YCB Your Community Bankshares, Inc.

Your Community Bankshares, Inc. (NASDAQ: YCB) reported fourth quarter net income available to common shareholders of $3.8 million and earnings per diluted common share of $0.68, compared to $2.3 million, or $0.66 per diluted common share, for the same period in 2014. Excluding merger and integration expenses resulting from the acquisition of First Financial Service Corporation of Elizabethtown, Kentucky (“FFKY”), the consolidation of the Company’s two subsidiary banks, and a net loss on the sale of loans, net income available to common shareholders for the quarter would have been $4.1 million or $0.74 per diluted common share (see “Regulation G Disclosure” below). The Company also announced today that on January 19, 2016, its board of directors declared a quarterly cash dividend on the Company’s common stock of $0.12 per share payable on February 25, 2016 to shareholders of record at the close of business on February 8, 2016.

“We made substantial progress integrating First Financial Service Corporation’s operations into our Company during 2015,” stated James Rickard, President and Chief Executive Officer. “We are actually ahead of where we thought we would be in the process as we enter 2016. This gives us a very strong foundation on which to continue to build shareholder value as we look ahead to the next few years.”

Mr. Rickard continued, “Core earnings continues to grow, but we are even more pleased with the improvement in credit quality during the last half of the year. Completing the bulk loan sale was a big step forward for the Company. We expect that this will have a meaningful impact on our non-interest expense as we reduce resources allocated to dealing with problem loan relationships.”

The following points summarize significant financial information for the fourth quarter of 2015:

• Net income for the fourth quarter of 2015 was $3.9 million while net income available to common shareholders was $3.8 million. Excluding merger and integration expenses of $124,000 ($81,000, net of tax) and loss on sale of loans of $316,000 ($205,000, net of tax), net income would have been $4.1 million (see “Regulation G Disclosure” below).
• Non-performing assets to total assets increased to 0.90% at December 31, 2015 from 0.87% at September 30, 2015. Non-accrual loans declined from $4.5 million at September 30, 2015 to $4.0 million at December 31, 2015. Foreclosed and repossessed assets increased from $9.3 million to $10.0 million over the same period.
• During the fourth quarter the Company completed a bulk loan sale in which the Company sold 54 loans to third party investors netting proceeds of $15.6 million after costs to sell. The Company recorded a net loss of $316,000 as a result of loan sale transactions in the fourth quarter. The loans sold were excluded from the Company’s credit quality metrics as of September 30, 2015.
• Tangible book value per common share was $21.57 as of December 31, 2015 as compared to $20.55 at December 31, 2014.
• The Company is closing its financial center located at 12629 Taylorsville Road, Louisville, KY 40299 on February 19, 2016. The Company leases the land and owns the building. During the third quarter, the Company entered into a sublease with a third party and took a charge of $972,000 related to the transaction. Consequently, the Company expects to recognize approximately $400,000 in annual pre-tax cost savings starting on March 1, 2016.
• The Company closed its drive through located at 401 E. Spring Street, New Albany, IN 47150 on November 20, 2015, which will allow the Company to avoid approximately $60,000 in non-interest expense per year starting on the closing date.
• The Company closed the lobby of its location located at 1671 N. Wilson Road, Radcliff, KY 40160 effective November 20, 2015. The Company continues to operate a drive through and an ATM at this location. The Company expects to avoid approximately $70,000 in non-interest expense per year starting on the closing date.
• Net interest income increased to $13.9 million from $13.4 million in the fourth quarter of 2015 due primarily to the reclassification of $466,000 from non-accretable yield into accretion income from one loan relationship. The loan was acquired in the acquisition of First Federal Savings Bank of Elizabethtown in January 2015.
• Fully tax equivalent net interest margin was 4.08%, an increase from 3.94% for the third quarter of 2015. The increase in the margin was attributable to the same factors that drove the increase in net interest income.
• The Company recorded $330,000 provision for loan losses during the quarter, a decrease from $637,000 for the same quarter in 2014, primarily because of generally improving credit quality metrics, including net charge-offs.
• Non-interest income declined to $2.8 million compared to $3.5 million for the third quarter of 2015. Excluding the net loss on sale of loans in the fourth quarter and the gain on recognition of life insurance benefit in the third quarter, non-interest income increased from $2.7 million for the third quarter to $2.9 million for the fourth. This increase was mostly attributable to an increase in interchange income and mortgage banking income.
• Non-interest expense was $11.9 million as compared to $12.7 million for the third quarter of 2015. Excluding merger and integration expenses, non-interest expense increased from $11.2 million for the third quarter to $11.8 million for the fourth. This increase was due to higher incentive and stock-based compensation expenses for the fourth quarter as compared to the third.
• The Company’s effective tax rate was 14.07% during the quarter.
• Beginning March 31, 2015, the Company and its subsidiaries were subject to the new Basel III capital standards and met the definition of well-capitalized under the revised rules as of December 31, 2015.
• Selected performance ratios for the company are set out in the following table.

