the second quarter of 2016 compared to the second quarter of 2015, primarily due to the redemption of brokered certificates of deposits.

Provision for credit losses was $400 thousand in the second quarter of 2016. As a result, our allowance for credit losses has remained essentially flat in 2016. This compares with $0 provision for the same period in 2015.

Preferred stock costs were $0 in the second quarter of 2016 due to the redemption of the preferred stock in the fourth quarter of 2015, and $474 thousand in the second quarter of 2015.

Non-interest income for the second quarter of 2016 was $7.495 million, an increase of $755 thousand, or 11.2%, from $6.740 million in the second quarter of 2015. Excluding the impact of gains on the sale of securities, noninterest income increased $1.282 million or 22.2% primarily due to an increase in mortgage revenue. Mortgage banking production resulted in revenues of $5.354 million in the second quarter of 2016 compared to $4.015 million in the second quarter of 2015. During the second quarter of 2016, we recorded net gains on sales of investments and SBA loan sales of $615 thousand compared to $1.221 million of net gains on sales of these assets in the same period of 2015. Gains on sales of SBA loans have declined as the Company's loan growth has recently favored conventional loans. Gains and losses on sales of assets can vary significantly from period to period.

Non-interest expense for the second quarter of 2016 increased $970 thousand to $10.628 million from $9.658 million in the second quarter of 2015. This increase is primarily related to elevated mortgage banking activities and investment in our technology.

In the second quarter of 2016, income tax expense was $914 thousand compared to $1.211 million in the second quarter of 2015. The effective tax rate was 31.0% in the second quarter of 2016 compared to 34.6% in the same period of 2015. The decrease in the effective tax rate in the second quarter of 2016 is due to a higher percentage of tax exempt income than in the second quarter 2015.

Net income available to common shareholders was $2.035 million, or $0.58 per diluted share, for the second quarter of 2016. Net income available to common shareholders in the second quarter of 2015 was $1.813 million, or $0.52 per diluted share after accounting for dividends paid on preferred stock. The preferred stock costs were $0 in the second quarter of 2016 due to the redemption of the preferred stock in the fourth quarter of 2015, and $474 thousand in the second quarter of 2015.

Six Months Ended June 30, 2016

Net interest income in the first half of 2016 was $12.758 million, a decrease of $265 thousand, or 2.0%, from $13.023 million in the first half of 2015 as the impact of higher yields on earning assets was offset by the impact of lower average earning assets. Yields on earning assets overall increased to 3.43% in the six month period ended June 30, 2016 compared to 3.28% in the same period of 2015, as average loan balances increased as a percentage of average earning assets from approximately 46% to 51%. Average loans held for investment increased $38.9 million, or 11.0%, compared to the first half of the prior year. On average, mortgage loans held for sale decreased by $12.6 million when compared to 2015. The average balance of investment securities decreased by $32.3 million in the first six months of 2016 compared to the same period a year ago. Overall, the net interest margin increased to 3.01% in the first six months of 2016 from 2.98% in the first six months of 2015.

Interest expense in the first half of 2016 increased to $1.763 million from $1.307 million, or 34.8%, in the same period of 2015. In the first half of 2016 and 2015, BNC submitted notices to redeem $33.4 million and $20.0 million, respectively, of higher rate callable brokered certificates of deposit, at a cost of $233 thousand, and $87 thousand, respectively. Excluding the costs to redeem these brokered deposits, interest expense increased by $311 thousand. The cost of interest bearing liabilities increased to 0.52% in the first half of 2016 from 0.39% in the same period of 2015, primarily due to the issuance of subordinated debt in 2015, and an increase in retail certificates of deposit balances partially offset by the effects of redeeming brokered deposits. The cost of core deposits increased to 0.21% in the first half of 2016 from 0.16% in the first half of 2015 as retail certificates of deposits have increased in recent quarters.

Provision for credit losses was $400 thousand in the first six months of 2016. This provision compares with $0 provision for the same period in 2015.

Non-interest income for the first six months of 2016 was $13.146 million, a decrease of $1.245 million, or 8.7% from $14.391 million in the same period of 2015. The decrease primarily relates to a $1.123 million, or 72.0%, decrease in gains on sales of securities. During the six month period ended June 30, 2016, we recorded a net gain on sales of investments of $437 thousand, compared to a $1.560 million net gain on sales of investments in the same period of 2015. Excluding securities gains, non-interest income decreased 1.0%.

Non-interest expense for the first six months of 2016 was $20.474 million, an increase of $1.150 million, or 6.0%, from $19.324 million in the same period of 2015. This increase is primarily related to compensation for producers, expenses associated with higher mortgage banking activity, as well as investments in technology.

During the six month period ended June 30, 2016, we recorded a tax expense of $1.580 million, equating to an effective tax rate of 31.4%. We recorded tax expense of $2.589 million during the six month period ended June 30, 2015, which resulted in an effective tax rate of 32.0%.

Preferred stock costs were $0 in the first six months of 2016 due to the redemption of the preferred stock in the fourth quarter of 2015, versus $949 thousand in the first half of 2015.

Net income available to common shareholders was $3.450 million, or $0.98 per diluted share, for the six months ended June 30, 2016. Net income available to common shareholders in the first six months of 2015 was $4.552 million, or $1.30 per diluted share after accounting for dividends paid on preferred stock.

Assets, Liabilities and Equity

Total assets were $927.0 million at June 30, 2016, an increase of $22.8 million, or 2.5%, compared to $904.2 million at December 31, 2015. Loans held for investment aggregated $399.7 million at June 30, 2016, an increase of $19.8 million, or 5.2% since December 31, 2015. In addition, mortgage loans held for sale as of June 30, 2016 were up $8.7 million from December 31, 2015 as mortgage volume continues to remain strong. Investment balances remained relatively unchanged from year-end 2015.

Total deposits were $757.0 million at June 30, 2016, a decrease of $23.4 million from $780.4 million at 2015 year-end. We exercised our right to call $18.8 million of brokered deposits in the first quarter of 2016. As a result, core deposit balances of $756.5 million at June 30, 2016 decreased only $4.4 million, or 0.6%, from $760.9 million at December 31, 2015. The Company has utilized Federal Home Loan Bank short term advances with an average cost of 0.48% to fund loan growth.


Trust assets under management or administration increased to $263.1 million at June 30, 2016, compared to $248.4 million at December 31, 2015.

Capital

Banks and bank holding companies operate under separate regulatory capital requirements.

At June 30, 2016, our capital ratios exceeded all regulatory capital thresholds and maintained sufficient capital conservation buffers to avoid limitations on certain types of capital distributions.

The CET 1 ratio, which is generally a comparison of a bank's core equity capital to its total risk weighted assets, is a measure of the current risk profile of our asset base from a regulatory perspective. The Tier 1 leverage ratio, which is based on average assets, does not consider the mix of risk weighted assets. In recent periods, regulators have required Tier 1 leverage ratios that significantly exceed "Well Capitalized" ratio levels. As a result, management believes the Bank's Tier 1 leverage ratio is our most restrictive capital measurement and we are managing the Tier 1 leverage ratio to levels significantly above the "Well Capitalized" ratio threshold.

In addition to regulatory risk based capital standards, we believe that regulators and investors also monitor the capital ratio of tangible common equity to total period end assets.

Book value per common share of the Company was $22.35 as of June 30, 2016, compared to $20.12 at December 31, 2015. Book value per common share, excluding accumulated other comprehensive income, was $19.87 as of June 30, 2016, compared to $18.93 at December 31, 2015.

Asset Quality

The allowance for credit losses was $8.7 million at June 30, 2016, compared to $8.6 million at December 31, 2015. The allowance for credit losses as a percentage of total loans at June 30, 2016 was 1.90%, compared to 2.00% at December 31, 2015. The allowance as a percentage of loans and leases held for investment at June 30, 2016 was 2.18% and at December 31, 2015 was 2.27%.

Nonperforming assets were $2.6 million at June 30, 2016, up from $807 thousand at December 31, 2015. The ratio of nonperforming assets to total assets was 0.28% at June 30, 2016 and 0.09% at December 31, 2015. Nonperforming loans were $2.3 million at June 30, 2016, up from $565 thousand at December 31, 2015. The increase in nonperforming assets relates to one relationship in the energy sector.

Since the beginning of 2016 our classified loans have decreased and non-accrual loans have increased. At June 30, 2016, BNC had $4.1 million of classified loans, $2.3 thousand of loans on non-accrual and $225 thousand of other real estate owned. At December 31, 2015, BNC had $9.8 million of classified loans, $390 thousand of loans on non-accrual and $242 thousand of other real estate owned. BNC had $8.7 million of potentially problematic loans, which are risk rated "watch list", at June 30, 2016 compared with $7.9 million as of December 31, 2015. The decrease in classified loans relates primarily to one relationship in North Dakota.

As evidenced by our nonperforming asset ratios and delinquency rates, as of June 30, 2016, the decrease in oil and agricultural commodity prices have yet to have a significant negative effect on our credit quality. However, prolonged depressed oil prices could have an adverse economic impact on the North Dakota economy, commodity dependent businesses, and our loan portfolio. Oil prices most directly impact the underlying collateral for our oil exploration and production (E&P) loans. Loans outstanding for the purpose of and secured by E&P in North Dakota were approximately $11.8 million, or 2.9% of total loans held for investment at June 30, 2016 compared to $11.7 million, or 3.1%, of loans held for investment at December 31, 2015. Advances on E&P lines are generally limited to 50% of the value of proven, developed and producing oil reserves with valuations generally being performed on a semi-annual basis. In addition to E&P loans, loans to customers serving the energy industries will be impacted by protracted low energy prices.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 16 locations. BNC also conducts mortgage banking from 17 offices in Arkansas, Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota.

This news release may contain "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of BNC. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management are generally identifiable by the use of words such as "expect", "believe", "anticipate", "plan", "intend", "estimate", "may", "will", "would", "could", "should", "future" and other expressions relating to future periods. Examples of forward-looking statements include, among others, statements we make regarding our belief that we have exceptional liquidity, our expectations regarding future market conditions and our ability to capture opportunities and pursue growth strategies, our expected operating results such as revenue growth and earnings and our expectations of the effects of the regulatory environment on our earnings for the foreseeable future. Forward-looking statements are neither historical facts nor assurances of future performance. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, but are not limited to: the impact of current and future regulation; the risks of loans and investments, including dependence on local and regional economic conditions; competition for our customers from other providers of financial services; possible adverse effects of changes in interest rates, including the effects of such changes on mortgage banking revenues and derivative contracts and associated accounting consequences; risks associated with our acquisition and growth strategies; and other risks which are difficult to predict and many of which are beyond our control. In addition, all statements in this news release, including forward-looking statements, speak only of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

This press release contains references to financial measures which are not defined in generally accepted accounting principles ("GAAP"). Such non-GAAP financial measures include the Company's tangible equity to assets ratio and information presented excluding nonrecurring transactions. These non-GAAP financial measures have been included as the Company believes they are helpful for investors to analyze and evaluate the Company's financial condition.

(Financial tables attached) -deleted tables-


SOURCE BNCCORP, INC.

http://www.prnewswire.com/news-releases/bnccorp-inc-reports-second-quarter-net-income-to-common-shareholders-of-20-million-or-058-per-diluted-share-300304590.html

BNCCORP, INC. Reports First Quarter Net Income Of $1.4 Million, Or $0.40 Per Diluted Share

2016 First Quarter Highlights

- Book value per common share was $21.31 at March 31, 2016

- Nonperforming assets were 0.10% of total assets as of March 31, 2016

- Loans held for investment increased in first quarter by 5% to $399 million

- Net income available to common shareholders in the 2016 first quarter was $1.4 million compared to $1.6 million and $2.7 million in the fourth and first quarters of 2015, respectively



BISMARCK, N.D., April 28, 2016 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Arkansas, Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the first quarter ended March 31, 2016.

Net income available to common shareholders in the 2016 first quarter was $1.415 million, or $0.40 per diluted share, compared to $2.739 million, or $0.78 per diluted share, in the first quarter of 2015. The decrease in earnings is primarily attributable to lower noninterest income.

Noninterest income in the first quarter of 2016 was $2.0 million less in the same period in 2015 as gains on asset sales decreased by $866 thousand and mortgage banking revenues receded from extraordinary levels experienced in early 2015. Non-interest expenses increased by 1.9% in the first three months of 2016 compared to the same period of 2015 as decreases in compensation expense were offset by increases in other operating costs. Net interest income in the 2016 first quarter was $331 thousand less than the same quarter in 2015 due to $140 thousand of costs incurred to prepay $18.8 million of brokered deposits and new interest on subordinated debt issued in late 2015 to redeem preferred stock.

The provision for credit losses was $0 in the first quarter of 2016 and 2015. The ratio of nonperforming assets to total assets was 0.10% at March 31, 2016 compared to 0.09% at December 31, 2015.

Book value per common share at March 31, 2016 was $21.31 compared to $20.12 and $19.62 at December 31, 2015 and March 31, 2015, respectively. Excluding accumulated other comprehensive income, book value per common share at March 31, 2016 was $19.26 compared to $18.93 and $17.52 at December 31, 2015 and March 31, 2015, respectively.

First Quarter 2016 comparison to Fourth Quarter 2015

Net interest income in the 2016 first quarter was $59 thousand higher than the 2015 fourth quarter. Interest income in 2016 first quarter increased $252 thousand or 3.6% primarily due to increased loans held for investment. As noted above, interest expense was higher in the first quarter of 2016 due to a $140 thousand charge for costs to redeem higher rate callable brokered certificates of deposit and new interest on subordinated debt issued in late 2015 to redeem preferred stock. Excluding the charge to redeem brokered deposits, net interest income increased $199 thousand or 3.2% from the fourth quarter of 2015.

Non-interest income increased $324 thousand, or 6.1%, in the 2016 first quarter compared to the 2015 fourth quarter driven by higher mortgage revenue in early 2016. Non-interest expense rose from the fourth quarter of 2015 by $606 thousand due to compensation costs related to increases in loans held for investment which began late in the fourth quarter of 2015 and continued in the first quarter of 2016.

Income tax expense in the first quarter of 2016 was $192 thousand higher than the last quarter of 2015 as an adjustment to the estimated effective tax rate was recorded late in 2015. Preferred stock costs were $0 in the first quarter of 2016 due to the redemption of preferred stock in late 2015.

Timothy J. Franz, BNC President and Chief Executive Officer, said, "We continued to create value this quarter as demonstrated by the increase in book value per share to $21.31 per share. We maintained exceptional credit quality metrics despite headwinds in the energy and agricultural industries in North Dakota while mortgage banking revenues continue to be elevated. We believe the resiliency of our balance sheet is improving as we have increased tangible common equity to 7.93% and maintained healthy total risk weighted regulatory ratios of 19.03% at the holding company and 17.81% at BNC Bank."

Mr. Franz continued, "In recent months, we have generated solid growth in our loans held for investment which we expect to be a fundamental driver of value in future periods. We remain focused on meeting the financial needs of our customers and being active in the communities we serve. Our strong balance sheet, improving capital structure and dedicated employees provide a solid foundation as we look forward."

.....

http://www.bnccorp.com/54304/mirror/files/Qtr_1_2016_Press_Release_Final_.pdf

Qtr. profits declining/slowing but still a profitable bank and value, IMO! (see 2015 annual report 5 year table & 2015 qtr. table)

BNCC 2015 annual report

http://www.bnccorp.com/54304/mirror/files/2015_BNC_Annual_Report.pdf

BNCCORP, INC. Announces Redemption of Series B Preferred Stock


BISMARCK, N.D., Nov. 20, 2015 /PRNewswire/ -- BNCCORP, INC. (OTCQX: BNCC) (the "Company") announced today that it is redeeming the 1,005 outstanding shares of the Company's 9% Fixed Rate Cumulative Perpetual Preferred Stock, Series B ("Series B Preferred Stock"). On November 19, 2015, the Company completed the previously announced redemption of the outstanding shares of the Company's Series A Preferred Stock.
The redemption of the Series B Preferred Stock is expected to be completed on December 21, 2015. The redemption price for the shares of Series B Preferred Stock is the stated liquidation preference amount of $1,000 per share or an aggregate $1,005,000, plus accrued and unpaid dividends aggregating approximately $9,000.

