UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
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CITIZENS FIRST CORPORATION
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(Exact name of registrant as specified in its charter)
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Kentucky 333-67435 61-0912615
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(State or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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1065 Ashley Street, Bowling Green, Kentucky 42103
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(Address of principal executive offices)
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(Zip Code)
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Not Applicable
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(Former name or former address, if changed since last report)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions (see General Instruction A.2. below):
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[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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ITEM 7.01. REGULATION FD DISCLOSURE.
On January 21, 2016, the Company issued a press release, a copy of which is attached hereto as Exhibit 99.1 and incorporated herein by reference. The press release includes the results of operations and the financial condition of the Company as of and for the quarter and year ending December 31, 2015. See “Item 2.02 Results of Operations and Financial Condition” which is incorporated by reference in this item 7.01.
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ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
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99.1 Press Release dated January 21, 2016
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CITIZENS FIRST CORPORATION
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(Registrant)
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By: /s/ M. Todd Kanipe
M. Todd Kanipe
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President and Chief Executive Officer
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Date: January 21, 2016
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EXHIBIT INDEX
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99.1 Press Release dated January 21, 2016
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NEWS
For Immediate Release
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Contact:
Todd Kanipe, CEO
tkanipe@citizensfirstbank.com
Steve Marcum, CFO
smarcum@citizensfirstbank.com
Citizens First Corporation
1065 Ashley Street, Suite 150
Bowling Green, KY 42103
270.393.0700
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·
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For the quarter ended December 31, 2015, the Company reported net income of $1.15 million, or $0.45 per diluted common share. This represents an increase of $376,000, or $0.14 per diluted common share from the linked quarter ended September 30, 2015 and an increase of $264,000, or $0.10 per diluted common share, from the quarter ended December 31, 2014. "Growth in average loan balances, steady margins, and expense control drove fourth quarter profitability," said Todd Kanipe, President and CEO. "Asset quality also contributed as non-performing assets continued their positive trend, helping keep credit costs low."
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·
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For the year ended December 31, 2015, net income totaled $3.61 million, or $1.40 per diluted common share. This represents an increase of $366,000, or $0.11 per diluted common share, from the net income of $3.24 million in the previous year. "Our strategy of targeted loan and deposit growth produced a second consecutive year of record profitability and our fourth in five years," Kanipe added. "These earnings enabled continued execution of our capital plan. During 2015 we retired all warrants associated with TARP, resumed a common dividend, and continued to improve the tangible book value of our company."
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·
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Non-performing assets totaled $637,000, or 0.15% of total assets, at December 31, 2015 compared to $1.36 million, or 0.33% of total assets at December 31, 2014, a decrease of $728,000. Non-performing assets decreased $376,000 from the linked quarter ended September 30, 2015.
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·
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The Company's net interest margin was 3.94% for the quarter ended December 31, 2015 compared to 3.84% for the linked quarter ended September 30, 2015, and 3.94% for the quarter ended December 31, 2014, an increase of 10 basis points for the linked quarter and unchanged from the prior year. The Company's net interest margin improved from the linked quarter due primarily to a reduction in the cost of interest-bearing liabilities.
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·
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Total loans increased 3.9% to $330.8 million at December 31, 2015 compared to $318.5 million at December 31, 2014. Total deposits increased 8.4% to $370.4 million at December 31, 2015 compared to $341.8 million at December 31, 2014.
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·
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Shares of CZFC closed at $13.74 as of December 31, 2015, an increase of 15.5% from the closing price of $11.90 at December 31, 2014, and an increase of 39.4% from the closing price of $9.86 at December 31, 2013.
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·
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Net interest income increased $118,000, or 3.1%, due to an increase in average loan balances for the quarter.
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·
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Non-interest income increased $81,000, or 9.6%, primarily due to a gain on the sale of loans included in other non-interest income of $95,000 and to a gain on the sale of investment securities of $68,000, partially offset by declines in non-deposit brokerage fees and service charges on deposits.
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·
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Non-interest expense decreased $311,000, or 8.8%, compared to the previous quarter, primarily due to the $262,000 loss on disposal of a former branch facility which occurred in the third quarter.
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·
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Net interest income increased $151,000, or 4.1%, as the volume of earning assets increased from the prior year.
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·
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Non-interest income increased $184,000, or 25.0%, primarily due to a gain on the sale of loans included in other non-interest income of $95,000 and an increase in the gain on the sale of investment securities of $47,000.
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·
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Non-interest expense decreased $3,000, or 0.1%, primarily due to a decrease in core deposit intangible expense and franchise tax expense of $64,000 and $61,000, respectively, partially offset by an increase in personnel expenses of $42,000.
