Select Bancorp, Inc. (
NASDAQ: SLCT) (the
“Company”), the holding company for Select Bank & Trust
Company, today reported net income for the quarter ended June 30,
2021 of $5.6 million with basic and diluted earnings per share of
$0.33 and $0.32, respectively, compared to net income of $681,000
with basic and diluted earnings per share of $0.04 for the
comparative quarter ended June 30, 2020. The increase in net income
in the second quarter of 2021 compared to 2020 was primarily
attributable to loan growth and an increase in earnings from the
three additional western North Carolina branches that were acquired
in April of 2020, plus an increase in non-interest income and a
recovery of provision for loan losses.
Total assets, deposits, and gross loans for the
Company as of June 30, 2021 were $1.9 billion, $1.6 billion, and
$1.3 billion, respectively, compared to total assets of $1.6
billion, total deposits of $1.3 billion, and gross loans of $1.2
billion as of the same date in 2020.
On June 1st, 2021, the Company announced it had
entered into an agreement to be acquired by First Bancorp,
headquartered in Southern Pines, North Carolina, which operates 102
branches in North Carolina and South Carolina and has approximately
$8.2 billion in assets. This transaction, which is subject to
regulatory and shareholder approvals and the satisfaction of other
customary closing conditions, is expected to close during the
fourth quarter of 2021.
Comments of the Chief Executive Officer
William Hedgepeth, President and Chief Executive
Officer of the Company, stated “We are pleased to announce our
second quarter results are very strong, following closely with the
results for the first quarter of this year. We had second quarter
earnings of $5.6 million including a recovery of loan loss
provision of $459,000. Total assets have grown $42.5 million this
quarter and deposits grew $38.0 million during the second quarter.
Gross loans declined by $9.9 million, which was primarily due to
PPP loans that were forgiven. Fee income for the quarter from our
mortgage and SBA departments have remained strong and increased by
$77,000 over the second quarter of 2020. As always, we are focused
on our net interest margin and are pleased to report it was 3.86%
for the first half of 2021. Maintaining our margin at this level is
challenging and was difficult to accomplish in the current interest
rate environment, especially considering the effects of the
COVID-19 pandemic on the economy. The strategic initiatives we have
been implementing over the last several quarters are proving to be
successful and are reflected in our ROAA of 1.33% and ROAE of
11.12% for the first half of 2021. We are reaping the benefits of
those initiatives and the efficiencies we have gained from those
efforts. Our efficiency ratio for the first half of 2021 was
59.72%.”
Hedgepeth continued, “As you can see, our asset
quality numbers continue to reflect a very low level of net charge
offs for our loan portfolio with past dues, nonaccruals and
foreclosed real estate remaining at historically low levels for our
institution as of June 30, 2021. We believe this is due to our
ongoing interaction with our customers that has allowed us to work
closely with them to ensure resources are available to those
customers still navigating the effects of the COVID-19 pandemic.
Our staff has dedicated a tremendous number of hours and has worked
diligently with our customers to utilize the SBA’s PPP loan program
and loan modifications as the economy continues to confront
challenges associated with the pandemic. For all phases of the
SBA’s PPP loan program, we originated 1,822 loans amounting to
$137.1 million that assisted our communities as they dealt with
this event. At the end of June 2021, we had approximately $41.5
million comprising 605 PPP loans outstanding that are in the
process of being forgiven. At the height of the pandemic we granted
419 loan deferrals related to COVID-19 for $219.6 million. As of
June 30, 2021, we had 8 loan deferrals related to COVID-19 totaling
$2.2 million. Our allowance for loan losses was reduced slightly
from year-end, but we believe it is sufficient to absorb any losses
in the near future. With the rise of new variants, the country is
not out of the pandemic, so we will continue to provide additional
staff resources, together with an ‘all hands-on deck’ philosophy to
facilitate superior customer service. We will continue to work with
our customers by assisting them with any stimulus programs in the
future.”
“All of our branch lobbies have remained open
for business transactions while keeping the health and safety of
our customers and employees as our primary objective. That will not
change as we quickly address any changes related to the pandemic
and remain watchful for adjustments in the economy that affect the
operational activities of our customers and our branches. We will
address and accommodate as needed the effects of social distancing
measures, occupancy limitations and other challenges that influence
how we interact with our customers. We continue to believe crafting
financial solutions enables and enhances our employees’
relationships with their customers to further strengthen business
partnerships during these times.”
Net Interest Income and Net Interest Margin
Net interest income was $16.0 million and $11.9
million for the second quarter of 2021 and 2020, respectively. On a
comparative quarter basis, the Company’s total interest income was
positively affected by increased loan balances due to branch
acquisitions and organic growth. The increase in interest income
was partially offset by a decreasing loan yield, an increase in
securities balances at a lower yield, plus the reduction in other
earning assets at a lower yield. Average total interest-earning
assets were $1.7 billion and $1.4 billion in the second quarter of
2021 and 2020, respectively. The yield on those assets increased 3
basis points, from 4.22% in the second quarter of 2020 to 4.25% for
the same period in 2021. This was primarily due to an increase of
accretion from acquired loans which was slightly offset by lower
rates on recently originated loans on a comparative quarter
basis.
The Company’s average interest-bearing
liabilities increased by $213.3 million, to $1.1 billion for the
quarter ended June 30, 2021 from $936 million for the second
quarter of 2020. Low-cost savings, NOW and money market deposits
increased $292.4 million while the cost of transactional deposits
decreased from 0.54% to 0.41%, or 13 basis points year over year.
The cost of total deposits decreased from 0.72% in the second
quarter of 2020 to 0.40% in the second quarter of 2021 primarily
due to the decrease in the cost of time deposits. During the second
quarter of 2021, the Company’s net interest margin was 3.85% and
net interest spread was 3.66%. In the second quarter of 2020, net
interest margin was 3.45% and net interest spread was 3.08%. The
Company’s net interest margin year to date through June 30, 2021
was 3.86% and net interest spread was 3.65%. For the comparative
six-month period ended June 30, 2020, net interest margin was 3.69%
and net interest spread was 3.29%.
Provision for Loan Losses and Asset Quality
During the second quarter of 2021, the Company
recorded a recovery of provision for loan losses of $459,000, based
primarily on adjustments to qualitative allowance factors and
improved economic performance metrics related to the economic
impact of the COVID-19 pandemic. The Company granted payment
extensions on approximately 8 commercial and consumer loans
totaling $2.2 million related to the impact of COVID-19 for the
quarter, which mature in the next 90 days. On a comparative
quarter basis, the Company recorded a provision for loan losses of
$1.9 million for the second quarter of 2020, based primarily on
adjustments to qualitative loan factors related to the pandemic
trends in the loan portfolio presented during that quarter. In the
second quarter of 2021, the Company recorded net charge-offs of
$70,000 compared to net charge-offs of $492,000 in the second
quarter of 2020. These charge-offs resulted in a net
charge-off rate of 0.02% of average loans for the current quarter,
compared to a net charge-off rate of 0.16% in the second quarter of
2020. On a comparative year-to-date basis, the Company recorded a
provision for loan losses of $4.2 million during the first six
months of 2020, based primarily on adjustments to qualitative loan
factors related to the pandemic trends in the loan portfolio
present during that period, as compared to a recovery of loan loss
provision of $1.2 million for the six months ended June 30, 2021.
In the first half of 2021, the Company recorded net charge-offs of
$214,000 compared to net charge-offs of $503,000 in the first half
of 2020. These charge-offs resulted in a net charge-off rate
of 0.02% of average loans for year to date 2021, compared to a net
charge-off rate of 0.05% for year to date 2020.