    Three Months Ended Twelve Months Ended December   September   June   March   December December   December 31, 30, 30, 31, 31, 31, 31, 2015 2015 2015 2015 2014 2015 2014 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)   Return on average assets 0.98 % 0.99 % 0.89 % (0.23 )% 1.10 % 0.65 % 1.04 % Return on average assets, excluding merger and integration expenses and net loss on sale of loans, net of income taxes 1.05 % 1.01 % 0.92 % 0.37 % 1.17 % 0.83 % 1.10 % Return on average equity 10.30 % 10.44 % 9.75 % (2.57 )% 9.83 % 7.03 % 9.54 % Return on average equity, excluding merger and integration expenses and net loss on sale of loans, net of income taxes and gain on recognition of life insurance benefit 11.07 % 10.65 % 10.02 % 4.16 % 10.46 % 9.00 % 10.03 % Net interest margin, fully tax equivalent 4.08 % 3.94 % 4.04 % 3.87 % 4.52 % 3.98 % 4.29 % Net interest margin excluding accretion 3.67 % 3.61 % 3.60 % 3.53 % 4.14 % 3.60 % 4.17 % Efficiency ratio (1) 64.63 % 64.56 % 58.85 % 82.07 % 57.15 % 67.35 % 63.75 %  

(1) Excludes gains or losses on sales of securities, foreclosed asset expenses, amortization of intangibles, and merger and integration expenses and includes net interest income on a fully taxable equivalent basis.

            Your Community Bankshares, Inc. Consolidated Balance Sheets   December 31,

September 30,

June 30, March 31, December 31, 2015 2015 (1) 2015 (1) 2015 (1) 2014 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (As Recast) (As Recast) (As Recast) (In thousands) ASSETS Cash and due from financial institutions $ 30,425 $ 29,618 $ 28,947 $ 45,784 $ 12,872 Interest-bearing deposits in other financial institutions 13,365 10,814 32,383 56,290 6,808 Securities available for sale 378,978 403,486 398,292 385,498 202,177 Loans held for sale 1,015 19,386 390 221 - Loans 1,016,314 992,622 1,008,724 1,005,416 603,575 Allowance for loan losses (6,851 ) (6,416 ) (8,045 ) (7,120 ) (6,465 ) Federal Home Loan Bank and Federal Reserve stock 3,890 3,891 3,807 5,451 4,964 Accrued interest receivable 5,328 5,151 5,083 4,802 3,152 Premises and equipment, net 33,270 30,314 31,462 31,793 18,124 Premises and equipment held for sale - 3,898 5,954 5,974 - Company owned life insurance 33,127 32,828 33,348 33,095 22,058 Goodwill 4,945 4,945 4,945 4,945 - Core deposit intangible 5,015 5,321 5,634 5,951 682 Foreclosed and repossessed assets 9,952 9,261 8,337 15,927 4,431 Other assets   27,242     27,568     29,804     28,328     16,368   Total Assets $ 1,556,015   $ 1,572,687   $ 1,589,065   $ 1,622,355   $ 888,746     LIABILITIES AND SHAREHOLDERS’ EQUITY Deposits Non-interest bearing $ 286,739 $ 275,350 $ 292,179 $ 285,634 $ 200,142 Interest-bearing   975,325     968,620     1,014,357     1,052,089     450,802   Total deposits 1,262,064 1,243,970 1,306,536 1,337,723 650,944 Short-term borrowings 48,785 74,034 42,989 39,228 45,818 Subscription agreement proceeds in escrow - - - - 20,774 Other borrowings 108,347 93,974 84,737 85,611 67,000 Accrued interest payable 451 375 703 462 158 Other liabilities   9,282     8,832     8,741     14,059     4,504   Total liabilities 1,428,929 1,421,185 1,443,706 1,477,083 789,198   SHAREHOLDERS’ EQUITY Preferred stock - 28,000 28,000 28,000 28,000 Common stock 578 578 578 578 386 Additional paid-in capital 90,869 90,459 89,791 89,342 44,421 Retained earnings 39,512 36,336 33,228 30,419 32,110 Accumulated other comprehensive income 2,089 2,489 150 3,788 1,809 Treasury stock   (5,962 )   (6,360 )   (6,388 )   (6,855 )   (7,178 ) Total shareholders’ equity   127,086     151,502     145,359     145,272     99,548   Total Liabilities and Shareholders’ Equity $ 1,556,015   $ 1,572,687   $ 1,589,065   $ 1,622,355   $ 888,746     Book value per common share $ 23.41   $ 22.84   $ 21.53   $ 21.81   $ 20.75   Tangible book value per common share $ 21.57   $ 21.10   $ 19.72   $ 19.93   $ 20.55    