The Company has sought and received approval for the redemption of the Series B Preferred Stock from its regulator.

This news release may contain "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of BNC. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management are generally identifiable by the use of words such as "expect", "believe", "anticipate", "plan", "intend", "estimate", "may", "will", "would", "could", "should", "future" and other expressions relating to future periods. Examples of forward-looking statements include, among others, statements we make regarding our belief that we have exceptional liquidity, our expectations regarding future market conditions and our ability to capture opportunities and pursue growth strategies, our expected operating results such as revenue growth and earnings, and our expectations of the effects of the regulatory environment on our earnings for the foreseeable future. Forward-looking statements are neither historical facts nor assurances of future performance. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, but are not limited to: the impact of current and future regulation; the risks of loans and investments, including dependence on local and regional economic conditions; competition for our customers from other providers of financial services; possible adverse effects of changes in interest rates, including the effects of such changes on mortgage banking revenues and derivative contracts and associated accounting consequences; risks associated with our acquisition and growth strategies; and other risks which are difficult to predict and many of which are beyond our control. In addition, all statements in this news release, including forward-looking statements, speak only of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/bnccorp-inc-announces-redemption-of-series-b-preferred-stock-300182693.html

SOURCE BNCCORP, INC.

/Web site: http://www.bnccorp.com



(END) Dow Jones Newswires

November 20, 2015 14:07 ET (19:07 GMT)

Wrong Or BS? (10/28/15)

http://seekingalpha.com/instablog/957061-chris-demuth-jr/4492186-wrong-or-bs

BNCCORP, INC. Reports Third Quarter Net Income Of $1.9 Million, Or $0.40 Per Diluted Share

http://www.prnewswire.com/news-releases/bnccorp-inc-reports-third-quarter-net-income-of-19-million-or-040-per-diluted-share-300167389.html

SERIES A PREFERRED STOCK TO BE REDEEMED

2015 Third Quarter Highlights

- Series A Preferred Stock to be redeemed, funded by available cash, and new subordinated debt, sharply reducing cost of capital

- Year-to-date net income is $7.4 million or $1.70 per diluted share

- Third quarter 2015 net income decreased by $105 thousand compared to the third quarter of 2014; net income for 2015 year-to-date increased by $1.3 million from 2014 period

- Book value per common share was $20.09 at September 30, 2015

- Total assets were $876 million at September 30, 2015

- Nonperforming assets were 0.07% of total assets as of September 30, 2015

PR Newswire

BISMARCK, N.D., Oct. 28, 2015

BISMARCK, N.D., Oct. 28, 2015 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC),which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Arkansas, Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota, today reported financial results for the third quarter ended September 30, 2015.

Net income for the 2015 third quarter was $1.875 million, or $0.40 per diluted share compared to net income of $1.981 million, or $0.43 per diluted share, in the third quarter of 2014. The earnings for the third quarter of 2015 reflected lower net interest income, partially offset by higher non-interest income. Reversals of previous provisions for credit losses were taken in the third quarters of 2015 and 2014, which increased pre-tax earnings by $400 thousand and $200 thousand, respectively. The ratio of nonperforming assets to total assets was 0.07% at September 30, 2015 compared to 0.03% at December 31, 2014. Book value per common share at September 30, 2015 was $20.09 compared to $18.28 and $17.18 at December 31, 2014 and September 30, 2014, respectively.

On October 20, 2015, BNC announced the redemption of 20,093 shares of 9% Series A Preferred Stock at par in November, 2015. The redemption price for the Series A Preferred Stock aggregates $20,093,000. On November 16, 2015 the Company will pay the recurring quarterly dividend and dividends of approximately $15 thousand will also be paid on the redemption date. BNC also has 1,005 shares of 9% Series B Preferred Stock outstanding. Subsequent to the redemption of the Series A Preferred Stock and subject to approval by the Company's board of directors, the Company's Series B Preferred Stock are eligible for redemption at par. Redemption of the Company's Series A and Series B Preferred Stock has been approved by the Company's regulatory authorities.

Redemption of the Series A Preferred Stock is being funded from cash available and new subordinated debt. BNC National Bank (the "Bank"), a wholly owned subsidiary of the Company, has declared an $11.0 million dividend to be paid to the Company during the fourth quarter of 2015. On October 19, 2015, the Company issued $10.0 million of subordinated debt that qualifies as Tier 2 capital. The subordinated debt matures October 19, 2025 and carries a fixed interest rate of 6.35%. The subordinated debt is eligible for prepayment at par after five years.

Annual dividends paid on the Company's Series A and B Preferred Stock aggregate approximately $1.9 million. The annual interest cost of the Company's new subordinated debt is estimated to be approximately $432 thousand after tax. The estimated annual impact of eliminating preferred stock dividends and incurring interest on the new subordinated debt is estimated to increase net income available to common shareholders by $1.5 million annually or approximately $0.43 per diluted share should the Series B Preferred Stock be redeemed.

Timothy J. Franz, BNC President and Chief Executive Officer, said, "We delivered solid results this quarter and are very pleased with our year to date results. Mortgage banking continues to deliver strong results and it appears that housing is strengthening in markets beyond those regions heavily influenced by energy. Our credit quality remains very strong and despite the recent decline in loan growth, our pipeline of new business provides optimism. Overall we are well positioned to continue creating value for our shareholders."

Mr. Franz continued, "The redemption of our Series A Preferred Stock is a meaningful benefit to our common shareholders. This redemption is a significant milestone and is the direct result of our ability to generate substantial capital from operations. We now have two issuances of subordinated debt outstanding aggregating $25 million with an estimated annual weighted average cost of 3.6%, or 2.4% after tax, and maturities of 10 and 22 years. We believe the cost of this capital is favorable to common shareholders, particularly when combined with our ability to exercise attractive call options in future periods. These transformative transactions will reduce our cost of capital and add flexibility to our capital structure."

Third Quarter Results

Net interest income for the third quarter of 2015 was $6.105 million, a decrease of $644 thousand, or 9.5%, from $6.749 million in the same period of 2014. Interest income declined by $878 thousand or 11.6% as the average balance of interest earning assets decreased $13.1 million and yields on investment securities declined when compared to the third quarter of 2014. Average loans held for investment increased $15.4 million, or 4.7%, compared to the prior year third quarter. On average, loans held for sale increased by $6.3 million when compared to the third quarter of 2014, as the lower interest rate environment continues to support mortgage activity. The average balance of investment securities decreased by $20.9 million in the third quarter of 2015 compared to the same period a year ago. The yield on earning assets decreased to 3.17% in the third quarter of 2015 compared to 3.54% in the third quarter of 2014. The lower yield on earning assets is the result of interest rates continuing to decline in recent periods and the changing composition of our investment portfolio. As of September 30, 2015 the balance of variable rate SBA securities was $102.8 million compared to $52.9 million at September 30, 2014. These defensive investments have lower yields than investments that have repaid over the past year. In recent periods we have also increased our investment in tax exempt municipal securities, which aggregated $94.8 million at September 30, 2015, due to the relative attractive yields and value provided via reduced income tax expense.

Overall, the net interest margin declined to 2.91% in the third quarter of 2015 from 3.17% in the third quarter of 2014. On a taxable equivalent basis, the net interest margin declined to 3.09% in the third quarter of 2015 from 3.31% in the third quarter of 2014.

Interest expense in the third quarter of 2015 decreased $234 thousand from the same period in 2014. Average deposits decreased $17.6 million, or 2.3%. The cost of core deposits declined to 0.16% in the current quarter, compared to 0.17% in the same period of 2014. In aggregate, the cost of interest bearing liabilities declined to 0.35% in the current quarter, compared to 0.47% in the same period of 2014. The redemption of $7.5 million of subordinated debentures in the third quarter of 2014 reduced the third quarter of 2015 interest expense by approximately $120 thousand. In addition, the Company's redemption of $20 million of brokered deposits in the second quarter of 2015 reduced interest expense $76 thousand in the third quarter 2015 compared to the same period in 2014.

A reversal of previous provisions for credit losses increased pre-tax earnings by $400 thousand in the third quarter of 2015. This reflects a recovery of a previously charged off loan. A reversal of previous provisions for credit losses increased pre-tax earnings by $200 thousand in the third quarter of 2014.

Non-interest income for the third quarter of 2015 was $5.232 million, an increase of $418 thousand, or 8.7% from $4.814 million in the third quarter of 2014. The increase primarily relates to a 31.7% increase in mortgage banking revenues, which aggregated $3.663 million in the third quarter of 2015, compared to $2.782 million in the third quarter of 2014. Mortgage banking operations continue to benefit from the continued lower rate environment in the third quarter of 2015. We continue to sell residential mortgage loans with servicing released. During the third quarter of 2015, we recorded a net gain on sales of investments of $172 thousand, compared to a $0 net gain on sales of investments in the same period of 2014. The 2015 third quarter included gains on sales of loans of $133 thousand, compared to $688 thousand in the same period of 2014. While gains on sales of investments and SBA loans can vary significantly from period to period we currently anticipate gains from sales of SBA loans will be higher in the foreseeable future.

Non-interest expense for the third quarter of 2015 was $8.980 million, an increase of $215 thousand, or 2.5%, from $8.765 million in the third quarter of 2014. This increase is primarily related to costs associated with higher mortgage banking activity.

In the third quarter of 2015, we recorded a tax expense of $882 thousand, a decrease from the $1.017 million income tax expense in the third quarter of 2014. The effective tax rate was 32% in the third quarter of 2015 compared to 33.92% in the same period of 2014. The higher effective tax rate in the third quarter of 2014 is the result of an adjustment to the annual estimated effective tax rate to achieve a rate of 32% correlating to higher estimated full year taxable income.

Net income available to common shareholders was $1.400 million, or $0.40 per diluted share, for the third quarter of 2015 after accounting for accrued dividends on preferred stock. These costs aggregated $475 thousand in the third quarters of 2015 and 2014. Net income available to common shareholders in the third quarter of 2014 was $1.506 million, or $0.43 per diluted share.
Nine Months Ended September 30, 2015

Net interest income in the first nine months of 2015 was $19.128 million, a decrease of $149 thousand, or 0.8%, from $19.277 million in the first nine months of 2014. Interest income decreased by $923 thousand as the $35.3 million increase in the average balance of interest earning assets was more than offset by lower yields on earning assets. Interest rates have declined in recent periods and the mix of assets has changed since 2014. Average loans held for investment increased $22.6 million, or 6.9%, compared to the first nine months of the prior year while the yield on loans held for investment has decreased by 7 basis points in the first nine months of 2015 when compared to the same period of 2014. On average, loans held for sale increased by $22.2 million when compared to the first nine months of 2014, as lower interest rates have continued to bolster our mortgage banking operations. The average balance of investment securities increased by $497 thousand in the first nine months of 2015 compared to the same period a year ago. However, the impact of higher average investments was offset by lower yields on investments due to the lower interest rate environment and the shift of investments to more defensive securities. The yield on earning assets decreased to 3.24% in the nine month period ended September 30, 2015 compared to 3.53% in the same period of 2014. Overall, the net interest margin declined to 2.96% in the first nine months of 2015 from 3.11% in the first nine months of 2014. On a taxable equivalent basis, the net interest margin declined to 3.12% for the first nine months of 2015 from 3.25% in first nine months of 2014.

Interest expense during the first nine months of 2015 decreased from the same period in 2014 despite an increase in average deposits of $25.0 million, or 3.3%. The cost of core deposits declined to 0.16% in the first nine months of 2015, compared to 0.18% in the same period of 2014. In aggregate, the cost of interest bearing liabilities declined to 0.38% in the first nine months of 2015, compared to 0.53% in the same period of 2014. This decrease in interest expense relates to a redemption of brokered deposits and prepayment of subordinated debentures. The lower balances of brokered deposits and subordinated debentures enabled us to decrease interest expense by $685 thousand during the nine month period ending September 30, 2015 when compared to the same time period in 2014.

A reversal of previous provisions for credit losses increased pre-tax earnings by $400 thousand in the first nine months of 2015. A reversal of previous provisions for credit losses increased pre-tax earnings by $800 thousand in the first nine months of 2014.

Non-interest income for the first nine months of 2015 was $19.623 million, an increase of $5.164 million, or 35.7% from $14.459 million in the same period of 2014. The increase primarily relates to a 55.5% increase in mortgage banking revenues, which aggregated $13.147 million in the first nine months of 2015, compared to $8.455 million in the same period of 2014. Mortgage banking revenues benefited from lower rates throughout 2015 as we continue to sell residential mortgage loans. During the first nine months of 2015, we recorded a net gain on sales of investments of $1.732 million, compared to a $528 thousand net gain on sales of investments in the same period of 2014. The first nine months of 2015 included gains on sales of loans of $705 thousand, compared to $1.688 million in the same period of 2014. Gains on sales of investments and loans can vary significantly from period to period.

Non-interest expense for the first nine months of 2015 was $28.304 million, an increase of $2.562 million, or 10.0%, from $25.742 million in the first nine months of 2014. This increase is primarily related to compensation for producers and higher mortgage banking activity.

During the nine month period ended September 30, 2015, we recorded a tax expense of $3.471 million, equating to an effective tax rate of 32%. We recorded tax expense of $2.814 million during the nine month period ended September 30, 2014, which resulted in an effective tax rate of 32%.

Net income available to common shareholders was $5.952 million, or $1.70 per diluted share, for the nine months ended September 30, 2015 after accounting for dividends accrued on preferred stock. These costs aggregated $1.424 million in the first nine months of 2015 and $1.321 million in the same period of 2014. The increase in preferred stock costs is due to the preferred dividend rate increasing from 5% to 9% in the second quarter 2014. Net income available to common shareholders for the first nine months ended September 30, 2014 was $4.659 million, or $1.34 per diluted share.

Assets, Liabilities and Equity

Total assets were $875.5 million at September 30, 2015, a decrease of $58.9 million, or 6.3%, compared to $934.4 million at December 31, 2014. Most of this decrease has occurred since late in the second quarter of 2015. In recent years we have experienced asset growth resulting from an increase in deposits as our North Dakota clients profited from the robust regional economy. As foreshadowed in previous press releases, some of these North Dakota customers have deployed funds in 2015 previously deposited with us. In addition, we redeemed brokered deposits aggregating $20 million this year. The decrease in total assets in combination with our strong year-to-date earnings increased our regulatory capital ratios at September 30, 2015 and contributed to our ability to redeem preferred stock as discussed above.

Loans held for investment aggregated $343.7 million at September 30, 2015, a decrease of $17.1 million since December 31, 2014. We continue to fund new loans held for investment but some North Dakota clients are deferring investment decisions and repaying loans in response to softer economic conditions in the region. Despite the decrease in loans held for investment in 2015, we have experienced significant growth of our loans held for investment in recent years. Our pipeline of loans held for investment is strong and we anticipate continued growth in future periods.

Total deposits were $745.8 million at September 30, 2015, a decrease of $65.4 million from 2014 year-end. Core deposit balances were $727.9 million at September 30, 2015 and $773.3 million at December 31, 2014. This decrease was anticipated as noted above. In addition to the decrease in core deposits, we exercised our right to call $20 million of brokered deposits in the second quarter of 2015.

The table below shows changes in total deposits since 2011:





September December December December December

30, 31, 31, 31, 31,

(In thousands) 2015 2014 2013 2012 2011



ND Bakken

Branches $186,308 $178,565 $166,904 $144,662 $125,884

ND Non-Bakken

Branches 363,838 433,129 382,225 335,452 285,488

Total ND

Branches 550,146 611,694 549,129 480,114 411,372

Other 195,658 199,537 174,100 169,490 164,883

Total Deposits $745,804 $811,231 $723,229 $649,604 $576,255



Trust assets under management or administration decreased to $249.6 million at September 30, 2015, compared to $257.4 million at December 31, 2014 as new account additions were off-set by reduced investment values and withdrawals of retirement assets.

Capital

Banks and bank holding companies operate under separate regulatory capital requirements.

