FLORENCE, S.C., Feb. 27, 2015 /PRNewswire/ -- First Reliance
Bancshares, Inc (OTC: FSRL) today announced unaudited results for
the year ended December 31,
2014. The Company earned net income of $4,407,611, or $0.68 per diluted share, for the year ended
December 31, 2014. This
compares to a net loss of $7,736,530,
or $2.07 per diluted share, for the
year ended December 31, 2013.
The increase in unaudited net income from 2013 to 2014 is
attributed primarily to an increase in net interest income of
$1.6 million, a reduction in
noninterest expense of $6.1 million,
and a tax benefit of $3.1 million
derived from the recapture of a portion of the Company's deferred
tax asset (DTA) in the third quarter of 2014. The Company had
a remaining DTA valuation allowance of $6.6
million as of December 31,
2014. Net income per share for the year ended December 31, 2014 is based on 4,688,981 diluted
average shares, compared to 4,294,105 diluted average shares for
2013. Income before income taxes increased to $1.3 million for the year ended December 31, 2014, versus a loss before income
taxes of $6.3 million for the year
ended December 31, 2013. The
Company's 2014 pre-tax operating results were positively impacted
by an increase in net interest income, and significant
reductions in noninterest expense.
Net interest income increased $1,656,687, and totaled $13,914,475 for the year ended December 31, 2014, compared to $12,257,788 for the year ended December 31, 2013. Interest income
increased $367,971, while interest
expense was reduced by $1,288,716. The Company continues to
withstand competitive pressures regarding loan yields and has
lowered its cost of funds, resulting in an increase in net interest
margin from 3.74% in 2013 to 4.35% for 2014.
Noninterest income remained relatively flat, and totaled
$4,436,645 for the year ended
December 31, 2014 compared to
$4,405,750 for 2013.
Noninterest expense levels decreased $6,075,398, and totaled $16,317,862 for the year ended December 31, 2014 compared to $22,393,260 for 2013. Contributing to this
decrease were significant reductions in overhead expenses on other
real estate owned, totaling $6,087,147, and salary and benefits
reductions.
Total assets increased 3.47% to $367.8 million as of December 31, 2014, compared to $355.4 million as of December 31, 2013.
Loans increased 7.08%, or $16.9
million, excluding loans held for sale, to $255.4 million as of December 31, 2014, from $238.5 million as of December 31, 2013. The Company continues to
focus efforts on its strategic initiatives of diversifying revenue
streams, expanding its consumer lending platform, increasing its
portfolio 1-4 family mortgage loans, and further expanding its
Charleston presence.
Deposits increased by $2.9
million, or 1.03%, to $285.3
million at December 31, 2014,
from $282.4 million at December 31, 2013. The increase in loans
was funded primarily by an increase in core non-time
deposits. No-cost / low-cost deposits increased 8.71%, to
$147.7 million as of December 31, 2014, compared to $136.0 million at the prior year-end.
The Company continues to show improvement in asset
quality. The ratio of nonperforming assets to total
assets was 1.87% as of December 31,
2014, compared to 4.97% as of December 31, 2013. The allowance for loan
losses as a percentage of loans was 1.18% as of December 31, 2014, compared to 1.22% as of
December 31, 2013. For the year
ended December 31, 2014, additions to
the allowance for loan losses were minimal at $108,769. The decrease in provisions for
loan losses is attributed to increased recoveries, reduced
non-performing assets, declining delinquencies and reduced
classified loans.
"We are extremely pleased with our Company's year-end results as
our asset quality continues to strengthen and we grow revenues
and profits in each business line," said Jeffrey Paolucci, Executive Vice President and
Chief Financial Officer.
