Community Bankers Trust Corporation Reports Results for First Quarter 2014

  Community Bankers Trust Corporation Reports Results for First Quarter 2014  Quarterly net income of $1.7 million is a 44.4% increase from the prior quarter and 30% from prior year  PR Newswire  RICHMOND, Va., April 25, 2014  RICHMOND, Va., April 25, 2014 /PRNewswire/ --Community Bankers Trust Corporation (the "Company") (NASDAQ: ESXB), the holding company for Essex Bank (the "Bank"), today reported results for the first quarter of 2014 including the following:    oNet income for the first quarter of 2014 was $1.7 million compared with     net income of $1.2 million for the fourth quarter of 2013, and net income     of $1.3 million for the first quarter of 2013.   oFully diluted earnings per common share were $0.08 for the first quarter     of 2014 compared with $0.04 for the fourth quarter of 2013 and $0.05 for     the first quarter of 2013.   oNoninterest expense for the quarter decreased $1.2 million, or 11.6%, on a     linked quarter basis and $533,000 year over year.   oNet charge-offs were $34,000 during the first quarter, marking the lowest     level in over four years. Annualized net charge-offs equaled only 0.02% of     average loans for the quarter ended March 31, 2014 versus 0.14% for the     fourth quarter of 2013 and 0.46% for the first quarter of 2013.   oAsset quality remained solid, and no provision for loan losses was     necessary. The ratio of the allowance for loan losses to total non-covered     loans remained sound at 1.75% at March 31, 2014.   oThe Company recently opened two new branches around the end of the first     quarter, in Annapolis, Maryland and at the new corporate headquarters in     the Deep Run office area in Richmond, Virginia.   oFollowing quarter end, on April 23, 2014, the Company repaid the remaining     $10,680,000 of its TARP preferred stock from the U.S. Department of the     Treasury. The Company funded the repurchase through a third-party loan.    Community Bankers Trust Corporation logo.  Rex L. Smith, III, President and Chief Executive Officer of the Company and the Bank, stated, "We are pleased with our first quarter results of continued improvement in net income. Historically, the first quarter is difficult, so todeliver such an improvement in profitability of 44.4% from the prior quarter is a great start to 2014. Our previously stated strategies have aligned the Company for further growth in earning assets while reducing non-interest expenses related to past credit problems."  Smith added, "While net loan growth was down in the first quarter from prepayments and sales of purchased USDA loans, our core non-covered loan portfolio increased by $5 million for the quarter. Total non-covered loan growth was 9.0%, or $48 million, over the last twelve months when excluding USDA loan balances and loans related to the Georgia franchise. Our loan pipeline is robust and we are extremely optimistic about our growth potential in all of our markets. Furthermore, we opened our Annapolis branch in the latter part of the quarter which enhances our ability to attract more business relationships and increases our visibility in the area. Additionally we repaid our outstanding TARP preferred stock investment from the United States Department of the Treasury through a third-party loan. As previously reported, the transactions will result in total expected after-tax savings of at least $750,000."  RESULTS OF OPERATIONS  Net income was $1.7 million for the first quarter of 2014 compared with $1.3 million in the first quarter of 2013 and $1.2 million in the fourth quarter of 2013. Net income available to common shareholders was $1.7 million in the first quarter of 2014 compared with $1.0 million in the first quarter of 2013 and $914,000 in the fourth quarter of 2013. Earnings per common share, basic and fully diluted, were $0.08 per share for the first quarter of 2014 compared with $0.05 per share for the first quarter of 2013 and $0.04 per share for the fourth quarter of 2013.  On a linked quarter basis net income increased $530,000, or 44.4%. While net interest income and non-interest income declined a combined $430,000, this amount was more than offset by a reduction in non-interest expenses of $1.2 million during the quarter. Expenses related to other real estate owned (OREO) declined $545,000, or 65.8%, and other operating expenses declined $430,000, or 24.9%, from the fourth quarter of 2013. The reduction in OREO expense was the direct result of fewer losses and write-downs on properties in that portfolio. Other operating expenses were lower in the first quarter of 2014 compared with the fourth quarter of 2013 as, effective January 1, 2014, the Company will no longer incur Delaware state franchise taxes.  The $399,000 increase in net income year over year was driven by a reduction in non-interest expenses of $533,000, or 5.5%. The most notable decline was evidenced in OREO expense, which equaled only $283,000 for the first quarter of 2014, declining $454,000, or 61.6%, from the same quarter in 2013. Management expects lower OREO expenses throughout 2014 as these properties have been continually re-evaluated and written-down or sold.  The following table presents summary income statements for the three months ended March 31, 2014, December 31, 2013 and March 31, 2013.  