Form 8-K Monarch Financial Holdin For: Oct 22

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 22, 2015

 

 

MONARCH FINANCIAL HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Virginia		001-34565		20-4985388
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

1435 Crossways Boulevard Chesapeake, Virginia		23320
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (757) 389-5111

Not Applicable

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Item 2.02. – Results of Operations and Financial Condition

On October 22, 2015, Monarch Financial Holdings, Inc. (the “Company”) issued a press release announcing its financial results for the three and nine months ended September 30, 2015. The Company also announced the declaration of an 11 for 10 common stock split and a quarterly common stock dividend of $0.09 per share. The stock split is payable December 4, 2015 to shareholders of record on November 12, 2015. The common stock dividend is payable November 30, 2015 to shareholders of record on November 12, 2015. A copy of the Company’s press release is attached as Exhibit 99.1 hereto and is hereby incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

 

(d)

Exhibits.

 

99.1		Monarch Financial Holdings, Inc. press release dated October 22, 2015.

 

2

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

				MONARCH FINANCIAL HOLDINGS, INC.
Date: October 22, 2015				/s/ Brad E. Schwartz
				Brad E. Schwartz
				Chief Executive Officer

 

3

Exhibit 99.1

 

MONARCH FINANCIAL REPORTS 3^RD QUARTER FINANCIAL PERFORMANCE AND DECLARES BOTH CASH AND STOCK DIVIDENDS

Chesapeake, VA, October 22, 2015 - Monarch Financial Holdings, Inc. (Nasdaq: MNRK), the bank holding company for Monarch Bank, reported strong third quarter profit and continued financial performance. The Board of Directors announced a quarterly common stock cash dividend of $0.09 per common share, payable on November 30, 2015, to shareholders of record on November 12, 2015. Total cash dividends declared in 2015 increased 13% from the previous year.

The Board also declared an 11-for-10 stock split effected as a stock dividend. This was the company’s seventh stock split or stock dividend in its history, with the last split in December of 2012. This 11-for-10 stock split equals one additional share for every ten shares owned, and is payable December 4, 2015 to shareholders of record on November 12, 2015. The stock split should enhance shareholder total cash dividends payments, if declared in the future. The amount and declaration of future cash dividends is subject to Board of Director’s approval in addition to regulatory restrictions. All earnings per share and share totals have been restated to reflect this upcoming stock split.

Third quarter 2015 highlights are:

 

•

3rd quarter net income of $3,127,744, up 11.4%

 

•

Diluted earnings per share of $0.26, up 8.3%

 

•

Return on Equity of 10.82%

 

•

Net Interest Margin remains strong at 4.19%

 

•

Non-performing assets at 0.19% of total assets

 

•

$528 million in mortgage loans closed, 83% purchase money

Year to date 2015 highlights are:

 

•

Record net income of $10,012,780, up 17.4%

 

•

Diluted earnings per share of $0.84, up 15%

 

•

Return on Equity of 12.00%

 

•

$1.62 billion in mortgage loans closed, up 40%

 

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“We are pleased to report a record year for net income, as well as both a cash and stock dividend for our shareholders. Our banking, mortgage and private wealth segments continue to perform well. Mortgage closings of $1.62 billion already exceed total mortgage loans closed for all of 2014. A solid net interest margin, strong mortgage production, minimal credit costs, and a focus on expense management continue to drive our above peer bottom line results.” stated Brad E. Schwartz, Chief Executive Officer. “From a shareholder perspective our earnings per share are up 15% for the year, cash dividends declared have grown by 13%, and our net income available to common shareholders is at record levels. We believe this common stock dividend will enhance the overall value of our company, as well as enhance the dividend payout for our shareholders in the future should additional cash dividends be declared. The year 2015 is shaping up to be another great year for the Butterfly Bank.”

Net income was $3,127,744 for the third quarter of 2015, up 11.4% from the same period one year ago. The quarterly annualized return on average equity (ROE) was 10.82%, and the quarterly return on average assets (ROA) was 1.11%. Restated for the stock split, quarterly diluted earnings per share increased to $0.26 compared to $0.24 for the same quarter in 2014.

Net income was $10,012,780 for the first nine months of 2015, up 17.4% from the previous year. The annualized return on average equity (ROE) was 12.00%, and the quarterly return on average assets (ROA) was 1.21%. Restated for the stock split, diluted earnings per share were $0.84, up 15% when compared to $0.73 for the same period in 2014.