(1) Management obtained information subsequent to the issuance of the September 30, 2015, June 30, 2015 and March 31, 2015 financial statements about the fair value of assets acquired and liabilities assumed from First Financial Service Corporation which resulted in an adjustment to the initial fair values established. The table below details the adjustments to the September 30, 2015, June 30, 2015 and March 31, 2015 consolidated balance sheet; there were no adjustments to the consolidated statement of operations for the periods ending September 30, 2015, June 30, 2015 and March 31, 2015.

        September 30, 2015 June 30, 2015 March 31, 2015

As Previously

  Recast  

As Previously

  Recast  

As Previously

  Recast  

Reported

Adjustments

As Recast

Reported

Adjustments

As Recast

Reported

Adjustments

As Recast

(In thousands) Loans $ 992,662 $ - $ 992,662 $ 1,005,016 $ 3,708 $ 1,008,724 $ 999,906 $ 5,510 $ 1,005,416 Loans held for sale 20,896 (1,510 ) 19,386 390 - 390 221 - 221 Premises and equipment held for sale 3,898 - 3,898 5,635 319 5,954 6,155 (181 ) 5,974 Foreclosed and repossessed assets 9,028 233 9,261 8,354 (17 ) 8,337 15,818 109 15,927 Other assets (deferred tax asset) 27,121 447 27,568 30,647 (843 ) 29,804 29,430 (1,102 ) 28,328 Goodwill 4,115 830 4,945 6,375 (1,430 ) 4,945 7,544 (2,599 ) 4,945 Other borrowings (subordinated debt) 93,974 - 93,974 83,000 1,737 84,737 83,874 1,737 85,611       Your Community Bankshares, Inc. Consolidated Statements of Operations   Three Months Ended   Twelve Months Ended December   September   June   March   December December   December 31, 30, 30, 31, 31, 31, 31, 2015 2015 2015 2015 2014 2015 2014 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (In thousands except share and per data) Interest and dividend income Loans, including fees $ 12,956 $ 12,361 $ 12,787 $ 12,523 $ 7,911 $ 50,627 $ 28,950 Investment securities and other   2,307     2,334     2,319     2,233     1,322     9,193     5,324   Interest and dividend income   15,263     14,695     15,106     14,756     9,233     59,820     34,274     Interest expense Deposits 575 570 580 574 245 2,299 1,020 Borrowed funds   795     731     612     698     291     2,836     921   Total interest expense   1,370     1,301     1,192     1,272     536     5,135     1,941   Net interest income 13,893 13,394 13,914 13,484 8,697 54,685 32,333 Provision for loan losses   330     -     2,155     106     637     2,591     1,275   Net interest income after provision for loan losses   13,563     13,394     11,759     13,378     8,060     52,094     31,058     Non-interest income Service charges on deposit accounts 1,634 1,655 1,669 1,391 854 6,349 3,355 Interchange income 700 575 476 444 287 2,195 1,168 Earnings on company owned life insurance 298 226 253 252 170 1,029 672 Net gain (loss) on sales of available for sale securities 204 (1 ) - 51 - 254 468 Net loss on sale of loans (316 ) - - - - (316 ) - Mortgage banking income 104 70 74 117 42 365 126 Commission income 46 48 50 47 48 191 194 Gain on recognition of life insurance benefit - 835 - - - 835 - Other income   136     101     130     110     128     477     462  