SUMMARY INCOME STATEMENT (Dollars in thousands)       For the three months ended                              March 31,        December 31,     March 31,                               2014             2013             2013 Interest income             $    11,879  $    12,217  $    12,166 Interest expense             1,570            1,644            1,894 Net interest income        10,309           10,573           10,272 Provision for loan losses    -                -                - Net interest income after provision  for loan losses            10,309           10,573           10,272 Noninterest income           1,301            1,467            1,326 Noninterest expense          9,178            10,386           9,711 Net income before income     2,432            1,654            1,887 taxes Income tax expense           709              461              563 Net income                  1,723            1,193            1,324 Dividends on preferred stock 65               235              221 Accretion of preferred stock -                44               58 discount Net income available  to common shareholders     $           $          $                                   1,658            914             1,045 EPS Basic                    $          $          $                                    0.08             0.04             0.05 EPS Diluted                  $          $          $                                    0.08             0.04             0.05  Interest Income  Interest income was $11.9 million for the first quarter of 2014, a decrease of $338,000, or 2.8%, from the fourth quarter of 2013. Interest and fees on loans declined very slightly, while interest income derived from the securities portfolio declined $294,000 on a linked quarter basis. The yield on the securities portfolio declined 34 basis points from 2.93% in the fourth quarter of 2013 to 2.59% in the first quarter of 2014. The primary reason for the decline was early pay-offs of SBA floating rate investments that were purchased at a premium. The increased pre-payment speeds resulted in an immediate absorption of unamortized premium which was fully expensed during the first quarter. Management subsequently sold part of its position in its SBA floater portfolio to mitigate further premium acceleration. Additionally, the average balance of the securities portfolio declined $5.5 million on a linked quarter basis.  Interest income declined $287,000 from $12.2 million during the first quarter of 2013. Interest income on the non-covered loan portfolio declined $460,000 while interest income on the covered portfolio increased $302,000. The yield on non-covered loans declined 46 basis points to 4.80%for the quarter endedMarch 31, 2014 from the same period a year ago. Continued competitive pricing for new loans precipitated this decline. The increase in income on covered loans was the direct result of two payments made on an acquisition, development, and construction loan. These payments aretreated as cash income as these pools had previously been written down to a zero carrying value. Interest income on the securities portfolio declined $132,000 when comparingthe quarter ended March 31, 2014 versus the same quarter a year ago. While the yield on the portfolio remained virtually unchanged, average securities balances were $18.6 million lower in the first quarter of 2014 than the same period in the prior year.  Interest Expense  Interest expense was $1.6 million for the first quarter of 2014, declining $74,000, or 4.5%, from the fourth quarter of 2013. The cost of interest bearing deposits remained unchanged at 0.69% for the first quarter of 2014 and the fourth quarter of 2013, yet average interest bearing deposits balances declined $42.1 million during the first quarter of 2014 primarily as a result of the sale of the Georgia operations in November 2013. The Company funded the sale in part with Federal Home Loan Bank (FHLB) advances and was able to realize an improvement in the cost of its FHLB borrowings of 12 basis points during the first quarter, to 0.80%.  Year over year, interest expense declined $324,000, from $1.9 million in the first quarter of 2013. Interest expense related to interest bearing deposits declined $293,000 or 17.2%. The average balances in these deposits declined $52.9 million year over year. This decline was primarily the result of the sale of the Georgia branches. Meanwhile, the Bank increased its level of FHLB borrowings to fund the sale. Over the same time frame, average FHLB advances increased $27.3 million, yet the expense associated with the borrowings declined $31,000. This was due to a 65 basis point improvement on all FHLB advances to 0.80% for the quarter ended March 31, 2014.  Net Interest Income  Net interest income was $10.3 million for the quarter ended March 31, 2014, compared with $10.6 million for the quarter ended December 31, 2013.This represents a decrease of $264,000, or 2.5%.The decline in net interest income on a linked quarter basis is the direct result of the factors noted above in the Interest Income section. The decline in interest income was partially offset by a $74,000 reduction in interest expense. The tax equivalent net interest margin increased 6 basis points from 4.22% in the fourth quarter of 2013 to 4.28% in the first quarter of 2014. Likewise, the interest spread increased from 4.17% to 4.23% on a linked quarter basis.  Year-over-year, net interest income increased slightly by $37,000, or 0.36%, as the Company's net interest margin improved 11 basis points over this time frame. The Company was able to maintain the same yield on its earning asset base at 4.93% while lowering its cost of funding 13 basis points to 0.70% for the quarter ended March 31, 2014. As mentioned in the Interest Expense section above, this was the result of improved funding costs related to FHLB advances.  The following table compares the Company's net interest margin, on a tax-equivalent basis, for the three months ended March 31, 2014, December 31, 2013 and March 31, 2013.  