000-27205
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56-2132396
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(Commission
File No.)
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(IRS
Employer Identification No.)
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518 West C Street, Newton, North Carolina
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28658
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(Address
of Principal Executive Offices)
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(Zip
Code)
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(828) 464-5620
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(Registrant’s
Telephone Number, Including Area Code)
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Peoples
Bancorp of North Carolina, Inc.
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INDEX
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Page
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Item
2.02 – Results of Operations and Financial
Condition
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3
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Item
9.01 – Financial Statements and Exhibits
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3
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Signatures
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4
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Exhibit
(99)(a) Press Release dated April 22, 2019
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5
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SIGNATURES
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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.
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PEOPLES
BANCORP OF NORTH CAROLINA, INC.
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Date:
April 22, 2019
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By:
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/s/ A.
Joseph Lampron, Jr.
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A.
Joseph Lampron, Jr.
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Executive
Vice President and Chief Financial Officer
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CONSOLIDATED BALANCE SHEETS
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March
31, 2019, December 31, 2018 and March 31, 2018
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(Dollars
in thousands)
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March
31,
2019
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December
31,
2018
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March
31,
2018
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(Unaudited)
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(Audited)
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(Unaudited)
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ASSETS:
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Cash
and due from banks
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$35,318
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$40,553
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$32,849
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Interest-bearing
deposits
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15,896
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2,817
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34,985
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Cash
and cash equivalents
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51,214
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43,370
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67,834
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Investment
securities available for sale
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184,428
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194,578
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213,299
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Other
investments
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4,329
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4,361
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1,834
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Total
securities
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188,757
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198,939
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215,133
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Mortgage
loans held for sale
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361
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680
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503
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Loans
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823,557
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804,023
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765,824
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Less:
Allowance for loan losses
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(6,561)
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(6,445)
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(6,373)
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Net
loans
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816,996
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797,578
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759,451
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Premises
and equipment, net
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18,247
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18,450
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19,732
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Cash
surrender value of life insurance
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16,031
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15,936
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15,647
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Accrued
interest receivable and other assets
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19,542
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18,298
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14,931
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Total
assets
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$1,111,148
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$1,093,251
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$1,093,231
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LIABILITIES AND SHAREHOLDERS' EQUITY:
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Deposits:
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Noninterest-bearing
demand
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$310,053
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$298,817
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$294,998
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NOW,
MMDA & savings
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493,773
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475,223
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496,044
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Time,
$250,000 or more
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20,362
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16,239
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17,927
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Other
time
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83,926
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86,934
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98,655
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Total
deposits
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908,114
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877,213
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907,624
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Securities
sold under agreements to repurchase
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41,231
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58,095
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38,257
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FHLB
borrowings
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-
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-
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-
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Junior
subordinated debentures
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20,619
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20,619
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20,619
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Accrued
interest payable and other liabilities
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14,600
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13,707
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10,249
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Total
liabilities
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984,564
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969,634
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976,749
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Shareholders'
equity:
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Series A preferred stock, $1,000 stated value;
authorized
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5,000,000
shares; no shares issued and outstanding
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-
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-
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-
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Common
stock, no par value; authorized
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20,000,000
shares; issued and outstanding
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5,997,136
shares 3/31/19,
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5,995,256
shares 12/31/18 and 3/31/18
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62,151
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62,096
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62,096
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Retained
earnings
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62,757
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60,535
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52,806
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Accumulated
other comprehensive income
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1,676
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986
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1,580
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Total
shareholders' equity
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126,584
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123,617
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116,482
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Total
liabilities and shareholders' equity
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$1,111,148
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$1,093,251
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$1,093,231
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CONSOLIDATED STATEMENTS OF INCOME
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For the
three months ended March 31, 2019 and 2018
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(Dollars
in thousands, except per share amounts)
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Three
months ended
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March
31,
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2019
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2018
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(Unaudited)
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(Unaudited)
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INTEREST INCOME:
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Interest
and fees on loans
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$10,619
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$9,069
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Interest
on due from banks
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14
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45
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Interest
on investment securities:
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U.S.