Total assets at September 30, 2015 were $1.12 billion, with both loans and deposits showing strong year over year growth. Year over year total loans held for investment grew $77 million or 10.8% and mortgage loans held for sale grew $15 million or 10.6%. For the third quarter total loans held for investment were flat due to the competitive and sometimes irrational lending environment. During the third quarter we funded $69 million in new loans and renewed $103 million in existing loans. Funding continues the shift to a higher level of demand deposits, with 35% of our total deposit mix now in demand deposits.

“While I am thrilled with our year over year loan performance, the market remains highly competitive and we are unwilling to accept the credit, future profitability, or term risk in the current market. Our pipeline remains strong and we will maintain our discipline and continue to look for quality banking relationships that value our client-focused style of doing business.” stated Neal Crawford, President of Monarch Bank. “Many bankers seem to have very short memories when it comes to lending.”

Non-performing assets to total assets were 0.19%, which continues to remain significantly below that of our local, state, and national peer group. This is the lowest level of non-performing assets reported since 2008. Non-performing assets were $2.1 million which were down from the previous quarter and the

 

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same period in 2014. Non-performing assets were comprised of $1.8 million in non-accrual loans, $0 in loans more than 90 days past due, and $275 thousand in other repossessed assets. Net charge-offs for the year were $717 thousand, provision expense was $500 thousand, and the allowance for loan losses represents 1.10% of loans held for investment and 474% of non-performing loans.

The Board of Directors announced two capital actions at their October board meeting. A quarterly common stock cash dividend of $0.09 per common share, payable on November 30, 2015, to shareholders of record on November 12, 2015. They also announced an 11-for-10 stock split for shareholders of record on November 12, 2015 to be paid on December 4, 2015.

Average equity to average assets was 10.22%, and total risk-based capital to risk weighted assets at Monarch Bank equaled 14.02%, significantly higher than the level required to be rated “Well Capitalized” by federal banking regulators. Monarch was again awarded the highest 5-Star “Superior” rating by Bauer Financial, an independent third-party bank rating agency that rates banks on safety and soundness.

Net interest income, our number one driver of profitability, increased 14.6% or $1.4 million during the third quarter of 2015 compared to the same quarter in 2014 driven by higher average balances of loans held for investment and mortgage loans held for sale. Net interest income increased for the full year by 14.7%. The net interest margin was 4.19% for the third quarter, one basis point higher than the margin from the same quarter in 2014. The net interest margin declined in the third quarter on a linked-quarter basis due to competitive pricing on new and renewed loans, yet remains well above our peer average.

Non-interest income in the third quarter increased 15.9% or $2.8 million from the previous year driven by increased revenues from mortgage loans sold, title insurance fees, investment and insurance revenue and service charges. Mortgage revenue continues to be the number one driver of non-interest income. We closed $528 million in mortgage loans (83% purchase) during the third quarter of 2015 compared to $441 million (84% purchase) in the same quarter one year prior. We closed $1.62 billion in mortgage loans (71% purchase) during the first nine months of 2015 compared to $1.16 billion (84% purchase) in the same period of 2014. Total non-interest expense increased 16.2% or $3.8 million during the third quarter due to higher mortgage commissions, salaries and benefits expenses.

“We had a strong third quarter for mortgage originations and closings. Excluding the volatility in our forward rate commitments, which are non-cash accounting entries we are required to book, our profits on a per loan basis increased, our yields remain strong, and the operation is well positioned for a potential rise in long-term interest rates.” stated William T. Morrison, CEO of Monarch Mortgage.

 

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Also during the third quarter Monarch Bank, through its affiliated 503(c) Monarch Children’s Charities, held their annual fundraising golf tournament and raised over $260,000 from the local community to support local charitable causes. These funds will support over thirty local charities in their mission to improve the lives of children.