NET INTEREST MARGIN (Dollars in thousands)               For the three months ended                                      March 31,  December 31,  March 31,                                       2014       2013           2013 Average interest earning assets      $ 984,026  $  1,001,665   $ 1,006,528 Interest income                      $ 11,879   $  12,217      $ 12,166 Interest income - tax equivalent     $ 11,960   $  12,305      $ 12,243 Yield on interest earning assets       4.93%       4.87%         4.93% Average interest bearing liabilities $ 904,639  $  926,476     $ 929,483 Interest expense                     $ 1,570    $  1,644       $ 1,894 Cost of interest bearing liabilities   0.70%       0.70%         0.83% Net interest income                  $ 10,309   $  10,573      $ 10,272 Net interest income - tax equivalent $ 10,390   $  10,661      $ 10,349 Interest spread                        4.23%       4.17%         4.10% Net interest margin                    4.28%       4.22%         4.17%  Provision for Loan Losses  The Company did not record a provision for loan losses in 2013 or in the first quarter of 2014 with respect to either its non-covered loan portfolio or its FDIC covered loan portfolio. For the non-covered loan portfolio, this was the direct result of continued improvement in loan quality as evidenced by the lowest aggregate amount of net charge-offs in over four years. The Company's level of classified and "impaired" loans continue to remain low, as discussed below.  Noninterest Income  Noninterest income was $1.3 million for the first quarter of 2014 compared with $1.5 million for the fourth quarter of 2013. Gain on sales of securities was $355,000 in the first quarter of 2014, an increase of $283,000 over gain on sales of securities of $72,000 in the fourth quarter of 2013. This increase was more than offset by declines in service charge income and gain/(loss) on the sale of loans. Service charge income declined $145,000 during the first quarter of 2014 to equal $489,000. This decline was driven by the reduction of service charge income derived from the Georgia branches which the Bank received for part of the fourth quarter of 2013. Furthermore, prolonged periods of inclement weather during the first quarter of 2014 hampered account usage. Gain/(loss) on the sale of loans was down $207,000, or 81.2%, from the fourth quarter of 2013. Management recognized $48,000 on the sale of USDA guaranteed loans during the quarter, while the Company recognized the entire gain on the Georgia loan portfolio during the fourth quarter of 2013.  Year over year, noninterest income decreased $25,000, or 1.9%, from first quarter of 2013. Service charges on deposit accounts declined $174,000, or 26.2%, year over year due mostly to the sale of the Georgia branches. The reduction in service charge income was partially offset by increases in securities gains as well as gains on the sale of loans. Securities gains during the first quarter of 2014 were $77,000 higher than the same period in 2013. As mentioned above, management sold USDA loans resulting in $48,000 of gains for the quarter versus no loan sale gains in the first quarter of 2013.  Noninterest Expense  Noninterest expenses totaled $9.2 million for the three months ended March 31, 2014 and $10.4 million for the quarter ended December 31, 2013, a decrease of $1.2 million, or 11.6%. The majority of the decline was evidenced in three categories: OREO expenses, other operating expenses, and FDIC indemnification asset amortization. OREO expenses declined $545,000, or 65.8%, during the first quarter of 2014 from the fourth quarter of 2013. Management took additional charges in the fourth quarter to conservatively mark OREO properties. Smaller write-downs were recognized in the first quarter of 2014. Other operating expenses declined $430,000, or 24.9%. A large component of this decline was the final recognized expense of $188,000 to the state of Delaware for franchise taxes in the fourth quarter of 2013. Lastly, the Company benefitted from $142,000 in decreased indemnification asset amortization for the first quarter of 2014.  Noninterest expenses declined $533,000, or 5.5%, when comparing the first quarter of 2014 to the same period in 2013. The single largest decline was evidenced in OREO expenses. These expenses declined from $737,000 in the first quarter of 2013 to $283,000 in the first quarter of 2014. The overall OREO portfolio has been marked accordingly and fewer losses are expected for the rest of 2014.  Income Taxes  Income tax expense was $709,000 for the three months ended March 31, 2014, compared with income tax expense of $461,000 in the fourth quarter of 2013. Income tax expense was $563,000 in the first quarter of 2013.  FINANCIAL CONDITION  During the first quarter of 2014, total assets increased $12.2 million to $1.102 billion at March 31, 2014. Total assets declined $15.4 million, or 1.4%, over the past year from total assets of $1.117 billion at March 31, 2013. Total loans were $665.5million at March 31, 2014, decreasing $4.0 million since December 31, 2013 and increasing $3.3 million since March 31, 2013.Total non-covered loans were $593.8 million at March 31, 2014 and $596.3 million at December 31, 2013. While traditional non-covered loan growth was positive at $4.8 million during the first quarter of 2014, the purchased government guaranteed USDA loan portfolio declined approximately $7.4 million from year end. This decline was the result of a combination of pre-payments on USDA loans as well as management selling USDA loans at gains to optimize yield.  Year over year, non-covered loan growth of $13.8 million outpaced covered loan decreases of $10.5 million. Excluding the aforementioned reduction of USDA loans during the first quarter of 2014, traditional loan growth was brisk for the year, and management expects continued solid traditional loan growth throughout 2014.  The following table shows the composition of the Company's non-covered loan portfolio at March 31, 2014, December 31, 2013 and March 31, 2013.  