SOURCE: Birmingham Bloomfield Bancshares, Inc.

October 28, 2013 16:09 ET

Birmingham Bloomfield Bancshares, Inc. Announces Record Results for Period Ended September 30, 2013

BIRMINGHAM, MI--(Marketwired - Oct 28, 2013) - Birmingham Bloomfield Bancshares, Inc. (OTCQB: BBBI) ("the Company"), the holding company for Bank of Birmingham, today announced unaudited results for the quarter and nine month periods ended September 30, 2013. The Company generated record income on a pre-tax, pre-provision basis as a result of significant growth in earning assets.

The Company reported net income of $268,000 or $0.15 per common share for the third quarter of 2013 compared to net income of $138,000 or $0.08 per common share for the same period of 2012. Net income for the nine month period ended September 30, 2013 was $787,000 or $0.43 per common share compared to $682,000 or $0.38 per common share for the same period last year.

Chief Executive Officer, Rob Farr, issued the results and commented, "The performance produced record earnings on a pre-tax, pre-provision basis, and net income increased 15.3% compared to 2012. Total assets have increased 23.0% on a year over year basis and total loans reached $151.5 million as the end of the third quarter. The growth has translated to an increase in the earnings capacity of the balance sheet and our net interest margin still remains strong despite the competitive pricing environment in our local markets. We continue to focus on opportunities to improve the core profitability of the Bank and increase franchise value."

Results of Operation

The Company reported net interest income of $1.752 million for the third quarter of 2013, a 16.3% increase relative to the same quarter of 2012. Net interest margin for the quarter was 4.36% compared to 4.50% for the most recent linked quarter and 4.65% for the third quarter of 2012. The margin compression is a result of the changing product mix of the balance sheet and competitive pricing environment. Net interest income for the first nine months of 2013 increased 13.0% to $4.967 million relative to the same period of 2012. The improvement was the result of portfolio loan growth and a modest reduction in total funding costs.

The Company provided $180,000 in provision expense during the third quarter of 2013, a decrease of $150,000 compared to the same period last year. Total provision expense for the year to date period ending September 30, 2013 was $280,000, compared to $400,000 for the nine month period in 2012. The current year provision expense was specifically related to new loan volume. Net loan charges offs for the year to date period totaled $336,000.

Total non-interest income for the third quarter of 2013 was $210,000, compared to $300,000 for the same period of 2012. The decrease was a function of reduced loan volume related to commercial SBA and residential mortgage loans sold in the secondary market. Total non-interest income for the year to date period ending September 30, 2013 was $610,000, a decrease of $286,000 from the prior period. The reduction in revenue was a result of a decline in mortgage and SBA loan activity. In addition, the Company recognized a $150,000 gain in 2012 related to the sale of an ORE property.

Total non-interest expense for the third quarter of 2013 was $1.358 million, compared to $1.394 million for the most recent linked quarter and $1.248 million for the same period of 2012. The quarter over quarter decline in expenses for 2013 was a result of focused efforts by the Company to improve efficiency and lower the operating cost burden. Year to date non-interest expense for 2013 was $4.054 million, an increase of $251,000 relative to 2012. The increase in expenses are a result of the Company's growth, specifically hiring new personnel, expanding infrastructure capacity and investments in new products and applications.

Balance Sheet

Total assets as of September 30, 2013 were $182.7 million, an increase of 23.0% from the prior year and 19.6% from December 31, 2012. The growth was a result of improved market penetration due to focused business development efforts and expanded product options. Total portfolio loans reached $151.5 million at the end of the current quarter, an increase of $13.5 million from the most recent linked quarter and 27.9% or $33.1 million from September 30, 2012. The increase was primarily concentrated in commercial real estate, mortgage related loans and commercial leases. The asset quality of the Company remains solid, total non-performing loans have declined and the allowance for loan loss was 1.31% of total portfolio loans as the end of the period. Total deposits as of September 30, 2013 were $163.8 million, an increase of 24.9% from the prior year. The growth was a function of our expanded presence in the community, targeted marketing programs and increased activity in the wholesale market. The Bank continues to be classified as well capitalized based on regulatory guidelines with a Tier 1 ratio of 8.71% and remains a 5-Star rated institution from Bauer Financial.