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·
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Total assets increased $19.4 million, or 4.7%, from December 31, 2014 to December 31, 2015 due primarily to a growth in outstanding loans. Average assets year-to-date increased 3.6%, or $14.9 million from December 31, 2014. Average interest earning assets year-to-date increased 4.1%, or $15.8 million, from December 31, 2014.
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·
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Stockholders' equity increased $1.1 million, or 2.8%, from December 31, 2014 to December 31, 2015. During 2015, the Company repurchased the 254,218 warrants issued in 2008 to the US Treasury as part of its participation in the US Treasury's Capital Purchase Program for $1.7 million. The tangible common equity ratio declined slightly to 6.43% as of December 31, 2015 compared to 6.45% at December 31, 2014 due to the warrants redemption. The Company paid a cash dividend of $.08 per common share in the fourth quarter of 2015, which marks the first common dividend paid since December, 2008.
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Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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Consolidated Statement of Income:
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|||||||||||||||
Three Months Ended
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Dec 31
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Sept 30
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June 30
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March 31
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Dec 31
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|||||||||||
2015
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2015
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2015
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2015
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2014
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Interest income
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$ | 4,494 | $ | 4,415 | $ | 4,469 | $ | 4,306 | $ | 4,370 | |||||
Interest expense
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623 | 662 | 678 | 644 | 650 | ||||||||||
Net interest income
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3,871 | 3,753 | 3,791 | 3,662 | 3,720 | ||||||||||
Provision (credit) for loan losses
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(65) | - | 120 | 80 | - | ||||||||||
Non-interest income:
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|||||||||||||||
Service charges on deposits
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360 | 386 | 358 | 317 | 339 | ||||||||||
Other service charges and fees
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260 | 187 | 176 | 135 | 138 | ||||||||||
Gain on sale of mortgage loans
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63 | 60 | 79 | 31 | 39 | ||||||||||
Non-deposit brokerage fees
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82 | 103 | 87 | 92 | 90 | ||||||||||
Lease income
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43 | 59 | 70 | 73 | 63 | ||||||||||
BOLI income
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45 | 45 | 46 | 45 | 47 | ||||||||||
Securities gains
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68 | - | 10 | - | 21 | ||||||||||
Total
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921 | 840 | 826 | 693 | 737 | ||||||||||
Non-interest expenses:
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|||||||||||||||
Personnel expense
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1,648 | 1,650 | 1,589 | 1,648 | 1,606 | ||||||||||
Net occupancy expense
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464 | 495 | 493 | 528 | 483 | ||||||||||
Advertising and public relations
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80 | 75 | 123 | 52 | 73 | ||||||||||
Professional fees
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176 | 183 | 187 | 164 | 142 | ||||||||||
Data processing services
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262 | 262 | 238 | 239 | 242 | ||||||||||
Franchise shares and deposit tax
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96 | 146 | 145 | 146 | 157 | ||||||||||
FDIC insurance
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61 | 61 | 63 | 59 | 63 | ||||||||||
Core deposit intangible amortization
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18 | 18 | 17 | 18 | 82 | ||||||||||
Postage and office supplies
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43 | 55 | 52 | 40 | 43 | ||||||||||
Other real estate owned expenses
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52 | 6 | 29 | 7 | 25 | ||||||||||
Loss on branch disposal
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- | 262 | - | - | - | ||||||||||
Other
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319 | 317 | 310 | 302 | 306 | ||||||||||
Total
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3,219 | 3,530 | 3,246 | 3,203 | 3,222 | ||||||||||
Income before income taxes
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1,638 | 1,063 | 1,251 | 1,072 | 1,235 | ||||||||||
Provision for income taxes
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487 | 288 | 352 | 290 | 348 | ||||||||||
Net income
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1,151 | 775 | 899 | 782 | 887 | ||||||||||