NON-COVERED LOANS (Dollars in           March 31, 2014     December 31, 2013  March 31, 2013 thousands)                                  % of               % of               % of                                  Non-               Non-               Non-                       Amount             Amount             Amount                                  Covered            Covered            Covered                                   Loans              Loans              Loans Mortgage loans on real estate:    Residential 1-4    $ 146,069  24.60%  $ 144,382  24.21%  $ 137,302  23.68%    family    Commercial           254,666  42.89%    247,284  41.47%    239,794  41.35%    Construction and     54,914   9.25%     55,278   9.27%     60,565   10.44%    land development    Second mortgages     6,623    1.12%     6,854    1.15%     7,326    1.26%    Multifamily          35,528   5.98%     35,774   6.00%     36,344   6.27%    Agriculture          8,134    1.37%     9,565    1.60%     9,616    1.66%     Total real        505,934  85.21%    499,137  83.70%    490,947  84.66%    estate loans Commercial loans        80,942   13.63%    90,142   15.12%    80,942   13.96% Consumer installment    5,492    0.92%     5,623    0.94%     6,523    1.12% loans All other loans         1,430    0.24%     1,435    0.24%     1,524    0.26%     Gross loans       593,798  100.00%   596,337  100.00%   579,936  100.00% Allowance for loan      (10,410)           (10,444)           (12,258) losses Net unearned income/unamortized premium    on loans             (188)              (164)              (129) Non-covered loans, net of unearned       $ 583,200          $ 585,729          $ 567,549 income  The Company's securities portfolio, excluding equity securities, increased $3.6 million, or 1.2%, from $294.3 million at December 31, 2013 to $298.0 million at March 31, 2014. Realized gains of $355,000 occurred during the first quarter of 2014 through sales and call activity. As mentioned earlier in this release, the SBA floating rate portion of the investment portfolio evidenced some unforeseen pre-payment activity during the first quarter, which resulted in the acceleration of unamortized premiums paid on these securities. Subsequently, management sold additional SBA floating rate securities to mitigate the pre-payment anomaly and sold some longer term municipal securities. This was a strategic decision to mitigate duration risk in the municipal portfolio.  The Company had cash and cash equivalents of $38.9 million and $23.8 million at March 31, 2014 and December 31, 2013, respectively. Cash and cash equivalents were $24.1 million at March 31, 2013. There were no Federal funds purchased or securities sold under agreement to repurchase (repos) at March 31, 2014 versus $6.0 million of repos at December 31, 2013.  The following table shows the composition of the Company's securities portfolio, excluding equity securities, at March 31, 2014, December 31, 2013 and March 31, 2013.  SECURITIES PORTFOLIO (Dollars in           March 31, 2014        December 31, 2013      March 31, 2013 thousands)              Amortized  Fair   Amortized   Fair   Amortized   Fair              Cost       Value    Cost        Value    Cost        Value Securities Available for Sale U.S. Treasury issue and other  U.S. Government $ 107,485     106,628 $ 99,789     $ 98,987  $ 121,353    $ 121,355 agencies U.S. Government   -           -         487          486       -            - sponsored agencies State, county and   133,226     131,864   138,884      134,096   117,964      123,059 municipal Corporate and other    5,502       5,490     6,369        6,349     5,453        5,519 bonds Mortgage backed securities - U.S. Government          2,602       2,477     3,608        3,439     10,996       11,272 agencies Mortgage backed securities - U.S. Government  sponsored    25,126      24,886    22,631       22,420    12,634       12,885 agencies  Total securities $ 273,941     271,345 $ 271,768    $ 265,777 $ 268,400    $ 274,090 available for sale              March 31, 2014        December 31, 2013      March 31, 2013              Amortized  Fair     Amortized   Fair     Amortized   Fair              Cost       Value    Cost        Value    Cost        Value Securities Held to Maturity State, county and $ 9,069       9,769   $ 9,385      $ 10,103  $ 11,819     $ 12,865 municipal Mortgage backed securities - U.S. Government          6,202       6,574     6,604        7,002     8,360        8,923 agencies Mortgage backed securities - U.S. Government  sponsored    11,354      11,973    12,574       13,200    18,498       19,534 agencies  Total securities $ 26,625      28,316  $ 28,563     $ 30,305  $ 38,677     $ 41,322 held to maturity  Interest bearing deposits at March 31, 2014 were $831.2 million, an increase of $9.0million from December31, 2013. Total time deposits increased $13.8 million, or 2.5%, during the first quarter of 2014. NOW and MMDA account balances declined $3.5 million and $3.1 million, respectively, during the first quarter. The increase in time deposits was generated by two promotions that management ran during the first quarter of 2014. These were efforts to replace brokered time deposits obtained during the fourth quarter of 2013 to replace the sale of the Georgia deposit base.  FHLB advances were $76.9 million at March 31, 2014 compared with $77.1 million at December 31, 2013, and $49.7 million at March 31, 2013. The Company has increased the level of FHLB advances due to the low cost nature of this funding source and to assist with funding the sale of the Georgia franchise in the fourth quarter of 2013.  The following table compares the mix of interest bearing deposits for March 31, 2014, December 31, 2013 and March 31, 2013.  INTEREST BEARING DEPOSITS (Dollars in thousands)                            March 31, 2014   December 31, 2013   March 31, 2013 NOW                      $ 98,594         $ 102,111           $ 126,784 MMDA                       91,077           94,170              112,473 Savings                    76,950           75,159              79,988 Time deposits less than    242,139          235,482             284,936 $100,000 Time deposits $100,000     322,473          315,287             256,547 and over  Total interest        $ 831,233        $ 822,209           $ 860,728 bearing deposits  Shareholders' equity was $110.6 million at March 31, 2014 and $106.7 million at December 31, 2013. The change in equity was driven by earnings retention as well as a $2.2 million improvement in other comprehensive income related to the gains and losses in the investment portfolio.  