Carolina Bank Holdings, Inc. Reports Record Net Income of $7.5 Million in 2012; EPS of $1.85 in 2012 Increases 413% From 2011

Carolina Bank Holdings, Inc. Reports Record Net Income of $7.5 Million in
2012; EPS of $1.85 in 2012 Increases 413% From 2011

GREENSBORO, N.C., Jan. 31, 2013 (GLOBE NEWSWIRE) -- Carolina Bank Holdings,
Inc. (Nasdaq:CLBH) today reported record 2012 net income with highlights as
follows:

Fourth Quarter and 2012 Financial Highlights

  *Net income was $7,502,000 in 2012, up 213.0% from $2,397,000 in 2011. Net
    income increased 112.1% in the fourth quarter of 2012 to $2,187,000 from
    $1,031,000 in the fourth quarter of 2011.
  *Net income available to common shareholders was $6,276,000 in 2012, an
    increase of 413.2% from $1,223,000 in 2011. Net income available to common
    shareholders increased 158.4% to $1,884,000 in the fourth quarter of 2012
    from $729,000 in the fourth quarter of 2011.
  *Diluted net income per common share increased 413.9% to $1.85 in 2012 from
    $0.36 in 2011. Diluted net income per common share rose 150% to $0.55 in
    the fourth quarter of 2012 from $0.22 in the fourth quarter of 2011.
  *The net interest margin, computed on a fully taxable basis, decreased to
    4.01% in the fourth quarter of 2012 compared to 4.14% in the fourth
    quarter of 2011.
  *Residential mortgage loan originations rose to a record $1.23 billion in
    2012 from $784 million in 2011.
  *Carolina Bank, the subsidiary of Carolina Bank Holdings, Inc., continued
    to maintain 'Well Capitalized' status, the highest regulatory capital
    measure. Capital ratios at December 31, 2012 for Carolina Bank improved to
    9.23% for Tier 1 leverage, 11.27% for Tier 1 risk-based, and 14.18% for
    Total risk-based.
  *Non-interest bearing demand deposits increased 27.1% in 2012 to
    $73,032,000 at December 31, 2012.
  *Non-performing assets to total assets declined to 2.75% at December 31,
    2012 from 4.40% at December 31, 2011.
  *CLBH stock increased 200% to $7.35 at December 31, 2012 from $2.45 at
    December 31, 2011.

Robert T. Braswell, President and CEO of Carolina Bank Holdings, Inc.
commented, "We are pleased to report record profitability in 2012. Our
outstanding financial performance resulted from improved credit quality,
stable interest rate margins, and strong results by our mortgage division. Our
stock price, which increased 200% during 2012, was one of the best performers
in our industry and reflects our outstanding results."

Non-performing assets to total assets decreased to 2.75% at December 31, 2012
from 4.40% at December 31, 2011. Braswell commented, "We continue to maintain
a steady focus on improving asset quality and have seen a substantial
improvement in credit quality over the past two years. Unlike some of our
peers, who have taken massive losses on large problem asset sales with
accompanying capital raises, we have maximized shareholder value and avoided
shareholder dilution by our steady focus and hard work approach to an industry
wide problem."

Braswell further commented, "Our mortgage division originated a record $1.2
billion in residential mortgage loans in 2012 and has been a major contributor
to our financial results. Our decision to start a residential mortgage
operation in 2007, which was a contrarian strategy at the time, has proven to
be a wise move. The mortgage division has expanded over the past few years as
origination activity increased during this period of super low interest
rates."

About the Company

Carolina Bank, the banking subsidiary of Carolina Bank Holdings, Inc. began
banking operations on November 25, 1996. The parent company is a North
Carolina corporation organized in 2000. The bank is engaged in lending and
deposit gathering activities in the Piedmont Triad of North Carolina, with
operations in four counties: Guilford, Alamance, Forsyth and Randolph. The
bank has eight full-service banking locations, four in Greensboro, one in
Asheboro, one in High Point, one in Burlington, and one in Winston-Salem and
mortgage loan production offices in Burlington, Raleigh, and Hillsborough. The
Company's stock is listed on the NASDAQ Global Market under the symbol CLBH.
Further information is available on the Company's web site:
www.carolinabank.com.

This press release contains forward-looking statements regarding future
events. These statements are only predictions and are subject to risks and
uncertainties that could cause the actual events or results to differ
materially. These risks and uncertainties include risks of managing our
growth, substantial changes in financial markets, regulatory changes, changes
in interest rates, loss of deposits and loan demand to other financial
institutions, and changes in real estate values and the real estate market.
Additional information concerning factors that could cause actual results to
be materially different from those in the forward-looking statements is
contained in the Company's filings with the Securities and Exchange
Commission. Carolina Bank Holdings, Inc. undertakes no obligation to update or
clarify forward-looking statements, whether as a result of new information,
future events or otherwise.

Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Balance Sheets
                                           December 31,
                                           2012              2011*
                                           (unaudited)       
                                           (in thousands except share and per
                                            share data)
Assets                                                       
Cash and due from banks                     $7,913          $5,664
Interest-bearing deposits with banks        7,186            7,647
Securities available-for-sale, at fair      42,036            42,208
value
Securities held-to-maturity                 211               392
Loans held for sale                         131,762           91,955
Loans                                      461,728           487,031
Less allowance for loan losses              (9,944)           (11,793)
Net loans                                  451,784           475,238
Premises and equipment, net                 17,732            17,442
Other real estate owned                     5,940             6,728
Bank-owned life insurance                   10,765            10,385
Other assets                                16,539            15,666
Total assets                                $691,868        $673,325
                                                            
Liabilities and Stockholders' Equity                         
Deposits                                                     
Non-interest bearing demand                 $73,032         $57,475
NOW, money market and savings               343,740           324,449
Time                                        174,153           214,715
Total deposits                              590,925           596,639
                                                            
Advances from the Federal Home Loan Bank    15,982            3,075
Securities sold under agreements to         1,950             1,536
repurchase
Subordinated debentures                     19,563            19,489
Other liabilities and accrued expenses      9,586             6,028
Total liabilities                           638,006           626,767
                                                            
Stockholders' equity                                         
Preferred stock, no par value, authorized
1,000,000 shares; issued and outstanding    15,573            15,177
16,000 shares in 2012 and 2011
Common stock, $1 par value; authorized
20,000,000 shares;issued and outstanding   3,387             3,387
3,387,045 in 2012 and 2011
Common stock warrants                       1,841             1,841
Additional paid-in capital                  15,906            15,870
Retained earnings                          15,408            9,132
Stock in directors' rabbi trust             (1,050)           (875)
Directors' deferred fees obligation         1,050             875
Accumulated other comprehensive income     1,747             1,151
Total stockholders' equity                  53,862            46,558
Total liabilities and stockholders' equity  $691,868        $673,325
                                                            
* Derived from audited consolidated financial statements.


Carolina Bank Holdings, Inc. and Subsidiary
Consolidated Statements of Income (unaudited)
                                      Three Months        Years Ended
                                      Ended December 31, December 31,
                                      2012      2011      2012      2011
                                      (in thousands, except per share data)
Interest income                                                   
Loans                                  $7,072  $7,541  $27,703 $28,743
Investment securities, taxable         273      325      1,195    1,419
Investment securities, non taxable     106      118      402      551
Interest from deposits in banks        25       7        93       77
Total interest income                  7,476    7,991    29,393   30,790
                                                                 
Interest expense                                                  
NOW, money market, savings             345      598      1,835    2,526
Time deposits                          576      757      2,569    3,411
Other borrowed funds                   204      194      802      758
Total interest expense                 1,125    1,549    5,206    6,695
                                                                 
Net interest income                    6,351    6,442    24,187   24,095
Provision for loan losses              300      1,700    2,360    6,850
Net interest income afterprovision    6,051    4,742    21,827   17,245
for loan losses
Non-interest income                                               
Service charges                        274      199      1,126    986
Mortgage banking income                5,546    3,260    18,938   9,928
Gain on sale of investment securities  37       --       37       239
available-for-sale
Gain (loss) on sale of other real      64       (152)    (202)    (316)
estate owned
Other                                  149      119      607      503
Total non-interest income              6,070    3,426    20,506   11,340
                                                                 
Non-interest expense                                              
Salaries and benefits                  5,023    3,522    18,085   13,129
Occupancy and equipment                664      696      2,693    2,519
Professional fees                      461      226      1,280    929
Outside data processing                246      166      887      793
FDIC insurance                         211      209      850      1,026
Advertising and promotion              251      321      797      731
Stationery, printing and supplies      176      172      640      614
Impairment of other real estate owned  272      443      1,466    2,442
Other real estate owned expense        382      223      1,025    1,106
Other                                  1,052    799      3,376    2,342
Total non-interest expense             8,738    6,777    31,099   25,631
                                                                 
Income before income taxes             3,383    1,391    11,234   2,954
Income tax expense                    1,196    360      3,732    557
Net income                            2,187    1,031    7,502    2,397
Dividends and accretion on preferred   303      302      1,226    1,174
stock
Net income available to common         $1,884  $729    $6,276  $1,223
stockholders
                                                                 
Net income per common share                                       
Basic                                  $0.56   $0.22   $1.85   $0.36
Diluted                                $0.55   $0.22   $1.85   $0.36


Carolina Bank Holdings, Inc.
Consolidated Financial Highlights
Fourth Quarter 2012
(unaudited)
                Quarterly                                         Years Ended
                4th Qtr    3rd Qtr   2nd Qtr   1st Qtr   4th Qtr            
($ in thousands
except for share 2012       2012      2012      2012      2011      2012      2011
data)
                                                                       