"We believe that the Company's year-end results demonstrate our
ability to execute on our strategic plan and expand our products
and services. We continue to grow our consumer lending
platform and will expand further within the Charleston market with a focus on mortgage
lending. Additionally, we are expanding convenient platforms
for mobile banking to meet the needs of customers who want banking
on the go. We are the community bank of choice in our local
markets as many people have discovered the exceptional service they
receive and recognize us for our support of the communities we
serve," said Rick Saunders,
President and CEO.
|
Year Ended
|
|
December 31,
2014
(unaudited)
|
December 31,
2013
|
%
Change
|
|
Income Statement
Data
|
|
|
|
|
Net Interest
Income
|
13,914,475
|
12,257,788
|
13.52%
|
|
Provision for loan
losses
|
706,891
|
609,808
|
15.92%
|
|
Noninterest
Income
|
4,436,645
|
4,405,750
|
0.70%
|
|
Noninterest
Expense
|
16,317,862
|
22,393,260
|
-27.13%
|
|
Income Tax Expense
(Benefit)
|
(3,081,244)
|
1,397,000
|
-320.56%
|
|
Net Income
(Loss)
|
4,407,611
|
(7,736,530)
|
-156.97%
|
|
|
|
|
|
Per Share
Data
|
|
|
|
|
Net Income (Loss) Per
Share
|
|
|
|
|
Basic
|
$
0.68
|
$
(2.07)
|
132.85%
|
|
Diluted
|
$
0.67
|
$
(2.07)
|
132.37%
|
|
|
|
|
|
Average Shares
Outstanding
|
|
|
|
|
Basic
|
4,612,758
|
4,294,105
|
7.42%
|
|
Diluted
|
4,688,981
|
4,294,105
|
9.20%
|
|
|
|
|
|
Key
Ratios
|
|
|
|
|
Return on
Assets
|
1.20%
|
-2.02%
|
159.33%
|
|
Return on
Equity
|
12.12%
|
-19.57%
|
161.93%
|
|
Nonperforming assets
to assets
|
1.87%
|
4.97%
|
-62.37%
|
|
Reserve to
loans
|
1.18%
|
1.22%
|
-3.28%
|
|
Reserve to
nonperforming loans
|
69.62%
|
33.03%
|
110.78%
|
|
Net Interest
Margin
|
4.35%
|
3.74%
|
16.35%
|
ABOUT FIRST RELIANCE BANCSHARES, INC.
First Reliance Bancshares, Inc. is the holding company for First
Reliance Bank. The Bank was founded in 1999, employs
approximately 100 highly-talented associates and serves the
Columbia, Lexington, Charleston, Mount
Pleasant and Florence
markets in South Carolina. First
Reliance Bank offers several unique customer programs which include
a Hometown Heroes package of benefits to serve those who are
serving our communities, Check 'N Save, a community outreach
program for the unbanked or under-banked, a Moms First program, and
an iMatter program targeted to young people. The Bank also offers a
Customer Service Guaranty, a Mortgage Service Guaranty, FREE Coin
Machines for customers to use, Mobile Banking, and is open on most
traditional bank holidays. Its commitment to making
customers' lives better, and the idea that "There's More to Banking
Than Money" has earned the Bank a customer satisfaction rating of
95% (2013 results from an outside survey firm.)
The common stock of First Reliance Bancshares, Inc. is traded
under the symbol FSRL.OB. Additional information about the
Company is available on the Company's web site at
www.firstreliance.com.
This press release contains forward-looking statements about
branch openings within the meaning of the Securities Litigation
Reform Act of 1995. Forward-looking statements give our
expectations or forecasts of future events. The preliminary
results for the year ended December 31,
2014 presented herein above are the Company's
expectations. However, these results are subject to
adjustment by management before the audit is completed and may be
adjusted based upon the results of the audit. Should management or
audit adjustments be necessary, audited results could differ
materially from these preliminary results.
Any or all of our forward-looking statements here or in other
publications may turn out to be incorrect. They can be affected by
inaccurate assumptions or by known or unknown risks and
uncertainties. Many such factors will be important in
determining our actual future results. Consequently, no forward-
looking statements can be guaranteed. Our actual results may
vary materially, and there are no assurances about the performance
of our common stock.
