First Capital, Inc. Reports 2012 Earnings

First Capital, Inc. Reports 2012 Earnings

CORYDON, Ind., Jan. 28, 2013 (GLOBE NEWSWIRE) -- First Capital, Inc.
(Nasdaq:FCAP) (the "Company"), the holding company for First Harrison Bank
(the "Bank"), today reported net income of $3.9 million or $1.41 per diluted
share for the year ended December 31, 2012, compared to net income of $4.0
million or $1.43 per diluted share for the year ended December 31, 2011.

The decrease in earnings is primarily due to the Bank's previously announced
voluntary early retirement program that was effective September 30, 2012.
Fourteen employees participated in the program which resulted in a pre-tax
charge to earnings of $693,000 during the quarter ended September 30, 2012.
During the quarter ended December 31, 2012, the Bank recognized a pre-tax
savings of $132,000 due to the lower salary and benefit expenses than would
have been expensed without the early retirement program.Had the program not
been implemented, the Company would have recognized net income of $4.3 million
or $1.53 per diluted share for the year ended December 31, 2012.

Net interest income after provision for loan losses increased $122,000 for the
year ended December 31, 2012 as compared to the year ended December 31, 2011.
Interest income decreased $1.5 million when comparing the two periods as the
average tax-equivalent yield of interest-earning assets decreased from 5.05%
for the year ended December 31, 2011 to 4.59% and for the year ended December
31, 2012.This was partially offset by an increase in the average balance in
interest earning assets from $412.2 million for 2011 to $422.8 million for
2012.Interest expense decreased $1.3 million as the average cost and balance
of interest-bearing liabilities decreased, respectively, from 1.08% and $347.0
million to 0.73% and $339.1 million when comparing the same two periods.The
provision for loan losses decreased from $1.8 million for the year ended
December 31, 2011 to $1.5 million for the year ended December 31, 2012
primarily due to a decrease in net charge-offs from $2.1 million during 2011
to $971,000 during 2012.

Noninterest income increased $486,000 for the year ended December 31, 2012 as
compared to the year ended December 31, 2011.Gains on the sale of loans
increased $355,000 when comparing the two periods primarily due to the
continuing recovery of the housing market.Service charges on deposits also
increased $70,000 for the year ended December 31, 2012 as compared to the same
period in 2011 due to an increase in ATM and debit card fee income.

Noninterest expenses increased $642,000 for the year ended December 31, 2012
compared to the year ended December 31, 2011 primarily due to increases of
$461,000 in salary and benefit expenses and $122,000 in data processing
expenses.The increase in salary and benefit expenses was primarily due to the
previously discussed voluntary early retirement program.The increase in data
processing expenses is primarily due to an increase in ATM processing fees and
more customers using alternative delivery channels.

For the quarter ended December 31, 2012, the Company's net income was $1.2
million or $0.45 per diluted share compared to net income of $1.0 million or
$0.37 per diluted share for the same period in 2011. 

Net interest income after provision for loan losses increased $126,000 for the
quarter ended December 31, 2012 as compared to the quarter ended December 31,
2011.Interest income decreased $242,000 when comparing the two periods as a
result of a decrease in the average tax-equivalent yield on interest-earning
assets from 4.94% for the fourth quarter of 2011 to 4.42% for the same period
in 2012, partially offset by an increase in the average balance of
interest-earning assets from $409.9 million for the quarter ended December 31,
2011 to $436.6 million for the same period in 2012.Interest expense decreased
$268,000 as the average cost of interest-bearing liabilities decreased from
0.94% to 0.61% when comparing the two periods.This was partially offset by
the average balance of interest-bearing liabilities increasing from $342.8
million for the quarter ended December 31, 2011 to $352.7 million for the same
period in 2012.The provision for loan losses decreased $100,000 when
comparing the two periods from $500,000 for the quarter ended December 31,
2011 to $400,000 for the quarter ended December 31, 2012.

Noninterest income increased $137,000 when comparing the quarter ended
December 31, 2012 to the quarter ended December 31, 2011, primarily due to
increases of $44,000 in commission income and $40,000 in service charges on
deposit accounts.

Noninterest expenses decreased $80,000 when comparing the quarter ended
December 31, 2012 to the quarter ended December 31, 2011, primarily due to a
decrease of $116,000 in salary and benefits expenses.This decrease was
primarily due to the aforementioned savings from the voluntary early
retirement program.

Total assets as of December 31, 2012 were $459.1 million compared to $438.9
million at December 31, 2011.Securities available for sale and net loans
receivable increased $11.5 million and $4.4 million, respectively.Deposits
increased $20.0 million overall during 2012. Noninterest-bearing deposits
increased $9.4 million and represented 14.8% of all deposits at December 31,
2012, up from 13.0% at December 31, 2011.Nonperforming assets (consisting of
nonaccrual loans, accruing loans 90 days or more past due, troubled debt
restructurings on accrual status, and foreclosed real estate) totaled $8.4
million and $8.9 million at December 31, 2012 and 2011, respectively.At
December 31, 2012, the Bank was considered well-capitalized under applicable
federal regulatory capital guidelines.

