First Capital, Inc. Reports Record Earnings for 2013

First Capital, Inc. Reports Record Earnings for 2013

CORYDON, Ind., Jan. 29, 2014 (GLOBE NEWSWIRE) -- First Capital, Inc.
(Nasdaq:FCAP) (the "Company"), the holding company for First Harrison Bank
(the "Bank"), today reported net income of $5.1 million, or $1.82 per diluted
share, for the year ended December 31, 2013, compared to net income of $3.9
million, or $1.41 per diluted share, for the year ended December 31, 2012.

The increase in earnings is primarily due to increases in net interest income
after provision for loan losses and noninterest income, and a decrease in
noninterest expenses. Earnings for 2012 were negatively impacted by the Bank's
voluntary early retirement 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 $1.2 million for
2013 as compared to 2012. Interest income decreased $389,000 when comparing
the two periods as the average tax-equivalent yield of interest-earning assets
decreased from 4.59% for 2012 to 4.46% for 2013. This was partially offset by
an increase in the average balance in interest-earning assets from $421.8
million for 2012 to $426.6 million for 2013. Interest expense decreased
$812,000 as the average cost of interest-bearing liabilities decreased from
0.73% to 0.48% when comparing the two periods. The provision for loan losses
decreased from $1.5 million for 2012 to $725,000 for 2013 primarily due to a
decrease in net charge-offs from $971,000 during 2012 to $539,000 during 2013.

Noninterest income increased $103,000 for 2013 as compared to 2012.Service
charges on deposit accounts and commission income increased by $158,000 and
$135,000, respectively, when comparing the two periods. These increases were
partially offset by a $203,000 decrease in gains on the sale of loans
primarily due to a decrease in sales activity during the quarter ended
December 31, 2013 as a result of higher interest rates.

Noninterest expenses decreased $522,000 for 2013 compared to 2012 primarily
due to a decrease of $764,000 in compensation and benefits expense. The
decrease in compensation and benefits expense was primarily due to the
previously discussed voluntary early retirement program in 2012.This decrease
was partially offset by increases in data processing fees and other operating
expenses of $134,000 and $113,000, respectively.

The Company's net income was $1.2 million, or $0.45 per diluted share, for
both the quarters ended December 31, 2013 and 2012. 

Net interest income after provision for loan losses increased $391,000 for the
quarter ended December 31, 2013 as compared to the quarter ended December 31,
2012.Interest income decreased $49,000 when comparing the two periods as a
result of a decrease in the average balance of interest-earning assets from
$436.6 million for the fourth quarter of 2012 to $423.5 million for the same
period in 2013, partially offset by an increase in the average tax-equivalent
yield of interest-earning assets from 4.42% for the quarter ended December 31,
2012 to 4.53% for the same period in 2013. Interest expense decreased
$190,000 as the average cost of interest-bearing liabilities decreased from
0.61% to 0.41% and the average balance of interest-bearing liabilities
decreased from $352.7 million to $336.0 million when comparing the two
periods.The provision for loan losses decreased $250,000 when comparing the
two periods from $400,000 for the quarter ended December 31, 2012 to $150,000
for the quarter ended December 31, 2013 primarily due to a decrease in net
charge-offs from $255,000 for 2012 to $132,000 for 2013.

Noninterest income decreased $157,000 when comparing the quarter ended
December 31, 2013 to the quarter ended December 31, 2012, primarily due to a
decrease of $166,000 in gains on loans sold.

Noninterest expenses increased $256,000 when comparing the quarter ended
December 31, 2013 to the quarter ended December 31, 2012, primarily due to
increases of $175,000 and $72,000 in compensation and benefits expense and
other operating expenses, respectively.

Total assets as of December 31, 2013 were $444.4 million compared to $459.1
million at December 31, 2012.Securities available for sale and cash and cash
equivalents decreased $14.2 million and $10.7 million, respectively, while net
loans receivable increased by $8.1 million during 2013.Deposits and retail
repurchase agreements decreased $10.5 million and $4.8 million, respectively,
during 2013. 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 $7.6 million and $8.4 million at
December 31, 2013 and 2012, respectively.At December 31, 2013, 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 Investment Centers of America, 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)
                                                                 
                                Year Ended                Three Months Ended
                                December 31,              December 31,
OPERATING DATA                   2013         2012         2013      2012
(Dollars in thousands, except                                     
per share data)
                                                                 
Total interest income            $18,411    $18,800    $4,632  $4,681
Total interest expense           1,653       2,465       347      537
Net interest income              16,758      16,335      4,285    4,144
Provision for loan losses        725         1,525       150      400
Net interest income after        16,033      14,810      4,135    3,744
provision for loan losses
                                                                 
Total non-interest income        4,640       4,537       1,079    1,236
Total non-interest expense       13,331      13,853      3,433    3,177
Income before income taxes       7,342       5,494       1,781    1,803
Income tax expense              2,255       1,559       534      551
Net income                      $5,087     $3,935     $1,247  $1,252
Less net income attributable to  13          13          3        3
the noncontrolling interest
Net income attributable to First $5,074     $3,922     $1,244  $1,249
Capital, Inc.
                                                                 
Net income per share                                              
attributable to
First Capital, Inc. common                                        
shareholders:
Basic and Diluted                $1.82      $1.41      $0.45   $0.45
                                                                 
Weighted average common shares                                    
outstanding:
Basic and Diluted                2,784,690    2,785,286    2,784,220 2,785,001
                                                                 
OTHER FINANCIAL DATA                                              
                                                                 
Cash dividends per share         $0.80      $0.76      $0.20   $0.19
Return on average assets (three  1.11%        0.86%        1.10%     1.07%
months date annualized)
Return on average equity (three  9.56%        7.54%        9.32%     9.48%
months data annualized)
Net interest margin              4.07%        4.00%        4.20%     3.93%
Interest rate spread             3.98%        3.86%        4.12%     3.81%
Net overhead expense as a
percentage of average assets     2.93%        3.05%        3.05%     2.71%
(three months data annualized)
                                                                 
                                                                 
                                December 31, December 31,          
BALANCE SHEET INFORMATION        2013         2012                  
                                                                 
Cash and cash equivalents        $11,136    $21,811             
Interest-bearing time deposits   4,425       1,400                
Investment securities            108,771     122,985              
Gross loans                      293,428     285,143              
Allowance for loan losses        4,922       4,736                
Earning assets                   407,211     421,755              
Total assets                     444,384     459,132              
Deposits                         373,830     384,343              
FHLB debt                        5,500       5,100                
Repurchase agreements            9,310       14,092               
Stockholders' equity, net of     53,227      52,824               
noncontrolling interest
Non-performing assets:                                            
Nonaccrual loans                 5,256       7,578                
Accruing loans past due 90 days  227         289                  
Foreclosed real estate           466         295                  
Troubled debt restructurings on  1,662       221                  
accrual status
Regulatory capital ratios (Bank                                   
only):
Tier I - adjusted total assets   10.89%       10.00%                
Tier I - risk based              14.86%       14.35%                
Total risk-based                 16.11%       15.60%                

CONTACT: Chris Frederick
         Chief Financial Officer
         Executive Vice President
         812-734-3464