EX-99.1 2 ktyb-20160729ex991354eb7.htm EX-99.1 ktyb_Ex99_1

Exhibit 99.1

 

July 29, 2016

 

Earnings Report

June 30, 2016

 

Dear Shareholders:

 

We are pleased to announce continued balance sheet growth for your company.  Total assets were $994.1 million as of June 30, 2016 compared to $853.0 million as of June 30, 2015, reflecting growth of 16.5%.  Year-to-date net income was $3.9 million for the period ending June 30, 2016 compared to $3.6 million for the period ending June 30, 2015, reflecting an increase of 7.8%.

 

The increase in total assets of $141.1 million from prior year reflects the merger with Madison Bank in July of 2015 as well as organic growth from our existing branches.  Components of the change include an increase in net loans of $105.9 million, an increase in investment securities of $29.2 million, and an increase in total deposits of $107.4 million.

 

The increase in year-to-date net income of $282 thousand from prior year was driven by an increase in net interest income after provision of $2.4 million, offset by an increase in other expenses of $2.0 million.  The rise in net interest income was due to increased loans and securities associated with the growth in those asset classes.  The rise in other expenses was primarily due to an increase in compensation expense associated with the increase in employees year-over-year.

 

Year-to-date diluted earnings per share was $1.31 for the period ending June 30, 2016 compared to $1.33 for the same period last year.  While net income was higher than prior year, the earnings per share was slightly lower due to more shares being outstanding this year compared to prior year.

 

Recently, we created a Regional Board in Madison County.  We are happy to announce the following as board members:  Keith Daniel, Mark Gentry, Chris Hornsby, Amanda Marcum, Debra Neal, and Marc Robbins.  As we partner with this Board, we are excited about the prospects for continued growth in Madison County.

 

We are pleased with the results of the first half of 2016 but recognize the banking industry continues to face challenges, including heightened competition and enhanced supervisory oversight.  The national and statewide economies continue to improve but the global economy remains uncertain and, most recently, created market and interest rate volatility as international influences impacted the U.S. stock and bond markets.  Banking regulators are becoming increasingly concerned about, among other things, growth, capital levels, and cyber security.  This cumulative environment exerts downward pressure on revenues and upward pressure on costs. In response to these challenges, we will be pursuing opportunities for profitable growth and improved efficiency to accomplish what is in the long term best interest of our shareholders, customers, and employees.

 

Thank you for your continued support and we look forward to the remainder of the year.

 

 

 

/s/Louis Prichard

 

Louis Prichard

 

President, CEO

 

 


 

UNAUDITED

CONSOLIDATED BALANCE SHEET

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percentage

 

 

    

6/30/2016

    

12/31/2015

    

Change

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

Cash & Due From Banks

 

$

15,459

 

$

16,143

 

-4.2

%

Interest Bearing Time Deposits

 

 

4,829

 

 

1,280

 

277.3

 

Securities

 

 

266,722

 

 

237,476

 

12.3

 

Trading Assets

 

 

5,704

 

 

5,400

 

5.6

 

Loans Held for Sale

 

 

1,485

 

 

1,719

 

-13.6

 

Loans

 

 

653,277

 

 

546,085

 

19.6

 

Reserve for Loan Losses

 

 

7,259

 

 

5,950

 

22.0

 

Net Loans

 

 

646,018

 

 

540,135

 

19.6

 

Federal Funds Sold

 

 

1,169

 

 

205

 

470.2

 

Other Assets

 

 

52,682

 

 

50,596

 

4.1

 

Total Assets

 

$

994,068

 

$

852,954

 

16.5

%

 

 

 

 

 

 

 

 

 

 

Liabilities & Stockholders' Equity

 

 

 

 

 

 

 

 

 

Deposits

 

 

 

 

 

 

 

 

 

Demand

 

$

205,693

 

$

179,909

 

14.3

%

Savings & Interest Checking

 

 

344,983

 

 

280,409

 

23.0

 

Certificates of Deposit

 

 

200,720

 

 

183,698

 

9.3

 

Total Deposits

 

 

751,396

 

 

644,016

 

16.7

 

Repurchase Agreements

 

 

26,057

 

 

13,690

 

90.3

 

Other Borrowed Funds

 

 

111,529

 

 

110,090

 

1.3

 

Other Liabilities

 

 

9,287

 

 

6,161

 

50.7

 

Total Liabilities

 

 

898,269

 

 

773,957

 

16.1

 

Stockholders' Equity

 

 

95,799

 

 

78,997

 

21.3

 

Total Liabilities & Stockholders' Equity

 

$

994,068

 

$

852,954

 

16.5

%

 


 

CONSOLIDATED INCOME STATEMENT

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ending

 

Three Months Ending

 

 

    

 

    

 

    

Percentage

    

 

    

 

    

Percentage

 

 

 

6/30/2016

 

12/31/2015

 

Change

 

6/30/2016

 

12/31/2015

 

Change

 

Interest Income

 

$

18,184

 

$

15,566

 

16.8

%  

$

9,086

 

$

7,835

 

16.0

%

Interest Expense

 

 

2,190

 

 

1,940

 

12.9

 

 

1,101

 

 

972

 

13.3

 

Net Interest Income

 

 

15,994

 

 

13,626

 

17.4

 

 

7,985

 

 

6,863

 

16.3

 

Loan Loss Provision

 

 

600

 

 

650

 

(7.7)

 

 

225

 

 

350

 

(35.7)

 

Net Interest Income After Provision

 

 

15,394

 

 

12,976

 

18.6

 

 

7,760

 

 

6,513

 

19.1

 

Other Income

 

 

6,033

 

 

5,892

 

2.4

 

 

3,286

 

 

3,622

 

(9.3)

 

Other Expenses

 

 

16,936

 

 

14,925

 

13.5

 

 

8,608

 

 

7,708

 

11.7

 

Income Before Taxes

 

 

4,491

 

 

3,943

 

13.9

 

 

2,438

 

 

2,427

 

0.5

 

Income Taxes

 

 

572

 

 

306

 

86.9

 

 

356

 

 

305

 

16.7

 

Net Income

 

$

3,919

 

$

3,637

 

7.8

%  

$

2,082

 

$

2,122

 

(1.9)

%

Net Change in Unrealized Gain (Loss) on Securities

 

 

4,043

 

 

(1,223)

 

(430.6)

 

 

1,656

 

 

(2,160)

 

(176.7)

 

Comprehensive Income (Loss)

 

$

7,962

 

$

2,414

 

229.8

%  

$

3,738

 

$

(38)

 

(9936.8)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on Average Assets

 

 

0.79

%  

 

0.84

%  

 

 

 

0.83

%  

 

0.99

%  

 

 

Return on Average Equity

 

 

8.49

 

 

9.14

 

 

 

 

8.91

 

 

10.64

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings Per Share

 

$

1.31

 

$

1.33

 

 

 

$

0.70

 

$

0.77

 

 

 

Earnings Per Share - assuming dilution

 

 

1.31

 

 

1.33

 

 

 

 

0.70

 

 

0.77

 

 

 

Cash Dividends Per Share

 

 

0.54

 

 

0.52

 

 

 

 

0.27

 

 

0.26

 

 

 

Book Value Per Share

 

 

32.00

 

 

28.98

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Market Price

    

High

    

Low

    

Close

 

Second Quarter '16

 

$

28.00

 

$

26.41

 

$

27.00

 

First Quarter '16

 

 

29.65

 

 

26.01

 

 

26.80