Non-interest Income
Non-interest income for the quarter ended June
30, 2021 was $1.9 million, an increase of $484,000 from $1.4
million in the second quarter of 2020. Service charges on deposit
accounts totaled $239,000 for the quarter ended June 30, 2021,
compared to $206,000 for the second quarter in 2020, representing a
$33,000 increase on a comparative quarter basis. Other non-deposit
fees and income increased $375,000 from the second quarter of 2020
to the second quarter of 2021. Fees of $268,000 from presold
mortgages and $163,000 from SBA loans totaled $431,000 in the
second quarter of 2021, which represented an increase from the
$234,000 in mortgage fees and $121,000 in SBA fees in the second
quarter of 2020.
Year to date fees of $556,000 from presold
mortgages and $360,000 from SBA loans totaled $916,000 in the first
half of 2021, compared to $419,000 in mortgage fees and $228,000 in
SBA fees in the first half of 2020 totaling $647,000. The Company
did not sell any investment securities in the second quarter of
2021 or 2020.
Non-interest Expense
Non-interest expenses increased by $519,000 to
$11.0 million for the quarter ended June 30, 2021, from $10.5
million for the same period in 2020. In general, most categories of
non-interest expenses increased, primarily due to an increase in
expenses related to our western North Carolina branches acquired in
April 2020. The following are highlights of the significant
categories of non-interest expenses during the second quarter of
2021 versus the same period in 2020:
- Personnel expenses increased
$383,000 to $6.2 million, due to additional branch personnel and
cost-of-living increases.
- Occupancy expenses decreased
$38,000.
- FDIC insurance premium expense
increased $186,000 due to increased assets from acquisition and
growth.
- Core deposit intangible (“CDI”)
expense decreased $55,000 due to amortization.
- Information systems increased
$85,000 due to a higher number of accounts.
- Professional fees increased by
$542,000 to $993,000 due to expenses related to acquisition.
- Other expenses increased by
$104,000 due primarily to increased branches.
Non-interest expenses increased by $1.5 million
to $21.2 million for the first half of 2021, from $19.7 million for
the same period in 2020. In general, most categories of
non-interest expenses increased, primarily due to an increase in
expenses related to our western North Carolina branches acquired in
April 2020. The following are highlights of the significant
categories of non-interest expenses during the first half of 2021
versus the same period in 2020:
- Personnel expenses increased
$883,000 to $12.3 million, due to additional branch personnel and
cost-of-living increases.
- Occupancy expenses increased
$21,000.
- FDIC insurance premium expense
increased $578,000 due to increased assets from acquisition and
growth.
- CDI expense decreased $83,000 due
to amortization.
- Information systems increased
$93,000 due to higher number of accounts.
- Merger/acquisition related expenses
declined by $748,000.
- Professional fees increased by
$632,000 to $1.5 million due to expenses related to
acquisition.
- Other expenses increased by
$216,000 due primarily to increased branches.
Income Taxes
The Company’s effective tax rate was 23.1% and
22.1% for the quarters ended June 30, 2021 and 2020,
respectively.
Balance Sheet
Total assets at June 30, 2021 were $1.9 billion,
an increase of $255.8 million from a year earlier. Gross loans at
June 30, 2021 were $1.3 billion, up $82.4 million or 6.6% from a
year earlier, and total deposits were $1.6 billion, an increase of
$281.9 million or 21.1% from a year earlier.
Deposits (excluding brokered deposits and
internet time deposits) increased 21.1% or $281.9 million as of
June 30, 2021 compared to the same period in 2020. Wholesale
deposits were $3.5 million at June 30, 2021 compared to $3.2
million at June 30, 2020 as the Company continues emphasizing core
deposit growth. Retail core deposits were 84.7% of total deposits
as of June 30, 2021.
About Select Bank & Trust
Company
Select Bank & Trust has 22 full-service
offices in these North Carolina communities: Dunn, Burlington,
Charlotte, Clinton, Cornelius (Charlotte area), Elizabeth City,
Fayetteville, Franklin, Goldsboro, Greenville, Highlands, Holly
Springs (Raleigh area), Leland, Lillington, Lumberton, Morehead
City, Raleigh, Sylva and Wilmington, North Carolina; in the
following South Carolina communities: Blacksburg and Rock Hill; and
in Virginia Beach, Virginia. The Bank also has loan production
offices in Wilson, Durham and Winston-Salem, North Carolina.
About Select Bancorp, Inc.
Select Bancorp, Inc. is a bank holding company
headquartered in Dunn, North Carolina. The Company primarily
conducts operations through its wholly owned subsidiary, Select
Bank & Trust Company, a North Carolina-chartered commercial
bank that provides a full suite of banking services through its
offices in North Carolina, South Carolina, and Virginia. The
Company’s common stock is listed on the Nasdaq Global Market under
the symbol “SLCT”.
Non-GAAP Financial Measures
Certain financial measures we use to evaluate
our performance and discuss in this release and the accompanying
tables are identified as being “non-GAAP financial measures.” In
accordance with the rules of the Securities and Exchange
Commission, or the SEC, we classify a financial measure as being a
non-GAAP (generally accepted accounting principles) financial
measure if that financial measure excludes or includes amounts, or
is subject to adjustments that have the effect of excluding or
including amounts, that are included or excluded, as the case may
be, in the most directly comparable measure calculated and
presented in accordance with GAAP as in effect from time to time in
the United States in our statements of operations, balance sheet or
statements of cash flows. Non-GAAP financial measures do not
include operating and other statistical measures or ratios or
statistical measures calculated using exclusively either financial
measures calculated in accordance with GAAP, operating measures or
other measures that are not non-GAAP financial measures or
both.
The non-GAAP financial measures that we discuss
in this release should not be considered in isolation or as a
substitute for the most directly comparable or other financial
measures calculated in accordance with GAAP. Moreover, the manner
in which we calculate the non-GAAP financial measures that we
discuss in this release may differ from that of other companies
reporting measures with similar names. You should understand how
such other banking organizations calculate their financial measures
similar, or with names similar, to the non-GAAP financial measures
we have discussed in this release when comparing such non-GAAP
financial measures.
Tangible book value per share is a non-GAAP
measure generally used by financial analysts and investment bankers
to evaluate financial institutions. We calculate: (a) tangible
common equity as shareholders’ equity less goodwill and core
deposit intangibles; and (b) tangible book value per share as
tangible common equity (as described in clause (a)) divided by
shares of common stock outstanding. For tangible book value per
share, the most directly comparable financial measure calculated in
accordance with GAAP is our book value per share. A reconciliation
of tangible book value per share to book value per share is
included in the tables that accompany this release.
We believe that this measure is important to
many investors in the marketplace who are interested in changes
from period to period in book value per share exclusive of changes
in intangible assets. Goodwill and other intangible assets have the
effect of increasing total book value while not increasing our
tangible book value.