In the first quarter of 2015 regulatory capital requirements for community banks changed to incorporate certain of the capital requirements addressed in the Basel III framework. These standards introduced a new requirement, Common Equity Tier 1 ("CET 1"), and increased certain previously existing capital requirements. At September 30, 2015 our capital ratios exceeded all regulatory capital thresholds.

A summary of our capital ratios at September 30, 2015 and a comparison of new and prior regulatory capital requirements are presented below:



Current BASEL III Former General

Risk Based Capital

Standards Risk Based Capital Standard

For Capital To be For Capital To be

Adequacy Well Adequacy Well

Actual Purposes Capitalized Purposes Capitalized

September

30, 2015

Total Risk Based

Capital Ratio

Consolidated 23.21% >=8.0% N/A % >=8.0% N/A %

BNC National

Bank 22.11 >=8.0 10.0 >=8.0 10.0

Tier 1 Risk Based

Capital Ratio

Consolidated 21.96 >=6.0 N/A >=4.0 N/A

BNC National

Bank 20.85 >=6.0 8.0 >=4.0 6.0

Common Equity Tier

1 Risk

Based Capital Ratio

Consolidated 13.95 >=4.5 N/A N/A N/A

BNC National

Bank 20.85 >=4.5 6.5 N/A N/A

Tier 1 Leverage

Capital Ratio

Consolidated 11.20 >=4.0 N/A >=4.0 N/A

BNC National

Bank 10.67 >=4.0 5.0 >=4.0 5.0

Tangible

Common Equity

Consolidated 7.82 N/A N/A N/A N/A

BNC National

Bank 11.45 N/A N/A N/A N/A


December

31, 2014

Total Risk Based

Capital Ratio

Consolidated 21.10% >=8.0% N/A % >=8.0% N/A %

BNC National

Bank 19.73 >=8.0 10.0 >=8.0 10.0

Tier 1 Risk Based

Capital Ratio

Consolidated 19.85 >=6.0 N/A >=4.0 N/A

BNC National

Bank 18.48 >=6.0 8.0 >=4.0 6.0

Common Equity Tier

1 Risk

Based Capital Ratio

Consolidated N/A >=4.5 N/A N/A N/A

BNC National

Bank N/A >=4.5 6.5 N/A N/A

Tier 1 Leverage

Capital Ratio

Consolidated 9.94 >=4.0 N/A >=4.0 N/A

BNC National

Bank 9.13 >=4.0 5.0 >=4.0 5.0

Tangible

Common Equity

Consolidated 6.67 N/A N/A N/A N/A

BNC National 9.83 N/A N/A N/A N/A

Bank



The new CET 1 ratio, which is generally a comparison of a bank's core equity capital to its total risk weighted assets, is a measure of the current risk profile of our asset base from a regulatory perspective. The Tier 1 leverage ratio, which is based on average assets, does not consider the mix of risk weighted assets. In recent periods regulators have required Tier 1 leverage ratios that significantly exceed "Well Capitalized" ratio levels. As a result, management believes the Bank's Tier 1 leverage ratio is our most restrictive capital measurement and we are managing the Tier 1 leverage ratio to levels significantly above the "Well Capitalized" ratio threshold.

In addition to regulatory risk based capital standards, we believe that regulators and investors also monitor the capital ratio of tangible common equity to total period end assets.

As noted above the Bank will pay a dividend to the holding company of $11 million in the fourth quarter of 2015 in connection with the Company's redemption of the Series A Preferred Stock. The table below presents our pro forma capital ratios as if the Bank had paid this dividend and the Company had redeemed $21 million of preferred stock and issued $10 million of subordinated debt as of September 30, 2015. (The Company is not currently redeeming the Series B Preferred Stock. However, the table below is prepared as if both the Series A Preferred Stock and Series B Preferred Stock had been redeemed on September 30, 2015 in order to illustrate slightly more conservative capital ratios that could result should our Board of Directors decide to redeem our Series B Preferred Stock.)



Current BASEL III

Risk Based Capital Standards

For Capital To be

Adequacy Well

Pro Forma Purposes Capitalized

September

30, 2015

Total Risk Based

Capital Ratio

Consolidated 20.75 % >=8.0 % N/A %

BNC National Bank 19.67 >=8.0 10.0

Tier 1 Risk Based

Capital Ratio

Consolidated 17.28 >=6.0 N/A

BNC National Bank 18.41 >=6.0 8.0

Common Equity Tier 1

Risk

Based Capital Ratio

Consolidated 13.95 >=4.5 N/A

BNC National Bank 18.41 >=4.5 6.5

Tier 1 Leverage

Capital Ratio

Consolidated 8.82 >=4.0 N/A

BNC National Bank 9.42 >=4.0 5.0

Tangible

Common Equity

Consolidated 7.91 N/A N/A

BNC National Bank 10.31 N/A N/A





Book value per common share of the Company was $20.09 as of September 30, 2015, compared to $18.28 at December 31, 2014. Book value per common share, excluding accumulated other comprehensive income, was $18.49 as of September 30, 2015, compared to $16.72 at December 31, 2014.

Asset Quality

Nonperforming assets were $583 thousand at September 30, 2015, up from $317 thousand at December 31, 2014. The ratio of nonperforming assets to total assets was 0.07% at September 30, 2015 and 0.03% at December 31, 2014. Nonperforming loans were $341 thousand at September 30, 2015, up from $61 thousand at December 31, 2014.

The allowance for credit losses was $8.6 million at September 30, 2015 and December 31, 2014. While the recent decreases in oil and agricultural commodity prices have yet to have a significant negative effect on our credit quality, prolonged declines could have an adverse economic impact on the North Dakota economy and our loan portfolio.

The allowance for credit losses as a percentage of total loans at September 30, 2015 was 2.22%, compared to 2.11% at December 31, 2014. The allowance for credit losses as a percentage of loans and leases held for investment at September 30, 2015 was 2.50% and at December 31, 2014 was 2.38%.

At September 30, 2015, BNC had $8.5 million of classified loans, $341 thousand of loans on non-accrual and $242 thousand of other real estate owned. At December 31, 2014, BNC had $9.1 million of classified loans, $56 thousand of loans on non-accrual and $256 thousand of other real estate owned.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 15 locations. BNC also conducts mortgage banking from 14 offices in Arkansas, Illinois, Kansas, Missouri, Minnesota, Arizona and North Dakota.

This news release may contain "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of BNC. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management are generally identifiable by the use of words such as "expect", "believe", "anticipate", "plan", "intend", "estimate", "may", "will", "would", "could", "should", "future" and other expressions relating to future periods. Examples of forward-looking statements include, among others, statements we make regarding our belief that we have exceptional liquidity, our expectations regarding future market conditions and our ability to capture opportunities and pursue growth strategies, our expected operating results such as revenue growth and earnings, the possible redemption of our Series B Preferred Stock, the effect of the redemption of our Series A Preferred Stock and our expectations of the effects of the regulatory environment on our earnings for the foreseeable future. Forward-looking statements are neither historical facts nor assurances of future performance. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, but are not limited to: the impact of current and future regulation; the risks of loans and investments, including dependence on local and regional economic conditions; competition for our customers from other providers of financial services; possible adverse effects of changes in interest rates, including the effects of such changes on mortgage banking revenues and derivative contracts and associated accounting consequences; risks associated with our acquisition and growth strategies; and other risks which are difficult to predict and many of which are beyond our control. In addition, all statements in this news release, including forward-looking statements, speak only of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

This press release contains references to financial measures which are not defined in generally accepted accounting principles ("GAAP"). Such non-GAAP financial measures include the Company's tangible equity to assets ratio and information presented excluding nonrecurring transactions. These non-GAAP financial measures have been included as the Company believes they are helpful for investors to analyze and evaluate the Company's financial condition.

(Financial tables attached)



BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Nine Months

Ended September 30, Ended September 30,

(In thousands,

except per

share data) 2015 2014 2015 2014

SELECTED INCOME

STATEMENT DATA

Interest income $ 6,662 $7,540 $ 20,992 $21,915

Interest expense 557 791 1,864 2,638

Net interest

income 6,105 6,749 19,128 19,277

Provision

(reduction) for

credit losses (400) (200) (400) (800)

Non-interest

income 5,232 4,814 19,623 14,459

Non-interest

expense 8,980 8,765 28,304 25,742

Income before

income taxes 2,757 2,998 10,847 8,794

Income tax

expense 882 1,017 3,471 2,814

Net income 1,875 1,981 7,376 5,980

Preferred stock

costs 475 475 1,424 1,321

Net income

available to

common

shareholders $ 1,400 $1,506 $ 5,952 $4,659
EARNINGS PER

SHARE DATA

Basic earnings

per common

share $ 0.41 $0.44 $ 1.76 $1.38

Diluted earnings

per common

share $ 0.40 $0.43 $ 1.70 $1.34





BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Nine Months

Ended September 30, Ended September 30,

(In thousands,

except per

share data) 2015 2014 2015 2014

ANALYSIS OF

NON-INTEREST

INCOME

Bank charges and

service fees $761 $743 $2,185 $2,114

Wealth

management

revenues 355 331 1,127 1,066

Mortgage banking

revenues 3,663 2,782 13,147 8,455

Gains on sales

of loans, net 133 688 705 1,688

Gains on sales

of investments,

net 172 - 1,732 528

Other 148 270 727 608

Total

non-interest

income $5,232 $4,814 $19,623 $14,459

ANALYSIS OF

NON-INTEREST

EXPENSE

Salaries and

employee

benefits $4,317 $4,435 $14,996 $13,217

Professional

services 1,039 848 2,891 2,237

Data processing

fees 788 745 2,290 2,183

Marketing and

promotion 1,044 813 2,600 2,121

Occupancy 507 588 1,457 1,561

Regulatory costs 176 158 523 466

Depreciation and

amortization 358 315 1,062 922

Office supplies

and postage 153 156 492 495

Other real

estate costs 1 27 16 59

Other 597 680 1,977 2,481

Total

non-interest

expense $8,980 $8,765 $28,304 $25,742

WEIGHTED

AVERAGE SHARES

Common shares

outstanding

(a) 3,388,706 3,386,187 3,384,634 3,364,465

Incremental

shares from

assumed

conversion of

options and

contingent

shares 112,616 116,257 113,028 123,716

Adjusted

weighted

average shares

(b) 3,501,322 3,502,444 3,497,662 3,488,181







(a) Denominator for basic earnings per common share

(b) Denominator for diluted earnings per common share





BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



As of

(In thousands,

except share, per

share and full

time equivalent September 30, September 30,

data) 2015 December 31, 2014 2014

SELECTED BALANCE

SHEET DATA

Total assets $ 875,524 $ 934,419 $ 899,720

Loans held for

sale-mortgage

banking 43,795 47,109 42,441

Loans and leases

held for

investment 343,687 360,789 335,364

Total loans 387,482 407,898 377,805

Allowance for

credit losses (8,599) (8,601) (8,675)

Investment

securities

available for

sale 436,680 449,333 456,192

Other real estate,

net 242 256 1,056

Earning assets 824,067 880,988 841,712

Total deposits 745,804 811,231 774,266

Core deposits (1) 727,878 773,279 740,748

Other borrowings 30,460 31,020 38,032

Cash and cash

equivalents 13,696 41,124 28,781

OTHER SELECTED

DATA

Net unrealized

gains in

accumulated other

comprehensive

income $ 5,488 $ 5,324 $ 3,625

Trust assets under

supervision $ 249,627 $ 257,400 $ 255,929

Total common

stockholders'

equity $ 68,559 $ 62,390 $ 58,658

Book value per

common share $ 20.09 $ 18.28 $ 17.18

Book value per

common share

excluding

accumulated other

comprehensive

income, net $ 18.49 $ 16.72 $ 16.12

Full time

equivalent

employees 272 249 255

Common shares

outstanding 3,411,984 3,413,854 3,413,854

CAPITAL RATIOS

Common equity Tier

1 risk-based

capital

(Consolidated) 13.95% N/A N/A

Tier 1 leverage

(Consolidated) 11.20% 9.94% 10.13%

Tier 1 risk-based

capital

(Consolidated) 21.96% 19.85% 20.22%

Total risk-based

capital

(Consolidated) 23.21% 21.10% 21.48%

Tangible common

equity

(Consolidated) 7.82% 6.67% 6.51%



Common equity Tier

1 risk-based

capital (Bank) 20.85% N/A N/A

Tier 1 leverage

(Bank) 10.67% 9.13% 10.12%

Tier 1 risk-based

capital (Bank) 20.85% 18.48% 20.34%

Total risk-based

capital (Bank) 22.11% 19.73% 21.60%

Tangible capital

(Bank) 11.45% 9.83% 10.56%









(1) Core deposits consist of all deposits and repurchase agreements with

customers and exclude certain brokered certificates of deposit.





BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Nine Months

Ended September 30, Ended September 30,

(In thousands) 2015 2014 2015 2014

AVERAGE

BALANCES

Total assets $ 884,156 $899,665 $ 916,823 $884,649

Loans held for

sale-mortgage

banking 38,820 32,495 50,445 28,215

Loans and leases

held for

investment 346,985 331,554 351,047 328,464

Total loans 385,805 364,049 401,492 356,679

Investment

securities

available for

sale 434,433 455,368 445,015 444,518

Earning assets 832,729 845,820 865,085 829,801

Total deposits 754,480 772,085 784,684 759,723

Core deposits 736,096 738,270 756,938 720,353

Total equity 87,832 79,138 87,358 75,337

Cash and cash

equivalents 26,892 42,986 33,341 45,812

KEY RATIOS

Return on

average common

stockholders'

equity (a) 8.88% 10.91% 13.03% 11.75%

Return on

average assets

(b) 0.84% 0.87% 1.08% 0.90%

Net interest

margin 2.91% 3.17% 2.96% 3.11%

Efficiency ratio 79.20% 75.80% 73.04% 76.30%

Efficiency ratio

(BNC National

Bank) 76.93% 72.89% 70.80% 70.92%







(a) Return on average common stockholders' equity is calculated by using the

net income available to common shareholders as the numerator and average

common equity (less preferred stock and accumulated other comprehensive

income) as the denominator.

(b) Return on average assets is calculated by using net income as the

numerator and average total assets as the denominator.





BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



As of

September 30, December 31, September 30,

(In thousands) 2015 2014 2014

ASSET QUALITY

Loans 90 days or more

delinquent and still

accruing interest $ - $ 5 $ 18

Non-accrual loans 341 56 112

Total nonperforming

loans $ 341 $ 61 $ 130

Other real estate, net 242 256 1,056

Total nonperforming

assets $ 583 $ 317 $ 1,186

Allowance for credit

losses $ 8,599 $ 8,601 $ 8,675

Troubled debt

restructured loans $ 2,209 $ 5,105 $ 5,136

Ratio of total

nonperforming loans

to total loans 0.09% 0.01% 0.03%

Ratio of total

nonperforming assets

to total assets 0.07% 0.03% 0.13%

Ratio of nonperforming

loans to total

assets 0.04% 0.01% 0.01%

Ratio of allowance for

credit losses to

loans and leases held

for investment 2.50% 2.38% 2.59%

Ratio of allowance for

credit losses to

total loans 2.22% 2.11% 2.30%

Ratio of allowance for

credit losses to

nonperforming loans 2,522% 14,100% 6,673%







For the Quarter For the Nine Months

Ended September 30, Ended September 30,

(In thousands) 2015 2014 2015 2014

Changes in

Nonperforming

Loans:

Balance,

beginning of

period $ 722 $3,251 $ 61 $5,617

Additions to

nonperforming 94 119 937 198

Charge-offs (22) (7) (168) (680)

Reclassified

back to

performing (436) (3,177) (455) (3,177)

Principal

payments

received (17) (56) (34) (1,131)

Transferred to

repossessed

assets - - - -

Transferred to

other real

estate owned - - - (697)

Balance, end of

period $ 341 $130 $ 341 $130





BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



For the Quarter For the Nine Months

Ended September 30, Ended September 30,

charge-offs to
average total

loans 0.106% 0.013% 0.099% (0.104)%

Ratio of net

charge-offs to

average total

loans,

annualized 0.423% 0.052% 0.132% (0.139)%







For the Quarter For the Nine Months

Ended September 30, Ended September 30,

(In thousands) 2015 2014 2015 2014

Changes in

Other Real

Estate:

Balance,

beginning of

period $ 242 $ 1,753 $ 256 $1,056

Transfers from

nonperforming

loans - - - 697

Real estate sold - (697) - (697)

Net gains

(losses) on

sale of assets - - - -

Provision - - (14) -

Balance, end of

period $ 242 $ 1,056 $ 242 $1,056







As of

September 30, December 31, September 30,

(In thousands) 2015 2014 2014

Other Real Estate:

Other real estate $ 954 $ 954 $ 1,754

Valuation allowance (712) (698) (698)

Other real estate, net $ 242 $ 256 $ 1,056





BNCCORP, INC.