Birmingham Bloomfield Bancshares, Inc. is the holding company for Bank of Birmingham, a full-service community bank serving Oakland County. Bank of Birmingham is dedicated to providing financial services to small and medium sized businesses; their owners and employees; professionals; and individuals who work or reside in the Oakland County market area. Every Bank of Birmingham customer has a relationship manager who serves a single point of contact empowered to provide all the bank's services. Birmingham Bloomfield Bancshares, Inc. marketmakers include Raymond James, Chicago; Monroe Securities, Chicago; Boenning & Scattergood, Philadelphia; Stockcross Financial Services.

Forward-Looking Statements

This news release contains comments or information that constitute forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995), which involve significant risks and uncertainties. Actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include: changes in interest rates and interest-rate relationships; changes in the national and local economy; demand for products and services; the degree of competition by traditional and non-traditional competitors; changes in banking regulations; changes in tax laws; changes in prices, levies, and assessments; our ability to successfully integrate acquisitions into our existing operations, and the availability of new acquisitions, joint ventures and alliance opportunities; the impact of technological advances; governmental and regulatory policy changes; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; and other factors. The Company assumes no responsibility to update forward-looking statements.

(Unaudited Consolidated Financial Statements Follow)

   
   
Birmingham Bloomfield Bancshares, Inc.  
Consolidated Balance Sheet (Unaudited)  
                   
    September 30,     December 31,     September 30,  
    2013     2012     2012  
ASSETS                        
    Cash and due from banks   $ 23,426,914     $ 15,539,072     $ 20,841,410  
    Federal funds sold     -       -       -  
  Total cash and cash equivalents     23,426,914       15,539,072       20,841,410  
                           
    Securities available-for-sale     3,007,173       3,725,923       3,837,942  
    Securities held-to-maturity     -       -       -  
    Federal Home Loan Bank Stock     248,000       218,100       218,100  
  Total securities     3,255,173       3,944,023       4,056,042  
                           
  Loans held for sale     -       -       -  
                           
  Portfolio loans                        
    Consumer loans     1,692,481       1,801,991       1,380,152  
    Mortgage loans     18,260,586       16,203,001       16,222,484  
    Commercial leases     11,759,921       1,346,177       -  
    Commercial loans     119,810,689       108,926,273       100,837,254  
  Total loans     151,523,677       128,277,442       118,439,890  
    Less: Allowance for loan loss     1,988,587       2,044,350       1,974,350  
  Net loans     149,535,090       126,233,092       116,465,540  
                           
    Premises and equipment, net     1,148,428       1,277,802       1,326,624  
    Bank owned life insurance     2,238,172       2,182,513       2,162,296  
    Accrued interest receivable and other assets     3,088,983       3,596,576       3,644,739  
                           
  TOTAL ASSETS   $ 182,692,760     $ 152,773,078     $ 148,496,651  
                         
                         
                         
LIABILITIES                        
  Deposits                        
    Noninterest-bearing   $ 30,224,120     $ 23,947,132     $ 21,733,611  
    Interest-bearing     133,611,792       110,955,051       109,413,057  
  Total deposits     163,835,912       134,902,183       131,146,668  
                           
    Short term borrowings     -       -       -  
    Accrued interest payable, taxes and other liabilities     1,048,141       867,356       667,533  
  Total liabilities     164,884,053       135,769,539       131,814,201  
                         