Important Note Regarding Forward-Looking
Statements
This news release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995, including, without limitation, (i) statements
regarding certain of our goals and expectations with respect to
earnings, revenue, and expenses and the growth rate in such items,
as well as other measures of economic performance, including
statements relating to anticipated market share growth, and (ii)
statements preceded by, followed by or that include the words
“may,” “could,” “should,” “would,” “believe,” “anticipate,”
“estimate,” “expect,” “intend,” “plan,” “projects,” “outlook” or
similar expressions. The actual results might differ materially
from those projected in the forward-looking statements for various
reasons, including, but not limited to: our ability to successfully
consummate our previously announced merger with First Bancorp,
including the ability to obtain required governmental and
shareholder approvals of the merger on the proposed terms and
schedule; the diversion of management time from core banking
functions due to merger-related issues; potential difficulty in
maintaining relationships with customers, associates or business
partners as a result of our previously announced merger with First
Bancorp; the ongoing COVID-19 pandemic and measures intended to
prevent its spread, which include wide disruptions to business
activity that may impact the financial strength of our borrowers;
our ability to manage growth or achieve it at all; substantial
changes in financial markets; our ability to obtain the synergies
and expense efficiencies anticipated from our merger and
acquisition activity (including the proposed First Bancorp merger)
and branch divestures and consolidations; regulatory changes,
including changes in regulatory agendas that may impact the
business climate in which we operate; changes in interest rates;
loss of deposits and loan demand to other savings and financial
institutions; adverse economic conditions that impact our
borrowers’ ability to pay their debts when due; and changes in real
estate values and the real estate market. Additional information
concerning factors that could cause actual results to materially
differ from those in the forward-looking statements is contained in
the Company’s SEC filings, including its periodic reports under the
Securities Exchange Act of 1934, as amended, copies of which are
available upon request from the Company. Except as required by law,
the Company assumes no obligation to update the forward-looking
statements publicly or to update the reasons actual results could
differ materially from those anticipated in the forward-looking
statements, even if new information becomes available in the
future.
Additional Information About the
Proposed Merger with First Bancorp and Where to Find
It
This release includes statements made in respect
of the proposed merger involving the Company and First Bancorp. In
connection with the proposed merger, First Bancorp has filed with
the Securities and Exchange Commission ("SEC") a Registration
Statement on Form S-4 (File No. 333-257674) that includes a joint
proxy statement of First Bancorp and the Company and a prospectus
of First Bancorp, as well as other relevant documents concerning
the proposed merger. The definitive joint proxy
statement/prospectus was mailed to the Company’s and First
Bancorp’s shareholders of record on or about July 28, 2021 seeking
their approval of the proposed merger. This communication does not
constitute an offer to sell or the solicitation of an offer to buy
any securities.
BEFORE MAKING ANY VOTING OR INVESTMENT
DECISIONS, INVESTORS AND SHAREHOLDERS OF THE COMPANY AND FIRST
BANCORP ARE URGED TO CAREFULLY READ THE ENTIRE REGISTRATION
STATEMENT AND JOINT PROXY STATEMENT/PROSPECTUS REGARDING THE
PROPOSED MERGER AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE
SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS,
BECAUSE SUCH DOCUMENTS CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED MERGER, FIRST BANCORP AND THE COMPANY. Investors and
security holders may obtain a free copy of the joint proxy
statement/prospectus and other filings containing information about
the Company and First Bancorp at the SEC’s website at www.sec.gov.
Investors and security holders may also obtain free copies of the
documents filed with the SEC by First Bancorp on its website at
http://www.localfirstbank.com and by the Company on its website at
http://www.selectbank.com.
The Company, First Bancorp, and certain of their
respective directors and executive officers, under the SEC’s rules,
may be deemed to be participants in the solicitation of proxies of
the Company’s and First Bancorp’s shareholders in connection with
the proposed merger. Certain information regarding the interests of
the directors and executive officers of the Company and First
Bancorp and other persons who may be deemed participants in the
solicitation of the shareholders of the Company or of First Bancorp
in connection with the proposed merger and a description of their
direct and indirect interests, by security holdings or otherwise,
has been included in the definitive proxy statement related to the
proposed merger that was filed by the Company with the SEC on July
28, 2021. Additional information about the directors and executive
officers of First Bancorp and their ownership of First Bancorp
common stock is set forth in the proxy statement for First
Bancorp’s 2021 Annual Meeting of Shareholders, as filed with the
