CITIZENS COMMUNITY BANK (VIRGINIA) 
By SOUTH HILL, Va., July 23 /PRNewswire-FirstCall/ -- Citizens Community Bank (OTC Bulletin Board: CZYB) today reported second quarter and year-to-date results for the period ended June 30, 2010. For the second quarter of 2010, net income available to common shareholders equaled $86,922, an increase of $71,020 over the second quarter of 2009. Basic and diluted earnings per share to common shareholders equaled $.06 for the second quarter of 2010 compared to $.01 for the second quarter of 2009. Pre-tax income for the second quarter of 2010 accelerated to $180,730, an increase of $114,970 or 174.8% over the second quarter of 2009.
For the six-month period ended June 30, 2010, the Bank's net income available to common shareholders totaled $171,815, an increase of $105,332 over the first six months of 2009. Year to date, basic and diluted earnings per share to common shareholders equaled $.13 compared to $.05 for the same period in 2009. Pre-tax income for the first two quarters of 2010 equaled $371,329, up $226,501 or 156.4% over the same period in 2009.
As of June 30, 2010, total assets were $172.8 million, up $896,310 or .5% from December 31, 2009. Gross loans amounted to $130.6 million, a decline of $1.8 million or 1.4% from year end 2009. The Bank's investment portfolio declined $1.6 million or 6.7% over the past six months as cash flows and maturities were reinvested into federal funds. Total deposits equaled $142.7 million, an increase of $419,392 or .3% over the past six months.
President and CEO Thomas C. Manson stated, "We showed healthy improvements in both the 2010 quarter over quarter earnings as well as the comparative net income to first six months of 2009. While the economy remains sluggish, our net interest margin shows steady expansion and is affording the opportunity to increase profits while aggressively dealing with any remaining nonperforming assets and delinquent loans. While we're proud of our performance to date, we continue to increase our allowance for loan losses to remain among the strongest of our peers."
"We also are pleased to report positive feedback and results of our branding campaign to launch our new 'CCB' logo and nickname. This, along with our renewed efforts on outstanding quality service, should continue to help us positively differentiate ourselves in the marketplace," adds Manson.
For the second quarter of 2010, net interest income totaled $1,696,261, an increase of $319,347 or 23.2% over the second quarter of 2009. The improvement in net interest income was attributable to a stronger net interest margin. For the quarter ended June 30, 2010, the Bank generated a 4.32% net interest margin, which was 87 basis points higher than the second quarter of 2009 and 9 basis points higher than the first quarter of 2010. The continued widening of the net interest margin resulted from steady earning asset yields over the period coupled with a decline in funding cost. For the second quarter of 2010, earning asset yields remained relatively stable at 5.91% while the Bank's funding costs declined 100 basis points to 1.90%.
For the first six months of 2010, net interest income totaled $3,352,412, an increase of $688,898 or 25.9% over the first six month of 2009 as the Bank's net interest margin expanded. Year to date, the Bank's net interest margin was 4.27%, 84 basis points higher than the first six months of 2009. The net interest margin expansion resulted from a reduction in funding costs.
Noninterest income totaled $236,050, up $49,992 or 26.9% over the second quarter of 2009. For the six months ended June 30, 2010, noninterest income amounted to $449,481, an increase of $88,736 or 24.6% over the first six months of 2009. For both comparables periods, higher revenue primarily from deposit accounts and rental income on other real estate owned pushed noninterest income higher. Noninterest expense equaled $1,469,581, an increase of $109,569 or 8.1% over the second quarter of 2009 as expenses related to the branding and marketing of the new "CCB" were incurred as well as additional expenses associated with weakened loans and other real estate owned. For the six months ended June 30, 2010, noninterest expense totaled $2,824,840, an increase of $203,919 or 7.8% due primarily to branding and marketing related expenses coupled with overall loan related and general operating expenses. Salaries and benefits, which represented 43.4% of noninterest expense, increased a modest 1.4% or $16,537 over the first six months of 2009.
For the quarter ended June 30, 2010, provision for loan losses amounted to $282,000 an increase of $144,800 over the second quarter of 2009. For the six months ended June 30, 2010, provision for loan losses equaled $605,724, an increase of $347,214 over the first six months of 2009. The additional provision expenses resulted from higher net charge-offs during the first two quarters of 2010 coupled with the Bank increasing its loan loss reserve ratio as nonperforming assets remained elevated and the local economy continues to be weak.