Non-interest income

  2,806     3,509     2,652     2,412     1,529     11,379     6,445     Non-interest expense Salaries and employee benefits 6,065 5,619 5,086 9,119 3,276 25,889 13,878 Occupancy & equipment 1,681 2,640 1,672 2,208 966 8,201 3,814 Data processing 1,152 1,567 921 1,814 670 5,454 2,617 Core deposit intangible amortization 307 312 318 397 78 1,334 322 Foreclosed assets, net 90 119 (95 ) 344 118 458 162 Other expense   2,589     2,395     2,573     4,042     1,444     11,599     5,696   Total non-interest expense   11,884     12,652     10,475     17,924     6,552     52,935     26,489   Income (loss) before income taxes 4,485 4,251 3,936 (2,134 ) 3,037 10,538 11,014 Income tax expense (benefit)   627     334     371     (1,198 )   600     134     2,001   Net income (loss) 3,858 3,917 3,565 (936 ) 2,437 10,404 9,013 Preferred stock dividend   (91 )   (110 )   (109 )   (110 )   (110 )   (420 )   (439 ) Net income (loss) available (attributable) to common shareholders $ 3,767   $ 3,807   $ 3,456   $ (1,046 ) $ 2,327   $ 9,984   $ 8,574     Earnings (loss) per basic common share $ 0.70 $ 0.70 $ 0.64 $ (0.19 ) $ 0.68 $ 1.85 $ 2.49 Earnings (loss) per diluted common share $ 0.68 $ 0.70 $ 0.64 $ (0.19 ) $ 0.66 $ 1.82 $ 2.46 Dividend per common share $ 0.12 $ 0.12 $ 0.12 $ 0.12 $ 0.12 $ 0.48 $ 0.48 Average number of basic common shares 5,413,914 5,405,691 5,383,887 5,374,819 3,446,486 5,394,712 3,437,643 Average number of dilutive common shares 5,505,757 5,470,557 5,437,602 5,374,819 3,499,951 5,492,405 3,487,117   Merger and integration expenses contained in: Salaries and employee benefits - - 60 2,105 - 2,165 - Occupancy & equipment 21 972 - 310 - 1,303 - Data processing 59 413 27 719 - 1,218 - Other expense   44     20     69     633     238     766     697   Total merger and integration expenses 124 1,405 156 3,767 238 5,452 697 Total merger and integration expenses, net of income taxes 81 913 101 2,449 157 3,544 460     Your Community Bankshares, Inc. Average Balances, Interest Yields and Costs  

Three Months Ending,

12/31/2015

 

9/30/2015

 

6/30/2015

 

03/31/2015

 

12/31/2014

  Average   Average   Average   Average   Average Average Yield/ Average Yield/ Average Yield/ Average Yield/ Average Yield/

Balance

Cost

Balance

Cost

Balance

Cost

Balance

Cost

Balance

Cost

ASSETS

(In thousands) Earning assets: Interest-bearing deposits with banks $ 24,233 0.36 % $ 17,489 0.73 % $ 48,008 0.41 % $ 63,092 0.36 % $ 6,113 0.39 % Taxable securities 261,870 1.86 283,885 1.78 288,420 1.84 318,695 1.71 117,961 1.78 Tax-exempt securities 117,447 5.27 112,408 5.35 98,423 5.52 83,217 5.57 80,416 5.49 Total loans and fees 1,019,794 5.13 1,001,041 4.96 1,000,865 5.17 993,536 5.15 595,578 5.34 FHLB and Federal Reserve stock   3,890   4.18   3,837   4.65   4,860   5.69   6,484   5.94   5,768   3.71 Total earning assets 1,427,234 4.46 1,418,660 4.30 1,440,576 4.37 1,465,024 4.22 805,836 4.78