SEC on Schedule 14A on March 23, 2021. Additional information about
the directors and executive officers of the Company and their
ownership of Company common stock is set forth in the proxy
statement for the Company’s 2021 Annual Meeting of Shareholders, as
filed with the SEC on a Schedule 14A on April 6, 2021. Free copies
of these documents may be obtained as described in the preceding
paragraph or by contacting the Company’s Chief Financial Officer at
(910) 897-3603.
SELECT
BANCORP, INC. |
|
CONSOLIDATED
BALANCE SHEETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2021 |
|
March 31,
2021 |
|
December 31,
2020 |
|
September
30, 2020 |
|
June 30,
2020 |
|
|
|
(Unaudited) |
|
(Unaudited) |
|
(Audited) |
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
|
(Dollars in
thousands) |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks |
|
$ |
25,110 |
|
|
$ |
22,533 |
|
|
$ |
23,324 |
|
|
$ |
25,068 |
|
|
$ |
24,037 |
|
|
Interest-earning deposits in other banks |
|
179,832 |
|
|
|
133,884 |
|
|
|
87,399 |
|
|
|
249,541 |
|
|
|
157,521 |
|
|
Certificates
of deposit |
|
|
250 |
|
|
|
250 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Federal
funds sold |
|
|
2,731 |
|
|
|
4,966 |
|
|
|
5,364 |
|
|
|
8,046 |
|
|
|
9,726 |
|
|
Investment securities available for sale, at fair value |
|
217,605 |
|
|
|
208,648 |
|
|
|
194,492 |
|
|
|
87,434 |
|
|
|
62,958 |
|
|
Loans held
for sale |
|
|
3,061 |
|
|
|
3,953 |
|
|
|
2,064 |
|
|
|
2,945 |
|
|
|
3,455 |
|
|
Loans |
|
|
1,332,420 |
|
|
|
1,342,316 |
|
|
|
1,304,384 |
|
|
|
1,283,457 |
|
|
|
1,249,999 |
|
|
Allowance
for loan losses |
|
|
(12,658 |
) |
|
|
(13,187 |
) |
|
|
(14,108 |
) |
|
|
(13,561 |
) |
|
|
(12,054 |
) |
|
|
NET
LOANS |
|
1,319,762 |
|
|
|
1,329,129 |
|
|
|
1,290,276 |
|
|
|
1,269,896 |
|
|
|
1,237,945 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued
interest receivable |
|
|
4,844 |
|
|
|
4,991 |
|
|
|
5,110 |
|
|
|
4,486 |
|
|
|
4,400 |
|
|
Stock in
Federal Home Loan Bank of Atlanta, at cost |
|
|
862 |
|
|
|
862 |
|
|
|
1,147 |
|
|
|
3,059 |
|
|
|
3,059 |
|
|
Other
non-marketable securities |
|
|
655 |
|
|
|
655 |
|
|
|
709 |
|
|
|
718 |
|
|
|
718 |
|
|
Foreclosed
real estate |
|
|
1,675 |
|
|
|
1,968 |
|
|
|
2,172 |
|
|
|
3,237 |
|
|
|
3,561 |
|
|
Premises and
equipment, net |
|
|
19,899 |
|
|
|
20,222 |
|
|
|
20,587 |
|
|
|
20,883 |
|
|
|
20,893 |
|
|
Right of use
lease asset |
|
|
8,156 |
|
|
|
8,358 |
|
|
|
8,558 |
|
|
|
8,756 |
|
|
|
8,953 |
|
|
Bank owned
life insurance |
|
|
30,743 |
|
|
|
30,586 |
|
|
|
30,432 |
|
|
|
30,271 |
|
|
|
30,110 |
|
|
Goodwill |
|
|
42,907 |
|
|
|
42,907 |
|
|
|
42,907 |
|
|
|
41,914 |
|
|
|
41,914 |
|
|
Core deposit
intangible ("CDI") |
|
|
1,222 |
|
|
|
1,363 |
|
|
|
1,513 |
|
|
|
1,677 |
|
|
|
1,856 |
|
|
Other
assets |
|
|
15,496 |
|
|
|
17,054 |
|
|
|
13,991 |
|
|
|
14,015 |
|
|
|
7,854 |
|
|
|
TOTAL ASSETS |
$ |
1,874,810 |
|
|
$ |
1,832,329 |
|
|
$ |
1,730,045 |
|
|
$ |
1,771,946 |
|
|
$ |
1,618,960 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
|
|
Demand |
|
$ |
491,265 |
|
|
$ |
448,835 |
|
|
$ |
395,916 |
|
|
$ |
408,209 |
|
|
$ |
400,098 |
|
|
Savings |
|
|
59,243 |
|
|
|
55,184 |
|
|
|
51,843 |
|
|
|
51,629 |
|
|
|
52,597 |
|
|
Money market and NOW |
|
|
714,234 |
|
|
|
708,172 |
|
|
|
649,677 |
|
|
|
610,275 |
|
|
|
495,609 |
|
|
Time |
|
|
355,910 |
|
|
|
370,446 |
|
|
|
388,381 |
|
|
|
402,667 |
|
|
|
390,449 |
|
|
|
TOTAL DEPOSITS |
|
1,620,652 |
|
|
|
1,582,637 |
|
|
|
1,485,817 |
|
|
|
1,472,780 |
|
|
|
1,338,753 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
debt |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
20,000 |
|
|
|
20,000 |
|
|
Long-term
debt |
|
|
12,372 |
|
|
|
12,372 |
|
|
|
12,372 |
|
|
|
37,372 |
|
|
|
37,372 |
|
|
Lease
Liability |
|
|
8,598 |
|
|
|
8,766 |
|
|
|
8,930 |
|
|
|
9,089 |
|
|
|
9,243 |
|
|
Accrued
interest payable |
|
|
154 |
|
|
|
206 |
|
|
|
246 |
|
|
|
449 |
|
|
|
457 |
|
|
Accrued expenses and other liabilities |
|
11,551 |
|
|
|
15,859 |
|
|
|
7,312 |
|
|
|
18,889 |
|
|
|
1,597 |
|
|
|
TOTAL LIABILITIES |
|
1,653,327 |
|
|
|
1,619,840 |
|
|
|
1,514,677 |
|
|
|
1,558,579 |
|
|
|
1,407,422 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
Common
stock |
|
|
17,229 |
|
|
|
17,227 |
|
|
|
17,507 |
|
|
|
17,787 |
|
|
|
17,863 |
|
|
Additional
paid-in-capital |
|
|
132,473 |
|
|
|
132,400 |
|
|
|
135,058 |
|
|
|
137,130 |
|
|
|
137,559 |
|
|
Retained
earnings |
|
|
72,789 |
|
|
|
67,178 |
|
|
|
60,838 |
|
|
|
56,917 |
|
|
|
54,460 |
|
|
Common stock
issued to deferred compensation trust |
|
|
(2,449 |
) |
|
|
(2,449 |
) |
|
|
(2,416 |
) |
|
|
(2,352 |
) |
|
|
(2,553 |
) |
|
Directors' Deferred Compensation Plan Rabbi Trust |
|
2,449 |
|
|
|
2,449 |
|
|
|
2,416 |
|
|
|
2,352 |
|
|
|
2,553 |
|
|
Accumulated other comprehensive income (loss) |
|
(1,008 |
) |
|
|
(4,316 |
) |
|
|
1,965 |
|
|
|
1,533 |
|
|
|
1,656 |
|
|
TOTAL
SHAREHOLDERS' EQUITY |
|
221,483 |
|
|
|
212,489 |
|
|
|
215,368 |
|
|
|
213,367 |
|
|
|
211,538 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES & SHAREHOLDERS' EQUITY |
$ |
1,874,810 |
|
|
$ |
1,832,329 |
|
|
$ |
1,730,045 |
|
|
$ |
1,771,946 |
|
|
$ |
1,618,960 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECT
BANCORP, INC. |
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Twelve Months Ended |
|
|
June 30,2021 |
|
March 31,2021 |
|
December 31,2020 |
|
September 30,2020 |
|
June 30,2020 |
|
December 31,2020* |
|
December 31,2019* |
|
|
|
|
|
|
(Dollars in thousands,
except for share amounts) |