CONSOLIDATED FINANCIAL DATA

(Unaudited)



As of

September 30, December 31, September 30,

(In thousands) 2015 2014 2014

CREDIT CONCENTRATIONS

North Dakota

Commercial and

industrial $ 44,647 $ 56,681 $ 56,250

Construction 13,372 20,894 22,609

Agricultural 12,936 16,732 18,051

Land and land

development 10,451 10,468 11,890

Owner-occupied

commercial real

estate 37,871 38,035 28,479

Commercial real estate 75,838 55,349 50,280

Small business

administration 1,241 1,247 1,156

Consumer 37,307 33,127 36,061

Subtotal loans held

for investment $ 233,663 $ 232,533 $ 224,776

Consolidated

Commercial and

industrial $ 55,577 $ 67,533 $ 63,948

Construction 20,915 24,916 25,929

Agricultural 13,540 17,478 18,611

Land and land

development 17,206 28,220 26,235

Owner-occupied

commercial real

estate 44,717 47,218 37,524

Commercial real estate 121,205 108,122 101,852

Small business

administration 25,128 26,972 25,593

Consumer 45,352 40,470 35,779

Total loans held for

investment $ 343,640 $ 360,929 $ 335,471



To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/bnccorp-inc-reports-third-quarter-net-income-of-19-million-or-040-per-diluted-share-300167389.html

SOURCE BNCCORP, INC.

/Web site: http://www.bnccorp.com



(END) Dow Jones Newswires

October 28, 2015 07:00 ET (11:00 GMT)

at least it is done/announced :)

speculation on my part but since Stonecastle Fin. was holding the Pref. A and they just announced a big CLO offering for Community bank debts... the delay might not be on management side but more on the financing side....

http://bankingjournal.aba.com/2015/10/stonecastle-closes-first-community-bank-clo-since-2008/

A little overdue.

BNCCORP, INC. Announces Redemption of Series A Preferred Stock

BISMARCK, N.D., Oct. 20, 2015 /PRNewswire/ -- BNCCORP, INC. (OTCQX: BNCC) (the "Company") announced today that it is redeeming the 20,093 outstanding shares of the Company's 9% Fixed Rate Cumulative Perpetual Preferred Stock, Series A ("Series A Preferred Stock"). The redemption of the Series A Preferred Stock is expected to be completed on November 19, 2015. The redemption price for the shares of Series A Preferred Stock is the stated liquidation preference amount of $1,000 per share or an aggregate $20,093,000, plus accrued and unpaid dividends aggregating approximately $15,000.

Upon completion of the redemption of the Series A Preferred Stock, the Company will have 1,005 shares outstanding of its 9% Fixed Rate Cumulative Perpetual Preferred Stock, Series B ("Series B Preferred Stock"). The redemption of the Series B Preferred Stock is subject to certain terms and conditions, including the prior redemption of the Series A Preferred Stock, and has not been authorized by the Company's board of directors. However, the Company has sought and received approval for the redemption of both the Series A Preferred Stock and the Series B Preferred Stock from its regulator.

The preferred stock redemption will be financed in part by proceeds from the issuance of a $10 million subordinated note that qualifies as Tier 2 capital for the Company. The subordinated debt matures on October 19, 2025, has a fixed interest rate of 6.35% per annum, pays accrued interest quarterly, and may be partially or fully prepaid beginning five years after issuance without penalty. The remainder of the redemption price is being financed from a portion of the proceeds of an $11 million dividend from BNC National Bank, the Company's wholly owned subsidiary.

The Company's current annual dividends for the Series A Preferred Stock is approximately $1,808,000 of the approximately $1,899,000 aggregate dividends on the Company's Series A and B Preferred Stock. The annual interest expense on the subordinated debt is estimated to be approximately $635,000 or $432,000 after tax.

http://www.bnccorp.com/54304/mirror/

BNCC remains a buy.

Income remains strong despite shrinking the balance sheet from $979.7 million at 3/31/15 to $904.9 million at 6/30/15.

Reducing brokered deposits is a good thing, too.

BNCCORP, INC. Reports Second Quarter Net Income Of $2.3 Million, Or $0.52 Per Diluted Share
2015 Second Quarter Highlights

- Income before taxes increases by 9.4%

- Net interest income increases 1.5%, non-interest income increases by 25.7% and non-interest expense increases by 8.7% compared to 2014 second quarter

- The provision for credit losses was $0 in the second quarter compared to a reversal of previous credit provisions of $400 thousand in the second quarter of 2014

- Nonperforming assets were 0.11% of total assets as of June 30, 2015

- Return on equity was 11.78% and return on assets was 0.99% in the second quarter of 2015

- Year-to-date net income is $5.501 million or $1.30 per diluted share

- Book value per common share was $19.23 at June 30, 2015

- Total assets were $904.9 million at June 30, 2015 compared to $934.4 million at December 31, 2014

PR Newswire

BISMARCK, N.D., July 28, 2015

BISMARCK, N.D., July 28, 2015 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Arkansas, Illinois, Kansas, Nebraska, Minnesota, Arizona and North Dakota, today reported financial results for the second quarter ended June 30, 2015.

Net income for the 2015 second quarter increased to $2.287 million, or $0.52 per diluted share compared to net income of $2.207 million, or $0.50 per diluted share, in the second quarter of 2014. The increase in earnings for the second quarter of 2015 reflected higher net interest income and non-interest income, partially offset by higher non-interest expense. No provision for credit losses was taken in the second quarter of 2015 compared to a reversal of provisions for credit losses, which increased pre-tax earnings by $400 thousand, in the second quarter of 2014. The ratio of nonperforming assets to total assets was 0.11% at June 30, 2015 compared to 0.03% at December 31, 2014. Book value per common share at June 30, 2015 was $19.23 compared to $18.28 and $16.64 at December 31, 2014 and June 30, 2014, respectively.

Timothy J. Franz, BNCCORP President and Chief Executive Officer, said, "We are pleased to have generated a 11.78% return on common equity this quarter, and our 0.99% return on assets is commendable in the current operating environment. The nearly 4% growth in earnings was driven, in particular, by the performance of our mortgage banking business, as well as higher net interest income and net gains on sales of investments. Year to date we have delivered exceptional results and created value for BNC's common shareholders with our earnings per share of $1.30 and a 15.22% return on common equity."

Mr. Franz added, "We continue to closely monitor our clients and the economic conditions in North Dakota. While we have observed energy related activity slowing down in the marketplace, our review of a segment of loans in North Dakota to energy related businesses through the end of the second quarter has not revealed significant credit deterioration. We long understood that energy dependent economies will have fluctuations from time to time and operate accordingly and continue to believe in the North Dakota market."

Second Quarter Results

Net interest income for the second quarter of 2015 was $6.416 million, an increase of $93 thousand, or 1.5%, from $6.323 million in the same period of 2014. Interest income declined slightly by $159 thousand or 2.2% as the $21.2 million increase in average balance of interest earning assets was offset by decreased yields on investments when compared to the second quarter of 2014. Average loans held for investment increased $23.8 million, or 7.2%, compared to the prior year second quarter. On average, loans held for sale increased by $37.5 million when compared to the second quarter of 2014, as lower interest rates have spurred significant refinancing activity in our mortgage banking operations. The yield on earning assets decreased to 3.25% in the second quarter of 2015 compared to 3.41% in the second quarter of 2014. The lower yield on earning assets is the result of lower yields in our investment portfolio as yields have generally declined period-over-period on SBA securities. Overall, the net interest margin declined to 2.93% in the second quarter of 2015 from 2.96% in the second quarter of 2014.

Interest expense in the second quarter of 2015 decreased from the same period in 2014 despite an increase in average deposits of $4.0 million, or 0.5%. The cost of core deposits declined to 0.16% in the current quarter, compared to 0.18% in the same period of 2014. In aggregate, the cost of interest bearing liabilities declined to 0.42% in the current quarter, compared to 0.55% in the same period of 2014 despite incurring $87 thousand of charges related to exercising our right to call $20.0 million of brokered deposits in the second quarter of 2015. The redemption of $7.5 million of subordinated debentures in the third quarter of 2014 reduced the second quarter of 2015 interest expense by approximately $230 thousand. In addition, our call of $10.0 million of brokered deposits in the second quarter 2014 contributed to reducing interest expense in the current quarter by $27 thousand.

No provision for credit losses was taken in the second quarter of 2015, while a reversal of previous provisions for credit losses increased pre-tax earnings by $400 thousand in the second quarter of 2014.

Non-interest income for the second quarter of 2015 was $6.740 million, an increase of $1.379 million, or 25.7% from $5.361 million in the second quarter of 2014. The increase primarily relates to an 18.4% increase in mortgage banking revenues, which aggregated $4.015 million in the second quarter of 2015, compared to $3.391 million in the second quarter of 2014. Mortgage banking revenues benefited from lower rates in the second quarter of 2015 as we continue to sell residential mortgage loans with servicing released. During the second quarter of 2015, we recorded a net gain on sales of investments of $964 thousand, compared to a $5 thousand net gain on sales of investments in the same period of 2014. The 2015 second quarter included gains on sales of SBA loans of $257 thousand, compared to $760 thousand in the same period of 2014. Gains on sales of investments and SBA loans can vary significantly from period to period.

Non-interest expense for the second quarter of 2015 was $9.658 million, an increase of $771 thousand, or 8.7%, from $8.887 million in the second quarter of 2014. This increase is primarily related to compensation for producers and costs related to higher mortgage banking activity.

In the second quarter of 2015, we recorded a tax expense of $1.211 million, an increase from the $990 thousand income tax expense in the second quarter of 2014. The effective tax rate was 34.62% in the second quarter of 2015 compared to 30.97% in same period of 2014. The higher effective tax rate in the second quarter of 2015 is the result of an adjustment to the annual estimated effective tax rate to achieve a rate of 32% correlating to higher estimated full year taxable income.

Net income available to common shareholders was $1.813 million, or $0.52 per diluted share, for the second quarter of 2015 after accounting for dividends accrued on preferred stock. These costs aggregated $474 thousand in the second quarter of 2015 and $475 thousand in the same period of 2014. Net income available to common shareholders in the second quarter of 2014 was $1.732 million, or $0.50 per diluted share.

Six Months Ended June 30, 2015

Net interest income in the first half of 2015 was $13.023 million, an increase of $495 thousand, or 4.0%, from $12.528 million in the first half of 2014. Interest income decreased by $45 thousand as the $59.5 million increase in the average balance of interest earning assets was offset by lower investment portfolio yields, and a lower yielding mix of loans when compared to the first half of 2014. Average loans held for investment increased $26.2 million, or 8.0%, compared to the first half of the prior year. On average, loans held for sale increased by $30.2 million when compared to the first six months of 2014, as lower interest rates have spurred significant refinancing activity in our mortgage banking operations. The yield on earning assets decreased to 3.28% in the six month period ended June 30, 2015 compared to 3.53% in the same period of 2014. Overall, the net interest margin declined to 2.98% in the first six months of 2015 from 3.07% in the first six months of 2014.

Interest expense during the second quarter of 2015 decreased from the same period in 2014 despite an increase in average deposits of $46.2 million, or 6.1%. The cost of core deposits declined to 0.16% in the first six months of 2015, compared to 0.18% in the same period of 2014. In aggregate, the cost of interest bearing liabilities declined to 0.39% in the first half, compared to 0.56% in the same period of 2014. As previously noted, we recognized increased interest expense associated with exercising our right to call $20.0 million and $10.0 million of brokered deposits, in the second quarter of 2015 and 2014, respectively. However, our redemption of brokered deposits and subordinate debentures in 2014 enabled us to decrease interest expense by $515 thousand during the six month period ending June 30, 2015 when compared to the same time period in 2014.

No provision for credit losses was taken in the first six months of 2015, while a reversal of previous provisions for credit losses increased pre-tax earnings by $600 thousand in the first six months of 2014.

(MORE TO FOLLOW) Dow Jones Newswires

July 28, 2015 07:00 ET (11:00 GMT)

Why Almost Every Big Texas Bank Failed in the 1980s (4/22/15)

By John Maxfield

Despite having the second-largest economy in the United States, Texas isn't home to a single major bank.

The state's biggest bank, Comerica, has a modest $70 billion in assets, which ranks 14th among the nation's largest lenders. And Comerica, while based in Dallas, actually traces its roots to a consortium of Michigan banks that entered the Texas market in 1988.

If a bank's size is generally determined by the size of the surrounding economy, then why isn't Texas home to a host of the nation's leading financial institutions?

The answer to this question offers a striking illustration of the relationship between the diversification of banks' loan portfolios and their vulnerability to failure.

The destruction of Texas' banks

Thirty years ago, Texas was home to more banks than any other state in America. They thrived not only on the riches of the state's oil industry, but also on Texas laws banning out-of-state lenders from operating there.

As former FDIC Chairman William Seidman explained in his book Full Faith & Credit: The Great S&L Debacle and Other Washington Sagas:

Texas had been a locked-up state, with no foreign -- which to Texans meant no out-of-state -- banks allowed. Texans believed their banks were the most profitable, the best capitalized, and the best managed in the country. ... They felt they had too good a deal to share.

But these advantages came to a screeching halt in the mid-1980s.

Thanks to geopolitical developments during the 1970s -- specifically, two OPEC-initiated oil embargoes punishing the United States for its support of Israel during the 1973 Arab-Israeli War -- the price of oil soared from less than $20 a barrel at the beginning of 1973 to more than $114 per barrel by the end of the decade.

This trend reversed itself with equal ferocity in the 1980s. After the embargoes were lifted, the price of oil dropped by 79%. This threw the Texas economy into a recession and led its banks to focus on the commercial real estate market for growth.

One of Texas' leading banks at the time, First City Bancorporation of Texas, serves as a case in point. Real estate accounted for only 20% of the once-venerable Houston-based institution's loan portfolio in 1982. By 1987 that figure had almost doubled to 35%.

Bolstered by tax incentives that catalyzed the flow of capital into commercial real estate, this second boom came to an abrupt end in 1986 after Congress removed the tax incentives as part of a sweeping overhaul of the U.S. tax code. This drove down real estate values and left a wide swath of Texas' bank industry on the brink of insolvency.

By the end of the 1980s, virtually every major Texas-based bank had either failed or been acquired for pennies on the dollar by out-of-state institutions such as North Carolina's NationsBank (known today as Bank of America) and Michigan's Comerica.

A lesson from Texas' bank crisis

Aside from robbing the Lone Star State of its otherwise fair share of nationally recognized banks, the downfall of Texas' major lenders in the 1980s remains a valuable lesson for bankers and bank investors about the importance of a diversified loan portfolio.

It also, as JPMorgan Chase CEO Jamie Dimon pointed out in his latest shareholder letter, offers a compelling defense for the ever-increasing size of the nation's biggest banks -- JPMorgan being foremost among them, with $2.6 trillion in assets on its balance sheet.

Far from making a bank riskier, Dimon argued, the geographic diversification achieved by large interstate lenders improves their ability to survive localized crises like the one that destroyed Texas' financial industry three decades ago:

Many large banks had no problem navigating the [2008] financial crisis, while many smaller banks went bankrupt. Many of these smaller banks went bankrupt because they were undiversified, meaning that most of their lending took place in a specific geography. A good example was when oil collapsed in the late 1980s. Texas banks went bankrupt because of their direct exposure to oil companies and also because of their exposure to real estate whose value depended largely on the success of the oil business. Since the crisis began seven years ago, more than 500 smaller banks have gone bankrupt, and JPMorgan Chase has contributed approximately $8 billion to the Federal Deposit Insurance Corporation to help pay for the resolution of those banks.