Less: Allowance for loan losses

(7,301 ) (7,757 ) (7,532 ) (6,838 ) (7,743 ) Non-earning assets: Cash and due from banks 28,007 32,263 35,902 38,987 22,388 Bank premises and equipment, net 33,712 36,869 37,778 38,135 17,959 Other assets   87,095     92,150     96,967     124,855     40,034   Total assets $ 1,568,747   $ 1,572,185   $ 1,603,691   $ 1,660,163   $ 878,474     LIABILITIES AND SHAREHOLDERS’ EQUITY   Interest-bearing liabilities: Savings and other $ 656,227 0.16 % $ 652,860 0.15 % $ 688,831 0.15 % $ 697,094 0.15 % $ 338,104 0.18 % Time deposits 324,026 0.38 339,480 0.37 352,394 0.36 377,230 0.33 133,684 0.28 Short-term borrowings 59,004 0.34 50,067 0.32 39,033 0.24 38,253 0.23 42,819 0.24 Other borrowings   92,274   3.20   86,752   3.16   83,170   2.84   87,999   3.12 71,837 1.46 Total interest-bearing liabilities 1,131,531 0.48 1,129,159 0.46 1,163,428 0.41 1,200,576 0.43 586,444 0.36   Non-interest bearing liabilities: Non-interest demand deposits 277,333 285,743 283,101 279,879 185,844 Accrued interest payable and other liabilities 11,366 8,478 10,453 32,251 7,800 Shareholders’ equity   148,517     148,805     146,709     147,457   98,386 Total liabilities and shareholders’ equity $ 1,568,747   $ 1,572,185   $ 1,603,691   $ 1,660,163   $ 878,474   Net interest spread 3.98 % 3.84 % 3.96 % 3.79 % 4.42 % Net interest margin 4.08 3.94 4.04 3.87 4.52    

Accretion and Amortization of Fair Value Adjustments

 

Three Months Ending,

12/31/2015

 

9/30/2015

 

6/30/2015

 

03/31/2015

 

12/31/2014

  Impact on   Impact on   Impact on   Impact on   Impact on Net Net Net Net Net Fair Value Interest Fair Value Interest Fair Value Interest Fair Value Interest Fair Value Interest

Accretion

Margin

Accretion

Margin

Accretion

Margin

Accretion

Margin

Accretion

Margin

(In thousands) Loans $ 984 0.27 % $ 648 0.18 % $ 1,016 0.28 % $ 601 0.17 % $ 775 0.38 % Interest-bearing deposits 397 0.11 432 0.12 475 0.13 542 0.15 - 0.00 FHLB advances 63 0.02 63 0.02 62 0.02 62 0.02 - 0.00 Subordinated debentures   38 0.01   40 0.01   36 0.01   33 0.01   - 0.00 Total fair value accretion $ 1,482 0.41 % $ 1,183 0.33 % $ 1,589 0.44 % $ 1,238 0.34 % $ 775 0.38 %             Your Community Bankshares, Inc. Selected Loan Information   December 31, September 30, June 30, March 31, December 31, 2015 2015 2015 (1) 2015 (1) 2014 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (As recast) (As recast) (As recast) ACQUIRED LOANS (In thousands) Loans on non-accrual status $ 1,323 $ 2,257 $ 5,922 $ 10,122 $ 96 Loans past due 90 days or more and still accruing 68 - - - - Foreclosed and repossessed assets   7,825     6,023     4,849     12,409     254   Total non-performing assets 9,216 8,047 10,771 22,531 350   Allowance for loan losses 59 205 - - - Non-accretable yield on acquired loans 5,293 10,949 16,246 16,752 571   LEGACY LOANS Loans on non-accrual status 2,694 2,229 6,016 7,354 7,439 Loans past due 90 days or more and still accruing - - 220 803 - Foreclosed and repossessed assets   2,127     3,238     3,505     3,535     4,177   Total non-performing assets 4,821 5,467 9,741 11,692 11,616   Total Legacy Loans 704,549 667,281 625,624 588,076 570,864 Allowance for loan losses 6,792 6,211 8,045 7,120 6,465   Allowance for loan losses to legacy loans 0.96 % 0.93 % 1.29 % 1.21 % 1.13 %   TOTAL LOANS Loans on non-accrual status $ 4,017 $ 4,486 $ 11,938 $ 17,476 $ 7,535 Loans past due 90 days or more and still accruing 68 - 220 803 - Foreclosed and repossessed assets   9,952     9,261     8,354     15,944     4,431   Total non-performing assets 14,037 13,747 20,512 34,223 11,966   Non-performing assets to total assets 0.90 % 0.87 % 1.29 % 2.11 % 1.35 % Allowance for loan losses to total loans 0.67 % 0.65 % 0.80 % 0.71 % 1.06 %  

(1) Management obtained information subsequent to the issuance of the September 30, 2015, June 30, 2015 and March 31, 2015 financial statements about the fair value of assets acquired from First Financial Service Corporation which resulted in an adjustment to the initial fair values established.  The adjustments are reflected in the selected loan information reported as September 30, 2015, June 30, 2015 and March 31, 2015 above.