|
|
|
INTEREST
INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans |
$ |
16,700 |
|
|
$ |
17,035 |
|
|
$ |
17,901 |
|
$ |
15,404 |
|
$ |
14,086 |
|
$ |
60,980 |
|
$ |
54,605 |
|
Federal funds sold and interest-earning deposits in other
banks |
|
41 |
|
|
|
25 |
|
|
|
52 |
|
|
54 |
|
|
33 |
|
|
307 |
|
|
1,838 |
|
Investments |
|
977 |
|
|
|
920 |
|
|
|
752 |
|
|
367 |
|
|
381 |
|
|
1,921 |
|
|
2,003 |
|
TOTAL
INTEREST INCOME |
|
17,718 |
|
|
|
17,980 |
|
|
|
18,705 |
|
|
15,825 |
|
|
14,500 |
|
|
63,208 |
|
|
58,446 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Money
market, NOW and savings deposits |
|
781 |
|
|
|
924 |
|
|
|
1,041 |
|
|
891 |
|
|
648 |
|
|
2,928 |
|
|
1,616 |
|
Time
deposits |
|
831 |
|
|
|
1,038 |
|
|
|
1,269 |
|
|
1,415 |
|
|
1,576 |
|
|
6,191 |
|
|
8,061 |
|
Short-term
debt |
|
16 |
|
|
|
16 |
|
|
|
131 |
|
|
145 |
|
|
141 |
|
|
504 |
|
|
62 |
|
Long-term
debt |
|
71 |
|
|
|
71 |
|
|
|
240 |
|
|
263 |
|
|
281 |
|
|
1,136 |
|
|
1,817 |
|
TOTAL
INTEREST EXPENSE |
|
1,699 |
|
|
|
2,049 |
|
|
|
2,681 |
|
|
2,714 |
|
|
2,646 |
|
|
10,759 |
|
|
11,556 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INTEREST INCOME |
|
16,019 |
|
|
|
15,931 |
|
|
|
16,024 |
|
|
13,111 |
|
|
11,854 |
|
|
52,449 |
|
|
46,890 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION
FOR (RECOVERY OF) LOAN LOSSES |
|
(459 |
) |
|
|
(777 |
) |
|
|
400 |
|
|
1,638 |
|
|
1,933 |
|
|
6,244 |
|
|
438 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INTEREST INCOME AFTER PROVISION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FOR
(RECOVERY OF) LOAN LOSSES |
|
16,478 |
|
|
|
16,708 |
|
|
|
15,624 |
|
|
11,473 |
|
|
9,921 |
|
|
46,205 |
|
|
46,452 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-INTEREST
INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees on the sale of mortgages |
|
431 |
|
|
|
485 |
|
|
|
248 |
|
|
517 |
|
|
355 |
|
|
1,413 |
|
|
753 |
|
Gain on securities |
|
- |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
48 |
|
Service charges on deposit accounts |
|
239 |
|
|
|
256 |
|
|
|
291 |
|
|
257 |
|
|
206 |
|
|
1,092 |
|
|
1,161 |
|
Other fees and income |
|
1,225 |
|
|
|
941 |
|
|
|
1,002 |
|
|
950 |
|
|
850 |
|
|
3,615 |
|
|
3,457 |
|
TOTAL
NON-INTEREST INCOME |
|
1,895 |
|
|
|
1,682 |
|
|
|
1,541 |
|
|
1,724 |
|
|
1,411 |
|
|
6,120 |
|
|
5,419 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-INTEREST
EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Personnel |
|
6,169 |
|
|
|
6,132 |
|
|
|
5,977 |
|
|
5,742 |
|
|
5,786 |
|
|
23,137 |
|
|
20,278 |
|
Occupancy and equipment |
|
948 |
|
|
|
990 |
|
|
|
986 |
|
|
1,008 |
|
|
986 |
|
|
3,911 |
|
|
3,695 |
|
Deposit insurance |
|
262 |
|
|
|
380 |
|
|
|
374 |
|
|
370 |
|
|
76 |
|
|
808 |
|
|
184 |
|
Professional Fees |
|
993 |
|
|
|
462 |
|
|
|
430 |
|
|
399 |
|
|
451 |
|
|
1,652 |
|
|
1,886 |
|
CDI amortization |
|
140 |
|
|
|
151 |
|
|
|
164 |
|
|
179 |
|
|
195 |
|
|
717 |
|
|
825 |
|
Merger/acquisition related expenses |
|
- |
|
|
|
- |
|
|
|
- |
|
|
7 |
|
|
709 |
|
|
755 |
|
|
406 |
|
Information systems |
|
1,057 |
|
|
|
1,046 |
|
|
|
1,049 |
|
|
1,043 |
|
|
972 |
|
|
4,102 |
|
|
3,492 |
|
Foreclosed-related expenses |
|
208 |
|
|
|
(140 |
) |
|
|
342 |
|
|
228 |
|
|
187 |
|
|
762 |
|
|
140 |
|
Debt extinguishment |
|
- |
|
|
|
- |
|
|
|
1,616 |
|
|
- |
|
|
- |
|
|
1,616 |
|
|
- |
|
Other |
|
1,244 |
|
|
|
1,175 |
|
|
|
1,193 |
|
|
1,091 |
|
|
1,140 |
|
|
4,487 |
|
|
4,234 |
|
TOTAL NON-INTEREST EXPENSE |
|
11,021 |
|
|
|
10,196 |
|
|
|
12,131 |
|
|
10,067 |
|
|
10,502 |
|
|
41,947 |
|
|
35,140 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME
BEFORE INCOME TAXES |
|
7,352 |
|
|
|
8,194 |
|
|
|
5,034 |
|
|
3,130 |
|
|
830 |
|
|
10,378 |
|
|
16,731 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME
TAXES |
|
1,741 |
|
|
|
1,854 |
|
|
|
1,113 |
|
|
673 |
|
|
149 |
|
|
2,215 |
|
|
3,696 |
|
NET
INCOME |
$ |
5,611 |
|
|
$ |
6,340 |
|
|
$ |
3,921 |
|
$ |
2,457 |
|
$ |
681 |
|
$ |
8,163 |
|
$ |
13,035 |
|
NET INCOME
PER COMMON SHARE OUTSTANDING |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.33 |
|
|
$ |
0.36 |
|
|
$ |
0.22 |
|
$ |
0.14 |
|
$ |
0.04 |
|
$ |
0.46 |
|
$ |
0.69 |
|
Diluted |
$ |
0.32 |
|
|
$ |
0.36 |
|
|
$ |
0.22 |
|
$ |
0.14 |
|
$ |
0.04 |
|
$ |
0.45 |
|
$ |
0.68 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE COMMON |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
Outstanding Shares |
|
17,227,689 |
|
|
|
17,386,715 |
|
|
|
17,637,540 |
|
|
17,847,913 |
|
|
18,013,863 |
|
|
17,937,596 |
|
|
19,016,808 |
|
Diluted
Outstanding Shares |
|
17,227,578 |
|
|
|
17,415,680 |
|
|
|
17,661,922 |
|
|
17,866,822 |
|
|
18,030,136 |
|
|
17,961,258 |
|
|
19,063,237 |
|
*
Audited |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Select Bancorp, Inc. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset quality |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For Periods Ended |
|
|
June 30,2021 |
|
March 31,2021 |
|
December 31,2020 |
|
September 30,2020 |
|
June 30,2020 |
|
December 31,2020 |
|
December 31,2019 |
|
|
(Dollars in
thousands, except for share amounts, unaudited) |
|
Non-accrual
loans |
$ |
6,771 |
|
|
$ |
6,095 |
|
|
$ |
6,790 |
|
|
$ |
7,695 |
|
|
$ |
7,979 |
|
|
$ |
6,790 |
|
|
$ |
5,941 |
|
|
Accruing
TDRs |
|
4,075 |
|
|
|
2,217 |
|
|
|
7,506 |
|
|
|
6,044 |
|
|
|
6,420 |
|
|
|
7,506 |
|
|
|
6,207 |
|
|
Total
non-performing loans |
|
10,846 |
|
|
|
8,312 |
|
|
|
14,296 |
|
|
|
13,739 |
|
|
|
14,399 |
|
|
|
14,296 |
|
|
|
12,148 |
|
|
Foreclosed