Asset Quality – non-covered assets  Nonaccrual loans were $12.6 million at March 31, 2014, increasing slightly from $12.1 million at December 31, 2013. Nonaccrual loans were $19.0 million at March 31, 2013. The $540,000 increase from December 31, 2013 was the net result of $1.4 million in additions to nonaccrual loans and $836,000 in reductions. With respect to the reductions to nonaccrual loans, $400,000 were returned to accruing status, $113,000 were charged off, and $323,000 were the result of payments to existing credits.  Total nonperforming assets of $18.1 million at March 31, 2014 represented a decrease of $265,000 from December 31, 2013. The decline in non-performing assets was evidenced by an $805,000 reduction in non-covered OREO balances from year end 2013. Management continues to work OREO aggressively and has taken prudent periodic write-downs to effectively move properties out of the portfolio and continue to improve the quality of the balance sheet.  There were net charge-offs of $34,000 in the first quarter of 2014 compared with $209,000 in the fourth quarter of 2013 and $662,000 in the first quarter of 2013.  The allowance for loan losses equaled 82.33% of non-covered nonaccrual loans at March 31, 2014 compared with 86.28% at December 31, 2013, and 64.64% at March 31, 2013. The ratio of the allowance for loan losses to total nonperforming assets was 57.56% at March 31, 2014 compared with 56.92% at December 31, 2013 and 42.07% at March 31, 2013. The ratio of nonperforming assets to loans and other real estate owned continued to decline. The ratio was 3.01% at March 31, 2014 and 3.05% at December 31, 2013.  The following table reconciles the activity in the Company's non-covered allowance for loan losses, by quarter, for the past five quarters.  CREDIT QUALITY (Dollars in thousands)     2014      2013                            First     Fourth    Third      Second     First                            Quarter   Quarter   Quarter    Quarter    Quarter Allowance for loan losses: Beginning of period        $ 10,444  $ 10,653  $ 11,523   $ 12,258   $ 12,920 Provision for loan losses    -         -         -          -          - Charge-offs                  (152)     (263)     (1,018)    (1,302)    (908) Recoveries                   118       54        148        567        246 Net (charge-offs) recovery   (34)      (209)     (870)      (735)      (662) End of period              $ 10,410  $ 10,444  $ 10,653   $ 11,523   $ 12,258  The following table sets forth selected asset quality data, excluding FDIC covered assets, and ratios for the dates indicated:  ASSET QUALITY (NON-COVERED) (Dollars in thousands)       2014      2013                              March     December  September  June      March                              31        31        30         30        31 Non-accruing loans           $ 12,645  $ 12,105  $  13,044  $ 15,644  $ 18,963 Loans past due over 90 days    -         -          -         -         465 and accruing interest Total nonperforming            12,645    12,105     13,044    15,644    19,428 non-covered loans Other real estate owned        5,439     6,244      8,496     7,593     9,712 non-covered Total nonperforming          $ 18,084  $ 18,349  $  21,540  $ 23,237  $ 29,140 non-covered assets Allowance for loan losses to   1.75%     1.75%      1.87%     1.96%     2.11% loans Allowance for loan losses to   57.56%    56.92%     49.45%    49.59%    42.07% nonperforming assets Allowance for loan losses to   82.33%    86.28%     81.67%    73.66%    64.64% nonaccrual loans Nonperforming assets to        3.02%     3.05%      3.73%     3.90%     4.94% loans and other real estate Net charge-offs for quarter to average loans,  annualized                  0.02%     0.14%      0.59%     0.50%     0.46%  A further breakout of nonaccrual loans, excluding covered loans, at March 31, 2014, December 31, 2013 and March 31, 2013 is below:  NON-COVERED NONACCRUAL LOANS (Dollars in         March 31, 2014      December 31, 2013   March 31, 2013 thousands)                              % of Non-           % of Non-           % of Non-                      Amount   Covered    Amount   Covered    Amount   Covered                               Loans               Loans               Loans Mortgage loans on real estate:  Residential 1-4    $ 4,153  0.70%      $ 4,229  0.71%      $ 5,717  0.99%  family  Commercial           2,208  0.37%        1,382  0.23%        3,853  0.67%  Construction and     5,907  0.99%        5,882  0.99%        8,772  1.51%  land development  Second mortgages     225    0.04%        225    0.04%        141    0.02%  Multifamily          -      -          - -      -            -      -  Agriculture          -      -            205    0.03%        234    0.04%   Total real        12,493 2.10%        11,923 2.00%        18,717 3.23%  estate loans Commercial loans      57     0.01%        127    0.02%        161    0.03% Consumer              95     0.02%        55     0.01%        85     0.01% installment loans All other loans       -      -            -      -            -      -   Gross loans     $ 12,645 2.13%      $ 12,105 2.03%      $ 18,963 3.27%  Capital Requirements  Total shareholders' equity increased $4.0 million in the first quarter of 2014 and was $110.6 million at March 31, 2014. The Company's ratio oftotal risk-based capital was 17.3% at March 31, 2014 compared with 16.8% at December 31, 2013. The tier 1 risk-based capital ratio was 16.1% at March 31, 2014 and 15.6% at December 31, 2013. The Company's tier 1 leverage ratio was 10.1% at March 31, 2014 and 9.5% at December 31, 2013.All capital ratios exceed regulatory minimums to be considered well capitalized.  Following quarter end, on April 23, 2014, the Company repaid the remaining $10,680,000 of its TARP preferred stock from the U.S. Department of the Treasury. The Company funded the repurchase through a third-party loan. All Capital ratios will remain well above regulatory minimums upon the retirement of this TARP Capital.  