EARNINGS                                                                
Net interest     $6,351   5,848     5,939     6,049     6,442     24,187   24,095
income
Provision for    $300     600       0         1,460     1,700     2,360    6,850
loan loss
NonInterest      $6,070   5,660     4,976     3,800     3,426     20,506   11,340
income
NonInterest      $8,738   8,177     7,493     6,691     6,777     31,099   25,631
expense
Net income      $2,187   1,819     2,268     1,228     1,031     7,502    2,397
Net income
available to     $1,884   1,505     1,961     926       729       6,276    1,223
common
stockholders
Basic earnings   $0.56    0.44      0.58      0.27      0.22      1.85     0.36
per share
Diluted earnings $0.55    0.44      0.58      0.27      0.22      1.85     0.36
per share
Average common
shares           3,387,045  3,387,045 3,387,045 3,387,045 3,387,045 3,387,045 3,387,045
outstanding
Average diluted
common shares    3,420,396  3,387,045 3,387,045 3,387,045 3,387,045 3,395,383 3,387,045
outstanding
                                                                       
PERFORMANCE                                                             
RATIOS
Return on        1.11%      0.89%     1.18%     0.56%     0.43%     0.93%     0.18%
average assets *
Return on
average common   19.99%     16.75%    23.44%    11.58%    9.31%     18.05%    4.03%
equity *
Net interest
margin           4.01%      3.71%     3.86%     3.98%     4.14%     3.89%     3.92%
(fully-tax
equivalent) *
Efficiency ratio 70.06%     70.78%    68.34%    67.57%    68.28%    69.28%    71.79%
# full-time
equivalent       208        206       200       184       174       208       174
employees -
period end
                                                                       
CAPITAL                                                                 
Equity to
period-end       7.79%      7.68%     7.40%     7.18%     6.91%     7.79%     6.91%
assets
Common tangible  5.53%      5.40%     5.13%     4.89%     4.66%     5.53%     4.66%
equity to assets
Tier 1 leverage
capital ratio -  9.23%      9.00%     8.79%     8.35%     8.02%     9.23%     8.02%
Bank
Tier 1
risk-based       11.27%     11.14%    11.12%    9.92%     9.60%     11.27%    9.60%
capital ratio -
Bank
Total risk-based
capital ratio -  14.18%     14.09%    14.12%    12.83%    12.50%    14.18%    12.50%
Bank
Book value per   $11.30   10.75    10.27    9.65     9.26     11.30    9.26
common share
                                                                       
ASSET QUALITY                                                           
Net charge-offs $1,080   988       1,379     762       1,956     4,209    7,416
Net charge-offs
to average loans 0.95%      0.86%     1.18%     0.64%     1.60%     0.90%     1.49%
*
Allowance for    $9,944   10,725    11,112    12,491    11,793    9,944     11,793
loan losses
Allowance for
loan losses to   2.15%      2.33%     2.42%     2.60%     2.42%     2.15%     2.42%
loans held
invst.
Nonperforming    $13,068  21,387   21,771   23,187   22,915   13,068   22,915
loans
Performing
restructured     $13,822  11,192    12,207    15,728    18,502    13,822    18,502
loans
Other real       $5,940   4,751     6,384     7,708     6,728     5,940     6,728
estate owned
Nonperforming
loans to loans   2.83%      4.66%     4.74%     4.82%     4.71%     2.83%     4.71%
held for
investment
Nonperforming
assets to total  2.75%      3.87%     4.16%     4.62%     4.40%     2.75%     4.40%
assets
                                                                       
END OF PERIOD                                                           
BALANCES
Total assets     $691,868 675,746   677,476   668,009   673,325   691,868   673,325
Total loans held $461,728 459,323   459,144   480,888   487,031   461,728   487,031
for investment
Total deposits   $590,925 588,672   592,103   588,500   596,639   590,925   596,639
Stockholders'    $53,862  51,879    50,143    47,943    46,558    53,862    46,558
equity
                                                                       
AVERAGE BALANCES                                                        
Total assets     $675,573 675,569   670,339   663,932   670,436   671,376   668,753
Total earning    $635,170 631,347   624,183   616,101   623,176   626,736   621,889
assets
Total loans held $456,738 459,800   466,412   479,121   489,915   465,478   498,683
for investment
Total
interest-bearing $519,595 527,545   528,463   529,405   537,287   526,237   542,402
deposits
Common
stockholders'    $37,487  35,750    33,649    32,159    31,052    34,778    30,337
equity
                                                                       
* annualized for all periods presented return on average assets and on average common
equity are computed using net income available to common stockholders

CONTACT: Carolina Bank Holdings, Inc.
         T. Allen Liles, EVP and CFO
         Telephone: 336-286-8746
         Email: a.liles@carolinabank.com
 
Press spacebar to pause and continue. Press esc to stop.