The takeaway is that big isn't necessarily bad when it comes to banking. In fact, if you're interested in not only profiting from bank stocks but also in preserving your capital, then you would be smart to think long and hard before investing in a bank that doesn't have exposure to a variety of industries across multiple geographic markets.

http://www.fool.com/investing/general/2015/04/22/why-almost-every-big-texas-bank-failed-in-the-1980.aspx

BNCC now needs to invest in itself.

Dividends on the TARP Preferred are eating up about 15 percent of net income. Make them go away. It is not hard to do. Liquidate some of those low-yielding investment securities and redeem the shares.

BNCCORP, INC. Reports First Quarter Net Income Rose 79.4% To $3.2 Million, Or $0.78 Per Diluted Share (4/23/15)

2015 First Quarter Highlights

- Net interest income increases by $402 thousand, or 6.5%, compared to 2014 first quarter

- Non-interest income increases by $3.367 million, or 78.6%, compared to 2014 first quarter

- Non-interest expense increases by $1.576 million, or 19.5% compared to the 2014 first quarter

- Return on equity was 18.85% and return on assets was 1.39% in the first quarter of 2015

- Nonperforming assets were 0.05% of total assets as of March 31, 2015

- Book value per common share was $19.62 at March 31, 2015

- Board amends portions of Bylaws

BISMARCK, N.D., April 23, 2015 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Nebraska, Minnesota, Arizona and North Dakota, today reported financial results for the first quarter ended March 31, 2015, and also reported that the BNC Board of Directors has amended the Company's Bylaws.

Net income for the 2015 first quarter increased to $3.214 million, or $0.78 per diluted share compared to net income of $1.792 million, or $0.41 per diluted share, in the first quarter of 2014. Results for the first quarter of 2015 include higher net interest income and non-interest income; these increases were partially offset by higher non-interest expense. No provision for credit losses was taken in the first quarter of 2015, compared to a reversal of provisions for credit losses, which increased pre-tax earnings by $200 thousand, in the first quarter of 2014. The ratio of nonperforming assets to total assets was 0.05% at March 31, 2015 compared to 0.03% at December 31, 2014. The book value per common share at March 31, 2015 was $19.62 compared to $18.28 and $15.45 at December 31, 2014 and March 31, 2014, respectively.

Timothy J. Franz, BNCCORP President and Chief Executive Officer, said, "Our results in the first quarter were exceptional as net income was 79% higher than a year ago. The elevated earnings were primarily due to a sharp increase in mortgage banking income and higher net interest income, and drove impressive returns on assets and common equity. In recent periods, we have successfully built scalable mortgage banking operations and, as a result, we captured our share of the surging refinance activity that occurred in early 2015. When surges such as this occur we are positioned to quickly generate earnings and create shareholder value."

Mr. Franz continued, "While balance sheet growth continued this quarter, we anticipate growth to moderate as we move through 2015, as the North Dakota region pauses to absorb the impact of lower energy prices. While the impact of lower energy prices on the North Dakota economy may not become clearer until mid 2015 or later, we have reviewed those portions of our portfolio reasonably related to energy, and through the end of the first quarter we have not been notably impacted. Economies reliant on the energy sector can be relatively uneven, but we remain convinced that over the long term the energy sector will continue to benefit the North Dakota economy and contribute to making this market a very good place to be in the banking business."

First Quarter Results

Net interest income for the first quarter of 2015 was $6.607 million, an increase of $402 thousand, or 6.5%, from $6.205 million in the same period of 2014. Interest income rose by $114 thousand as the average balance of interest earning assets increased by $97.7 million when compared to the first quarter of 2014. Average loans held for investment increased $28.5 million, or 8.9%, compared to the prior year first quarter. On average, loans held for sale increased by $22.9 million when compared to the first quarter of 2014, as lower interest rates have spurred significant refinancing activity in our mortgage banking operations. The yield on earning assets decreased to 3.31% in the first quarter of 2015 compared to 3.66% in the first quarter of 2014. The lower yield on earning assets is the result of lower yields in our investment portfolio as interest rates have generally declined period-over-period. Overall, the net interest margin declined to 3.03% in the first quarter of 2015 from 3.20% in the first quarter of 2014.

Interest expense decreased despite an increase in average deposits of $88.5 million, or 12.3%, as we have been able to lower the rates paid on deposits. The cost of core deposits declined to 0.15% in the current quarter, compared to 0.19% in the same period of 2014. In aggregate, the cost of interest bearing liabilities declined to 0.37% in the current quarter, compared to 0.57% in the same period of 2014. The redemption of $7.5 million of subordinated debentures in the third quarter of 2014 reduced first quarter of 2015 interest expense by approximately $230 thousand.

No provision for credit losses was taken in the first quarter of 2015, while a reversal of provisions for credit losses increased pre-tax earnings by $200 thousand in the first quarter of 2014.

Non-interest income for the first quarter of 2015 was $7.651 million, an increase of $3.367 million, or 78.6% from $4.284 million in the first quarter of 2014. The increase primarily relates to a 139.7% increase in mortgage banking revenues, which aggregated $5.469 million in the first quarter of 2015, compared to $2.282 million in the first quarter of 2014. Mortgage banking revenues benefited from lower rates in the first quarter of 2015 as we continue to sell residential mortgage loans with servicing released. During the first quarter of 2015, we recorded a net gain on sales of investments of $596 thousand, compared to a $523 thousand net gain on sales of investments in the same period of 2014. The 2015 first quarter included gains on sales of SBA loans of $315 thousand, compared to $240 thousand in the same period of 2014. Gains on sales of investments and SBA loans can vary significantly from period to period.

Non-interest expense for the first quarter of 2015 was $9.666 million, an increase of $1.576 million, or 19.5%, from $8.090 million in the first quarter of 2014. This increase is primarily related to higher mortgage banking activity and compensation for producers.

In the first quarter of 2015, we recorded a tax expense of $1.378 million, equating to an effective tax rate of 30.01%. We recorded tax expense of $807 thousand in the first quarter of 2014, which resulted in an effective tax rate of 31.05%. The lower effective tax rate in the first quarter of 2015 is due to the impact of an increased mix of tax exempt investments.

Net income available to common shareholders was $2.739 million, or $0.78 per diluted share, for the first quarter of 2015 after accounting for dividends accrued on preferred stock. These costs aggregated $475 thousand in the first quarter of 2015 and $372 thousand in the same period of 2014. The increase in preferred stock costs is due to the preferred dividend rate increasing from 5% to 9% in the first quarter 2014. Net income available to common shareholders in the first quarter of 2014 was $1.420 million, or $0.41 per diluted share.

Assets, Liabilities and Equity

Total assets were $979.7 million at March 31, 2015, an increase of $45.3 million, or 4.8%, compared to $934.4 million at December 31, 2014. While depository increases drove balance sheet growth this quarter, some of our North Dakota customers have indicated their intent to utilize funds previously deposited with us, and as a result, we anticipate balance sheet growth will moderate as 2015 continues.

Loans held for investment aggregated $348.3 million at March 31, 2015, decreasing by $12.5 million since December 31, 2014. New originations of loans held for investment were approximately $15.0 million this quarter; however, we experienced significant pay-offs which resulted in a net reduction of loans held for investment in the first quarter of 2015. These pay-offs demonstrate the predisposition of North Dakotans to repay loans on an accelerated basis. We have also noticed certain borrowers have slowed investment decisions in response to lower energy prices.

Total deposits were $851.0 million at March 31, 2015, increasing by $39.8 million from 2014 year-end. Core deposit balances were $812.6 million at March 31, 2015 and $773.3 million at December 31, 2014. Deposit balances increased in the first quarter of 2015; however, as stated above, we anticipate muted deposit growth as 2015 continues.

[tables deleted]

Trust assets under management or administration increased to $265.4 million at March 31, 2015, compared to $257.4 million at December 31, 2014 as marketing efforts by this department are experiencing success.

Capital

Banks and their bank holding companies operate under separate regulatory capital requirements.

In the first quarter of 2015 regulatory capital requirements for community banks changed to incorporate certain of the capital requirements addressed in the Basel III framework. These standards introduced a new requirement, Common Equity Tier 1 ("CET 1"), and increased certain previously existing capital requirements. At March 31, 2015 our capital ratios exceeded all regulatory capital thresholds.

A summary of our capital ratios and a comparison of new and prior regulatory capital requirements are presented below:


The new CET 1 ratio is a measure of the current risk profile of our asset base from a regulatory perspective. The Tier 1 leverage ratio, which is based on average assets, does not consider the mix of risk weighted assets. In recent periods regulators have formally, or informally, required Tier 1 leverage ratios that significantly exceed "Well Capitalized" ratio levels. As a result, management believes the Bank's Tier 1 leverage ratio is our most restrictive capital measurement and we are managing the Tier 1 leverage ratio to levels significantly above the "Well Capitalized" ratio threshold.

We believe that regulators and others are also focused on the informal capital ratio of tangible common equity to total period end assets.

Book value per common share of the Company was $19.62 as of March 31, 2015, compared to $18.28 at December 31, 2014. Book value per common share, excluding accumulated other comprehensive income, was $17.52 as of March 31, 2015, compared to $16.72 at December 31, 2014.

Asset Quality

Nonperforming assets were $529 thousand at March 31, 2015, up from $317 thousand at December 31, 2014. The ratio of nonperforming assets to total assets was 0.05% at March 31, 2015 and 0.03% at December 31, 2014. Nonperforming loans were $287 thousand at March 31, 2015, up from $61 thousand at December 31, 2014.

The allowance for credit losses was $8.7 million at March 31, 2015, compared to $8.6 million at December 31, 2014. While the recent decreases in oil and agricultural commodity prices have yet to have a significant negative effect, prolonged declines could have a detrimental economic impact on the North Dakota economy and our loan portfolio.

The allowance for credit losses as a percentage of total loans at March 31, 2015 was 2.04%, compared to 2.11% at December 31, 2014. The allowance for credit losses as a percentage of loans and leases held for investment at March 31, 2015 was 2.51%, compared to 2.38% at December 31, 2014.

At March 31, 2015, BNC had $8.8 million of classified loans, $282 thousand of loans on non-accrual and $242 thousand of other real estate owned. At December 31, 2014, BNC had $9.1 million of classified loans, $56 thousand of loans on non-accrual and $256 thousand of other real estate owned.

Bylaw Amendments

As a matter of routine corporate governance, the Board of Directors has completed its periodic review of the Company's Bylaws. To modernize and align the Bylaws to current practices, the Company's Board of Directors has amended and restated its Bylaws to, among other things:

•amend the Bylaws to authorize the Company to provide electronic notices of meetings to stockholders who have consented to receive such electronic notice;

•amend the Bylaws to lower the voting threshold required by stockholders to approve most matters at a stockholder meeting from an absolute majority of shares outstanding to a majority of shares present in person or by proxy and entitled to vote at the meeting;

•amend the Bylaws to limit the right to call a special meeting of stockholders to the President of the Company, the Chair of the Board of Directors of the Company, and the Board of Directors of the Company; and

•add Bylaws to designate the Delaware Court of Chancery as the sole and exclusive jurisdiction for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action or proceeding asserting a claim for breach of a fiduciary duty owed by any director, officer, employee or agent of the Company to the Company or its stockholders, (iii) any action or proceeding asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, the Certificate of Incorporation or the Bylaws of the Company or (iv) any action or proceeding asserting a claim governed by the internal affairs doctrine, in all cases subject to the Court of Chancery having personal jurisdiction over the indispensable parties named as defendants.

A copy of the Bylaws of the Company, as amended and restated, may be requested from the Company by visiting the Company's website (www.bnccorp.com).

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 15 locations. BNC also conducts mortgage banking from 13 offices in Illinois, Kansas, Nebraska, Minnesota, Arizona and North Dakota.

http://www.prnewswire.com/news-releases/bnccorp-inc-reports-first-quarter-net-income-rose-794-to-32-million-or-078-per-diluted-share-300070772.html

thanks :)

excellent report highlights:

BNCCORP, INC. Reports First Quarter Net Income Rose 79.4% To $3.2 Million, Or $0.78 Per Diluted Share
3 hours 45 minutes ago - DJNF

2015 First Quarter Highlights


- Net interest income increases by $402 thousand, or 6.5%, compared to 2014 first quarter



- Non-interest income increases by $3.367 million, or 78.6%, compared to 2014 first quarter



- Non-interest expense increases by $1.576 million, or 19.5% compared to the 2014 first quarter



- Return on equity was 18.85% and return on assets was 1.39% in the first quarter of 2015



- Nonperforming assets were 0.05% of total assets as of March 31, 2015



- Book value per common share was $19.62 at March 31, 2015



- Board amends portions of Bylaws

Here I'll help out:

http://www.prnewswire.com/news-releases/bnccorp-inc-reports-first-quarter-net-income-rose-794-to-32-million-or-078-per-diluted-share-300070772.html

BNCCorp Says Higher Earnings Due To A Sharp Increase In Mortgage Banking Income And Higher Net Interest Income * Thursday 04/23/2015 07:06 AM ET - Dow Jones News

BNCCorp Inc 1Q Net Interest Income Up 6.5% >BNCC * Thursday 04/23/2015 07:05 AM ET - Dow Jones News

BNCCORP, INC. Reports 1Q Net Income Rose 79.4% To $3.2 M, Or $0.78 Per Diluted Shr * Thursday 04/23/2015 07:01 AM ET - Dow Jones News

sorry no link yet

"Bakken Syndrome"

sure can play an important factor! with todays EIA report showing less crude barrels added to storage comp. to analyst forcast and price of WTI up strong... BNCC has a strong BID coming in as well...

I added some shares here on this 'hopeful" turn :)

BTW, the last earning report adressed the effect of lower oil prices for the business in North Dakota, so the business would slow down from exceptional to great.... still attractive, IMO

BNCC way also be suffering from the "Bakken Syndrome".

BNCC $15.00

who is selling?

prob option holders, per 2014 report

"The Company granted 240,000 stock options on March 17, 2010. the stock options had a two year vesting period and a ten year contractual term. The exercise price is equal to the market price on grant date, which was $3.00.

The 2013 fiscal year shows 64,800 options exercised (beg. of 2013 228,000 outstanding) compared to 37,400 for 2014

As of Dec 31 2014 there were 125,800 options outstanding and vested with $3.00 exercise price and 5.21years time left.

http://www.bnccorp.com/54304/mirror/files/2014_Audited_Financials_Final-Secured.pdf

with total volume 2015 about 250,000 shares... prob more to sell,
can't blame them for cashing in :)

BNCC trading at 16 percent discount to book value.

BNCC $15.63

Any idea, where the selling pressure since Oct. 2014 is coming from?

fear about falling oil prices slowing their growth in North Dakota?

simply profit taking from the exceptional run from $2 -- $17+?
http://stockcharts.com/freecharts/gallery.html?s=bncc


Hard to dig up any ownership info/filings

feb 2011, Financial Capital Stock Partners reports ownership of 312,500 shares

feb 2010, Jeffrey Gendell reports ownership of 287,985 shares
Tontine Financial Partner and Tontine Mgmt each 261,985 shares and TTR MGMT 26,000 shares

http://www.otcmarkets.com/stock/BNCC/filings

book value from last earnings release 9/30/2014 $18.28, selling about 15% discount to book value currently

BNCCORP, INC. Reports Fourth Quarter Net Income Rose 31.9% To $2.5 Million, Or $0.57 Per Diluted Share (1/26/15)

2014 Fourth Quarter and Full Year Overview

-Net interest income increases by $666 thousand, or 11.1%, compared to 2013 fourth quarter

-Non-interest income increases by $1.387 million, or 30.1%,compared to 2013 fourth quarter

-Non-interest expense increases by 10.7% compared to the 2013 fourth quarter and decreases by 3.6% for full year

-Nonperforming assets decreased to $317 thousand, or 0.03% of total assets at end of 2014

-Full year 2014 net income is $8.5 million or $1.91 per diluted share

-Totals assets grow 10.8% to $934.4 million, loans held for investment grow 13.5% to $360.4 million and core deposits grow 13.9% to $773.3 million in 2014

-Return on assets is 0.94% and return on common equity is 12.37% in 2014

-Book value per common share is $18.28 at December 31, 2014

BISMARCK, N.D., Jan. 26, 2015 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQX Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Nebraska, Minnesota, Arizona and North Dakota, today reported financial results for the fourth quarter and year ended December 31, 2014.