SHAREHOLDERS' EQUITY                        
    Senior preferred stock, series D     4,621,000       4,621,000       4,621,000  
    Common Stock, no par value     17,163,818       17,105,618       17,105,618  
      Authorized - 9,000,000 shares, Issued and outstanding - 1,836,662                        
      1,824,662 and 1,824,662 shares respectively                        
    Accumulated other comprehensive income     36,490       76,066       91,669  
    Additional paid in capital - share based payments     493,154       493,154       493,154  
    Accumulated deficit     (4,505,755 )     (5,292,299 )     (5,628,991 )
  Total shareholders' equity     17,808,707       17,003,539       16,682,451  
                           
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 182,692,760     $ 152,773,078     $ 148,496,651  
                         
Book value per share   $ 7.18     $ 6.74     $ 6.61  
                         
                         
                         
Birmingham Bloomfield Bancshares, Inc.
Consolidated Statement of Income (Unaudited)
 
    For the three months ended   For the nine months ended
    September 30,   September 30,
    2013   2012   2013   2012
Interest Income                        
    Interest and fees on loans                        
      Commercial loans   $ 1,612,221   $ 1,507,071   $ 4,632,213   $ 4,422,140
      Commercial leases     134,191     -     260,245     -
      Installment loans     25,525     18,358     84,820     52,636
      Mortgage loans     104,106     69,602     291,028     181,095
      Home Equity loans     87,101     90,632     259,595     278,370
      Late charges and fees     6,034     28,230     32,218     62,483
  Total loan interest and fee income     1,969,178     1,713,893     5,560,119     4,996,724
                           
    Interest bearing deposits     8,477     7,317     23,453     13,907
    Federal Funds Sold     -     -     -     -
                             
    Interest on investment securities                        
      Taxable     19,691     23,309     63,395     72,249
      Tax-exempt     961     992     2,906     3,000
  Total investment income     20,652     24,301     66,301     75,249
                           
  Total interest income     1,998,307     1,745,511     5,649,873     5,085,880
                         
Interest Expense                        
    Interest on deposits     246,129     238,608     682,739     689,555
    Interest on borrowed funds     -     -     -     64
  Total interest expense     246,129     238,608     682,739     689,619
                           
  Net Interest Income     1,752,178     1,506,903     4,967,134     4,396,261
    Provision for loan losses     180,000     330,000     280,000     400,000
  Net Interest Income After Provision for Loan Losses     1,572,178     1,176,903     4,687,134     3,996,261
                         
Non-interest Income                        
    Service charge income     18,562     19,413     55,482     58,710
    Mortgage banking activities     49,999     77,165     159,187     274,032
    SBA loan sales     111,074     173,099     305,635     321,848
    Other income     30,747     30,031     89,436     240,733
  Total non-interest income     210,382     299,708     609,740     895,323
                         
Non-interest Expense                        
    Salaries and employee benefits     775,072     653,234     2,268,242     2,055,073
    Occupancy expense     120,358     122,137     368,404     356,804
    Equipment expense     50,885     49,950     158,736     150,229
    Advertising     48,458     81,712     158,470     172,180
    Data Processing     76,883     63,178     201,588     180,219
    Professional fees     118,545     102,328     400,483     378,629
    Loan origination expense     39,600     48,091     98,306     155,147
    Regulatory Assessments     36,624     25,270     100,491     74,245
    Other expense     91,263     102,264     298,983     280,363
  Total non-interest expense     1,357,688     1,248,164     4,053,703     3,802,889
                           
  Net Income Before Income Taxes     424,872     228,447     1,243,171     1,088,695
    Income tax expense     145,377     78,700     421,969     361,351
  Net Income     279,495     149,747     821,202     727,344
    Dividend on preferred stock     11,553     11,552     34,658     44,936
  Net Income applicable to common shareholders   $ 267,942   $ 138,195   $ 786,544   $ 682,408
                         
Income per share - basic   $ 0.15   $ 0.08   $ 0.43   $ 0.38
   
   
   
Birmingham Bloomfield Bancshares, Inc.  
Financial Summary and Selected Ratios (Unaudited)  
(Dollars in thousands except per share data)  
       