Dividends on preferred stock
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131 | 131 | 130 | 128 | 131 | ||||||||||
Net income available for common shareholders
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$ | 1,020 | $ | 644 | $ | 769 | $ | 654 | $ | 756 | |||||
Basic earnings per common share
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$ | 0.52 | $ | 0.33 | $ | 0.39 | $ | 0.33 | $ | 0.38 | |||||
Diluted earnings per common share
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$ | 0.45 | $ | 0.31 | $ | 0.35 | $ | 0.29 | $ | 0.35 |
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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Key Operating Statistics:
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Three Months Ended
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December
31
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September
30
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June
30
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March
31
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December
31
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2015
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2015
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2015
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2015
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2014
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Average assets
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$ | 430,174 | $ | 428,331 | $ | 434,003 | $ | 428,210 | $ | 414,852 | ||||||||||
Average earning assets
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399,055 | 396,906 | 403,814 | 397,920 | 384,050 | |||||||||||||||
Average loans
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329,131 | 319,053 | 319,758 | 321,028 | 313,888 | |||||||||||||||
Average interest-bearing deposits
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316,979 | 321,643 | 327,010 | 316,558 | 298,101 | |||||||||||||||
Average deposits
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365,401 | 366,627 | 370,820 | 360,240 | 341,128 | |||||||||||||||
Average borrowed funds
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23,179 | 20,696 | 23,022 | 26,967 | 33,366 | |||||||||||||||
Average equity
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39,181 | 38,516 | 38,180 | 39,029 | 38,249 | |||||||||||||||
Average common equity
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31,522 | 30,857 | 30,521 | 31,370 | 30,590 | |||||||||||||||
Return on average assets
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1.06 | % | 0.72 | % | 0.83 | % | 0.74 | % | 0.85 | % | ||||||||||
Return on average equity
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11.66 | % | 7.97 | % | 9.44 | % | 8.13 | % | 9.20 | % | ||||||||||
Efficiency ratio
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66.91 | % | 75.43 | % | 69.14 | % | 72.06 | % | 71.19 | % | ||||||||||
Non-interest income to average assets
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0.85 | % | 0.78 | % | 0.76 | % | 0.66 | % | 0.70 | % | ||||||||||
Non-interest expenses to average assets
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2.97 | % | 3.27 | % | 3.00 | % | 3.03 | % | 3.08 | % | ||||||||||
Net overhead to average assets
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2.12 | % | 2.49 | % | 2.24 | % | 2.38 | % | 2.36 | % | ||||||||||
Yield on loans
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4.97 | % | 5.04 | % | 5.15 | % | 4.99 | % | 5.06 | % | ||||||||||
Yield on investment securities (TE)
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2.84 | % | 2.79 | % | 2.85 | % | 2.88 | % | 2.75 | % | ||||||||||
Yield on average earning assets (TE)
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4.55 | % | 4.50 | % | 4.53 | % | 4.48 | % | 4.61 | % | ||||||||||
Cost of average interest bearing liabilities
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0.73 | % | 0.77 | % | 0.78 | % | 0.76 | % | 0.78 | % | ||||||||||
Net interest margin (TE)
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3.94 | % | 3.84 | % | 3.85 | % | 3.82 | % | 3.94 | % | ||||||||||
Number of FTE employees
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98 | 98 | 99 | 95 | 97 | |||||||||||||||
Asset Quality Indicators:
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Non-performing loans to total loans
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0.16 | % | 0.25 | % | 0.33 | % | 0.38 | % | 0.37 | % | ||||||||||
Non-performing assets to total assets
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0.15 | % | 0.24 | % | 0.29 | % | 0.34 | % | 0.33 | % | ||||||||||
Allowance for loan losses to total loans
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1.49 | % | 1.53 | % | 1.59 | % | 1.55 | % | 1.53 | % | ||||||||||
YTD net charge-offs to average loans, annualized
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0.03 | % | 0.03 | % | 0.06 | % | 0.02 | % | 0.01 | % | ||||||||||
YTD net charge-offs
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104 | 64 | 102 | 18 | 43 | |||||||||||||||
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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|||||||
Twelve Months Ended
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December
31
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December
31
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||||||
2015
|
2014