real estate |
|
1,675 |
|
|
|
1,968 |
|
|
|
2,172 |
|
|
|
3,237 |
|
|
|
3,561 |
|
|
|
2,172 |
|
|
|
3,533 |
|
|
Total
non-performing assets |
$ |
12,521 |
|
|
$ |
10,280 |
|
|
$ |
16,468 |
|
|
$ |
16,976 |
|
|
$ |
17,960 |
|
|
$ |
16,468 |
|
|
$ |
15,681 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accruing
loans past due 90 days or more |
$ |
1,682 |
|
|
$ |
1,673 |
|
|
$ |
802 |
|
|
$ |
1,548 |
|
|
$ |
1,326 |
|
|
$ |
802 |
|
|
$ |
1,231 |
|
|
Allowance
for loan losses |
$ |
12,658 |
|
|
$ |
13,187 |
|
|
$ |
14,108 |
|
|
$ |
13,561 |
|
|
$ |
12,054 |
|
|
$ |
14,108 |
|
|
$ |
8,324 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance
for loans to period end loans |
|
0.95 |
% |
|
|
0.98 |
% |
|
|
1.08 |
% |
|
|
1.06 |
% |
|
|
0.96 |
% |
|
|
1.08 |
% |
|
|
0.81 |
% |
|
Non-performing loans & accruing loans past |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
due 90 days or more to period ending loans |
|
0.94 |
% |
|
|
0.74 |
% |
|
|
1.16 |
% |
|
|
1.19 |
% |
|
|
1.26 |
% |
|
|
1.16 |
% |
|
|
1.30 |
% |
|
Non-performing loans to period ending loans |
|
0.95 |
% |
|
|
0.62 |
% |
|
|
1.10 |
% |
|
|
1.07 |
% |
|
|
1.15 |
% |
|
|
1.10 |
% |
|
|
1.18 |
% |
|
Allowance
for loans to non-performing loans |
|
117 |
% |
|
|
159 |
% |
|
|
99 |
% |
|
|
99 |
% |
|
|
84 |
% |
|
|
99 |
% |
|
|
69 |
% |
|
Allowance
for loans to non-performing Assets |
|
101 |
% |
|
|
128 |
% |
|
|
86 |
% |
|
|
80 |
% |
|
|
67 |
% |
|
|
86 |
% |
|
|
53 |
% |
|
Allowance
for loans to non-performing Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
and accruing loans past due 90 days or more |
|
89 |
% |
|
|
110 |
% |
|
|
82 |
% |
|
|
73 |
% |
|
|
63 |
% |
|
|
82 |
% |
|
|
49 |
% |
|
Non-performing assets to total assets |
|
0.67 |
% |
|
|
0.56 |
% |
|
|
0.95 |
% |
|
|
0.96 |
% |
|
|
1.11 |
% |
|
|
0.95 |
% |
|
|
1.23 |
% |
|
Non-performing assets to accruing loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
past due 90 days or more to total assets |
|
0.76 |
% |
|
|
0.65 |
% |
|
|
1.00 |
% |
|
|
1.05 |
% |
|
|
1.19 |
% |
|
|
1.00 |
% |
|
|
1.33 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECT BANCORP, INC. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($
in thousands, except per share data, unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Twelve Months Ended |
|
|
June 30,2021 |
|
March 31,2021 |
|
December 31,2020 |
|
September 30,2020 |
|
June 30,2020 |
|
December 31,2020 |
|
December 31,2019 |
|
Net
interest margin: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest
Margin-tax equivalent (1) |
$ |
16,076 |
|
|
$ |
16,014 |
|
|
$ |
16,075 |
|
|
$ |
13,141 |
|
|
$ |
11,883 |
|
|
$ |
52,588 |
|
|
$ |
47,037 |
|
|
Purchased
loan accretion and early payoff charges |
|
(538 |
) |
|
|
(379 |
) |
|
|
(506 |
) |
|
|
(455 |
) |
|
|
(620 |
) |
|
|
(1,581 |
) |
|
|
(904 |
) |
|
Net Interest
Margin(2) (Non-GAAP) |
$ |
15,538 |
|
|
$ |
15,635 |
|
|
$ |
15,569 |
|
|
$ |
12,686 |
|
|
$ |
11,263 |
|
|
$ |
51,007 |
|
|
$ |
46,133 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable interest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
receivable interest income |
$ |
16,700 |
|
|
$ |
17,035 |
|
|
$ |
17,913 |
|
|
$ |
15,415 |
|
|
$ |
14,097 |
|
|
$ |
61,025 |
|
|
$ |
54,645 |
|
|
Purchased
loan accretion and early payoff charges |
|
(538 |
) |
|
|
(379 |
) |
|
|
(506 |
) |
|
|
(455 |
) |
|
|
(620 |
) |
|
|
(1,581 |
) |
|
|
(904 |
) |
|
Loans
receivable interest income (Non-GAAP) |
$ |
16,162 |
|
|
$ |
16,656 |
|
|
$ |
17,407 |
|
|
$ |
14,960 |
|
|
$ |
13,477 |
|
|
$ |
59,444 |
|
|
$ |
53,741 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired and non-acquired loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired
loans receivable |
$ |
143,946 |
|
|
$ |
163,428 |
|
|
$ |
180,152 |
|
|
$ |
199,794 |
|
|
$ |
213,466 |
|
|
$ |
180,152 |
|
|
$ |
129,595 |
|
|
Non-acquired
loans receivable |
|
1,188,474 |
|
|
|
1,178,888 |
|
|
|
1,124,232 |
|
|
|
1,083,663 |
|
|
|
1,036,533 |
|
|
|
1,124,232 |
|
|
|
900,380 |
|
|
Total gross
loans receivable |
$ |
1,332,420 |
|
|
$ |
1,342,316 |
|
|
$ |
1,304,384 |
|
|
$ |
1,283,457 |
|
|
$ |
1,249,999 |
|
|
$ |
1,304,384 |
|
|
$ |
1,029,975 |
|
|
%
Acquired |
|
10.8 |
% |
|
|
12.2 |
% |
|
|
13.8 |
% |
|
|
15.6 |
% |
|
|
17.1 |
% |
|
|
13.8 |
% |
|
|
12.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-acquired
loans |
$ |
1,188,474 |
|
|
$ |
1,178,888 |
|
|
$ |
1,124,232 |
|
|
$ |
1,083,663 |
|
|
$ |
1,036,533 |
|
|
$ |
1,124,232 |
|
|
$ |
900,380 |
|
|
Allowance
for loan losses |
|
12,658 |
|
|
|
13,187 |
|
|
|
14,108 |
|
|
|
13,561 |
|
|
|
12,054 |
|
|
|
14,108 |
|
|
|
8,324 |
|
|
Allowance
for loan losses to non-acquired loans (Non-GAAP) |
|
1.07 |
% |
|
|
1.12 |
% |
|
|
1.25 |
% |
|
|
1.25 |
% |
|
|
1.16 |
% |
|
|
1.25 |
% |
|
|
0.92 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total gross
loan receivable |
$ |
1,332,420 |
|
|
$ |
1,342,316 |
|
|
$ |
1,304,384 |
|
|
$ |
1,283,457 |
|
|
$ |
1,249,999 |
|
|
$ |
1,304,384 |
|
|
$ |
1,029,975 |
|
|
Allowance
for loan losses |
|
12,658 |
|
|
|
13,187 |
|
|
|
14,108 |
|
|
|
13,561 |
|
|
|
12,054 |
|
|
|
14,108 |
|
|
|
8,324 |
|
|
Allowance
for loan losses to total gross loans receivable |
|
0.95 |
% |
|
|
0.98 |
% |
|
|
1.08 |
% |
|
|
1.06 |
% |
|
|
0.96 |
% |
|
|
1.08 |
% |
|
|
0.81 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For Periods Ended |
|
|
June 30,2021 |
|
March 31,2021 |
|
December 31,2020 |
|
September 30,2020 |
|
June 30,2020 |
|
December 31,2020 |
|
December 31,2019 |
|