We undertake no obligation to correct or update any
forward-looking statements, whether as a result of new information,
future results or otherwise.
|
Consolidated
Balance Sheets
|
|
|
December
31,
|
|
2014
|
2013
|
|
|
Assets
|
|
|
|
|
Cash and cash
equivalents:
|
|
|
|
|
Cash and
due from
banks
|
$
4,955,110
|
$
3,548,974
|
|
|
Interest-bearing deposits with other banks
|
17,891,077
|
14,698,851
|
|
|
Total cash and
cash
equivalents
|
22,846,187
|
18,247,825
|
|
|
|
|
|
|
Time
deposits in other
banks
|
101,409
|
101,207
|
|
|
|
|
|
|
Securities
available-for-sale
|
13,045,588
|
12,144,843
|
|
|
Securities held-to-maturity (Estimated
fair value of $32,242,017 and $36,951,934
at December 31, 2014 and 2013,
respectively)
|
31,384,418
|
36,951,934
|
|
|
Nonmarketable equity
securities
|
1,502,400
|
1,594,900
|
|
|
Total investment
securities
|
45,932,406
|
50,691,677
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage
loans held for
sale
|
1,970,068
|
2,248,252
|
|
|
|
|
|
|
Loans
receivable
|
255,381,014
|
238,502,131
|
|
|
Less
allowance for loan
losses
|
(3,002,922)
|
(2,894,153)
|
|
|
Loans,
net
|
252,378,092
|
235,607,978
|
|
|
|
|
|
|
Premises,
furniture and equipment,
net
|
23,395,306
|
24,333,616
|
|
|
Accrued
interest
receivable
|
1,034,316
|
1,129,881
|
|
|
Other
real estate
owned
|
2,444,253
|
8,932,634
|
|
|
Cash
surrender value life
insurance
|
13,282,565
|
12,945,693
|
|
|
Other
assets
|
4,371,719
|
1,169,368
|
|
|
Total
assets
|
$
367,756,321
|
$
355,408,131
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
Liabilities
|
|
|
|
|
Deposits
|
|
|
|
|
Noninterest-bearing transaction
accounts
|
$ 65,445,513
|
$ 65,576,524
|
|
|
Interest-bearing transaction
accounts
|
57,229,738
|
46,046,043
|
|
|
Savings
|
88,822,371
|
86,247,410
|
|
|
Time deposits $100,000 and
over
|
36,500,148
|
39,934,745
|
|
|
Other time
deposits
|
37,320,848
|
44,610,301
|
|
|
Total
deposits
|
285,318,618
|
282,415,023
|
|
|
Securities sold
under agreement to repurchase
|
7,573,403
|
4,876,118
|
|
|
Advances from
Federal Home Loan
Bank
|
25,000,000
|
23,000,000
|
|
|
Junior
subordinated
debentures
|
10,310,000
|
10,310,000
|
|
|
Accrued interest
payable
|
806,079
|
587,649
|
|
|
Other
liabilities
|
2,380,554
|
2,126,597
|
|
|
Total
liabilities
|
331,388,654
|
323,315,387
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
Equity
|
|
|
|
|
Preferred stock
|
|
|
|
|
Series A
cumulative perpetual preferred stock - 15,349 shares issued and
outstanding
|
15,179,709
|
15,145,597
|
|
|
Series B cumulative perpetual preferred stock -
767 shares issued and
outstanding
|
767,000
|
769,894
|
|
|
Common stock, $0.01 par value; 20,000,000 shares
authorized,
|
|
|
|
|
4,739,823
and 4,568,695 shares issued and outstanding
|
|
|
|
|
at
December 31, 2014 and 2013,
respectively
|
47,398
|
45,687
|
|
|
Capital
surplus
|
30,914,242
|
30,609,281
|
|
|