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||||||
Interest income
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$ | 17,684 | $ | 17,135 | |||
Interest expense
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2,607 | 2,709 | |||||
Net interest income
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15,077 | 14,426 | |||||
Provision for loan losses
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135 | 275 | |||||
Non-interest income:
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|||||||
Service charges on deposits
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1,421 | 1,196 | |||||
Other service charges and fees
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758 | 630 | |||||
Gain on sale of mortgage loans
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233 | 190 | |||||
Non-deposit brokerage fees
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364 | 301 | |||||
Lease income
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245 | 288 | |||||
BOLI income
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181 | 188 | |||||
Securities gains
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78 | 95 | |||||
Total
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3,280 | 2,888 | |||||
Non-interest expenses:
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|||||||
Personnel expense
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6,535 | 6,138 | |||||
Occupancy expense
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1,980 | 1,945 | |||||
Advertising and public relations
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330 | 323 | |||||
Professional fees
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710 | 581 | |||||
Data processing services
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1,001 | 973 | |||||
Franchise shares and deposit tax
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533 | 594 | |||||
FDIC insurance
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244 | 287 | |||||
Core deposit intangible amortization
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71 | 330 | |||||
Postage and office supplies
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190 | 207 | |||||
Other real estate owned expenses
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94 | 92 | |||||
Loss on branch disposal
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262 | - | |||||
Other
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1,248 | 1,088 | |||||
Total
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13,198 | 12,558 | |||||
Income before income taxes
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5,024 | 4,481 | |||||
Provision for income taxes
|
1,417 | 1,240 | |||||
Net income
|
3,607 | 3,241 | |||||
Dividends on preferred stock
|
520 | 521 | |||||
Net income available for common shareholders
|
$ | 3,087 | $ | 2,720 | |||
Basic earnings per common share
|
$ | 1.57 | $ | 1.38 | |||
Diluted earnings per common share
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$ | 1.40 | $ | 1.29 | |||
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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|||||||
Key Operating Statistics:
|
|||||||
Twelve Months Ended
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December
31
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December
31
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||||||
2015
|
2014
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||||||
Average assets
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$ | 430,180 | $ | 415,327 | |||
Average earning assets
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399,420 | 383,617 | |||||
Average loans
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322,256 | 307,256 | |||||
Average interest-bearing deposits
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320,551 | 303,609 | |||||
Average deposits
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365,788 | 345,342 | |||||
Average borrowings
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23,488 | 30,895 | |||||
Average equity
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38,726 | 37,079 | |||||
Average common equity
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31,067 | 29,295 | |||||
Return on average assets
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0.84 | % | 0.78 | % | |||
Return on average equity
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9.32 | % | 8.74 | % | |||
Efficiency ratio
|
70.84 | % | 71.51 | % | |||
Non-interest income to average assets
|
0.76 | % | 0.70 | % | |||
Non-interest expenses to average assets
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3.07 | % | 3.02 | % | |||
Net overhead to average assets
|
2.31 | % | 2.33 | % | |||
Yield on loans
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5.04 | % | 5.12 | % | |||
Yield on investment securities (TE)
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2.84 | % | 2.87 | % | |||
Yield on average earning assets (TE)
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4.52 | % | 4.56 | % | |||
Cost of average interest bearing liabilities
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0.76 | % | 0.81 | % | |||
Net interest margin (TE)
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3.86 | % | 3.85 | % |
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
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||||||||||
Consolidated Statement of Condition:
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As of
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As of
|
As of
|
|||||||
December 31,
|
December 31,
|
December 31,
|
||||||||
2015
|
2014
|
2013
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Cash and due from financial institutions
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$ | 8,865 | $ | 7,962 | $ | 8,572 | ||||
Federal funds sold
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6,390 | 3,360 | 28,490 | |||||||
Interest-bearing deposits in other financial institutions
|
2,728 | - | - | |||||||
Available for sale securities
|
60,200 | 58,986 | 51,633 | |||||||
Loans held for sale
|
- | - | - | |||||||
Loans
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330,782 | 318,477 | 295,068 | |||||||
Allowance for loan losses
|
(4,916) | (4,885) | (4,653) | |||||||
Premises and equipment, net
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9,998 | 10,758 | 11,054 | |||||||
Bank owned life insurance (BOLI)
|
8,174 | 7,993 | 7,806 | |||||||
Federal Home Loan Bank Stock, at cost
|
2,025 | 2,025 | 2,025 | |||||||
Accrued interest receivable
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1,680 | 1,527 | 1,554 | |||||||
Deferred income taxes
|
1,328 | 1,479 | 2,279 | |||||||
Intangible assets
|
4,362 | 4,433 | 4,762 | |||||||
Other real estate owned
|
100 | 198 | 833 | |||||||
Other assets
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465 | 501 | 752 | |||||||
Total Assets
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$ | 432,181 | $ | 412,814 | $ | 410,175 | ||||
Deposits:
|
||||||||||
Noninterest bearing
|
$ | 48,522 | $ | 41,975 | $ | 39,967 | ||||
Savings, NOW and money market
|
168,335 | 148,935 | 143,602 | |||||||
Time
|
153,531 | 150,874 | 159,382 | |||||||
Total deposits
|
$ | 370,388 | $ | 341,784 | $ | 342,951 | ||||
FHLB advances and other borrowings
|
15,000 | 25,500 | 22,000 | |||||||
Subordinated debentures
|
5,000 | 5,000 | 5,000 | |||||||
Accrued interest payable
|
213 | 231 | 243 | |||||||
Other liabilities
|
2,056 | 1,851 | 1,634 | |||||||
Total Liabilities
|
392,657 | 374,366 | 371,828 | |||||||
6.5% Cumulative preferred stock
|
7,659 | 7,659 | 7,659 | |||||||
Series A preferred stock
|
- | - | 3,266 | |||||||
Common stock
|
25,406 | 27,072 | 27,072 | |||||||
Retained earnings
|
6,304 | 3,373 | 653 | |||||||
Accumulated other comprehensive income (loss)
|
155 | 344 | (303) | |||||||
Total Stockholders' Equity
|
39,524 | 38,448 | 38,347 | |||||||
Total Liabilities and Stockholders' Equity
|
$ | 432,181 | $ | 412,814 | $ | 410,175 |
Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
|
||||||||||||||||
December
31, 2015
|
December
31, 2014
|
December
31, 2013
|
December
31, 2012
|
|||||||||||||
Consolidated Capital Ratios:
|
||||||||||||||||
Tangible equity ratio (1)
|
8.22 | % | 8.33 | % | 8.28 | % | 9.08 | % | ||||||||
Tangible common equity ratio (1)
|
6.43 | % | 6.45 | % | 5.59 | % | 5.55 | % | ||||||||
Book value per common share
|
$ | 16.18 | $ | 15.64 | $ | 13.93 | $ | 13.91 | ||||||||
Tangible book value per common share (1)
|
$ | 13.97 | $ | 13.39 | $ | 11.51 | $ | 11.32 | ||||||||
End of period common share closing price
|
$ | 13.74 | $ | 11.90 | $ | 9.86 | $ | 8.78 | ||||||||
_____________
|
||||||||||||||||
(1) The tangible equity ratio, tangible common equity ratio and tangible book value per common share, while not required by accounting principles generally accepted in the United States of America (GAAP), are considered critical metrics with which to analyze banks. The ratio and per share amount have been included to facilitate a greater understanding of the Company's capital structure and financial condition. See the Regulation G Non-GAAP Reconciliation table for reconciliation of this ratio and per share amount to GAAP.
|
||||||||||||||||
December
31, 2015
|
December
31, 2014
|
December
31, 2013
|
December
31, 2012
|
|||||||||||||
Regulation G Non-GAAP Reconciliation:
|
||||||||||||||||
Total shareholders' equity (a)
|
$ | 39,524 | $ | 38,448 | $ | 38,348 | $ | 41,566 | ||||||||
Less:
|
||||||||||||||||
Preferred stock
|
(7,659) | (7,659) | (10,925) | (14,178) | ||||||||||||
Common equity (b)
|
31,865 | 30,789 | 27,423 | 27,388 | ||||||||||||
Goodwill
|
(4,097) | (4,097) | (4,097) | (4,097) | ||||||||||||
Intangible assets
|
(265) | (336) | (665) | (997) | ||||||||||||
Tangible common equity (c)
|
27,503 | 26,356 | 22,661 | 22,294 | ||||||||||||
Add:
|
||||||||||||||||
Preferred stock
|
7,659 | 7,659 | 10,925 | 14,178 | ||||||||||||
Tangible equity (d)
|
$ | 35,162 | $ | 34,015 | $ | 33,586 | $ | 36,472 | ||||||||
Total assets (e)
|
$ | 432,181 | $ | 412,814 | $ | 410,175 | $ | 406,556 | ||||||||
Less:
|
||||||||||||||||
Goodwill
|
(4,097) | (4,097) | (4,097) | (4,097) | ||||||||||||
Intangible assets
|
(265) | (336) | (665) | (997) | ||||||||||||
Tangible assets (f)
|
$ | 427,819 | $ | 408,381 | $ | 405,413 | $ | 401,462 | ||||||||
Shares outstanding (in thousands) (g)
|
1,969 | 1,969 | 1,969 | 1,969 | ||||||||||||
Book value per common share (b/g)
|
$ | 16.18 | $ | 15.64 | $ | 13.93 | $ | 13.91 | ||||||||
Tangible book value per common share (c/g)
|
$ | 13.97 | $ | 13.39 | $ | 11.51 | $ | 11.32 | ||||||||
Total shareholders' equity to total assets ratio (a/e)
|
9.15 | % | 9.31 | % | 9.35 | % | 10.22 | % | ||||||||
Tangible equity ratio (d/f)
|
8.22 | % | 8.33 | % | 8.28 | % | 9.08 | % | ||||||||
Tangible common equity ratio (c/f)
|
6.43 | % | 6.45 | % | 5.59 | % | 5.55 | % |