Government sponsored enterprises
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673
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606
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State
and political subdivisions
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834
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996
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Other
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43
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43
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Total
interest income
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12,183
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10,759
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INTEREST EXPENSE:
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NOW,
MMDA & savings deposits
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282
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176
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Time
deposits
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151
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105
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FHLB
borrowings
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46
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-
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Junior
subordinated debentures
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226
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171
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Other
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52
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15
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Total
interest expense
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757
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467
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NET INTEREST INCOME
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11,426
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10,292
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PROVISION FOR (REDUCTION OF PROVISION
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FOR) LOAN LOSSES
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178
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31
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NET INTEREST INCOME AFTER
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PROVISION FOR LOAN LOSSES
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11,248
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10,261
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NON-INTEREST INCOME:
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Service
charges
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1,093
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1,024
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Other
service charges and fees
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169
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180
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Gain
on sale of securities
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231
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-
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Mortgage
banking income
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147
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216
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Insurance
and brokerage commissions
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231
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182
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Appraisal
management fee income
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862
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789
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Miscellaneous
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1,387
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1,345
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Total
non-interest income
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4,120
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3,736
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NON-INTEREST EXPENSES:
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Salaries
and employee benefits
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5,647
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4,962
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Occupancy
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1,737
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1,856
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Appraisal
management fee expense
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662
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592
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Other
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2,870
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2,632
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Total
non-interest expense
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10,916
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10,042
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EARNINGS
BEFORE INCOME TAXES
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4,452
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3,955
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INCOME
TAXES
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785
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652
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NET EARNINGS
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$3,667
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$3,303
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PER SHARE AMOUNTS
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Basic
net earnings
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$0.61
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$0.55
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Diluted
net earnings
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$0.61
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$0.55
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Cash
dividends
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$0.14
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$0.13
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Book
value
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$21.11
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$19.43
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FINANCIAL HIGHLIGHTS
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For
the three months ended March 31, 2019 and 2018
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(Dollars
in thousands)
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Three
months ended
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March
31,
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2019
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2018
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(Unaudited)
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(Unaudited)
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SELECTED AVERAGE BALANCES:
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Available
for sale securities
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$189,790
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$217,437
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Loans
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815,203
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765,670
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Earning
assets
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1,013,310
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998,226
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Assets
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1,091,822
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1,080,772
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Deposits
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895,708
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900,679
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Shareholders'
equity
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125,349
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116,578
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SELECTED KEY DATA:
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Net
interest margin (tax equivalent)
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4.66%
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4.29%
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Return
on average assets
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1.36%
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1.24%
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Return
on average shareholders' equity
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11.86%
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11.49%
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Shareholders'
equity to total assets (period end)
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11.39%
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10.65%
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ALLOWANCE FOR LOAN LOSSES:
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Balance,
beginning of period
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$6,445
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$6,366
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Provision
for loan losses
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178
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31
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Charge-offs
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(164)
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(106)
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Recoveries
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102
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82
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Balance,
end of period
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$6,561
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$6,373
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ASSET QUALITY:
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Non-accrual
loans
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$2,802
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$3,665
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90
days past due and still accruing
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-
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-
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Other
real estate owned
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27
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62
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Total
non-performing assets
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$2,829
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$3,727
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Non-performing
assets to total assets
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0.25%
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0.34%
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Allowance
for loan losses to non-performing assets
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231.92%
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171.00%
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Allowance
for loan losses to total loans
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0.80%
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0.83%
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LOAN RISK GRADE ANALYSIS:
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Percentage of Loans
By Risk Grade
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3/31/2019
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3/31/2018
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Risk
Grade 1 (excellent quality)
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0.70%
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0.95%
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Risk
Grade 2 (high quality)
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24.99%
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26.20%
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Risk
Grade 3 (good quality)
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61.41%
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61.22%
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Risk
Grade 4 (management attention)
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10.57%
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8.33%
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Risk
Grade 5 (watch)
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1.56%
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2.31%
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Risk
Grade 6 (substandard)
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0.78%
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0.99%
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Risk
Grade 7 (doubtful)
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0.00%
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0.00%
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Risk
Grade 8 (loss)
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0.00%
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0.00%
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At March 31, 2019, including non-accrual loans, there were two
relationships exceeding $1.0 million in the Watch risk grade (which
totaled $3.2 million). There were no relationships exceeding $1.0
million in the Substandard risk grade.
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