Treasury stock, at cost, 35,176 and 29,846 shares at December 31,
2014 and
|
|
|
|
|
2013,
respectively
|
(205,512)
|
(201,686)
|
|
|
Nonvested restricted
stock
|
(385,330)
|
(32,138)
|
|
|
Retained
deficit
|
(10,071,514)
|
(14,447,907)
|
|
|
Accumulated other comprehensive
income
|
121,674
|
204,016
|
|
|
Total shareholders'
equity
|
36,367,677
|
32,092,744
|
|
|
Total liabilities and shareholders'
equity
|
$
367,756,321
|
$
355,408,131
|
|
|
Consolidated
Statements of Operations
|
|
|
|
For the years
ended
|
|
December
31,
|
|
2014
|
2013
|
|
Interest
income:
|
|
|
|
Loans, including
fees
|
$ 13,758,531
|
$ 13,330,556
|
|
Investment securities:
|
|
|
|
Taxable
|
1,120,902
|
1,240,743
|
|
Tax
exempt
|
114,081
|
45,574
|
|
Other interest
income
|
80,517
|
89,187
|
|
Total
|
15,074,031
|
14,706,060
|
|
|
|
|
Interest
expense:
|
|
|
|
Time
deposits
|
706,565
|
1,814,922
|
|
Other
deposits
|
129,677
|
208,404
|
|
Other interest
expense
|
323,314
|
424,946
|
|
Total
|
1,159,556
|
2,448,272
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
13,914,475
|
12,257,788
|
|
Provision for loan
losses
|
706,891
|
609,808
|
|
Net interest
income after provision for loan
losses
|
13,207,584
|
11,647,980
|
|
Noninterest
income:
|
|
|
|
Service charges on deposit
accounts
|
1,624,575
|
1,665,059
|
|
Gain on sale of mortgage
loans
|
1,108,799
|
1,029,641
|
|
Income from bank owned life
insurance
|
336,872
|
345,906
|
|
Other service charges, commissions, and
fees
|
1,076,560
|
1,000,118
|
|
Gain on sale of available-for-sale
securities
|
5,321
|
33,917
|
|
Other
|
284,518
|
331,109
|
|
Total
|
4,436,645
|
4,405,750
|
|
|
|
|
|
|
|
|
|
|
Noninterest
expenses:
|
|
|
|
Salaries and
benefits
|
7,317,950
|
7,731,822
|
|
Occupancy
|
1,529,855
|
1,506,908
|
|
Furniture and equipment related
expenses
|
1,553,289
|
1,360,631
|
|
Other
|
5,916,768
|
11,793,899
|
|
Total
|
16,317,862
|
22,393,260
|
|
|
|
|
Income (loss)
before income
taxes
|
1,326,367
|
(6,339,530)
|
|
|
|
|
Income tax (benefit)
expense
|
(3,081,244)
|
1,397,000
|
|
Net income
(loss)
|
4,407,611
|
(7,736,530)
|
|
|
|
|
|
|
|
|
|
|
Preferred stock
dividends
accrued
|
1,220,205
|
962,064
|
|
Deemed dividends on
preferred stock resulting from
net accretion of discount and amortization of
premium
|
31,218
|
178,039
|
|
|
|
|
Net income (loss)
available to common
shareholders
|
$
3,156,188
|
$
(8,876,633)
|
|
|
|
|
Average common shares
outstanding,
basic
|
4,612,758
|
4,294,105
|
|
Average common shares
outstanding,
diluted
|
4,688,981
|
4,294,105
|
|
|
|
|
Income (loss) per
common share:
|
|
|
|
Basic income (loss) per
share
|
$
0.68
|
$
(2.07)
|
|
Diluted income (loss) per
share
|
0.67
|
(2.07)
|
Contact:
Jeffrey A.
Paolucci, EVP & CFO
(888) 543-5510
jpaolucci@firstreliance.com
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/first-reliance-announces-unaudited-year-end-operating-results-300042399.html
SOURCE First Reliance Bancshares, Inc.