Earnings Conference Call and Webcast  The Company will host a conference call for the financial community on Friday, April 25, 2014, at 10:00 a.m. Eastern Time to discuss the first quarter 2014 financial results. The public is invited to listen to this conference call by dialing877-870-4263 at least five minutes prior to the call. Interested parties may also listen to this conference call through the internet by accessing the "Corporate Overview – Corporate Profile" page of the Company's internet site at www.cbtrustcorp.com.  A replay of the conference call will be available from 12:00 noon Eastern Time on April 25, 2014, until 9:00 a.m. Eastern Time on May 5, 2014. The replay will be available by dialing 877-344-7529 and entering access code 10044104 or through the internet by accessing the "Corporate Overview – Corporate Profile" page of the Company's internet site at www.cbtrustcorp.com.  About Community Bankers Trust Corporation and Essex Bank  Community Bankers Trust Corporation is the holding company for Essex Bank, a Virginia state bank with 21 full-service offices, 14 of which are in Virginia and seven of which are in Maryland. The Bank also operates two loan production offices in Virginia. The Bank opened a new branch office in Annapolis, Maryland on March 25, 2014 and a branch office at its new headquarters in Richmond, Virginia on April 7, 2014.  Additional information on the Bank is available on the Bank's website at www.essexbank.com. For information on Community Bankers Trust Corporation, please visit its website at www.cbtrustcorp.com.  Forward-Looking Statements  This release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. These forward-looking statements include, without limitation, statements with respect to the Company's operations, performance, future strategy and goals. Actual results may differ materially from those included in the forward-looking statements due to a number of factors, including, without limitation, the effects of and changes in the following: the quality or composition of the Company's loan or investment portfolios, including collateral values and the repayment abilities of borrowers and issuers; assumptions that underlie the Company's allowance for loan losses; general economic and market conditions, either nationally or in the Company's market areas; the interest rate environment; competitive pressures among banks and financial institutions or from companies outside the banking industry; real estate values; the demand for deposit, loan, and investment products and other financial services; the demand, development and acceptance of new products and services; the performance of vendors or other parties with which the Company does business; time and costs associated with de novo branching, acquisitions, dispositions and similar transactions; the realization of gains and expense savings from acquisitions, dispositions and similar transactions; assumptions and estimates that underlie the accounting for loan pools under the shared-loss agreements; consumer profiles and spending and savings habits; levels of fraud in the banking industry; the level of attempted cyber attacks in the banking industry; the securities and credit markets; costs associated with the integration of banking and other internal operations; the soundness of other financial institutions with which the Company does business; inflation; technology; and legislative and regulatory requirements. Many of these factors and additional risks and uncertainties are described in the Company's Annual Report on Form 10-K for the year ended December 31, 2013 and other reports filed from time to time by the Company with the Securities and Exchange Commission. This press release speaks only as of its date, and the Company disclaims any duty to update the information in it.  Consolidated Balance Sheets Unaudited Condensed (Dollars in thousands)                              March 31, 2014  December 31, 2013  March 31, 2013  Assets Cash and due from banks      $   11,139      $    10,857        $   10,477 Interest bearing bank            27,782           12,978            13,591 deposits  Total cash and cash            38,921           23,835            24,068 equivalents Securities available for         271,345          265,777           274,090 sale, at fair value Securities held to maturity      26,625           28,563            38,677 Equity securities,               7,772            8,358             7,198 restricted, at cost  Total securities               305,742          302,698           319,965 Loans held for sale              -                100               1,145 Loans not covered by FDIC        593,610          596,173           579,807 shared-loss agreements Loans covered by FDIC            71,860           73,275            82,364 shared-loss agreements Allowance for loan losses        (10,410)         (10,444)          (12,258) (non-covered) Allowance for loan losses        (484)            (484)             (484) (covered)  Net loans                      654,576          658,520           649,429 Bank premises and equipment      29,139           27,872            33,237 Other real estate owned,         5,439            6,244             9,712 non-covered Other real estate owned,         3,211            2,692             2,483 covered by FDIC FDIC receivable                  433              368               750 Bank owned life insurance        20,956           20,795            20,274 Core deposit intangibles,        6,144            6,621             9,731 net FDIC indemnification asset       23,846           25,409            31,517 Other assets                    13,295           14,378            14,790  Total assets             $   1,101,702   $    1,089,532     $   1,117,101  Liabilities Deposits:  Noninterest bearing          