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Citizens First Corporation Announces First Quarter 2014 Results

       Citizens First Corporation Announces First Quarter 2014 Results

PR Newswire

BOWLING GREEN, Ky., April 17, 2014

BOWLING GREEN, Ky., April 17, 2014 /PRNewswire/ --Citizens First Corporation
(NASDAQ: CZFC) today reported results for the first quarter ending March 31,
2014, which include the following:

  oFor the quarter ended March 31, 2014, the Company reported net income of
    $691,000, which represents a decrease of $11,000 from the linked quarter
    ended December 31, 2013 and an increase of $576,000 from March 31, 2013.
    Earnings per diluted common share for the current quarter were $0.27, an
    increase of $0.02 from the linked quarter ended December 31, 2013 and an
    increase of $0.32 for the quarter ended March 31, 2013.

  oThe Company's net interest margin was 3.81% for the quarter ended March
    31, 2014 compared to 4.03% for the linked quarter ended December 31, 2013
    and 3.96% for the quarter ended March 31, 2013, a decrease of 22 basis
    points for the linked quarter and a decrease of 15 basis points from the
    prior year. The Company's net interest margin decreased from prior periods
    due to a decline in the yield on loans.

  oTotal loans increased 2.2% to $301.6 million at March 31, 2014 compared to
    $295.1 million at December 31, 2013. Total deposits increased 2.7% to
    $352.2 million at March 31, 2014 compared to $343.0 million at December
    31, 2013. Todd Kanipe, President & CEO of Citizens First commented, "We
    are encouraged by the growth of loans on our balance sheet. Loan growth is
    vital to improve our net interest income while interest rates continue to
    remain at historically low levels. We have added to both our lending and
    credit administration staff to focus on loan growth while maintaining
    credit quality in our loan portfolio."

First Quarter 2014 Compared to Fourth Quarter 2013

Net interest income for the quarter ended March 31, 2014 declined $231,000
from the previous quarter as the yield on loans declined.

Non-interest income for the three months ended March 31, 2014 decreased
$82,000, or 11.5%, compared to the previous quarter, primarily due to a
decrease in service charges on deposits of $58,000. Non-interest expense for
the three months ended March 31, 2014 increased $1,000, or .03%, compared to
the previous quarter.

A $125,000 provision for loan losses was recorded for the first quarter of
2014, compared to a $450,000 provision in the previous quarter, a decrease of
$325,000. The allowance for loan losses to total loans increased slightly
from 1.58% to 1.60%. Net charge-offs (recoveries) were $(49,000) for the
first quarter of 2014 compared to $617,000 in the fourth quarter of 2013. 

First Quarter 2014 Compared to First Quarter 2013

Net interest income for the quarter ended March 31, 2014 decreased $168,000,
or 4.6%, compared to the previous year. The decrease in net interest income
was impacted by a reduction in interest expense of $79,000 combined with a
decrease in interest income of $247,000. The decrease in interest income was
created by a decline in the yield on loans from 5.50% in the first quarter of
2013 to 5.14% in the first quarter of 2014. Loan yields have declined as
maturing loans were repriced at a lower rate.

Non-interest income for the three months ended March 31, 2014 decreased
$90,000, or 12.5%, compared to the three months ended March 31, 2013,
primarily due to a decline in gains on sale of mortgage loans of $58,000 from
the prior year.

Non-interest expense for the three months ended March 31, 2014 decreased
$20,000, or 0.6%, compared to the three months ended March 31, 2013, due to a
decrease in legal and collection expenses.

A $125,000 provision for loan losses was recorded for the first quarter of
2014, a decrease of $1.1 million, from $1.3 million in the first quarter of
2013. The allowance for loan losses to total loans decreased from 2.21% of
total loans at March 31, 2013 to 1.60% at March 31, 2014, primarily due to
charge-offs of specific allocations which were included in the allowance at
March 31, 2013. Net charge-offs (recoveries) were $(49,000) for the first
quarter of 2014 compared to net charge-offs of $321,000 in the first quarter
of 2013.

Balance Sheet

Total assets at March 31, 2014 were $420.1 million, an increase of $9.9
million from $410.2 million at December 31, 2013. Average assets during the
first quarter were $414.1 million, a decrease of 0.9%, or $3.7 million, from
$417.8 million in the first quarter of 2013. Average interest earning assets
decreased 0.8%, or $3.1 million, from $384.6 million in the first quarter of
2013 to $381.5 million in the first quarter of 2014.