Net income for the 2014 fourth quarter was $2.479 million, or $0.57 per diluted share. This compared to net income of $1.879 million, or $0.44 per diluted share, in the fourth quarter of 2013. Results for the fourth quarter of 2014 include higher net interest income and non-interest income. This was partially offset by higher non-interest expense. The provisions for credit losses were $0 in the fourth quarters of 2014 and 2013 as credit quality continued to improve throughout 2013 and 2014. Nonperforming assets decreased to $317 thousand at December 31, 2014, compared to $6.7 million at December 31, 2013. The ratio of nonperforming assets to total assets was 0.03% at December 31, 2014 and 0.79% at December 31, 2013.

Timothy J. Franz, BNCCORP President and Chief Executive Officer, said, "Our strong fourth quarter tops off a very good year. Growing core banking operations was a key objective in 2014 and we are pleased to have delivered impressive increases in total assets, core deposits and loans held for investment. These increases translated into a 32% year over year increase in our net interest margin which moves our business toward more consistent performance. We also continued to focus on credit quality and, as a result, we currently have a very low level of nonperforming assets. Overall, we are pleased to have delivered good results and our people can be proud of their efforts."

Mr. Franz continued, "While the recent energy boom in North Dakota has been a catalyst for transformational growth, as we begin 2015 oil prices are significantly lower and this region could be impacted by volatility associated with energy driven economies. Thus far, BNC has yet to be notably impacted, but should the recent decline in oil prices continue for an extended period, the North Dakota economy will be subdued compared to recent periods. The extent and duration of any such impact cannot be predicted at this time and as a result we will re-double our customary diligence and management discipline. Our recent successes have generated a strong capital base and excellent asset quality ratios which will position the Company well if economic conditions become less robust. Despite the current caution, we remain optimistic about the operating environment in North Dakota over the long term, as even a more modest rate of growth could be strong relative to other regions."

Fourth Quarter Results

Net interest income for the fourth quarter of 2014 was $6.679 million, an increase of $666 thousand, or 11.1%, from $6.013 million in the same period of 2013. Interest income rose as the average balance of interest earning assets increased by $112.7 million when compared to the fourth quarter of 2013. Importantly, the average loans held for investment increased $41.8 million, or 13.9%, compared to the prior year quarter as initiatives to grow loans have demonstrated results. On average, loans held for sale increased by $9.5 million when compared to the fourth quarter of 2013. The yield on earning assets decreased to 3.28% in the fourth quarter of 2014, compared to 3.55% in the fourth quarter of 2013. The net interest margin for the fourth quarter was 2.98%, compared to 3.07% in the same period of 2013. Net interest income in fourth quarter 2013 was aided by approximately $337 thousand of interest income recognized on nonaccrual loans that returned to performing status during the quarter.

Interest expense decreased despite exceptional growth in deposits, as we have been able to lower the rates paid on deposits. The cost of interest bearing liabilities declined to 0.40% in the current quarter, compared to 0.59% in the same period of 2013. The Company's redemption of subordinated debentures in the third quarter 2014 contributed to lower interest expense. The cost of core deposits declined to 0.16% in the current quarter, compared to 0.20% in the same period of 2013.

The provision for loan losses was $0 in the fourth quarters of 2014 and 2013.

Non-interest income for the fourth quarter of 2014 was $5.995 million, an increase of $1.387 million, or 30.1% from $4.608 million in the fourth quarter of 2013. The increase primarily relates to a 74% increase in mortgage banking revenues, which aggregated $3.363 million, compared to $1.931 million in the fourth quarter of 2013. Mortgage banking revenues benefited from lower rates in the fourth quarter of 2014. In the current quarter, investments in Small Business Investment Companies (SBIC's) generated revenue of $1.566 million compared to $1.419 million in the same period of 2013. We invested in the SBIC's several years ago and one of the investments has made distributions from the sale of the underlying companies. While it is difficult to predict the timing, or amount of such distributions, we currently anticipate further distributions in future periods. During the fourth quarter of 2014 we recorded a loss on sales of investments of $475 thousand, compared to $0 in the same period of 2013. The 2014 fourth quarter included gains on sales of SBA loans of $227 thousand, compared to $224 thousand in the same period of 2013. Bank fees and service charges were $848 thousand in the fourth quarter of 2014, an increase of 23.6% compared to the fourth quarter of 2013.

Non-interest expense for the fourth quarter of 2014 was $8.938 million, an increase of $864 thousand, or 10.7%, from $8.074 million in the fourth quarter of 2013. This increase relates to increased mortgage production costs and increased incentive compensation related to robust loan and deposit growth in 2014.

In the fourth quarter of 2014, we recorded a tax expense of $1.257 million equating to an effective tax rate of 33.65%. We recorded tax expense of $668 thousand in the fourth quarter of 2013, which resulted in an effective tax rate of 26.23%. The increased effective tax rate in the fourth quarter 2014 primarily relates to higher taxable income from SBIC investments. The lower effective tax rate in the fourth quarter of 2013 is due to the annual impact of increased tax exempt investments and non-taxable life insurance proceeds.

Net income available to common shareholders was $2.004 million, or $0.57 per diluted share, for the fourth quarter of 2014 after accounting for dividends accrued on preferred stock. These costs aggregated $475 thousand in the fourth quarter of 2014 and $339 thousand in the same period of 2013 as the preferred dividend rate increased from 5% to 9% in the first quarter 2014. Net income available to common shareholders in the fourth quarter of 2013 was $1.540 million, or $0.44 per diluted share.

Year Ended December 31, 2014

Net interest income in 2014 was $25.956 million, an increase of $6.111 million, or 30.8%, from $19.845 million in 2013. We grew assets steadily in 2014, as the average balance of earning assets was $844.6 million, compared to $747.7 million in the prior year. The net interest margin in 2014 increased to 3.07%, compared to 2.65% in 2013. The yield on earning assets was 3.47% in 2014, compared to 3.17% in 2013. The cost of interest bearing liabilities was 0.50% in 2014, compared to 0.63% in 2013. The cost of core deposits in 2014 was 0.17%, compared to 0.23% in 2013.

In 2014, we reversed previously recorded provisions for credit losses aggregating $800 thousand as a result of improved credit quality. This compared to a provision of $700 thousand in 2013, which was recorded in the first quarter of the year. Nonperforming loans were $61 thousand at December 31, 2014 compared to $5.6 million at December 31, 2013. Nonperforming assets decreased to $317 thousand at December 31, 2014 from $6.7 million at December 31, 2013.

Non-interest income in 2014 was $20.454 million compared to $29.285 million in 2013. Excluding the impact of non-recurring insurance proceeds aggregating $1.055 million in 2013, non-interest income in 2014 decreased by $7.776 million or 27.5%. Non-interest income was significantly influenced by mortgage banking revenues of $11.818 million in 2014 compared to $19.344 million in 2013. In 2014, mortgage banking revenues lagged 2013 until the fourth quarter when lower interest rates resulted in increased mortgage refinance activity and higher revenues. Gains on sales of investments were lower in 2014 aggregating $53 thousand, compared to $1.247 million in the same period of 2013. Gains on sales of SBA loans were $1.915 million in 2014, compared to $1.632 million in 2013. Gains on sales of loans and investments can vary from period to period. We also experienced an increase in bank charges and service fees of $287 thousand, or 10.7% in 2014, reflecting growth in deposits and new accounts. Non-interest income in 2014 and 2013 included $1.718 million and $1.587 million, respectively, of revenues related to SBIC investments. While it is difficult to predict the amount or timing of SBIC revenue, we currently anticipate there will be distributions in future periods.

Non-interest expense decreased 3.6% to $34.680 million in 2014, compared to $35.981 million during 2013. Excluding the impact of non-recurring impairment charge and reductions of post-retirement benefits, which netted to $1.326 million in 2013, non-interest expense in 2014 increased by $25 thousand, or 0.1%.

During 2014, we recorded tax expense of $4.071 million, which resulted in an effective tax rate of 32.49%. Tax expense of $3.822 million was recorded in 2013, which resulted in an effective tax rate of 30.70%. The lower effective tax rate in 2013 is due to the impact of tax exempt investments and non-taxable life insurance proceeds.

Net income available to common shareholders was $6.663 million, or $1.91 per diluted share, in 2014 after accounting for dividends accrued on preferred stock. These costs aggregated $1.796 million in 2014 and $1.320 million in the same period of 2013 as the preferred dividend rate increased from 5% to 9% in the first quarter 2014. Net income available to common shareholders in 2013 was $7.307 million, or $2.11 per diluted share.

Assets, Liabilities and Equity

Total assets were $934.4 million at December 31, 2014, an increase of $91.3 million, or 10.8%, compared to $843.1 million at December 31, 2013. The increases in recent periods have been funded primarily by growing deposits in North Dakota as this region has experienced robust economic conditions for much of 2013 and 2014.

Loans held for investment, which aggregated $360.8 million at December 31, 2014, increased by $42.9 million since December 31, 2013. In recent periods the economic prosperity in North Dakota has stimulated loan growth; however, these conditions also result in exceptional liquidity for many businesses and our clients in North Dakota have been generally predisposed to repay loans on an accelerated basis. Such repayments impeded loan growth during 2014.

Total deposits were $811.2 million at December 31, 2014, increasing by $88.0 million from 2013 year-end. Core deposit balances were $773.3 million at December 31, 2014 and $678.7 million at December 31, 2013. We anticipate that our customers may deploy up to $50 million of amounts currently held in deposits and, as a result, our deposit growth in 2015 could be muted.

[tables deleted]

In the fourth quarter 2014, the Company repaid the $2.3 million long-term debt owed to the Bank of North Dakota.

In August 2014, we redeemed $7.5 million of subordinated debentures. These debentures accrued interest at 12.05%. Redemption costs of $356 thousand were accrued in the second quarter of 2014.

Trust assets under management or administration increased to $257.4 million at December 31, 2014, compared to $249.7 million at December 31, 2013 as this department is capturing wealth being created by the exceptionally strong economic conditions in North Dakota.

Capital

Banks and their bank holding companies operate under separate regulatory capital requirements.

At December 31, 2014, BNCCORP's tier 1 leverage ratio was 9.94%, the tier 1 risk-based capital ratio was 19.85%, and the total risk-based capital ratio was 21.10%.

At December 31, 2014, BNCCORP's tangible common equity as a percent of assets was 6.67% compared to 5.79% at December 31, 2013. Common shareholder equity at December 31, 2014 was $62.4 million and we had preferred stock and subordinated debentures outstanding which aggregated $36.1 million at December 31, 2014.

Book value per common share of the Company was $18.28 as of December 31, 2014, compared to $14.45 at December 31, 2013. Book value per common share, excluding accumulated other comprehensive income, was $16.72 as of December 31, 2014, compared to $14.89 at December 31, 2013.

At December 31, 2014, BNC National Bank had a tier 1 leverage ratio of 9.13%, a tier 1 risk-based capital ratio of 18.48%, and a total risk-based capital ratio of 19.73%. At December 31, 2014, tangible common equity of BNC National Bank was 9.83% of total Bank assets.

In July of 2013, the Federal Reserve issued new regulatory capital standards for community banks which incorporate some of the capital requirements addressed in the Basel III framework and begin to be effective January 1, 2015. We have reviewed estimates of our regulatory capital ratios under the new Basel III framework and expect to be in compliance with these standards.

Asset Quality

Nonperforming assets were $317 thousand at December 31, 2014, down from $6.7 million at December 31, 2013. The decrease in nonperforming assets primarily relates to one significant relationship returning to performing status and the sale of other real estate. The ratio of nonperforming assets to total assets was 0.03% at December 31, 2014 and 0.79% at December 31, 2013. Nonperforming loans were $61 thousand at December 31, 2014, down from $5.6 million at December 31, 2013.

The allowance for credit losses was $8.6 million at December 31, 2014, compared to $9.8 million at December 31, 2013. The reduction of the allowance for credit losses reflects the reduction in nonperforming and classified loans. While the recent decreases in oil and agricultural commodity prices have yet to have a significant negative effect, prolonged declines could have a detrimental economic impact on the North Dakota economy. The allowance for credit losses as a percentage of total loans at December 31, 2014 was 2.11%, compared to 2.81% at December 31, 2013. The allowance for credit losses as a percentage of loans and leases held for investment at December 31, 2014 was 2.38%, compared to 3.10% at December 31, 2013.

At December 31, 2014, BNC had $9.1 million of classified loans, $56 thousand of loans on non-accrual and $256 thousand of other real estate owned. At December 31, 2013, BNC had $13.5 million of classified loans, $4.7 million of loans on non-accrual and $1.1 million of other real estate owned.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 15 locations. BNC also conducts mortgage banking from 14 offices in Illinois, Kansas, Nebraska, Minnesota, Arizona and North Dakota.

http://www.prnewswire.com/news-releases/bnccorp-inc-reports-fourth-quarter-net-income-rose-319-to-25-million-or-057-per-diluted-share-300024670.html

Best Long Idea For 2015: BNCCORP (12/16/14)

http://seekingalpha.com/article/2758435-best-long-idea-for-2015-bnccorp

Opinion: Chris DeMuth, Jr. is a must read on SA.

Regarding...

Treasury Department Announces $45.1 Million in Proceeds from Pricing of Auctions of Preferred Stock of Four Financial Institutions

3/7/2014

Auctions Part of Treasury’s Continued Efforts to Wind Down TARP’s Bank Programs

**Proceeds Deliver Additional Profit for Taxpayers on TARP’s Bank Programs

WASHINGTON – As part of the strategy it outlined for winding down its remaining Troubled Asset Relief Program (TARP) bank investments, the U.S. Department of the Treasury announced that it priced auctions of preferred stock (the “CPP Securities”) in the following four institutions at the following prices:

Issuer and Security

BNCCORP, Inc., Bismarck, ND

Fixed Rate Cumulative Perpetual Preferred Stock, Series A
Price per share: $1,001.08
Number of shares: 20,093
Aggregate Gross Proceeds: $20,114,700.44



The Preferred Stock A Series (or most of it) shows up as a holding of StoneCastle Partners as of Sept 30th 2014

http://www.stonecastle-financial.com/investors.jsp#holdingsTab

They are doing the rest thing by redeeming the $7.5mn debt. Next step will be redeeming the 9% preferred stock I guess

They are doing the rest thing by redeeming the $7.5mn debt. Next step will be redeeming the 9% preferred stock I guess

BNCCORP, INC. Shares Commence Trading on OTCQX Marketplace (11/12/14)

BNCCORP, INC. (OTCQX: BNCC) announced that its common stock began trading today on the OTCQX marketplace, operated by OTC Markets Group, Inc. Previously, the Company's shares traded on the OTCQB venture marketplace. The Company's stock symbol, "BNCC," remains the same.

BNCCORP, INC. is a bank holding company with total assets of nearly $900 million at September 30, 2014, whose principal subsidiary is BNC National Bank.

OTCQX is the best marketplace for established global and growth companies operated by OTC Markets Group. OTCQX for banks is an expansion of the OTCQX marketplace and was created to provide a shareholder-friendly trading experience for strongly capitalized, well managed banking institutions that have committed to provide higher level reporting and greater transparency to investors. To qualify for OTCQX, financial institutions must meet high financial reporting standards, be current in their reporting to their banking regulator and, if applicable, the SEC, and report material events as they occur. They must also appoint a Corporate Broker, a FINRA member broker-dealer specializing in trading and advising banks, to serve as their OTCQX advisor. D.A. Davidson & Co. will serve as BNC's Corporate Broker on OTCQX.