73,935           70,132            81,330  Interest bearing             831,233          822,209           860,728  Total deposits             905,168          892,341           942,058 Federal funds purchased and securities sold under            -                6,000             992  agreements to repurchase Federal Home Loan Bank           76,946           77,125            49,654 advances Trust preferred capital          4,124            4,124             4,124 notes Other liabilities                4,817            3,283             3,938  Total liabilities            991,055          982,873           1,000,766  Shareholders' Equity Preferred stock (5,000,000 shares authorized $0.01 par  value; 10,680, 10,680 and        10,680           10,680            17,680 17,680 shares issued and  outstanding, respectively) Discount on preferred       -                -                 (176) stock Warrants on preferred       1,037            1,037             1,037 stock Common stock (200,000,000 shares authorized $0.01  par value; 21,720,221 shares     217              217               218 issued and outstandingat  March 31, 2014) Additional paid in capital       144,747          144,656           144,463 Accumulated deficit              (44,163)         (45,822)          (49,564) Accumulated other                (1,871)          (4,109)           2,677 comprehensive income  Total shareholders'       $   110,647     $    106,659       $   116,335 equity  Total liabilities and     $   1,101,702   $    1,089,532     $   1,117,101 shareholders' equity      Consolidated Statements of Income Unaudited Condensed                                Three  (Dollars in thousands)         months Three months ended                                 ended                                March    December   September   June     March                                31,     31,        30,         30,      31,                                 2014     2013       2013        2013     2013 Interest and dividend income Interest and fees on loans $ 7,051  $ 7,050    $ 7,513     $ 7,622  $ 7,511 Interest and fees on FDIC     2,961    2,994      3,538       2,745    2,659 covered loans Interest on federal funds     -        -          -           1        2 sold Interest on deposits in       13       25         11          14       8 other banks Investments (taxable)        1,698    1,976      1,934       1,945    1,838 Investments (nontaxable)     156      172        175         164      148 Total interest income        11,879   12,217     13,171      12,491   12,166 Interest expense Interest on deposits         1,408    1,501      1,568       1,600    1,701 Interest on short-term        1        -          1           2        1 borrowings Interest on other borrowed    161      143        180         189      192 funds Total interest expense       1,570    1,644      1,749       1,791    1,894 Net interest income          10,309   10,573     11,422      10,700   10,272 Provision for loan losses    -        -          -           -        - Net interest income after provision for loan             10,309   10,573     11,422      10,700   10,272  losses Noninterest income Gain/(loss) on sale of        355      72         38          130      278 securities, net Service charges on deposit    489      634        741         701      663 accounts Gain/(loss) on sale of        48       255        (614)       -        - other loans, net Other                       409      506        428         507      385  Total         1,301    1,467      593         1,338    1,326 noninterest income Noninterest expense Salaries and employee         3,923    3,991      4,096       3,901    3,993 benefits Occupancy expenses           648      647        690         717      663 Equipment expenses           219      248        276         247      267 Legal fees                   28       20         24          38       13 Professional fees            107      49         52          139      50 FDIC assessment              207      228        225         223      167 Data processing fees         494      505        485         551      537 FDIC indemnification asset    1,498    1,640      1,716       1,592    1,501 amortization Amortization of               477      506        565         566      565 intangibles Other real estate expenses   283      828        (33)        502      737 Other operating expenses     1,294    1,724      1,337       1,282    1,218 Total noninterest expense    9,178    10,386     9,433       9,758    9,711 Net income before income      2,432    1,654      2,582       2,280    1,887 taxes Income tax expense           709      461        800         673      563 Net income                   1,723    1,193      1,782       1,607    1,324 Dividends on preferred        65       235        208         221      221 stock Accretion of discount on      -        44         73          59       58 preferred stock Net income available to common  shareholders            $ 1,658  $ 914      $ 1,501     $ 1,327  $ 1,045    NET INTEREST MARGIN ANALYSIS AVERAGE BALANCE SHEETS (Dollars in thousands)                   Three months ended March 31,    Three months ended December     Three months ended March 31,                   2014                            31, 2013                        2013                                          Average                         Average                         Average                   Average      Interest  Rates    Average      Interest  Rates    Average      Interest  Rates                   Balance      Income/   Earned/  Balance      Income/   Earned/  Balance      Income/   Earned/                   Sheet        Expense   Paid     Sheet        Expense   Paid     Sheet        Expense   Paid ASSETS:  Loans, including $ 595,614    $ 7,051   4.80%    $ 585,461    $ 7,050   4.78%    $ 579,635    $ 7,511   5.26%  fees  Loans covered by   72,770       2,961   16.50%     75,252       2,994   15.79%     82,776       2,659   13.03%  