Britton & Koontz Capital Reports Improved 1st Quarter 2011 Earnings

     Britton & Koontz Capital Reports Improved 1st Quarter 2011 Earnings

  PR Newswire

  NATCHEZ, Miss., April 25, 2011

NATCHEZ, Miss., April 25, 2011 /PRNewswire-FirstCall/ -- The Board of
Directors of Britton & Koontz Capital Corporation (Nasdaq: BKBK, "B&K Capital"
or "the Company") today reported net income and earnings per share for the
quarter ended March 31, 2011, of $575 thousand and $.27 per diluted share,
respectively, compared to $63 thousand and $.03 per diluted share,
respectively, for the quarter ended March 31, 2010. Annualized returns on
average assets and average equity for the quarter ended March 31, 2011, were
.61% and 5.80%, respectively, compared to .07% and .63%, respectively, for the
same period in 2010. 

The increase in earnings in the 1st quarter of 2011 as compared to the same
period in 2010 is due to several factors. During the 1st quarter of 2011, the
Company's provision for loan losses declined $350 thousand from $1.1 million
to $750 thousand, while gains on sales of investment securities increased $219
thousand during the same period. Additionally, earnings in the 1st quarter of
2010 were impacted by a $306 thousand charge incurred after management
concluded that the recovery of loan and related late fees previously believed
to be recoverable was ultimately uncertain at best. Finally, as described
below, net interest income during the 1st quarter of 2011 decreased $308
thousand compared to the same period in 2010. 

Net interest income for the quarter ended March 31, 2011, was $3.1 million
compared to $3.4 million for the quarter ended March 31, 2010. This decline
was due primarily to lower average earning assets, offset slightly by lower
funding costs of interest bearing liabilities. Contributing to the lower
average earning assets was a $13.3 million decrease in average loans coupled
with a small decline in average investment securities offset by increases in
average interest bearing cash balances. Net interest margin declined from
3.74% at March 31, 2010, to 3.44% at March 31, 2011, due to the drop in net
interest income.

Non-interest income ended March 31, 2011, at $1.5 million compared to $1.1
million at March 31, 2010. A total of approximately $11 million of
mortgage-backed securities was sold in both quarters, and gains on such sales
in the first quarter of 2011 exceeded gains in the corresponding period in
2010 by $219 thousand. The expansion of the Company's mortgage department
contributed an additional $186 thousand in income from the sale of mortgage
loans. 

Non-interest expense decreased $393 thousand as compared to the 1st quarter of
2010 and ended the 1st quarter of 2011 at $3.1 million. The decrease is
primarily due to an approximately $306 thousand charge to expense in the 1st
quarter of 2010 related to the provision of loan and late fees receivable and
higher personnel costs related to the expanded mortgage operations. 

Total non-performing assets, which include non-accrual loans, loans past due
90 days or more and other real estate, ended the 1st quarter of 2011 at $12.6
million compared to $11.3 million at December 31, 2010. The increase is due
primarily to one commercial credit in the amount of $1.1 million that was
classified as nonaccrual in the 1st quarter of 2011. Non-performing assets as
a percentage of assets increased to 3.31% at March 31, 2011, from 3.01% at
December 31, 2010. The allowance for loan losses ended the 1st quarter of
2011 at $3.1 million, or 1.49% of loans, net of loans held for sale ("LHFS"),
compared to $2.4 million, or 1.15% of loans, net of LHFS, at December 31,
2010. Non-accrual loans increased from $7.5 million at December 31, 2010, to
$9.2 million at March 31, 2011 primarily due to the addition of the above
mentioned commercial credit, while loans past due 90 days or more were down
from $484 thousand at December 31, 2010, to $82 thousand at March 31, 2011.
Other real estate remained the same at $3.3 million at March 31, 2011. 

The Bank's provision for loan losses for the three month period ending March
31, 2010, was decreased to $750 thousand, compared to $1.1 million for the
same period in 2010. The decreased provision was primarily in response to a
diminishing level of net charge-offs. From net charge-offs of $1.8 million in
the 1st quarter of 2010, net losses dropped to $518 thousand in the 4th
quarter of 2010 and $98 thousand for 1st quarter of 2011.