For the second quarter of 2010, net loan charge-offs equaled $164,678 or .50% of average loans compared to $76,079 or .23% of loans for the second quarter of 2009. For the six months ended June 30, 2010, net charge-offs stood at $387,561 or .59% of average loans, compared to $101,633 or .16% one year ago. Nonperforming loans equaled $3,487,287 or 2.67% of outstanding loans compared to $3,206,318 or 2.44% on June 30, 2009. Of the $3,487,287 in nonperforming loans, $1,007,547 was troubled debt restructured loans that were accruing interest. There were no loans 90 days past due and still accruing interest as of June 30, 2010. As of June 30, the Bank held $1,396,527 of other real estate owned. The allowance for loan losses equaled 1.79% of loans as of June 30, 2010 compared to 1.28% on June 30, 2009 and 1.60% on December 31, 2009.
Citizens Community Bank is a Virginia state chartered bank headquartered in South Hill, Va. Opened in December 1999, it operates five branches, three in south central Virginia and two in northern North Carolina. For more information and additional financial data, please visit www.ccbsite.com.
This press release contains "forward-looking statements" that concern future events which are subject to risks and uncertainties. Any such statements are based on certain assumptions and analyses by the Bank and other factors it believes are appropriate in the circumstances. The Bank's actual results, events and developments may differ materially from those contemplated by any forward-looking statement.
Citizens Community Bank
Financial Highlights
(Unaudited)
(Actual dollars, except per Three months ended
share data) June 30,
------------------
Selected Operating Data: 2010 2009
---- ----
Net interest income $1,696,261 $1,376,914
Provision for loan losses 282,000 137,200
Noninterest income 236,050 186,058
Noninterest expense 1,469,581 1,360,012
--------- ---------
Income before income tax 180,730 65,760
Income tax expense 45,433 1,483
------ -----
Net income $135,297 $64,277
======== =======
Less: Preferred dividends $48,375 $48,375
------- -------
Net income available to
common shareholders $86,922 $15,902
======= =======
Income per share available to
common shareholders:
Basic $0.06 $0.01
===== =====
Diluted $0.06 $0.01
===== =====
Average shares outstanding,
basic 1,364,670 1,364,670
Average shares outstanding,
diluted 1,364,670 1,364,670
(Unaudited)
(Actual dollars, except per Six months ended June
share data) 30,
----------------------
Selected Operating Data: 2010 2009
---- ----
Net interest income $3,352,412 $2,663,514
Provision for loan losses 605,724 258,510
Noninterest income 449,481 360,745
Noninterest expense 2,824,840 2,620,921
--------- ---------
Income before income tax 371,329 144,828
Income tax expense 102,764 2,487
------- -----
Net income $268,565 $142,341
======== ========
Less: Preferred dividends $96,750 $75,858
------- -------
Net income available to
common shareholders $171,815 $66,483
======== =======
Income per share available to
common shareholders:
Basic $0.13 $0.05
===== =====
Diluted $0.13 $0.05
===== =====
Average shares outstanding,
basic 1,364,670 1,364,670
Average shares outstanding,
diluted 1,364,670 1,364,670
Citizens Community Bank
Financial Highlights
(Unaudited) (Audited)
(Actual dollars, except June 30, December 31,
per share data) 2010 2009
----------- ------------
Balance Sheet Data:
Total assets $172,758,759 $171,862,449
Loans, net 128,260,944 130,301,003
Deposits 142,725,527 142,306,135
Borrowings 8,000,000 8,000,000
Stockholders' equity 21,685,141 21,396,677
Book value per
share (1) $13.53 $13.46
Total shares
outstanding 1,364,670 1,364,670
Three months ended Six months ended
June 30, June 30,
------------------ ----------------
2010 2009 2010 2009
---- ---- ---- ----
(Unaudited)
Asset Quality Ratios:
Allowance for
loan loss $ 2,336,878 $1,679,452 $2,336,878 $1,679,452
Nonperforming assets 4,883,814 4,536,634 4,883,814 4,536,634
Nonperforming loans 3,487,287 3,206,318 3,487,287 3,206,318
Other real estate owned 1,396,527 1,330,316 1,396,527 1,330,316
Net charge-offs 164,678 76,079 387,561 101,633
Allowance for loan
loss to total loans 1.79% 1.28% 1.79% 1.28%
Nonperforming loans
to total loans 2.67% 2.44% 2.67% 2.44%
Nonperforming assets
to total assets 2.83% 2.61% 2.83% 2.61%
Net charge-offs to
average loans 0.50% 0.23% 0.59% 0.16%
Selected Performance
Ratios:
Return on average assets 0.20% 0.04% 0.20% 0.08%
Return on average common
equity 1.87% 0.35% 1.83% 0.73%
Net interest margin 4.32% 3.45% 4.27% 3.43%
Overhead efficiency 76.05% 86.29% 74.30% 86.66%
Note: (1) Book value excludes $3,045,667 and $3,015,167 of preferred stock
for 2010 and 2009, respectively.
SOURCE Citizens Community Bank
