ex99-1.htm

EX-99 2 ex99-1.htm EXHIBIT 99.1 ex99-1.htm

Exhibit 99.1

Palmetto Bancshares, Inc. and Subsidiary

Consolidated Balance Sheets

(dollars in thousands, except per share data)

(unaudited)

																December 31,
	December 31,			September 30,			June 30,			March 31,			December 31,			2013 vs. 2012
	2013			2013			2013			2013			2012			% Change

Cash and cash equivalents	$	38,178		$	55,743		$	62,668		$	60,762		$	101,385			(62.3	)%
Investment securities available for sale, at fair value		214,383			227,079			246,501			265,798			264,502			(18.9	)
Trading account assets		5,118			5,027			-			-			-		n/m
Mortgage loans held for sale		1,722			1,865			2,934			7,056			6,114			(71.8	)
Other loans held for sale		-			-			-			776			776			(100.0	)

Loans, gross		767,513			756,814			741,355			730,764			738,282			4.0
Less: allowance for loan losses		(16,485	)		(16,706	)		(17,218	)		(17,470	)		(17,825	)		(7.5	)
Loans, net		751,028			740,108			724,137			713,294			720,457			4.2

Foreclosed real estate		7,502			7,928			8,296			11,057			10,911			(31.2	)
Deferred tax asset, net		22,087			22,197			1,273			-			-		n/m
Bank-owned life insurance		11,617			1,571			1,571			1,571			1,571		n/m
Other assets		38,594			38,379			37,842			38,977			39,740			(2.9	)
Total assets	$	1,090,229		$	1,099,897		$	1,085,222		$	1,099,291		$	1,145,456			(4.8	)%



Noninterest bearing deposits	$	178,075		$	187,150		$	188,197		$	180,290		$	179,695			(0.9	)%
Interest bearing deposits		729,285			757,662			770,644			791,906			843,547			(13.5	)
Total deposits		907,360			944,812			958,841			972,196			1,023,242			(11.3	)

Retail repurchase agreements		18,175			24,640			18,312			17,706			15,357			18.3
FHLB advances		35,000			-			-			-			-		n/m
Other liabilities		5,877			9,499			8,953			9,580			8,477			(30.7	)
Total liabilities		966,412			978,951			986,106			999,482			1,047,076			(7.7	)

Shareholders' equity		123,817			120,946			99,116			99,809			98,380			25.9

Total liabilities and shareholders' equity	$	1,090,229		$	1,099,897		$	1,085,222		$	1,099,291		$	1,145,456			(4.8	)%

Quarterly Average Balances
Loans⁽¹⁾	$	766,454		$	749,201		$	740,643		$	739,962		$	743,065			3.1	%
Investment securities		220,412			243,955			258,200			272,853			281,929			(21.8	)
Trading account assets		5,067			652			-			-			-		n/m
Total assets		1,096,881			1,080,900			1,086,965			1,117,090			1,143,855			(4.1	)
Noninterest-bearing deposits		188,603			188,477			185,199			177,974			184,059			2.5
Interest-bearing deposits		751,974			763,746			774,525			814,146			835,791			(10.0	)
Retail repurchase agreements		22,638			19,521			16,789			16,643			16,494			37.2
FHLB advances and other borrowings		2,271			24			9			14			36		n/m
Shareholders' equity		123,299			100,795			101,613			99,729			97,079			27.0

Other Data and Ratios
% of loans past due		0.42	%		0.63	%		0.40	%		0.85	%		1.03	%		(59.2	)
Nonperforming loans	$	15,108		$	14,735		$	16,752		$	17,106		$	15,848			(4.7	)
Nonperforming assets		22,654			22,706			25,081			28,194			26,839			(15.6	)
90-days past due and still accruing interest		-			1,723			-			-			-		n/m
ALL as % of loans held for investment		2.15	%		2.21	%		2.32	%		2.39	%		2.41	%		(10.8	)
Net charge-offs (quarterly)	$	2,021		$	1,157		$	922		$	705		$	1,838			9.9
Net charge-offs to average loans (annualized)		1.05	%		0.61	%		0.50	%		0.39	%		1.00	%		4.7

Outstanding common shares		12,784,605			12,783,019			12,772,344			12,762,452			12,754,045			0.2
Book value per common share	$	9.68		$	9.46		$	7.76		$	7.82		$	7.71			25.6
Closing market price per common share		12.96			13.04			13.00			11.60			8.33			55.6

Tier 1 risk-based capital (consolidated)		14.24	%		14.26	%		13.67	%		13.48	%		13.16	%		8.2
Total risk-based capital (consolidated)		15.49			15.52			14.93			14.74			14.42			7.4
Tier 1 leverage ratio (consolidated)		11.03			10.95			10.06			9.63			9.18			20.2

Full Time Equivalent Employees - including contractors		305.0			306.0			314.0			324.0			324.0			(5.9	)

⁽¹⁾ Includes Mortgage and Other Loans held for sale.