Britton & Koontz Capital Corporation, headquartered in Natchez, Mississippi,
is the parent company of Britton & Koontz Bank, N.A. which operates three full
service offices in Natchez, two in Vicksburg, Mississippi, and three in Baton
Rouge, Louisiana, and a loan production office in Central, Louisiana. As of
March 31, 2011, the Company reported assets of $382.0 million and equity of
$39.7 million. The Company's stock is traded on NASDAQ under the symbol BKBK
and the transfer agent is American Stock Transfer & Trust Company. Total
shares outstanding at March 31, 2011, were 2,142,466.

https://www.bkbank.com

Forward Looking Statements

This news release contains statements regarding the projected performance of
Britton & Koontz Capital Corporation and its subsidiaries. These statements
constitute forward-looking information within the meaning of the Private
Securities Litigation Reform Act. Actual results may differ materially from
the projections provided in this release since such projections involve
significant known and unknown risks and uncertainties. Factors that might
cause such differences include, but are not limited to: competitive pressures
among financial institutions increasing significantly; economic conditions,
either nationally or locally, in areas in which the Company conducts
operations being less favorable than expected; and legislation or regulatory
changes which adversely affect the ability of the combined Company to conduct
business combinations or new operations. The Company disclaims any obligation
to update such factors or to publicly announce the results of any revisions to
any of the forward-looking statements included herein to reflect future events
or developments.

                   Britton and Koontz Capital Corporation
                            Financial Highlights
                                 (Unaudited)
                                 For the Three Months
                                   Ended March 31,
                                 2011             2010
Interest income             $   4,303,497  $   4,874,190
Interest expense                  1,227,967        1,490,557
Net interest income               3,075,530        3,383,633
Provision for loan losses           750,000        1,099,996
Net interest income after
provision for loan losses         2,325,530        2,283,637
Non-interest income               1,531,309        1,122,842
Non-interest expense              3,133,548        3,526,876
Income before income taxes          723,291        (120,397)
Income taxes                        147,871        (183,690)
                                                   $    
Net income                 $    575,420          63,293
Return on Average Assets              0.61%            0.07%
Return on Average Equity              5.80%            0.63%
Diluted:
                              $          $      
Net income per share                  0.27            0.03
Weighted average shares
outstanding                       2,137,907        2,131,706
                              March 31,       December 31,       March 31,
Balance Sheet Data               2011             2010             2010
Total assets                  $ 381,994,668    $ 375,419,683    $ 369,854,661
Cash and due from banks          30,961,369        5,818,853        6,117,260
Investment securities           128,803,724      138,904,366      127,284,279
Gross loans. net of loans
held for sale                   206,835,643      210,564,816      221,211,246
Deposits-interest bearing       224,846,810      212,662,464      206,048,791
Deposits-non interest
bearing                          49,320,424       45,880,066       45,683,381
Total deposits                  274,167,234      258,542,530      251,732,172
Short-term borrowed funds        17,076,548       24,977,895       27,039,455
Long-term borrowed funds         49,000,000       49,000,000       49,000,000
Stockholders' equity             39,664,425       39,931,973       39,425,757
Book value (per share)                18.51            18.70            18.46
Total shares outstanding          2,142,466        2,135,466        2,135,466
Asset Quality Data
Non-accrual loans           $   9,240,708  $   7,509,711  $   9,335,222
Loans 90+ days past due              81,559          484,154           50,518
Total non-performing loans        9,322,267        7,993,865        9,385,740
Other real estate owned           3,303,189        3,303,189        1,763,965
Total non-performing
assets                       $  12,625,456   $  11,297,054   $  11,149,705
Total non-performing
assets to average assets              3.34%            3.00%            2.92%
                                  $    
Net chargeoffs - ytd                98,242  $   3,133,599  $   1,833,337
YTD net chargeoffs as a
percent of average net
loans                                 0.05%            1.42%            0.82%

SOURCE Britton & Koontz Capital Corporation

Website: https://www.bkbank.com
Contact: W. Page Ogden, President & CEO or William M. Salters, Treasurer &
CFO, +1-601-445-5576, +1-601-445-2481 Fax, corporate@bkbank.com,
https://www.bkbank.com
 
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