Monarch Financial Holdings, Inc. is the one-bank holding company for Monarch Bank. Monarch Bank is a community bank with ten banking offices in Chesapeake, Virginia Beach, Norfolk, and Williamsburg, Virginia. Monarch Bank also has loan production offices in Newport News and Richmond, Virginia. OBX Bank, a division of Monarch Bank, operates offices in Kitty Hawk and Nags Head, North Carolina. Monarch Mortgage and our affiliated mortgage companies have over thirty offices with locations in Virginia, North Carolina, Maryland, and South Carolina. Our subsidiaries/ divisions include Monarch Bank, OBX Bank, Monarch Mortgage (secondary mortgage origination), OBX Bank Mortgage (secondary mortgage origination), Coastal Home Mortgage, LLC (secondary mortgage origination), Fitzgerald Financial, LLC (secondary mortgage origination), Advance Mortgage, LLC (secondary mortgage origination), Monarch Bank Private Wealth (investment, trust, planning and private banking), Monarch Investments (investment and insurance solutions), Real Estate Security Agency, LLC (title agency) and Monarch Capital, LLC (commercial mortgage brokerage). The shares of common stock of Monarch Financial Holdings, Inc. are publicly traded on the Nasdaq Capital Market under the symbol “MNRK”.

This press release may contain “forward-looking statements,” within the meaning of federal securities laws that involve significant risks and uncertainties. Statements herein are based on certain assumptions and analyses by the Company and are factors it believes are appropriate in the circumstances. Actual results could differ materially from those contained in or implied by such statements for a variety of reasons including, but not limited to: changes in interest rates; changes in accounting principles, policies, or guidelines; significant changes in the economic scenario: significant changes in regulatory requirements; and significant changes in securities markets. Consequently, all forward-looking statements made herein are qualified by these cautionary statements and the cautionary language in the Company’s most recent Form 10-K and 10-Q reports and other documents filed with the Securities and Exchange Commission. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

 

Contact:		Brad E. Schwartz – (757) 389-5111, www.monarchbank.com, #

 

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Consolidated Balance Sheets

Monarch Financial Holdings, Inc. and Subsidiaries

(In thousands)

Unaudited

 

 

		September 30, 2015				June 30, 2015				March 31, 2015				December 31, 2014				September 30, 2014
ASSETS:
Cash and due from banks		$	11,862			$	15,319			$	13,870			$	14,503			$	21,083
Interest bearing bank balances			75,658				84,225				73,237				49,761				58,207
Federal funds sold			14,188				2,377				63,311				1,135				3,938
Investment securities, at fair value			14,998				17,338				20,283				23,725				25,137
Mortgage loans held for sale			153,243				193,948				159,899				147,690				138,590
Loans held for investment, net of unearned income			790,704				792,962				787,003				772,590				713,667
Less: allowance for loan losses			(8,733	)			(8,676	)			(8,644	)			(8,949	)			(8,977	)
Net loans			781,971				784,286				778,359				763,641				704,690
Bank premises and equipment, net			29,513				30,117				30,050				30,247				30,368
Restricted equity securities, at cost			3,658				4,706				3,243				3,633				3,179
Bank owned life insurance			10,528				10,465				9,950				9,687				9,587
Goodwill			775				775				775				775				775
Accrued interest receivable and other assets			25,195				27,119				25,403				21,940				23,688
Total assets		$	1,121,589			$	1,170,675			$	1,178,380			$	1,066,737			$	1,019,242
LIABILITIES:
Demand deposits—non-interest bearing		$	276,706			$	293,442			$	270,446			$	235,301			$	252,286
Demand deposits—interest bearing			62,335				54,580				58,725				66,682				53,093
Money market deposits			365,615				379,716				417,329				369,221				365,041
Savings deposits			19,263				19,431				19,519				20,003				25,211
Time deposits			238,260				231,854				271,121				228,207				189,142
Total deposits			962,179				979,023				1,037,140				919,414				884,773
FHLB borrowings			10,000				46,025				1,050				11,075				1,100
Trust preferred subordinated debt			10,000				10,000				10,000				10,000				10,000
Accrued interest payable and other liabilities			23,376				22,167				19,653				18,710				18,145
Total liabilities			1,005,555				1,057,215				1,067,843				959,199				914,018
STOCKHOLDERS’ EQUITY:
Common stock (3)			57,689				52,182				51,950				51,864				51,735
Capital in excess of par value (3)			17,115				8,846				8,555				8,336				7,966
Retained earnings (3)			41,183				52,412				49,957				47,354				45,523
Accumulated other comprehensive loss			(38	)			(65	)			(14	)			(102	)			(135	)
Total Monarch Financial Holdings, Inc. stockholders’ equity			115,949				113,375				110,448				107,452				105,089
Noncontrolling interest			85				85				89				86				135
Total equity			116,034				113,460				110,537				107,538				105,224
Total liabilities and stockholders’ equity		$	1,121,589			$	1,170,675			$	1,178,380			$	1,066,737			$	1,019,242
Common shares outstanding at period end (3)			11,884,060				10,777,965				10,736,947				10,652,475				10,646,873
Nonvested shares of common stock included in commons shares outstanding (3)			380,875				341,450				346,950				279,750				299,910
Book value per common share at period end (1)(4)		$	9.79			$	9.56			$	9.35			$	9.17			$	8.97
Tangible book value per common share at period end (2)(4)		$	9.72			$	9.50			$	9.29			$	9.10			$	8.91
Closing market price		$	12.39			$	12.55			$	12.51			$	13.75			$	12.56
Total risk based capital - Consolidated company			14.11	%			13.62	%			13.57	%			13.79	%			14.16	%
Total risk based capital - Bank			14.02	%			13.52	%			13.38	%			13.81	%			14.18	%