Palmetto Bancshares, Inc. and Subsidiary

Consolidated Statements of Income

(dollars in thousands, except per share data)

(unaudited)

	For the Three Months Ended
	December 31, 2013			September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			December 31, 2013 vs. 2012 % Change
Interest income
Interest earned on cash and cash equivalents	$	17		$	24		$	24		$	35		$	37			(54.1	)%
Dividends received on FHLB stock		10			8			21			-			12			(16.7	)
Interest earned on trading account assets		33			5			-			-			-		n/m
Interest earned on investment securities available for sale		1,033			1,010			964			1,010			1,006			2.7
Interest and fees earned on loans		9,330			9,476			9,719			9,819			9,812			(4.9	)
Total interest income		10,423			10,523			10,728			10,864			10,867			(4.1	)

Interest expense
Interest expense on deposits		385			475			502			895			1,178			(67.3	)
Interest expense on retail repurchase agreements		1			-			1			-			-		n/m
Interest paid on FHLB advances		1			-			-			-			-		n/m
Total interest expense		387			475			503			895			1,178			(67.1	)

Net interest income		10,036			10,048			10,225			9,969			9,689			3.6

Provision for loan losses		1,800			645			670			350			1,325			35.8

Net interest income after provision for loan losses		8,236			9,403			9,555			9,619			8,364			(1.5	)

Noninterest income
Service charges on deposit accounts, net		1,883			1,862			1,603			1,554			1,713			9.9
Fees for trust and investment management and brokerage services		151			214			905			769			746			(79.8	)
Mortgage-banking		498			375			564			571			797			(37.5	)
Debit card and automatic teller machine, net		652			648			600			499			565			15.4
Bankcard services		67			70			64			60			64			4.7
Investment securities gains (losses), net		23			(44	)		331			-			635			(96.4	)
Trading asset income		134			36			-			-			-		n/m
Other		167			118			170			292			282			(40.8	)
Total noninterest income		3,575			3,279			4,237			3,745			4,802			(25.6	)

Noninterest expense
Salaries and other personnel		4,837			4,862			5,310			5,098			4,940			(2.1	)
Occupancy and equipment		2,037			2,004			1,965			1,967			1,913			6.5
Professional services		609			491			556			427			406			50.0
FDIC deposit insurance assessment		356			355			358			370			381			(6.6	)
Marketing		304			267			338			142			400			(24.0	)
Foreclosed real estate writedowns and expenses		468			173			2,280			452			258			81.4
Loss (gain) on other loans held for sale		-			-			(326	)		-			1,122			(100.0	)
Loan workout expenses		204			410			240			212			651			(68.7	)
Other		1,397			1,273			1,190			1,707			1,256			11.2
Total noninterest expense		10,212			9,835			11,911			10,375			11,327			(9.8	)

Income before provision (benefit) for income taxes		1,599			2,847			1,881			2,989			1,839			(13.1	)

Provision (benefit) for income taxes		(224	)		(19,386	)		382			813			(871	)	n/m

Net income	$	1,823		$	22,233		$	1,499		$	2,176		$	2,710			(32.7	)%

Earnings per Share and Results of Operations
Basic net income per common share	$	0.14		$	1.74		$	0.12		$	0.17		$	0.21			(33.3	)%
Diluted net income per common share		0.14			1.74			0.12			0.17			0.21			(33.3	)
Weighted average shares outstanding, diluted		12,689,245			12,674,743			12,671,929			12,650,766			12,640,991			0.4
Efficiency ratio		75.0	%		73.8	%		82.4	%		75.7	%		78.2	%		(4.0	)
Return on average assets		0.66			8.16			0.55			0.79			0.94			(29.9	)
Return on average equity		5.87			87.51			5.92			8.85			11.11			(47.2	)