FDIC loss share   Total loans   668,384      10,012  6.08%      660,713      10,044  6.03%      662,411      10,170  6.23%  Interest bearing   16,309       13      0.31%      35,304       25      0.28%      16,402       8       0.20%  bank balances  Federal funds      -            -       -          783          0       0.10%      9,811        2       0.10%  sold  Investments        279,295      1,698   2.43%      283,516      1,976   2.79%      300,001      1,838   2.45%  (taxable)  Investments (tax   20,038       237     4.71%      21,349       260     4.88%      17,903       225     5.02%  exempt)   Total         984,026      11,960  4.93%      1,001,665    12,305  4.87%      1,006,528    12,243  4.93%  earning assets  Allowance for      (10,955)                        (11,133)                        (13,470)  loan losses  Non-earning        113,705                         128,596                         132,378  assets   Total       $ 1,086,776                     $ 1,119,128                     $ 1,125,436  assets LIABILITIES AND  SHAREHOLDERS'  EQUITY  Demand -         $ 190,804    $ 142     0.30%    $ 220,656    $ 168     0.30%    $ 245,714    $ 191     0.32%  interest bearing  Savings            75,601       66      0.35%      79,572       70      0.35%      78,377       62      0.32%  Time deposits      555,867      1,200   0.88%      564,191      1,263   0.89%      551,125      1,448   1.07%   Total         822,272      1,408   0.69%      864,419      1,501   0.69%      875,216      1,701   0.79%  deposits  Short-term         1,134        1       0.51%      107          -       0.00%      329          1       0.72%  borrowings  FHLB and other     81,233       161     0.80%      61,950       143     0.92%      53,938       192     1.45%  borrowings   Total  interest-bearing   904,639      1,570   0.70%      926,476      1,644   0.70%      929,483      1,894   0.83%  liabilities  Non-interest       68,594                          80,172                          75,551  bearing deposits  Other              3,921                           3,874                           4,117  liabilities   Total         977,154                         1,010,522                       1,009,151  liabilities  Shareholders'      109,622                         108,606                         116,285  equity   Total  liabilities and    stockholders'    $ 1,086,776                     $ 1,119,128                     $ 1,125,436  equity  Net interest                  $ 10,390                        $ 10,661                        $ 10,349  earnings  Interest spread                         4.23%                           4.17%                           4.10%  Net interest                            4.28%                           4.22%                           4.17%  margin  Non-GAAP Financial Measures  The information below presents certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (GAAP). Common tangible book value equals total shareholders' equity less preferred stock, goodwill and identifiable intangible assets, and common tangible book value per share is computed by dividing common tangible book value by the number of common shares outstanding. Common tangible assets equal total assets less preferred stock, goodwill and identifiable intangible assets.  Management believes that common tangible book value and the ratio of common tangible book value to common tangible assets are meaningful because they are some of the measures that the Company and investors use to assess capital adequacy. Management believes that presenting the change in common tangible book value per share, the change in stock price to common tangible book value per share, and the change in the ratio of common tangible book value to common tangible assets provide meaningful period-to-period comparisons of these measures.  These measures are a supplement to GAAP used to prepare the Company's financial statements and should not be viewed as a substitute for GAAP measures. In addition, the Company's non-GAAP measures may not be comparable to non-GAAP measures of other companies. The following table reconciles these non-GAAP measures from their respective GAAP basis measures.                   March 31,           December 31,        March 31,                   2014                2013                 2013  Common Tangible  Book Value  Total           $                $                 $     stockholder's   110,647,000         106,659,000          116,335,000  equity  Preferred stock 11,717,000          11,717,000           18,541,000  (net)  Core deposit  intangible      6,144,000           6,621,000            9,731,000  (net)  Common tangible 92,786,000          88,321,000           88,063,000  book value  Shares          21,720,221          21,709,096           21,682,963  outstanding  Common tangible $           $            $          book value per   4.27              4.07               4.06  share  Stock Price     $           $            $                           4.02              3.76               3.29  Price/common    94.1%               92.4%                81.0%  tangible book  Common tangible  book/common  tangible assets  Total assets    $                  $  1,089,532,000   $  1,117,101,000                  1,101,702,000  Preferred stock 11,717,000          11,717,000           18,541,000  (net)  Core deposit    6,144,000           6,621,000            9,731,000  intangible  Common tangible 1,083,841,000       1,077,194,000        1,088,829,000  assets  Common tangible 92,786,000          88,321,000           88,063,000  book  Common tangible  equity to       8.56%               8.20%                8.09%  assets    Logo - http://photos.prnewswire.com/prnh/20140129/PH54398LOGO  SOURCE Community Bankers Trust Corporation  Website: http://www.cbtrustcorp.com Contact: Bruce E. Thomas, Executive Vice President/Chief Financial Officer, Community Bankers Trust Corporation, 804-934-9999  
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