 

(1)	Book value per common share is defined as stockholders’ equity divided by common shares outstanding.

(2)	Tangible book value per common share is defined as stockholders’ equity less goodwill and other intangibles divided by commons shares outstanding

(3)	September 30, 2015 capital and common shares have been adjusted to reflect the 11 for 10 stock dividend.

(4)	Per share values have been restated to reflect the 11 for 10 stock dividend

 

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Consolidated Statements of Income

Monarch Financial Holdings, Inc. and Subsidiaries

Unaudited

 

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2015				2014				2015				2014
INTEREST INCOME:
Interest and fees on loans held for investment		$	10,160,805			$	9,007,543			$	30,034,064			$	27,575,506
Interest on mortgage loans held for sale			1,495,426				1,442,668				4,548,898				3,489,898
Interest on investment securities			70,650				90,669				238,349				258,647
Interest on federal funds sold			15,387				15,313				30,847				79,870
Dividends on equity securities			58,513				21,000				139,226				73,410
Interest on other bank accounts			135,473				61,609				354,256				152,546
Total interest income			11,936,254				10,638,802				35,345,640				31,629,877
INTEREST EXPENSE:
Interest on deposits			727,880				789,712				2,134,707				2,463,428
Interest on trust preferred subordinated debt			48,089				124,200				142,371				369,896
Interest on other borrowings			34,232				13,765				80,305				42,351
Total interest expense			810,201				927,677				2,357,383				2,875,675
NET INTEREST INCOME			11,126,053				9,711,125				32,988,257				28,754,202
PROVISION FOR LOAN LOSSES			—				—				500,000				—
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES			11,126,053				9,711,125				32,488,257				28,754,202
NON-INTEREST INCOME:
Mortgage banking income			19,379,901				16,657,849				62,684,553				46,229,239
Service charges and fees			598,494				559,497				1,673,838				1,568,288
Title income			246,494				180,402				721,184				452,890
Investment and insurance income			471,182				428,265				1,215,850				1,209,624
Other income			42,957				72,921				336,030				246,417
Total non-interest income			20,739,028				17,898,934				66,631,455				49,706,458
NON-INTEREST EXPENSE:
Salaries and employee benefits			10,099,413				8,571,995				29,791,207				25,336,002
Commissions and incentives			9,113,787				7,047,140				29,364,091				17,828,126
Occupancy and equipment			2,426,534				2,464,666				7,104,926				7,136,247
Loan origination expense			1,617,713				1,552,162				6,007,337				4,975,873
Marketing expense			1,033,207				801,403				2,682,366				2,121,152
Data processing			529,144				601,644				1,758,462				1,557,728
Telephone			346,385				325,405				1,025,294				929,993
Other expenses			1,707,203				1,756,476				5,471,048				4,989,177
Total non-interest expense			26,873,386				23,120,891				83,204,731				64,874,298
INCOME BEFORE TAXES			4,991,695				4,489,168				15,914,981				13,586,362
Income tax provision			(1,822,868	)			(1,635,440	)			(5,777,971	)			(4,874,180	)
NET INCOME			3,168,827				2,853,728				10,137,010				8,712,182
Less: Net income attributable to noncontrolling interest			(41,083	)			(45,880	)			(124,230	)			(183,285	)
NET INCOME ATTRIBUTABLE TO MONARCH FINANCIAL HOLDINGS, INC.		$	3,127,744			$	2,807,848			$	10,012,780			$	8,528,897
NET INCOME PER COMMON SHARE:
Basic (1)		$	0.26			$	0.24			$	0.85			$	0.73
Diluted (1)		$	0.26			$	0.24			$	0.84			$	0.73
Weighted average basic shares outstanding (1)			11,864,347				11,698,803				11,835,975				11,670,733
Weighted average diluted shares outstanding (1)			11,864,347				11,737,558				11,852,361				11,713,118
Return on average assets			1.11	%			1.11	%			1.21	%			1.15	%
Return on average stockholders’ equity			10.82	%			10.72	%			12.00	%			11.27	%