           

Reconciliation of Fully Tax Equivalent Adjustments to GAAP Net Interest Income

 

12/31/2015

9/30/2015

6/30/2015

3/31/2015

12/31/2014

Net   Net   Net   Net   Net   Interest Interest Interest Interest Interest

Income

Yield

Income

Yield

Income

Yield

Income

Yield

Income

Yield

(In thousands) GAAP net interest income $ 13,893 3.86 % $ 13,394 3.75 % $ 13,914 3.87 % $ 13,484 3.73 % $ 8,697 4.28 %   Tax equivalent adjustment Investment securities 546 0.15 530 0.15 474 0.14 400 0.11 379 0.19 Loans   225 0.07     154 0.04     115 0.03     102 0.03     100 0.05   Total tax equivalent adjustment 771 0.21 684 0.19 589 0.17 502 0.14 479 0.24   Tax equivalent net interest income 14,664 4.08 % 14,078 3.94 % 14,503 4.04 % 13,986 3.87 % 9,176 4.52 %  

Regulation G Disclosure

This press release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission (the “SEC”). The Company believes that these non-GAAP financial measures provide information that is useful to the users of its financial information regarding the Company’s financial condition and results of operations. Additionally, the Company uses these non-GAAP measures to evaluate its past performance and prospects for future performance. The Company believes that this non-GAAP financial information is helpful in understanding the results of operations separate and apart from items that may, or could, have a disproportional positive or negative impact in any particular period.

While the Company believes that these non-GAAP financial measures are useful in evaluating Company performance, this information should be considered as supplemental in nature and not as a substitute for or superior to the related financial information prepared in accordance with U.S. GAAP. Further, these non-GAAP financial measures may differ from similar measures presented by other companies.

The Company recognized expenses associated with its acquisition of First Financial Service Corporation, the consolidation of the Company’s two subsidiary banks, and a net loss on the sale of loans during the three months ended December 31, 2015 which substantially impacts the reported financial results for that period. The Company believes excluding these items provides investors and other interested parties with an additional meaningful measure to evaluate the Company’s results of operations.

    Earnings perdiluted

Three Months Ended

common share

Net income available to common shareholders reconciliation:

December 31, 2015

impact (In thousands) Net income available to common shareholders as reported $ 3,767 $ 0.68 Less: Merger and integration expenses reported in non-interest expense 124 0.03 Less: Tax effect of merger and integration charges (43 ) (0.01 ) Less: Net loss on sale of loans reported in non-interest income 316 0.06 Less: Tax effect of net loss on sale of loans   (111 )   (0.02 ) Net income available to common shareholders excluding merger and integration expense and net loss on sale of loans and related tax effects $ 4,053   $ 0.74    

Net income reconciliation:

  Net income as reported $ 3,858 Less: Merger and integration expenses reported in non-interest expense 124 Less: Tax effect of merger and integration charges (43 ) Less: Net loss on sale of loans reported in non-interest income 316 Less: Tax effect of net loss on sale of loans   (111 ) Net income excluding merger and integration expense and net loss on sale of loans and related tax effects $ 4,144    

Non-interest income reconciliation:

  Non-interest income as reported $ 2,806 Less: Net loss on sale of loans   (316 ) Non-interest income excluding net loss on sale of loans $ 3,122    

Non-interest expense reconciliation:

  Non-interest expense as reported $ 11,884 Less: Merger and integration charges 124 Non-interest expense excluding merger and integration expense $ 11,760  

About Your Community Bankshares, Inc.

Your Community Bankshares, Inc. is a bank holding company headquartered in New Albany, Indiana and includes its wholly owned, state-chartered subsidiary bank, Your Community Bank. The Company operates 36 financial centers in Indiana and Kentucky. The Banks are engaged primarily in the business of attracting deposits from the general public and using such funds for the origination of commercial business and real estate loans and secured consumer loans such as home equity lines of credit, automobile loans, and recreational vehicle loans. Additionally, the Banks originate and sell into the secondary market mortgage loans for the purchase of single-family homes. For more information visit www.yourcommunitybank.com.

Statements in this press release relating to the Company’s plans, objectives, or future performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations. The Company’s actual strategies and results in future periods may differ materially from those currently expected due to various risks and uncertainties, including those discussed in the Company’s 2014 Form 10-K and subsequent 10-Q filed with the Securities and Exchange Commission.

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Your Community Bankshares, Inc.Paul Chrisco, 812-981-7375CFO