Loans increased $6.5 million, or 2.2%, from $295.1 million at December 31,
2013 to $301.6 million at March 31, 2014. Total loans averaged $303.4 million
the first quarter of 2014, compared to $303.9 million the first quarter of
2013, a decrease of $0.5 million, or 0.2%.

Deposits at March 31, 2014 were $352.2 million, an increase of $9.2 million,
or 2.7%, compared to $343.0 million at December 31, 2013. Total deposits
averaged $346.1 million the first quarter of 2014, an increase of $3.6
million, or 1.1%, compared to $342.5 million during the first quarter of
2013. Average deposits increased during the year, but the cost of funds
declined as higher cost deposits matured and were renewed at lower rates.

Non-performing assets totaled $2.6 million at March 31, 2014 compared to $2.0
million at December 31, 2013, an increase of $593,000. A summary of
nonperforming assets is presented below:

                                      March  December September June   March

(In thousands)                        31,    31,      30,       30,    31,

                                      2014   2013     2013      2013   2013
Nonaccrual loans                      $1,104 $1,026   $3,784    $6,141 $7,097
Loans 90+ days past due/accruing      56     -        19        -      23
Restructured loans                    815    154      2,041     3,340  3,528
Total non-performing loans            1,975  1,180    5,844     9,481  10,648
Other real estate owned               631    833      547       517    232
Total non-performing assets           $2,606 $2,013   $6,391    $9,998 $10,880
Non-performing assets to total        0.62%  0.49%    1.56%     2.43%  2.58%
assets

The allowance for loan losses at March 31, 2014 was $4.8 million, or 1.60% of
total loans, compared to $4.7 million, or 1.58% of total loans as of December
31, 2013. The allowance increased due to an increase in nonperforming
assets. A summary of the allowance for loan losses is presented below:

                                       March  December September June   March

(In thousands)                         31,    31,      30,       30,    31,

                                       2014  2013    2013     2013  2013
Balance at beginning of period         $4,653 $4,820   $6,064    $6,650 $5,721
Provision for loan losses              125    450      900       50     1,250
Charged-off loans                      22     788      2,198     678    358
Recoveries of previously charged-off   71     171      54        42     37
loans
Balance at end of period               $4,827 $4,653   $4,820    $6,064 $6,650
Allowance for loan losses to total     1.60%  1.58%    1.60%     1.98%  2.21%
loans

At March 31, 2014, total shareholders' equity was $35.9 million compared to
$38.3 million at December 31, 2013, a decrease of $2.4 million. During the
first quarter of 2014, the Company paid $3.3 million to repurchase the
remaining 93 shares of the Series A preferred stock that the Company had
issued to the Treasury in 2008 under the TARP Capital Purchase Program.

The Company's tangible equity ratio declined to 7.51% as of March 31, 2014
compared to 8.28% at December 31, 2013 due to the repayment of the TARP
Capital Purchase Program funds. The tangible book value per common share
improved from $11.51 at December 31, 2013, to $11.97 at March 31, 2014. The
Company and Citizens First Bank are categorized as "well capitalized" under
regulatory guidelines.

About Citizens First Corporation

Citizens First Corporation is a bank holding company headquartered in Bowling
Green, Kentucky and established in 1999. The Company has branch offices
located in Barren, Hart, Simpson and Warren Counties in Kentucky.

Forward-Looking Statements

Statements in this press release relating to Citizens First Corporation's
plans, objectives, expectations or future performance are forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995 that are based upon the Company's current expectations, but are
subject to certain risks and uncertainties that may cause actual results to
differ materially. Among the risks and uncertainties that could cause actual
results to differ materially are economic conditions generally and in the
market areas of the Company, a continuation or worsening of the current
disruption in credit and other markets, goodwill impairment, overall loan
demand, increased competition in the financial services industry which could
negatively impact the Company's ability to increase total earning assets, and
the retention of key personnel. Actions by the Department of the Treasury and
federal and state bank regulators in response to changing economic conditions,
changes in interest rates, loan prepayments by and the financial health of the
Company's borrowers, and other factors described in the reports filed by the
Company with the Securities and Exchange Commission could also impact current
expectations.



Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Consolidated Statement of Income:
                                      Three Months Ended

                                      
                                      March 31 Dec 31 Sept 30 June 30 March 31
                                      2014     2013   2013    2013    2013
Interest income             $4,181   $4,411 $4,381  $4,325  $4,428
Interest expense                      683      682    747     770     762
Net interest income                   3,498    3,729  3,634   3,555   3,666
Provision for loan losses             125      450    900     50      1,250
Non-interest income:
 Service charges on deposits        261      319    341     321     291
 Other service charges and fees     153      133    156     158     138
 Gain on sale of mortgage loans     24       36     81      78      82
 Non-deposit brokerage fees         69       72     91      78      65
 Lease income                       75       75     74      75      74
 BOLI income                        47       49     53      56      61
 Securities gains                   -        27     -       29      8
 Total                           629      711    796     795     719
Non-interest expenses:
 Personnel expense                  1,527    1,419  1,382   1,417   1,441
 Net occupancy expense              482      485    499     465     461
 Advertising and public relations   83       65     70      110     78
 Professional fees                  153      141    201     174     164
 Data processing services           233      266    280     272     265
 Franchise shares and deposit tax   146      145    146     141     141
 FDIC insurance                     77       119    150     26      85
 Core deposit intangible            84       79     84      85      84
amortization
 Postage and office supplies        51       38     35      35      43
 Other real estate owned expenses   10       46     7       20      11
 Other                              216      258    425     434     309
 Total                           3,062    3,061  3,279   3,179   3,082
Income before income taxes            940      929    251     1,121   53
Provision for income taxes            249      227    18      333     (62)
Net income                            691      702    233     788     115
Preferred dividends and discount      132      184    178     176     217
accretion
Net income (loss) available for       $559     $518   $55     $612    $(102)
common shareholders
Basic earnings (loss) per common      $0.28    $0.26  $0.03   $0.31   $(0.05)
share
Diluted earnings (loss) per common    $0.27    $0.25  $0.02   $0.30   $(0.05)
share





Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Key Operating Statistics:
                                 Three Months Ended

                                 
                                 March    December September June     March

                                 31      31      30       30      31
                                 2014     2013     2013      2013     2013
Average assets                   $414,089 $408,792 $413,293  $419,240 $417,804
Average earning assets           381,485  375,658  380,154   387,663  384,614
Average loans                    303,438  298,833  307,618   305,532  303,942
Average deposits                 346,089  340,938  340,067   345,738  342,475
Average equity                   36,213   38,469   37,937    38,353   40,164
Average common equity            28,046   27,548   27,023    27,445   27,695
Return on average assets         0.68%    0.68%    0.22%     0.75%    0.11%
Return on average equity         7.74%    7.24%    2.44%     8.24%    1.16%
Efficiency ratio                 72.73%   68.07%   72.66%    72.17%   68.96%
Non-interest income to average   0.62%    0.69%    0.77%     0.76%    0.70%
assets
Non-interest expenses to average 3.00%    2.97%    3.15%     3.04%    2.99%
assets
Net overhead to average assets   2.38%    2.28%    2.38%     2.28%    2.29%
Yield on loans                   5.14%    5.42%    5.26%     5.28%    5.50%
Yield on investment securities   3.02%    2.97%    2.87%     2.78%    2.97%
(TE)
Yield on average earning assets  4.53%    4.75%    4.66%     4.56%    4.76%
(TE)
Cost of average interest bearing 0.83%    0.83%    0.89%     0.92%    0.93%
liabilities
Net interest margin (tax         3.81%    4.03%    3.88%     3.77%    3.96%
equivalent)
Number of FTE employees          98       100      100       98       99
Asset Quality Ratios:
Non-performing loans to total    0.65%    0.40%    1.94%     3.09%    3.54%
loans
Non-performing assets to total   0.62%    0.49%    1.56%     2.43%    2.58%
assets
Allowance for loan losses to     1.60%    1.58%    1.60%     1.98%    2.21%
total loans
YTD net charge-offs (recoveries) (0.06)%  1.22%    1.36%     0.63%    0.43%
to average loans, annualized





Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
Consolidated Statement of Condition:       As of     As of        As of
                                           March 31, December 31, December 31,
                                           2014      2013         2012
Cash and due from financial institutions   $ 8,166   $ 8,572      $9,549
Federal funds sold                         30,095    28,490       25,250
Available for sale securities              54,675    51,633       46,639
Loans held for sale                        85        -            61
Loans                                      301,598   295,068      298,754
Allowance for loan losses                  (4,827)   (4,653)      (5,721)
Premises and equipment, net                10,970    11,054       11,568
Bank owned life insurance (BOLI)           7,853     7,806        7,587
Federal Home Loan Bank Stock, at cost      2,025     2,025        2,025
Accrued interest receivable                1,444     1,554        1,660
Deferred income taxes                      1,759     2,279        2,180
Intangible assets                          4,678     4,762        5,094
Other real estate owned                    631       833          191
Other assets                               976       752          1,719
 Total Assets                             $420,128  $410,175     $406,556
Deposits:
 Noninterest bearing                    $ 41,653  $ 39,967     $ 41,725
 Savings, NOW and money market          146,130   143,602      111,194
 Time                                   164,414   159,382      178,814
 Total deposits                       $352,197  $342,951     $331,733
FHLB advances and other borrowings         25,300    22,000       26,000
Subordinated debentures                    5,000     5,000        5,000
Accrued interest payable                   241       243          238
Other liabilities                          1,477     1,634        2,019
Total Liabilities                          384,215   371,828      364,990
6.5% Cumulative preferred stock            7,659     7,659        7,659
Series A preferred stock                   -         3,266        6,519
Common stock                               27,072    27,072       27,072
Retained earnings (deficit)                1,212     653          (430)
Accumulated other comprehensive income     (30)      (303)        746
(loss)
Total Stockholders' Equity                 35,913    38,347       41,566
Total Liabilities and Stockholders' Equity $420,128  $410,175     $406,556





Consolidated Financial Highlights (Unaudited)
In thousands, except per share data and ratios
                                          March 31, December 31, December 31,

                                          2014      2013         2012
Capital Ratios:
Tier 1 leverage                           8.86%     9.57%        10.20%
Tier 1 risk-based capital                 11.48%    12.56%       13.16%
Total risk based capital                  12.73%    13.81%       14.41%
Tangible equity ratio (1)                 7.51%     8.28%        9.08%
Tangible common equity ratio (1)          5.67%     5.59%        5.55%
Book value per common share               $14.35    $13.93       $13.91
Tangible book value per common share (1)  $11.97    $11.51       $11.32
Shares outstanding (in thousands)         1,969     1,969        1,969
_____________

    The tangible equity ratio, tangible common equity ratio and tangible book
    value per common share, while not required by accounting principles
    generally accepted in the United States of America (GAAP), are considered
(1) critical metrics with which to analyze banks. The ratio and per share
    amount have been included to facilitate a greater understanding of the
    Company's capital structure and financial condition. See the Regulation G
    Non-GAAP Reconciliation table for reconciliation of this ratio and per
    share amount to GAAP.



                                           March 31, December 31, December 31,
Regulation G Non-GAAP Reconciliation:
                                           2014      2013         2012
Total shareholders' equity (a)             $35,913   $38,348      $41,566
Less:
 Preferred stock                         (7,659)   (10,925)     (14,178)
Common equity (b)                          28,254    27,423       27,388
 Goodwill                                (4,097)   (4,097)      (4,097)
 Intangible assets                       (581)     (665)        (997)
Tangible common equity (c)                 23,576    22,661       22,294
Add:
 Preferred stock                         7,659     10,925       14,178
Tangible equity (d)                        $31,235   $33,586      $36,472
Total assets (e)                           $420,435  $410,175     $406,556
Less:
 Goodwill                                (4,097)   (4,097)      (4,097)
 Intangible assets                       (581)     (665)        (997)
Tangible assets (f)                        $415,757  $405,413     $401,462
Shares outstanding (in thousands) (g)      1,969     1,969        1,969
Book value per common share (b/g)          $14.35    $13.93       $13.91
Tangible book value per common share       $11.97    $11.51       $11.32
(c/g)
Total shareholders' equity to total        8.54%     9.35%        10.22%
assets ratio (a/e)
Tangible equity ratio (d/f)                7.51%     8.28%        9.08%
Tangible common equity ratio (c/f)         5.67%     5.59%        5.55%



SOURCE Citizens First Corporation

Contact: Todd Kanipe, CEO, tkanipe@citizensfirstbank.com; Steve Marcum, CFO,
smarcum@citizensfirstbank.com; Citizens First Corporation, 1065 Ashley Street,
Suite 150, Bowling Green, KY 42103, 270.393.0700
 
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