Yields and Rates
Loans ⁽¹⁾		4.83	%		5.02	%		5.26	%		5.38	%		5.25	%		(8.0	)
Investment securities		1.87			1.66			1.49			1.48			1.43			30.8
Trading account assets		2.58			3.04			-			-			-		n/m
Transaction deposits		0.01			0.01			0.01			0.01			0.01			-
Money market deposits		0.03			0.02			0.02			0.02			0.02			50.0
Savings deposits		0.01			0.01			0.02			0.01			0.02			(50.0	)
Time deposits		0.64			0.75			0.77			1.17			1.35			(52.6	)
Retail repurchase agreements		0.02			-			0.02			-			-		n/m
FHLB advances and other borrowings		0.17			-			-			-			-		n/m
Net interest margin		3.86			3.83			3.92			3.77			3.50			10.3

⁽¹⁾ Includes Mortgage and Other Loans held for sale.

Palmetto Bancshares, Inc. and Subsidiary

Consolidated Statements of Income (Loss)

(dollars in thousands, except per share data)

(unaudited)

For the Years Ended

December 31,

2013 vs. 2012

2013

2012

% Change

Interest income

Interest earned on cash and cash equivalents
$ 100 $ 209 (52.2
)%

Dividends received on FHLB stock
39 47 (17.0 )

Interest on trading account assets
38 -
n/m

Interest earned on investment securities available for sale
4,017 5,059 (20.6 )

Interest and fees earned on loans
38,344 40,075 (4.3 )

Total interest income
42,538 45,390 (6.3 )

Interest expense

Interest expense on deposits
2,257 5,136 (56.1 )

Interest expense on retail repurchase agreements
2 2 -

Interest paid on FHLB advances
1 -
n/m

Total interest expense
2,260 5,138 (56.0 )

Net interest income
40,278 40,252 0.1

Provision for loan losses
3,465 13,075 (73.5 )

Net interest income after provision for loan losses
36,813 27,177 35.5

Noninterest income

Service charges on deposit accounts, net
6,902 6,691 3.2

Fees for trust and investment management and brokerage services
2,039 3,092 (34.1 )

Mortgage-banking
2,008 3,139 (36.0 )

Debit card and automatic teller machine, net
2,400 2,171 10.5

Bankcard services
261 247 5.7

Investment securities gains, net
310 10,494 (97.0 )

Trading asset income
170 -
n/m

Gain on sale of branches
- 568 (100.0 )

Other
746 628 18.8

Total noninterest income
14,836 27,030 (45.1 )

Noninterest expense

Salaries and other personnel
20,107 21,088 (4.7 )

Occupancy and equipment
7,973 7,833 1.8

Professional services
2,083 1,715 21.5

FDIC deposit insurance assessment
1,439 1,861 (22.7 )

Marketing
1,051 1,384 (24.1 )

Foreclosed real estate writedowns and expenses
3,373 9,285 (63.7 )

Loss (gain) on other loans held for sale
(326 ) 3,660 (108.9 )

Loan workout expenses
1,066 1,273 (16.3 )

Other
5,567 5,251 6.0

Total noninterest expense
42,333 53,350 (20.7 )

Income before provision (benefit) for income taxes
9,316 857
n/m

Provision (benefit) for income taxes
(18,415 ) 2,721
n/m

Net income (loss)
$ 27,731 $ (1,864 )
n/m
%

Earnings per Share and Results of Operations

Basic net income (loss) per common share
$ 2.17 $ (0.15 )
n/m
%

Diluted net income (loss) per common share
2.17 (0.15 )
n/m

Weighted average shares oustanding, diluted
12,658,752 12,639,379 0.2

Efficiency ratio
76.8
%
79.3
%
(3.1 )

Return on average assets
2.53 (0.16 )
n/m

Return on average equity
26.06 (1.86 )
n/m

Yields and Rates

Loans ⁽¹⁾
5.12
%
5.29
%
(3.2 )

Investment securities
1.62 1.88 (13.8 )

Trading account assets
2.64 -
n/m

Transaction deposits
0.01 0.01 -

Money market deposits
0.02 0.04 (50.0 )

Savings deposits
0.01 0.01 -

Time deposits
0.85 1.37 (38.0 )

Retail repurchase agreements
0.01 0.01 -

FHLB advances and other borrowings
0.17 -
n/m

Net interest margin
3.85 3.58 7.5

⁽¹⁾ Includes Mortgage and Other Loans held for sale.