Tangible common equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders' equity |
$ |
221,483 |
|
|
$ |
212,489 |
|
|
$ |
215,368 |
|
|
$ |
213,367 |
|
|
$ |
211,538 |
|
|
$ |
215,368 |
|
|
$ |
212,775 |
|
|
Adjustment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill |
|
42,907 |
|
|
|
42,907 |
|
|
|
42,907 |
|
|
|
41,914 |
|
|
|
41,914 |
|
|
|
42,907 |
|
|
|
24,579 |
|
|
Core deposit intangibles |
|
1,222 |
|
|
|
1,363 |
|
|
|
1,513 |
|
|
|
1,677 |
|
|
|
1,856 |
|
|
|
1,513 |
|
|
|
1,610 |
|
|
Tangible common equity |
$ |
177,354 |
|
|
$ |
168,219 |
|
|
$ |
170,948 |
|
|
$ |
169,776 |
|
|
$ |
167,768 |
|
|
$ |
170,948 |
|
|
$ |
186,586 |
|
|
Common
shares outstanding(3) |
|
17,229,504 |
|
|
|
17,227,104 |
|
|
|
17,507,103 |
|
|
|
17,786,552 |
|
|
|
17,862,554 |
|
|
|
17,507,103 |
|
|
|
18,330,058 |
|
|
Book value
per common share(4) |
$ |
12.85 |
|
|
$ |
12.33 |
|
|
$ |
12.30 |
|
|
$ |
12.00 |
|
|
$ |
11.84 |
|
|
$ |
12.30 |
|
|
$ |
11.61 |
|
|
Tangible
book value per common share(5) |
$ |
10.29 |
|
|
$ |
9.76 |
|
|
$ |
9.76 |
|
|
$ |
9.55 |
|
|
$ |
9.39 |
|
|
$ |
9.76 |
|
|
$ |
10.18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net interest margin-tax equivalent reflects
tax-exempt income on a tax-equivalent basis. |
|
|
|
|
|
|
|
|
|
(2) Net interest margin-core and yield on loans -
core excludes the impact of purchase accounting accretion, loan
payoff charges and related deferred fees |
recognized related to early loan repayments. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) Excludes the dilutive effect of common stock
issuable upon exercise of stock options. |
|
|
|
|
|
|
|
|
|
(4) We calculate book value per common share as
shareholders' equity less preferred stock at the end of the
relevant period divided by the outstanding number |
of shares of our common stock at the end of the relevant
period. |
|
|
|
|
|
|
|
|
|
|
|
|
(5) We calculate the tangible book value per
common share as total shareholders' equity less goodwill, preferred
stock and core deposit intangibles, divided by |
the number of outstanding shares of our common stock at the end of
the relevant period. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Select Bancorp, Inc. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Financial Information and Other Data |
|
|
|
|
|
|
|
|
|
|
|
|
($ in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarter Ended |
|
For the Year Ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
December 31, |
|
December 31, |
|
December 31, |
|
|
2021 |
|
|
2021 |
|
|
2020 |
|
|
|
2020 |
|
|
|
2020 |
|
|
2020 |
|
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest income |
$ |
17,718 |
|
|
$ |
17,980 |
|
|
$ |
18,705 |
|
|
$ |
15,825 |
|
|
$ |
14,500 |
|
|
$ |
63,208 |
|
|
$ |
58,446 |
|
|
$ |
56,835 |
|
Total interest expense |
|
1,699 |
|
|
|
2,049 |
|
|
|
2,681 |
|
|
|
2,714 |
|
|
|
2,646 |
|
|
|
10,759 |
|
|
|
11,556 |
|
|
|
9,450 |
|
Net interest income |
|
16,019 |
|
|
|
15,931 |
|
|
|
16,024 |
|
|
|
13,111 |
|
|
|
11,854 |
|
|
|
52,449 |
|
|
|
46,890 |
|
|
|
47,385 |
|
Provision for (recovery of) loan losses |
|
(459 |
) |
|
|
(777 |
) |
|
|
400 |
|
|
|
1,638 |
|
|
|
1,933 |
|
|
|
6,244 |
|
|
|
438 |
|
|
|
(156 |
) |
Net interest income after provision |
|
16,478 |
|
|
|
16,708 |
|
|
|
15,624 |
|
|
|
11,473 |
|
|
|
9,921 |
|
|
|
46,205 |
|
|
|
46,452 |
|
|
|
47,541 |
|
Noninterest income |
|
1,895 |
|
|
|
1,682 |
|
|
|
1,541 |
|
|
|
1,724 |
|
|
|
1,411 |
|
|
|
6,120 |
|
|
|
5,419 |
|
|
|
4,701 |
|
Merger/acquisition related expenses |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
7 |
|
|
|
709 |
|
|
|
755 |
|
|
|
406 |
|
|
|
1,826 |
|
Noninterest expense |
|
11,021 |
|
|
|
10,196 |
|
|
|
12,131 |
|
|
|
10,060 |
|
|
|
9,793 |
|
|
|
41,192 |
|
|
|
34,734 |
|
|
|
32,724 |
|
Income before income taxes |
|
7,352 |
|
|
|
8,194 |
|
|
|
5,034 |
|
|
|
3,130 |
|
|
|
830 |
|
|
|
10,378 |
|
|
|
16,731 |
|
|
|
17,692 |
|
Provision for income taxes |
|
1,741 |
|
|
|
1,854 |
|
|
|
1,113 |
|
|
|
673 |
|
|
|
149 |
|
|
|
2,215 |
|
|
|
3,696 |
|
|
|
3,910 |
|
Net Income |
$ |
5,611 |
|
|
$ |
6,340 |
|
|
$ |
3,921 |
|
|
$ |
2,457 |
|
|
$ |
681 |
|
|
$ |
8,163 |
|
|
$ |
13,035 |
|
|
$ |
13,782 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share and Per Share Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share - basic |
$ |
0.33 |
|
|
$ |
0.36 |
|
|
$ |
0.22 |
|
|
$ |
0.14 |
|
|
$ |
0.04 |
|
|
$ |
0.46 |
|
|
$ |
0.69 |
|
|
$ |
0.87 |
|
Earnings per share - diluted |
$ |
0.32 |
|
|
$ |
0.36 |
|
|
$ |
0.22 |
|
|
$ |
0.14 |
|
|
$ |
0.04 |
|
|
$ |
0.45 |
|
|
$ |
0.68 |
|
|
$ |
0.87 |
|
Book value per share |
$ |
12.85 |
|
|
$ |
12.33 |
|
|
$ |
12.30 |
|
|
$ |
12.00 |
|
|
$ |
11.84 |
|
|
$ |
12.30 |
|
|
$ |
11.61 |
|
|
$ |
10.85 |
|
Tangible book value per share(1) |
$ |
10.29 |
|
|
$ |
9.76 |
|
|
$ |
9.76 |
|
|
$ |
9.55 |
|
|
$ |
9.39 |
|
|
$ |
9.76 |
|
|
$ |
10.18 |
|
|
$ |
9.47 |
|
Ending shares outstanding |
|
17,229,504 |
|
|
|
17,227,104 |
|
|
|
17,507,103 |
|
|
|
17,786,552 |
|
|
|
17,862,554 |
|
|
|
17,507,103 |
|
|
|
18,330,058 |
|
|
|
19,311,505 |
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
17,227,689 |
|
|
|
17,386,715 |
|
|
|
17,637,540 |
|
|
|
17,847,913 |
|
|
|
18,013,863 |
|
|
|
17,937,596 |
|
|
|
19,016,808 |
|
|
|
15,812,585 |
|
Diluted |
|
17,227,578 |
|
|
|
17,415,680 |
|
|
|
17,661,922 |
|
|
|
17,866,822 |
|
|
|
18,030,136 |
|
|
|
17,961,258 |
|
|
|
19,063,237 |
|
|
|
15,877,633 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Performance Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets(2) |