Timothy J. Franz, BNCCORP President and Chief Executive Officer, said, "The move to OTCQX is a reflection of the Company's operational and financial progress in recent years, as well as a demonstration of our commitment to building shareholder value. Trading on a trusted marketplace with robust financial reporting standards, a reputation for transparency, and Corporate Broker support will build the confidence of current stockholders and potential investors. We believe this will heighten the visibility of our Company and increase the liquidity of our shares, making BNCC more attractive to a wider shareholder base."

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 14 locations. BNC also conducts mortgage banking from 12 offices in Illinois, Kansas, Minnesota, Arizona and North Dakota.

U.S. investors can find current financial disclosure and Real-Time Level 2 quotes for the Company on www.otcmarkets.com.

SOURCE BNCCORP, INC.

BNCCORP, INC. Reports Third Quarter Net Income Of $2.0 Million, Or $0.43 Per Diluted Share (10/27/14)

2014 Third Quarter Highlights

- Net income increases $1.5 million, or 306.8%, compared to 2013 third quarter

- Net interest income increases by $2.1 million, or 46.2%, compared to 2013 third quarter

- Non-interest income increases by $868 thousand, or 22%, compared to 2013 third quarter, excluding non-recurring non-interest income item

- Non-interest expense increases by $640 thousand, or 7.9%, compared to 2013 third quarter, excluding non-recurring non-interest expense items

- Book value per common share increases to $17.18 at September 30, 2014 compared to $14.45 at December 31, 2013

- High-cost subordinated debentures of $7.5 million redeemed in third quarter of 2014

- BNCCORP, INC. adds Mr. Nathan Brenna to Board of Directors

BISMARCK, N.D., Oct. 27, 2014 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQB Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Minnesota, Arizona and North Dakota, today reported financial results for the third quarter ended September 30, 2014.

Net income for the 2014 third quarter was $1.981 million, or $0.43 per diluted share. This compares to net income of $487 thousand, or $0.05 per diluted share, in the third quarter of 2013. Results for the third quarter of 2014 primarily reflect substantially increased net interest income largely due to higher balances of earning assets and a rise in net interest margin. Non-interest income and non-interest expense increased compared to the third quarter of 2013, excluding non-recurring items. The third quarter of 2014 also included a reversal of previous provisions for loan losses which increased pre-tax earnings by $200 thousand as credit quality continues to improve.

Timothy J. Franz, BNCCORP President and Chief Executive Officer, said, "We had a solid quarter and have made significant strides forward, particularly when compared to the unsettled business environment in the third quarter one year ago. Our core bank is growing and mortgage banking has largely shifted away from refinancing activity toward purchase originations. These improvements are resulting in higher net interest income and improved non-interest income. As a result of hard work, our credit risk profile is currently very good."

Mr. Franz added, "While our improvement has been noteworthy, challenges remain. Balancing loan growth and credit risk requires constant diligence and mortgage banking operations dependent on purchase activity introduces seasonality to a complicated business segment. We are focused on these challenges and believe our ability to grow deposits and the pipeline of loans held for investment should continue to drive performance. Most importantly, our people have the talent and motivation to continue creating value."

Third Quarter Results

Net interest income for the third quarter of 2014 was $6.749 million, an increase of $2.133 million, or 46.2%, from $4.616 million in the same period of 2013. Third quarter interest income rose year over year as the average balance of interest earning assets increased by $95.5 million to $845.8 million from $750.3 million, when compared to the third quarter of 2013. The average loans held for investment increased $54.3 million, or 19.6%, compared to the prior year third quarter. On average, loans held for sale decreased by $14.4 million when compared to the third quarter of 2013 due to lower mortgage banking activity. The decrease in net interest income resulting from this lower balance was more than offset by the net interest income resulting from an increase of $92.5 million in average investment securities during the same period. The net interest margin in the third quarter of 2014 increased to 3.17% compared to 2.44% in the same period of 2013. The yield on earning assets increased to 3.54% in the third quarter of 2014, compared to 2.94% in the third quarter of 2013.

Interest expense decreased $153 thousand or 16.2% despite growth in deposits as we have been able to lower the rates paid on deposits. The redemption of $7.5 million of 12.05% subordinated debentures reduced interest expense by approximately $106 thousand in the third quarter of 2014. The cost of interest bearing liabilities declined to 0.47% in the current quarter, compared to 0.61% in the same period of 2013. The cost of core deposits was 0.17% in the current quarter compared to 0.22% in the same period of 2013.

A reversal of previous provisions for credit losses increased pre-tax earnings by $200 thousand in the third quarter 2014 as credit quality continues to improve.

Non-interest income for the third quarter of 2014 was $4.814 million, a decrease of $187 thousand, or 3.7%, from $5.001 million in the third quarter of 2013. Excluding the impact of non-recurring insurance proceeds aggregating $1.055 million in 2013, non-interest income in the third quarter of 2014 increased by $868 thousand or 22.0%. Mortgage revenue of $2.782 million was up $360 thousand compared to $2.422 million in the third quarter of 2013. Although the mortgage banking market is significantly influenced by interest rates and federal policies, we have successfully transformed this business as purchase originations now exceed refinance originations. The focus on purchase originations may result in a more seasonal business, particularly in our more northern locations. The 2014 third quarter included gains on sales of SBA loans of $688 thousand, compared to $301 thousand in the same period of 2013. Other recurring sources of fee income increased by smaller but steady amounts.

Non-interest expense for the third quarter of 2014 was $8.765 million, a decrease of $686 thousand, or 7.3%, from $9.451 million in the third quarter of 2013. Excluding the impact of non-recurring impairment charge and reductions of post-retirement benefits, which netted to $1.326 million in 2013, non-interest expense in the third quarter or 2014 increased by $640 thousand, or 7.9%. The increase is primarily related to incentive compensation expense related to loan and deposit growth.

In the third quarter of 2014, we recorded income tax expense of $1.017 million equating to an effective tax rate of 33.92%. During the three month period ending September 30, 2014, the Company recorded increased tax expense equating to an annualized effective tax rate of 32.00%. This adjustment results from a different mix of taxable and non-taxable income than anticipated. In the third quarter of 2013, we recorded a tax benefit of $321 thousand as life insurance proceeds of $1.055 million were not taxable.

Net income available to common shareholders was $1.507 million, or $0.43 per diluted share, for the third quarter of 2014 after accounting for dividends on preferred stock. Dividends on the preferred stock aggregated $474 thousand in the third quarter of 2014 and $330 thousand in the same period of 2013. The dividend associated with $20.1 million of preferred stock increased as the annual dividend rate increased to 9% from 5% in February 2014. Net income available to common shareholders in the third quarter of 2013 was $157 thousand, or $0.05 per diluted share.

Nine Months Ended September 30, 2014

Net interest income for the nine month period ended September 30, 2014 was $19.277 million, an increase of $5.445 million, or 39.4%, from $13.832 million in the same period of 2013. The average balance of earning assets during that period was approximately $829.8 million, compared to approximately $738.3 million in the prior year. The net interest margin during the nine month period of 2014 increased to 3.11%, compared to 2.50% during the same period of 2013. The yield on earning assets was 3.53% in the nine month period ended September 30, 2014, compared to 3.04% in the same period of 2013. The cost of interest bearing liabilities was 0.53%, in the first nine months of 2014, compared to 0.65% in the same period of 2013. As noted above, we repaid $7.5 million of high cost subordinated debentures in the third quarter of 2014 and the cost of core deposits was 0.18% in the first nine months of 2014 compared to 0.25% in the same period of 2013.

A reversal of previous provisions for credit losses increased pre-tax earnings by $800 thousand in the first nine months of 2014. A provision for credit losses of $700 thousand was recorded in the same period in 2013.

Non-interest income for the first nine months of 2014 was $14.459 million, a decrease of $10.218 million, or 41.4%, from $24.677 million in the same period of 2013. Excluding the impact of non-recurring insurance proceeds aggregating $1.055 million in 2013, non-interest income in the first nine months of 2014 decreased by $9.163 million or 38.8% compared to the first nine months of 2013. Non-interest income was particularly influenced by lower interest rates in 2013 as mortgage banking revenues were $8.455 million in the first three quarters of 2014, a decrease of $8.958 million, or 51.4%, compared to the same period in 2013. Gains on sales of investments in the first nine months of 2014 were $528 thousand compared to $1.247 million in the same period of 2013. Gains on sales of SBA loans were $1.688 million in the first nine months of 2014, compared to $1.408 million in the same period of 2013. Gains and losses on sales of loans and investments can vary significantly from period to period. Bank fees and service charges and wealth management revenues grew 6.3% and 14.0%, respectively, reflecting growth of our core banking and wealth management services.

Non-interest expense for the first nine months of 2014 was $25.742 million, a decrease of $2.165 million, or 7.8%, from $27.907 million in the same period of 2013. Excluding the impact of the non-recurring impairment charge and reduction of post-retirement benefits, which netted to $1.326 million in 2013, non-interest expense in the first nine months of 2014 decreased by $839 thousand, or 3.2%. The reduction is primarily driven by lower mortgage related variable costs as well as lower regulatory assessments. Included in other expenses in the first nine months of 2014 is $356 thousand of costs recorded related to the subordinated debt redemption.

During the nine month period ended September 30, 2014, we recorded tax expense of $2.814 million, which resulted in an effective tax rate of 32.00%. Tax expense of $3.154 million was recorded during the nine month period ended September 30, 2013, which resulted in an effective tax rate of 31.85%. During the third quarter of 2014, the Company increased the effective tax rate from 31.00% to 32.00% due to a different mix of taxable and non-taxable income than anticipated.

Net income available to common shareholders was $4.659 million, or $1.34 per diluted share, for the nine months ended September 30, 2014 after accounting for dividends on preferred stock. The dividends aggregated $1.321 million in the first nine months of 2014 and $981 thousand in the same period of 2013. The costs associated with $20.1 million of preferred stock increased in February of 2014 when the dividend rate increased to 9% from 5%. Net income available to common shareholders for the first nine months ended September 30, 2013 was $5.767 million, or $1.66 per diluted share.

Assets, Liabilities and Equity

Total assets were $899.7 million at September 30, 2014, an increase of $56.6 million, or 6.7%, compared to $843.1 million at December 31, 2013. The increases in recent periods have been funded primarily by growing deposits in North Dakota as this region is experiencing robust economic conditions.

Loans held for investment, which aggregated $335.4 million at September 30, 2014, $317.9 million at December 31, 2013 and $294.9 million at September 30, 2013, increased by $40.5 million, or 13.7%, since September 30, 2013. The economic prosperity in North Dakota provides tail-winds for long-term loan growth; however, these conditions also result in exceptional liquidity for many businesses and our clients in North Dakota are generally predisposed to repay loans on an accelerated basis. While such repayments challenge loan growth in the short term, the economic vitality and appetite for loans continues to be greater in North Dakota than other regions.

Total deposits were $774.3 million at September 30, 2014, increasing by $67.8 million, or 9.6%, from September 30, 2013. Core deposit balances were $720.0 million at September 30, 2014, $658.7 million at December 31, 2013 and $641.7 million at September 30, 2013.

[table deleted]

In August 2014, we redeemed $7.5 million of subordinated debentures. These debentures accrued interest at 12.05%. Redemption costs of $356 thousand were accrued in the second quarter of 2014. The significant reduction in interest expense has a positive impact on earnings and capital.

Trust assets under management or administration decreased to $255.9 million at September 30, 2014, compared to $256.2 million at September 30, 2013. This decrease is a direct reflection of market depreciation, as our wealth management business is capturing wealth being created by the exceptionally strong economic conditions in North Dakota, both in managed agency and retirement services.

Capital

Banks and their bank holding companies operate under separate regulatory capital requirements. At September 30, 2014, BNCCORP's tier 1 leverage ratio was 10.13%, the tier 1 risk-based capital ratio was 20.22%, and the total risk-based capital ratio was 21.48%.

At September 30, 2014, BNCCORP's tangible common equity as a percent of assets was 6.51% compared to 5.79% at December 31, 2013. Common shareholders' equity at September 30, 2014 was $58.7 million and we had preferred stock and subordinated debentures outstanding which aggregated $36.1 million at September 30, 2014.

Book value per common share of the Company was $17.18 as of September 30, 2014, compared to $14.45 at December 31, 2013. Book value per common share, excluding accumulated other comprehensive income, was $16.12 as of September 30, 2014, compared to $14.89 at December 31, 2013.

At September 30, 2014, BNC National Bank had a tier 1 leverage ratio of 10.12%, a tier 1 risk-based capital ratio of 20.34%, and a total risk-based capital ratio of 21.60%. At September 30, 2014, tangible common equity of BNC National Bank was 10.56% of total Bank assets.

In July of 2013, the Federal Reserve issued new regulatory capital standards for community banks which incorporate some of the capital requirements addressed in the Basel III framework and begin to be effective January 1, 2015. We have reviewed estimates of our regulatory capital ratios under the new Basel III framework and expect to be in compliance with these standards.

Asset Quality

Nonperforming assets were $1.2 million at September 30, 2014, down from $6.7 million at December 31, 2013. The ratio of nonperforming assets to total assets was 0.13% at September 30, 2014 and 0.79% at December 31, 2013. Nonperforming loans were $130 thousand at September 30, 2014, down from $5.6 million at December 31, 2013.

The allowance for credit losses was $8.7 million at September 30, 2014, compared to $9.8 million at December 31, 2013. The reduction of the allowance for credit losses reflects stabilized risk in our loan portfolio and the allowance coverage relative to nonperforming and classified loans. While the recent decreases in oil and agricultural commodity prices have yet to have a significant negative effect, prolonged declines could have a detrimental economic impact on the North Dakota economy. The allowance for credit losses as a percentage of total loans at September 30, 2014 was 2.30%, compared to 2.81% at December 31, 2013. The allowance for credit losses as a percentage of loans and leases held for investment at September 30, 2014 was 2.59%, compared to 3.10% at December 31, 2013.

At September 30, 2014, BNC had $9.5 million of classified loans, $130 thousand of loans on non-accrual and $1.1 million of other real estate owned. At December 31, 2013, BNC had $13.5 million of classified loans, $4.7 million of loans on non-accrual and $1.1 million of other real estate owned. At September 30, 2013, BNC had $13.0 million of classified loans, $10.1 million of loans on non-accrual and $2.2 million of other real estate owned.

BNCCORP, INC Adds Director

Mr. Nathan P. Brenna was added to the Company's Board of Directors in September 2014. Mr. Brenna has a distinguished legal background having represented clients across the country for more than a decade. During his legal career, Mr. Brenna represented BNC on several matters and, as a result, has familiarity with BNC's history. In 2007, Mr. Brenna returned to his roots to operate a large farming and ranching operation in northwestern North Dakota. These operations are located near BNC's branches in the oil producing regions of North Dakota where he is also active in community service. Mr. Brenna's background should contribute a valuable perspective on matters of corporate governance, and an insight into local community and business issues.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 14 locations. BNC also conducts mortgage banking from 12 offices in Illinois, Kansas, Minnesota, Arizona and North Dakota.

http://www.prnewswire.com/news-releases/bnccorp-inc-reports-third-quarter-net-income-of-20-million-or-043-per-diluted-share-492472764.html

New 52-week high (8/28/14)

BNCC
USD Bnccorp Inc
Last [Tick] $18.50[+]
Change Up $0.30
% Change Up 1.65%
Bid [Tick] $17.92
Bid Size 200
Ask $18.20
Ask Size 900
Open $18.20
Volume 400
Day High $18.50
Day Low $18.20
Previous Close $18.20
Prev. Close Date 08/27/2014

Finally, something can be done with the 12.05 percent series.
We plan to redeem $7.5 million of subordinated debentures in the third quarter of 2014. These debentures accrue interest at 12.05%. Redemption costs of $356 thousand were accrued in the second quarter of 2014. As a result of the redemption, we expect the full year reduction of interest expense to be approximately $900 thousand in 2015. After the redemption, we will continue to remain in excess of well capitalized levels. Furthermore, the significant reduction in interest expense will have a positive impact on future earnings and capital.

