Third Century Bancorp Releases Earnings for Quarter Ended and Year Ended December 31, 2015;

Announces Quarterly Dividend

FRANKLIN, Ind.--()--Third Century Bancorp (“Company”) (OTCBB:TDCB), the holding company for Mutual Savings Bank (“Bank”) announced it had net income of $165,000 for the quarter ended December 31, 2015, or $0.13 per share, compared to net income of $178,000 for the quarter ended December 31, 2014, or $0.14 per share. For the twelve months ended December 31, 2015, the Company recorded net income of $547,000, or $0.43 per share, compared to net income of $399,000 for the twelve months ended December 31, 2014, or $0.31 per share.

For the three months ended December 31, 2015, net income decreased $13,000, or 7.3%, to $165,000 as compared to $178,000 for the same period in the prior year. The decrease in net income for the three month period ended December 31, 2015 was primarily a result of a decline in credit to reserve for loan losses of $118,000 and a $94,000 increase in noninterest expense, partially offset by a $34,000 increase in net interest income, a $107,000 increase in noninterest income and a $58,000 decrease in income tax expense. During the three month period ended December 31, 2014, the Company recorded a credit to allowance for loan losses in the amount of $118,000 due to improvements in the credit quality within the loan portfolio. No provision expense or credit was recorded during the three months ended December 31, 2015. The increase in noninterest expense for the quarter ended December 31, 2015 compared to the same period in the prior year was due to increases in wages and benefits, audit and accounting fees, advertising expenses and other noninterest expenses. The increase in net interest income was due to increases in the average yield on interest earning assets and average balance of interest earning assets and decreases in the average cost of funds and average balance of interest bearing liabilities. The increase in noninterest income was due to increases in bank owned life insurance income, trust income, ATM fees and deposit fees and service charges for the three month period ended December 31, 2015.

For the Twelve month period ended December 31, 2015, net income increased $148,000, or 37.1% to $547,000 as compared to $399,000 for the same period in the prior year. The increase in net income for the twelve month period was primarily a result of an increase of $93,000 in net interest income, which was achieved through a $22,000 increase in interest income and a $71,000 decrease in interest expense, and a $285,000 increase in credit to reserve for loan losses created by improvements in loan credit quality. The Company recorded net loan recoveries of $98,000 during the year ended December 31, 2015 compared to net loan charge-offs of $338,000 during the year ended December 31, 2014. Nonperforming loans totaled $72,000 or 0.07% of total loans at December 31, 2015 compared to $284,000 or 0.30% of total loans at December 31, 2014.

Total assets increased $3.9 million to $127.0 million at December 31, 2015 from $123.1 million at December 31, 2014, an increase of 3.2%. The increase was primarily due to a $4.8 million increase in net loans, primarily funded by a $1.0 million increase in total deposits and a $2.5 million increase in FHLB advances.

Deposits increased $1.0 million or 1.1% to $94.8 million at December 31, 2015 from $93.7 million at December 31, 2014. Federal Home Loan Bank advances and other borrowings increased $2.5 million, or 18.5%, to $16.0 million at December 31, 2015 from $13.5 million at December 31, 2014. At December 31, 2015 the weighted average rate of all Federal Home Loan Bank advances was 1.33% compared to 1.57% at December 31, 2014 and the weighted average maturity was 1.9 years at December 31, 2015 compared to 2.9 years at December 31, 2014.

Stockholders’ equity was $16.1 million at December 31, 2015 compared to $15.7 million at December 31, 2014. Stockholders’ equity increased due to net income of $547,000 for the twelve months ended December 31, 2015, partially offset by cash dividends paid of $165,000. Equity as a percentage of assets decreased to 12.64% at December 31, 2015 compared to 12.73% at December 31, 2014.

On February 25, 2016 the Board of Directors declared a dividend of $0.04 per share for shareholders of record March 15, 2016. The payment date for this quarterly dividend is April 1, 2016.

Founded in 1890, Mutual Savings Bank is a full-service financial institution based in Johnson County, Indiana. In addition to its main office at 80 East Jefferson Street, Franklin, Indiana, the bank operates branches in Franklin at 1124 North Main Street and the Franklin United Methodist Community, as well as in Nineveh and Trafalgar, Indiana.

This press release contains certain forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, legislative and regulatory changes that adversely affect the business of the Company and the Bank, and changes in the securities markets. Except as required by law, the Company does not undertake any obligation to update any forward-looking statements to reflect changes in belief, expectations or events.

     
Selected Consolidated Financial Data
(unaudited)
 
At December 31, At December 31,
2015 2014
Selected Consolidated Financial Condition Data: (Dollars in thousands, except per share data)
Assets $ 127,044 $ 123,132
Loans receivable-net 98,412 93,616
Cash and cash equivalents 6,173 9,517
Interest-earning time deposits in other banks 4,712 4,712
Investment securities 10,058 9,867
Deposits 94,765 93,715
FHLB advances and other borrowings 16,000 13,500
Stockholders’ equity-net 16,061 15,679
 
Equity to assets ratio at period end 12.64 % 12.73 %
Non-performing loans to total loans 0.07 0.30

Allowance for loan losses to total loans outstanding

1.24 1.62
Allowance for loan losses to non-performing loans 1,718.15 542.16
Number of full service offices 5 5
Tangible book value per share $ 12.51 $ 12.22
Market closing price at end of quarter $ 8.25 $ 8.00
Price-to-tangible book value 65.37 % 65.45 %
 
 
For the Three Months Ended December 31,
2015 2014
(Dollars In Thousands, Except Share Data)
Selected Consolidated Earnings Data:
Total interest income $ 1,179 $ 1,155
Total interest expense   105     115  
Net interest income 1,074 1,040
Provision of losses on loans   -     (118 )
Net interest income after provision for losses on loans 1,074 1,158
Noninterest income 248 141
Noninterest expenses 1,098 1,004
Income tax expense   59     117  
Net income $ 165   $ 178  
Earnings per share basic and diluted $ 0.13 $ 0.14
 
Selected Financial Ratios and Other Data:
Interest rate spread during period 3.43 % 3.36 %
Net yield on interest-earning assets 3.57 3.48
Return on average assets 0.52 0.58
Return on average equity 4.14 4.57

Average interest-earning assets to average interest-bearing liabilities

139.37 132.57
 
 
For the Twelve Months Ended December 31,
2015     2014
(Dollars In Thousands, Except Share Data)
Selected Consolidated Earnings Data:
Total interest income $ 4,585 $ 4,563
Total interest expense   424     495  
Net interest income 4,161 4,068
Provision for losses on loans   (400 )   (115 )
Net interest income after provision for losses on loans 4,561 4,183
Noninterest income 484 706
Noninterest expenses 4,233 4,227
Income tax expense   265     263  
Net income $ 547   $ 399  
Earnings per share – basic and diluted $ 0.43 $ 0.31
 
Selected Financial Ratios and Other Data:
Interest rate spread during period 3.32 % 3.30 %
Net yield on interest-earning assets 3.45 3.45
Return on average assets 0.44 0.32
Return on average equity 3.45 2.57

Average interest-earning assets to average interest-bearing liabilities

138.95 135.90

Contacts

Third Century Bancorp
Robert D. Heuchan, President and CEO
David A. Coffey, Executive Vice President, CFO and COO
Tel. 317-736-7151
Fax 317-736-1726

Contacts

Third Century Bancorp
Robert D. Heuchan, President and CEO
David A. Coffey, Executive Vice President, CFO and COO
Tel. 317-736-7151
Fax 317-736-1726