 

(1)	Per share values have been restated to reflect the 11 for 10 stock dividend

 

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Financial Highlights

Monarch Financial Holdings, Inc. and Subsidiaries

 

 

 

(Dollars in thousands, except per share data)		For the Quarter Ended
		September 30, 2015				June 30, 2015				March 31, 2015				December 31, 2014				September 30, 2014
EARNINGS - COMMERCIAL AND OTHER BANKING SEGMENT
Interest income		$	11,497			$	11,526			$	10,999			$	10,889			$	10,146
Interest expense			(810	)			(810	)			(737	)			(786	)			(928	)
Net interest income			10,687				10,716				10,262				10,103				9,218
Provision for loan losses			—				(250	)			(250	)			—				—
Noninterest income - other			1,359				1,385				1,202				1,162				1,241
Noninterest expense			(7,605	)			(8,174	)			(7,815	)			(7,228	)			(6,783	)
Pre-tax net income			4,441				3,677				3,399				4,037				3,676
Minority interest in net income			(13	)			(15	)			(16	)			(13	)			(10	)
Income taxes			(1,622	)			(1,327	)			(1,235	)			(1,502	)			(1,339	)
Net income		$	2,806			$	2,335			$	2,148			$	2,522			$	2,327
EARNINGS - MORTGAGE BANKING OPERATIONS
Interest income		$	1,495			$	1,746			$	1,307			$	1,377			$	1,443
Interest expense			(1,056	)			(1,248	)			(921	)			(905	)			(950	)
Net interest income			439				498				386				472				493
Noninterest income - mortgage banking income			20,595				22,449				18,307				16,910				17,124
Forward rate commitments and unrealized hedge gain (loss)			(834	)			341				1,267				(565	)			(62	)
Noninterest expense			(19,649	)			(21,529	)			(17,873	)			(16,511	)			(16,742	)
Pre-tax net income			551				1,759				2,087				306				813
Minority interest in net income			(28	)			(36	)			(16	)			(31	)			(36	)
Income taxes			(201	)			(634	)			(758	)			(114	)			(296	)
Net income		$	322			$	1,089			$	1,313			$	161			$	481
INTERCOMPANY ELIMINATIONS
Interest income - Commercial and Other Banking Segment			(1,056	)			(1,248	)			(921	)			(905	)			(950	)
Interest expense - Mortgage Banking Operations			1,056				1,248				921				905				950
EARNINGS - CONSOLIDATED
Interest income		$	11,936			$	12,024			$	11,385			$	11,361			$	10,639
Interest expense			(810	)			(810	)			(737	)			(786	)			(928	)
Net interest income			11,126				11,214				10,648				10,575				9,711
Provision for loan losses			—				(250	)			(250	)			—				—
Noninterest income - mortgage banking income			19,380				22,241				21,064				16,211				16,658
Noninterest income - other			1,359				1,385				1,202				1,162				1,241
Noninterest expense			(26,873	)			(29,154	)			(27,178	)			(23,605	)			(23,121	)
Pre-tax net income			4,992				5,436				5,486				4,343				4,489
Minority interest in net income			(41	)			(51	)			(32	)			(44	)			(46	)
Income taxes			(1,823	)			(1,961	)			(1,993	)			(1,616	)			(1,635	)
Net income		$	3,128			$	3,424			$	3,461			$	2,683			$	2,808
PER COMMON SHARE
Earnings per share - basic (1)		$	0.26			$	0.29			$	0.29			$	0.23			$	0.24
Earnings per share - diluted (1)			0.26				0.29				0.29				0.23				0.24
Common stock - per share dividends			0.09				0.09				0.08				0.08				0.08
Average Basic Shares Outstanding (1)			11,864,347				10,836,175				10,801,027				11,703,002				11,698,803
Average Diluted Shares Outstanding (1)			11,864,347				11,848,826				11,837,536				11,758,141				11,737,558
YIELDS
Loans held for investment			5.17	%			5.21	%			5.21	%			5.34	%			5.16	%
Mortgage loans held for sale, net at fair value			4.02				3.88				3.90				4.16				4.14
Other earning assets			1.04				1.38				1.31				1.33				1.16
Total earning assets			4.49				4.59				4.62				4.75				4.58
Interest bearing checking			0.12				0.13				0.13				0.14				0.15
Money market and regular savings			0.35				0.36				0.30				0.31				0.36
Time deposits			0.65				0.61				0.61				0.81				0.88
Borrowings			0.96				1.04				1.33				1.71				4.92
Total interest-bearing liabilities			0.46				0.44				0.43				0.48				0.57
Interest rate spread			4.03				4.15				4.19				4.27				4.01
Net interest margin			4.19				4.28				4.32				4.42				4.18
FINANCIAL RATIOS
Return on average assets			1.11	%			1.22	%			1.31	%			1.04	%			1.11	%
Return on average stockholders’ equity			10.82				12.28				12.98				10.03				10.72
Non-interest revenue/Total revenue			63.5				66.3				66.2				60.5				62.7
Efficiency - Consolidated			84.3				83.7				82.6				84.5				83.7
Efficiency - Bank only			60.8				64.6				66.2				61.2				61.7
Average equity to average assets			10.22				9.92				10.10				10.39				10.40