BNCCORP, INC. Reports Second Quarter Net Income Of $2.2 Million, Or $0.50 Per Diluted Share (7/28/14)

2014 Second Quarter

- Net income rises 23% sequentially from 2014 first quarter; declines 11% from 2013 second quarter

- Net interest income increases by $1.7 million, or 38%, compared to 2013 second quarter

- Non-interest income decreases due to lower mortgage banking revenues compared to 2013 second quarter

- Non-interest expense decreases compared to 2013 second quarter

- Total assets increase 7.1% from year-end

- Book value per common share increases to $16.64 at June 30, 2014 compared to $15.45 at March 31, 2014 and $14.45 at December 31, 2013

- Year-to-date net income is $4.0 million or $0.91 per diluted share

- Company to redeem high-cost subordinated debentures

BISMARCK, N.D., July 28, 2014 /PRNewswire/ -- BNCCORP, INC. (BNC or the Company) (OTCQB Markets: BNCC), which operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota, and has mortgage banking offices in Illinois, Kansas, Nebraska, Minnesota, Arizona and North Dakota, today reported financial results for the second quarter ended June 30, 2014.

Net income for the 2014 second quarter was $2.207 million, or $0.50 per diluted share. This compares to net income of $2.476 million, or $0.62 per diluted share, in the second quarter of 2013 and net income of $1.792 million or $0.41 per diluted share in the first quarter of 2014. Results for the second quarter of 2014 primarily reflect lower non-interest income due to the impact of interest rates on mortgage banking revenues, which is causing a shift from refinance originations to purchase originations in the market. This was partially offset by significantly higher net interest income and lower non-interest expenses when compared to the prior year second quarter. Included in non-interest expense, for the recent quarter, are non-recurring costs of approximately $356 thousand related to the redemption of high-cost subordinated debentures. The second quarter of 2014 also included a reversal of previous provisions for loan losses which increased pre-tax earnings by $400 thousand. Nonperforming assets decreased to $5.0 million, or 0.55% of total assets, at June 30, 2014, compared to $6.7 million, or 0.79% of total assets, at December 31, 2013.

Timothy J. Franz, BNCCORP President and Chief Executive Officer, said, "We had a solid quarter in several respects. We continue to improve net interest income and reduce noninterest expense. While the interest rate environment caused mortgage banking revenues to decline from the second quarter of 2013, as expected, we have successfully transformed this business as purchase originations outnumber refinance originations almost two to one this quarter and our recurring sources of noninterest income continue to climb."

Mr. Franz added, "We continue to focus on growing our core banking operations and our pipeline of loans held for investment, an indicator of future loan growth, remains robust. I personally visited the North Dakota 'Oil Patch' twice this quarter and have witnessed the incredible nascent economic vitality of the area first-hand. This region has unique possibilities and obstacles, but we are clearly in the right place at the right time. Our people are energized and we look forward to capitalizing on the opportunities before us."

Second Quarter Results

Net interest income for the second quarter of 2014 was $6.323 million, an increase of $1.740 million, or 38%, from $4.583 million in the same period of 2013. Second quarter interest income rose year over year as the average balance of interest earning assets increased by $112.2 million to $856.3 million from $744.1 million, when compared to the second quarter of 2013. The average loans held for investment increased $57.5 million, or 21.0%, compared to the prior year second quarter. On average, loans held for sale decreased by $45.7 million when compared to the second quarter of 2013 due to lower mortgage banking activity. The decrease in net interest income resulting from this lower balance was more than offset by the net interest income resulting from an increase of $113.8 million in average investment securities during the same period. The net interest margin in the second quarter of 2014 increased to 2.96% compared to 2.47% in the same period of 2013. The yield on earning assets increased to 3.41% in the second quarter of 2014, compared to 3.00% in the second quarter of 2013.

Interest expense decreased despite exceptional growth in deposits as we have been able to lower the rates paid on deposits. The cost of interest bearing liabilities declined to 0.55% in the current quarter, compared to 0.64% in the same period of 2013. The cost of core deposits at the Bank were 0.18% in the current quarter compared to 0.24% in the same period of 2013.

Pre-tax earnings increased by $400 thousand in the second quarter of 2014 due to a reversal of previous provisions for credit losses. This reflects the continued improvement of our credit quality and a successful restructuring of an impaired loan in the second quarter, which consequently used less of the allowance for loan losses than previously anticipated and led to recognition of the reversal.

Non-interest income for the second quarter of 2014 was $5.361 million, a decrease of $2.991 million, or 35.8%, from $8.352 million in the second quarter of 2013. The decrease primarily relates to a decline in mortgage banking revenues, which aggregated $3.391 million, compared to $6.744 million in the second quarter of 2013. Although the mortgage banking revenues continue to be significantly impacted in 2014 by interest rates that are higher than in 2013, we have successfully transformed this business as purchase originations now exceed refinance originations by almost two to one. The focus on purchase originations may result in a more seasonal business, particularly in our more northern locations. The 2014 second quarter included gains on sales of SBA loans of $760 thousand, compared to $352 thousand in the same period of 2013. This increase is consistent with expectations as our SBA operations experienced temporary delays in the first quarter of 2014. Other recurring sources of fee income increased by smaller but steady amounts.

Non-interest expense for the second quarter of 2014 was $8.887 million, a decrease of $172 thousand, or 1.9%, from $9.059 million in the second quarter of 2013. As discussed in more detail below, noninterest expense includes $356 thousand of costs related to the planned redemption of subordinated debentures. Excluding the redemption costs, non-interest expense decreased by $528 thousand or 5.8% in the quarter compared to the second quarter of 2013.

In the second quarter of 2014, we recorded income tax expense of $990 thousand. The effective tax rate was 30.97%. We recorded income tax expense of $1.400 million in the second quarter of 2013, which resulted in an effective tax rate of 36.12%. The 2014 effective tax rate reduction relates primarily to the impact of tax exempt investments made in the second half of 2013.

Net income available to common shareholders was $1.732 million, or $0.50 per diluted share, for the second quarter of 2014 after accounting for dividends accrued on preferred stock. Dividend expense on the preferred stock aggregated $475 thousand in the second quarter of 2014 and $327 thousand in the same period of 2013. The dividend expense associated with $20.1 million of preferred stock increased as the annual dividend rate increased to 9% from 5% in February 2014. Net income available to common shareholders in the second quarter of 2013 was $2.149 million, or $0.62 per diluted share.

Six Months Ended June 30, 2014

Net interest income in the first half of 2014 was $12.528 million, an increase of $3.312 million, or 35.9%, from $9.216 million in the first half of 2013. We grew assets steadily in the first six months of 2014. The average balance of earning assets during that period was approximately $821.8 million, compared to approximately $732.2 million in the prior year. The net interest margin during the first six months of 2014 increased to 3.07%, compared to 2.54% during the same period of 2013. The yield on earning assets was 3.53% in the six month period ended June 30, 2014, compared to 3.09% in the same period of 2013. The cost of interest bearing liabilities was 0.56%, in the first half of 2014, compared to 0.67% in 2013. The cost of core deposits at the Bank were 0.18% in the first half of 2014 compared to 0.26% in the same period of 2013.

A reversal of previous provisions for credit losses increased pre-tax earnings by $600 thousand in the first six months of 2014. The reduction relates to $200 thousand in net recoveries in the first quarter of 2014 and continued improvement in credit quality and the successful restructuring of an impaired loan in the second quarter of 2014. We continue to maintain an allowance to loans ratio of 2.44% as of June 30, 2014.

Non-interest income for the first six months of 2014 was $9.645 million, a decrease of $10.031 million, or 51.0%, from $19.676 million in the same period of 2013. Non-interest income was significantly influenced by interest rates as mortgage banking revenues were $5.673 million, a decrease of $9.318 million, or 62.2%, compared to 2013. Gains on sales of investments in the first half of 2014 were $528 thousand compared to $1.210 million in the same period of 2013. Gains on sales of SBA loans were $1.000 million in the first six months of 2014, compared to $1.107 million in the same period of 2013. Gains and losses on sales of loans and investments can vary significantly from period to period. We also experienced an increase in bank fees and service charges of $80 thousand, or 6.2%, when comparing the first half of 2014 to the first half of 2013, reflecting growth in deposits and new accounts.

Non-interest expense for the first six months of 2014 was $16.977 million, a decrease of $1.479 million, or 8.0%, from $18.456 million in the same period of 2013. As discussed in more detail below, noninterest expense includes $356 thousand of costs related to the planned redemption of subordinated debentures. Excluding redemption costs, non-interest expense was lower by $1.835 million or 9.9% in the first six months of 2014 compared to the first half of 2013.

During the six month period ended June 30, 2014, we recorded tax expense of $1.797 million which resulted in an effective tax rate of 31.00%. Tax expense of $3.475 million was recorded during the six month period ended June 30, 2013, which resulted in an effective tax rate of 35.69%. The 2014 effective tax rate reduction relates primarily to the impact of tax exempt investments made in the second half of 2013.

Net income available to common shareholders was $3.152 million, or $0.91 per diluted share, for the six months ended June 30, 2014 after accounting for dividends accrued on preferred stock. These costs aggregated $847 thousand in the first six months of 2014 and $651 thousand in the same period of 2013. Net income available to common shareholders for the first six months ended June 30, 2013 was $5.610 million, or $1.62 per diluted share. The costs associated with $20.1 million of preferred stock increased in February of 2014 when the rate of dividends increased to 9% from 5%.

Assets, Liabilities and Equity

Total assets were $903.0 million at June 30, 2014, an increase of $59.9 million, or 7.1%, compared to $843.1 million at December 31, 2013. The increases in recent periods have been funded primarily by growing deposits in North Dakota as this region is experiencing robust economic conditions.

Loans held for investment, which aggregated $324.9 million at June 30, 2014, $317.9 million at December 31, 2013 and $281.5 million at June 30, 2013, increased by $43.4 million, or 15.4%, since June 30, 2013. The economic prosperity in North Dakota provides tail-winds for long-term loan growth. However, these conditions also result in exceptional liquidity for many businesses and our clients in North Dakota are generally predisposed to repay loans on an accelerated basis. For example, in the second quarter of 2014 we received significant unscheduled payments on loans equating to approximately $14 million. While such repayments challenge loan growth in the short term, the economic vitality and appetite for loans continues to be greater in North Dakota than other regions.

Total deposits were $772.9 million at June 30, 2014, increasing by $49.6 million from 2013 year-end. Deposits declined from the end of the first quarter of 2014 by $30.0 million. As previously reported, we experienced a surge in deposits in the first quarter of 2014 when deposits grew by $80 million and, as anticipated, our clients redeployed portions of these funds. The redeployment was partially offset by other depository growth. During the second quarter of 2014, recognizing favorable economic conditions, we exercised our redemption rights to call a $10 million brokered certificate of deposit.

We plan to redeem $7.5 million of subordinated debentures in the third quarter of 2014. These debentures accrue interest at 12.05%. Redemption costs of $356 thousand were accrued in the second quarter of 2014. As a result of the redemption, we expect the full year reduction of interest expense to be approximately $900 thousand in 2015. After the redemption, we will continue to remain in excess of well capitalized levels. Furthermore, the significant reduction in interest expense will have a positive impact on future earnings and capital.

Trust assets under management or administration increased to $262.3 million at June 30, 2014, compared to $249.7 million at December 31, 2013 and $237.4 million at June 30, 2013. Our wealth management business is capturing wealth being created by the exceptionally strong economic conditions in North Dakota, both in managed agency and retirement services and bolstered by strong equity markets.

Capital

Banks and their bank holding companies operate under separate regulatory capital requirements.

At June 30, 2014, BNCCORP's tier 1 leverage ratio was 10.66%, the tier 1 risk-based capital ratio was 22.23%, and the total risk-based capital ratio was 23.49%.

At June 30, 2014, BNCCORP's tangible common equity as a percent of assets was 6.28% compared to 5.79% at December 31, 2013. Common shareholders' equity at June 30, 2014 was $56.8 million and we had preferred stock and subordinated debentures outstanding which aggregated $43.6 million at June 30, 2014.

Book value per common share of the Company was $16.64 as of June 30, 2014, compared to $15.45 at March 31, 2014 and $14.45 at December 31, 2013. Book value per common share, excluding accumulated other comprehensive income, was $15.67 as of June 30, 2014, compared to $14.89 at December 31, 2013.

At June 30, 2014, BNC National Bank had a tier 1 leverage ratio of 9.75%, a tier 1 risk-based capital ratio of 20.51%, and a total risk-based capital ratio of 21.77%.

At June 30, 2014, tangible common equity of BNC National Bank was 10.24% of total Bank assets.

In July of 2013, the Federal Reserve issued new regulatory capital standards for community banks which incorporate some of the capital requirements addressed in the Basel III framework and begin to be effective January 1, 2015. We have reviewed estimates of our regulatory capital ratios under the new Basel III framework and expect to be in compliance with these standards.

Asset Quality

Nonperforming assets were $5.0 million at June 30, 2014, down from $6.7 million at December 31, 2013. The ratio of total nonperforming assets to total assets was 0.55% at June 30, 2014 and 0.79% at December 31, 2013. Nonperforming loans were $3.2 million at June 30, 2014, down from $5.6 million at December 31, 2013. The ratio of the allowance for credit losses to total nonperforming loans as of June 30, 2014 was 272%, compared to 175% at December 31, 2013.

The allowance for credit losses was $8.8 million at June 30, 2014, compared to $9.8 million at December 31, 2013. The reduction of the allowance for credit losses reflects stabilized risk in our loan portfolio, strong allowance coverage of nonperforming and classified loans, net recoveries in the first quarter of 2014 and the restructuring of a significant impaired loan in the second quarter. The allowance for credit losses as a percentage of total loans at June 30, 2014 was 2.44%, compared to 2.81% at December 31, 2013. The allowance for credit losses as a percentage of loans and leases held for investment at June 30, 2014 was 2.72%, compared to 3.10% at December 31, 2013.

At June 30, 2014, BNC had $10.4 million of classified loans, $3.3 million of loans on non-accrual and $1.8 million of other real estate owned. At December 31, 2013, BNC had $13.5 million of classified loans, $4.7 million of loans on non-accrual and $1.1 million of other real estate owned. At June 30, 2013, BNC had $13.1 million of classified loans, $10.2 million of loans on non-accrual and $3.0 million of other real estate owned.

BNCCORP, INC., headquartered in Bismarck, N.D., is a registered bank holding company dedicated to providing banking and wealth management services to businesses and consumers in its local markets. The Company operates community banking and wealth management businesses in North Dakota, Arizona and Minnesota from 14 locations. BNC also conducts mortgage banking from 13 offices in Illinois, Kansas, Nebraska, Minnesota, Arizona and North Dakota.

This news release may contain "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of BNC. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management are generally identifiable by the use of words such as "expect", "believe", "anticipate", "plan", "intend", "estimate", "may", "will", "would", "could", "should", "future" and other expressions relating to future periods. Examples of forward-looking statements include, among others, statements we make regarding our belief that we have exceptional liquidity, our expectations regarding future market conditions and our ability to capture opportunities and pursue growth strategies, our expected operating results such as revenue growth and earnings, and our expectations of the effects of the regulatory environment on our earnings for the foreseeable future. Forward-looking statements are neither historical facts nor assurances of future performance. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, but are not limited to: the impact of current and future regulation; the risks of loans and investments, including dependence on local and regional economic conditions; competition for our customers from other providers of financial services; possible adverse effects of changes in interest rates, including the effects of such changes on mortgage banking revenues and derivative contracts and associated accounting consequences; risks associated with our acquisition and growth strategies; and other risks which are difficult to predict and many of which are beyond our control. In addition, all statements in this news release, including forward-looking statements, speak only of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

http://www.prnewswire.com/news-releases/bnccorp-inc-reports-second-quarter-net-income-of-22-million-or-050-per-diluted-share-268904021.html

BNCCORP, INC. Reports Second Quarter Net Income Of $2.2 Million, Or $0.50 Per Diluted Share

New 52-week high.

$18... in a word...wow.

Just 2 years ago in May it was $2.20.

..and the best news is...it has no shortage of catalyst to go higher.

Anyone else thinking target bank?

Marker:
Bnccorp, Inc. (QB) (BNCC)
$18.00 up 0.01 (0.06%)
Volume: 1,410