First Harrison Bank currently has thirteen offices in the Indiana communities
of Corydon, Edwardsville, Greenville, Floyds Knobs, Hardinsburg, Palmyra, New
Albany, New Salisbury, Jeffersonville, Salem and Lanesville.Access to First
Harrison Bank accounts, including online banking and electronic bill payments,
is available anywhere with Internet access through the Bank's website at
www.firstharrison.com.First Harrison Bank, through its business arrangement
with Lincoln Investments, member SIPC, continues to offer non FDIC insured
investments to complement the Bank's offering of traditional banking products
and services.

This release may contain forward-looking statements within the meaning of the
federal securities laws.These statements are not historical facts; rather,
they are statements based on the Company's current expectations regarding its
business strategies and their intended results and its future
performance.Forward-looking statements are preceded by terms such as
"expects," "believes," "anticipates," "intends" and similar expressions.

Forward-looking statements are not guarantees of future performance.Numerous
risks and uncertainties could cause or contribute to the Company's actual
results, performance and achievements to be materially different from those
expressed or implied by the forward-looking statements.Factors that may cause
or contribute to these differences include, without limitation, general
economic conditions, including changes in market interest rates and changes in
monetary and fiscal policies of the federal government; legislative and
regulatory changes; and other factors disclosed periodically in the Company's
filings with the Securities and Exchange Commission.

Because of the risks and uncertainties inherent in forward-looking statements,
readers are cautioned not to place undue reliance on them, whether included in
this report or made elsewhere from time to time by the Company or on its
behalf.Except as may be required by applicable law or regulation, the Company
assumes no obligation to update any forward-looking statements.

FIRST CAPITAL, INC. AND SUBSIDIARY
Consolidated Financial Highlights (Unaudited)
(Dollars in thousands, except per share data)
                                                                 
                                Year Ended                Three Months Ended
                                 December 31,              December 31,
OPERATING DATA                   2012         2011         2012      2011
                                                                 
Total interest income            $18,800    $20,273    $4,681  $4,923
Total interest expense           2,465       3,760       537      805
Net interest income              16,335      16,513      4,144    4,118
Provision for loan losses        1,525       1,825       400      500
Net interest income after        14,810      14,688      3,744    3,618
provision for loan losses
                                                                 
Total non-interest income        4,537       4,051       1,236    1,099
Total non-interest expense       13,853      13,211      3,177    3,257
Income before income taxes       5,494       5,528       1,803    1,460
Income tax expense              1,559       1,543       551      415
Net income                      $3,935     $3,985     $1,252  $1,045
Less net income attributable to  13          13          3        3
the noncontrolling interest
Net income attributable to First $3,922     $3,972     $1,249  $1,042
Capital, Inc.
                                                                 
Net income per share                                              
attributable to
First Capital, Inc. common                                        
shareholders:
Basic and Diluted                $1.41      $1.43      $0.45   $0.37
                                                                 
Weighted average common shares                                    
outstanding:
Basic and Diluted                2,785,286    2,786,410    2,785,001 2,785,693
                                                                 
OTHER FINANCIAL DATA                                              
                                                                 
Cash dividends per share         $0.76      $0.76      $0.19   $0.19
Return on average assets         0.86%        0.90%        1.07%     0.94%
(annualized for 3-month period)
Return on average equity         7.54%        8.04%        9.48%     8.22%
(annualized for 3-month period)
Net interest margin              4.00%        4.14%        3.93%     4.15%
Interest rate spread             3.86%        3.97%        3.81%     4.00%
Net overhead expense as a
percentage of average assets     3.05%        2.98%        2.71%     2.93%
(annualized for 3-month period)
                                                                 
                                                                 
BALANCE SHEET INFORMATION        December 31, December 31,          
                                 2012         2011
                                                                 
Cash and cash equivalents        $23,211    $18,923             
Investment securities            122,985     111,456              
Gross loans                      285,143     280,229              
Allowance for loan losses        4,736       4,182                
Earning assets                   421,755     401,361              
Total assets                     459,132     438,886              
Deposits                         384,343     364,374              
FHLB debt                        5,100       12,350               
Repurchase agreements            14,092      9,125                
Stockholders' equity, net of     52,824      50,942               
noncontrolling interest
Non-performing assets:                                            
Nonaccrual loans                 7,578       7,401                
Accruing loans past due 90 days  289         363                  
Foreclosed real estate           295         661                  
Troubled debt restructurings on  221         462                  
accrual status
Regulatory capital ratios (Bank                                   
only):
Tier I - adjusted total assets   10.00%       10.06%                
Tier I - risk based              14.35%       16.11%                
Total risk-based                 15.60%       17.05%                

CONTACT: Chris Frederick
         Chief Financial Officer
         812-734-3464
 
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