 

(1)	Per common share values have been restated to reflect the 11 for 10 stock dividend

 

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Financial Highlights

Monarch Financial Holdings, Inc. and Subsidiaries

 

 

 

(Dollars in thousands, except per share data)		For the Quarter Ended
		September 30, 2015				June 30, 2015				March 31, 2015				December 31, 2014				September 30, 2014
ALLOWANCE FOR LOAN LOSSES
Beginning balance		$	8,676			$	8,644			$	8,949			$	8,977			$	9,070
Provision for loan losses			—				250				250				—				—
Charge-offs			—				(287	)			(598	)			(174	)			(181	)
Recoveries			57				69				43				146				88
Net charge-offs			57				(218	)			(555	)			(28	)			(93	)
Ending balance		$	8,733			$	8,676			$	8,644			$	8,949			$	8,977
COMPOSITION OF RISK ASSETS
Nonperforming loans:
90 days past due		$	—			$	—			$	175			$	175			$	243
Nonaccrual loans			1,841				2,266				4,325				2,705				2,180
OREO and reposessed assets			275				375				100				144				767
Nonperforming assets		$	2,116			$	2,641			$	4,600			$	3,024			$	3,190
ASSET QUALITY RATIOS
Nonperforming assets to total assets			0.19	%			0.23	%			0.39	%			0.28	%			0.31	%
Nonperforming loans to total loans			0.23				0.29				0.57				0.37				0.34
Allowance for loan losses to total loans held for investment			1.10				1.09				1.10				1.16				1.26
Allowance for loan losses to nonperforming loans			474.36				382.88				192.09				310.73				370.49
Annualized net charge-offs to average loans held for investment			-0.03				0.11				0.29				0.02				0.05
PERIOD END BALANCES (Amounts in thousands)
Total mortgage loans held for sale		$	152,532			$	193,948			$	159,899			$	147,690			$	138,590
Total loans held for investment			790,663				792,962				787,003				772,590				713,667
Interest-earning assets			1,059,135				1,101,733				1,110,582				1,003,332				945,697
Assets			1,121,589				1,170,675				1,178,380				1,066,737				1,019,242
Total deposits			962,179				979,023				1,037,140				919,414				884,773
Other borrowings			20,000				56,025				11,050				21,075				11,100
Stockholders’ equity			116,034				113,460				111,443				107,452				105,089
AVERAGE BALANCES (Amounts in thousands)
Total mortgage loans held for sale		$	147,670			$	180,485			$	136,084			$	131,471			$	138,382
Total loans held for investment			783,113				778,757				771,587				725,093				701,137
Interest-earning assets			1,060,069				1,062,119				1,009,389				958,904				930,420
Assets			1,122,895				1,126,749				1,070,581				1,021,591				999,358
Total deposits			955,979				969,144				925,984				883,478				867,980
Other borrowings			33,872				27,437				21,049				14,575				11,124
Stockholders’ equity			114,714				111,824				108,174				106,088				103,908
MORTGAGE PRODUCTION (Amounts in thousands)
Dollar volume of mortgage loans closed		$	527,514			$	605,401			$	487,423			$	445,846			$	440,784
Percentage of refinance based on dollar volume			17.3	%			23.9	%			47.0	%			30.9	%			16.0	%

 

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