|
1.21 |
% |
|
|
1.46 |
% |
|
|
0.87 |
% |
|
|
0.58 |
% |
|
|
0.18 |
% |
|
|
0.52 |
% |
|
|
1.03 |
% |
|
|
1.12 |
% |
Return on average equity(2) |
|
10.35 |
% |
|
|
11.90 |
% |
|
|
7.26 |
% |
|
|
4.56 |
% |
|
|
1.28 |
% |
|
|
3.81 |
% |
|
|
6.08 |
% |
|
|
8.51 |
% |
Net interest margin |
|
3.85 |
% |
|
|
4.02 |
% |
|
|
4.10 |
% |
|
|
3.73 |
% |
|
|
3.45 |
% |
|
|
3.79 |
% |
|
|
4.04 |
% |
|
|
4.19 |
% |
Efficiency ratio (3) |
|
61.52 |
% |
|
|
57.89 |
% |
|
|
69.06 |
% |
|
|
67.82 |
% |
|
|
73.83 |
% |
|
|
70.32 |
% |
|
|
66.40 |
% |
|
|
62.83 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period End Balance Sheet Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross loans |
$ |
1,332,420 |
|
|
$ |
1,342,316 |
|
|
$ |
1,304,384 |
|
|
$ |
1,283,457 |
|
|
$ |
1,249,999 |
|
|
$ |
1,304,384 |
|
|
$ |
1,029,975 |
|
|
$ |
986,040 |
|
Total interest-earning assets |
|
1,724,758 |
|
|
|
1,613,526 |
|
|
|
1,529,322 |
|
|
|
1,429,614 |
|
|
|
1,222,416 |
|
|
|
1,529,322 |
|
|
|
1,167,857 |
|
|
|
1,119,344 |
|
Goodwill |
|
42,907 |
|
|
|
42,907 |
|
|
|
42,907 |
|
|
|
41,914 |
|
|
|
41,914 |
|
|
|
42,907 |
|
|
|
24,579 |
|
|
|
24,579 |
|
Core deposit intangible |
|
1,222 |
|
|
|
1,363 |
|
|
|
1,513 |
|
|
|
1,677 |
|
|
|
1,856 |
|
|
|
1,513 |
|
|
|
1,610 |
|
|
|
2,085 |
|
Total assets |
|
1,874,810 |
|
|
|
1,832,329 |
|
|
|
1,730,045 |
|
|
|
1,771,946 |
|
|
|
1,618,960 |
|
|
|
1,730,045 |
|
|
|
1,275,076 |
|
|
|
1,258,525 |
|
Deposits |
|
1,620,652 |
|
|
|
1,582,637 |
|
|
|
1,485,817 |
|
|
|
1,472,780 |
|
|
|
1,338,753 |
|
|
|
1,485,817 |
|
|
|
992,838 |
|
|
|
980,427 |
|
Short-term debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
20,000 |
|
|
|
20,000 |
|
|
|
- |
|
|
|
- |
|
|
|
7,000 |
|
Long-term debt |
|
12,372 |
|
|
|
12,372 |
|
|
|
12,372 |
|
|
|
37,372 |
|
|
|
37,372 |
|
|
|
12,372 |
|
|
|
57,372 |
|
|
|
57,372 |
|
Shareholders' equity |
|
221,483 |
|
|
|
212,489 |
|
|
|
215,368 |
|
|
|
213,367 |
|
|
|
211,538 |
|
|
|
215,368 |
|
|
|
212,775 |
|
|
|
209,611 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Average Balances: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Loans |
$ |
1,335,800 |
|
|
$ |
1,322,031 |
|
|
$ |
1,288,138 |
|
|
$ |
1,255,027 |
|
|
$ |
1,193,985 |
|
|
$ |
1,189,894 |
|
|
$ |
1,004,051 |
|
|
$ |
987,634 |
|
Total interest-earning assets |
|
1,675,768 |
|
|
|
1,613,963 |
|
|
|
1,561,104 |
|
|
|
1,403,106 |
|
|
|
1,321,172 |
|
|
|
1,386,187 |
|
|
|
1,164,149 |
|
|
|
1,119,344 |
|
Core Deposit Intangible |
|
1,529 |
|
|
|
1,423 |
|
|
|
1,572 |
|
|
|
1,743 |
|
|
|
1,529 |
|
|
|
1,588 |
|
|
|
1,812 |
|
|
|
2,547 |
|
Total Assets |
|
1,859,769 |
|
|
|
1,761,938 |
|
|
|
1,784,289 |
|
|
|
1,683,174 |
|
|
|
1,520,278 |
|
|
|
1,561,865 |
|
|
|
1,268,728 |
|
|
|
1,228,576 |
|
Deposits |
|
1,557,448 |
|
|
|
1,516,612 |
|
|
|
1,499,162 |
|
|
|
1,399,840 |
|
|
|
1,237,343 |
|
|
|
1,278,068 |
|
|
|
981,132 |
|
|
|
989,838 |
|
Short-term debt |
|
- |
|
|
|
- |
|
|
|
17,609 |
|
|
|
20,000 |
|
|
|
20,000 |
|
|
|
17,596 |
|
|
|
3,414 |
|
|
|
21,393 |
|
Long-term debt |
|
12,372 |
|
|
|
12,372 |
|
|
|
34,383 |
|
|
|
37,438 |
|
|
|
37,438 |
|
|
|
38,440 |
|
|
|
57,372 |
|
|
|
49,357 |
|
Shareholders' equity |
|
217,396 |
|
|
|
216,007 |
|
|
|
214,861 |
|
|
|
214,277 |
|
|
|
213,796 |
|
|
|
214,360 |
|
|
|
214,324 |
|
|
|
161,953 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Quality Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming loans (4) |
$ |
10,846 |
|
|
$ |
8,312 |
|
|
$ |
14,296 |
|
|
$ |
13,739 |
|
|
$ |
14,399 |
|
|
$ |
14,296 |
|
|
$ |
12,148 |
|
|
$ |
11,635 |
|
Other real estate owned |
|
1,675 |
|
|
|
1,968 |
|
|
|
2,172 |
|
|
|
3,237 |
|
|
|
3,561 |
|
|
|
2,172 |
|
|
|
3,533 |
|
|
|
1,088 |
|
Allowance for loan losses |
|
12,658 |
|
|
|
13,187 |
|
|
|
14,108 |
|
|
|
13,561 |
|
|
|
12,054 |
|
|
|
14,108 |
|
|
|
8,324 |
|
|
|
8,669 |
|
Nonperforming loans (4) to period-end loans |
|
0.62 |
% |
|
|
0.62 |
% |
|
|
1.10 |
% |
|
|
1.07 |
% |
|
|
1.15 |
% |
|
|
1.10 |
% |
|
|
1.18 |
% |
|
|
1.18 |
% |
Allowance for loan losses to period-end loans |
|
0.95 |
% |
|
|
0.98 |
% |
|
|
1.08 |
% |
|
|
1.06 |
% |
|
|
0.96 |
% |
|
|
1.08 |
% |
|
|
0.81 |
% |
|
|
0.88 |
% |
Delinquency ratio (5) |
|
0.23 |
% |
|
|
0.26 |
% |
|
|
0.46 |
% |
|
|
0.17 |
% |
|
|
0.22 |
% |
|
|
0.46 |
% |
|
|
0.34 |
% |
|
|
0.19 |
% |
Net loan charge-offs (recoveries) to average loans (2) |
|
0.02 |
% |
|
|
0.04 |
% |
|
|
-0.05 |
% |
|
|
0.04 |
% |
|
|
0.16 |
% |
|
|
0.04 |
% |
|
|
0.08 |
% |
|
|
0.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Tangible book value per share (a non GAAP measure) is equal to
total shareholders’ equity less goodwill and core deposit
intangibles, |
divided by the number of outstanding shares of our
common stock at the end of the relevant period. Please refer to the
table |
above for a reconciliation of this non-GAAP
measure. |
|
|
|
|
|
|
|
|
|
|
(2) Annualized. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
Efficiency ratio is calculated as a non-interest expenses divided
by the sum of net interest income and non-interest income. |
(4)
Nonperforming loans consist of non-accrual loans and accruing TDR
loans. |
|
|
|
|
|
|
|
|
(5)
Delinquency Ratio includes loans 30-89 days past due and excludes
non-accrual loans. |
|
|
|
|
|
|
Mark A. JeffriesExecutive Vice PresidentChief Financial Officer
Office: 910-892-7080 and Direct:
910-897-3603markj@SelectBank.comSelectBank.com
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