        Year to Date  
        September 30,     Change  
        2013     2012     Amount     Percentage  
INCOME STATEMENT                              
      Interest Income   $ 5,650     $ 5,086     $ 564     11.1 %
      Interest Expense     683       690       (7 )   -1.0 %
    Net Interest Income     4,967       4,396       571     13.0 %
      Provision for loan loss     280       400       (120 )   -30.0 %
      Non-interest income     610       895       (286 )   -31.9 %
      Non-interest expense     4,054       3,803       251     6.6 %
    Net Income before Income Taxes     1,243       1,089       154     14.2 %
      Income tax expense     422       361       61     16.8 %
    Net Income     821       727       94     12.9 %
      Dividend on preferred stock     35       45       (10 )   -22.9 %
    Net Income - common shareholders   $ 787     $ 682     $ 104     15.3 %
                                   
    Income per share - basic & diluted   $ 0.43     $ 0.38     $ 0.05     14.6 %
                                   
BALANCE SHEET DATA                              
    Total assets     182,693       148,497       34,196     23.0 %
    Average Assets     163,490       135,682       27,808     20.5 %
    Total loans     151,524       118,440       33,084     27.9 %
    Allowance for loan loss (ALLL)     1,989       1,974       14     0.7 %
    Total deposits     163,836       131,147       32,689     24.9 %
    Other borrowings     -       -       -     0.0 %
    Shareholders' equity     17,809       16,682       1,126     6.8 %
    Average Equity     17,409       16,449       959     5.8 %
                                   
ASSET QUALITY                              
    Other real estate owned (OREO)     -       -       -     0.0 %
    Net charge-offs     336       -       336     0.0 %
    Non-accrual loans     316       708       (392 )   -55.4 %
(2)   Non-performing assets (NPA)     316       708       (392 )   -55.4 %
    Non-accrual loans / total loans     0.21 %     0.60 %     -0.39 %   -65.2 %
    Allowance for loan loss / total loans     1.31 %     1.67 %     -0.35 %   -21.3 %
                                   
PERFORMANCE MEASUREMENTS                              
    Net interest margin (tax equivalent)     4.47 %     4.78 %     -0.31 %   -6.5 %
(1)   Return on average assets (annualized)     0.67 %     0.72 %     -0.05 %   -6.9 %
(3)   Return on average assets (annualized)     1.25 %     1.47 %     -0.22 %   -15.0 %
(1)   Return on average common equity (annualized)     8.59 %     8.21 %     0.38 %   4.6 %
(3)   Return on average common equity (annualized)     15.93 %     16.81 %     -0.88 %   -5.2 %
    Efficiency ratio     72.7 %     71.9 %     0.82 %   1.1 %
    Total loans / Total deposits     92.5 %     90.3 %     2.17 %   2.4 %
    Tier 1 Leverage Ratio (Bank only)     8.71 %     9.20 %     -0.49 %   -5.33 %
    Equity / Assets     9.75 %     11.23 %     -1.49 %   -13.2 %
    Tangible common equity / Total assets     7.22 %     8.12 %     -0.90 %   -11.1 %
                                   
    Book value per share   $ 7.18     $ 6.61     $ 0.57     8.6 %
    Stock price   $ 5.70     $ 4.55     $ 1.15     25.3 %
    Stock price / book value (%)     79.4 %     68.8 %     10.55 %   15.3 %
    Income per share - basic & diluted   $ 0.43     $ 0.38     $ 0.05     14.6 %
    Income per share - basic & diluted (LTM)   $ 0.61     $ 2.01     $ (1.40 )   -69.7 %
    Price to earnings ratio (P/E) (year to date)     9.9x       9.1x       0.8x     9.3 %
    Shares outstanding     1,836,662       1,824,662       12,000     0.7 %
    Average shares outstanding     1,828,838       1,817,874       10,964     0.6 %
 
(1)   Amount is computed on net income before preferred dividends.   
(2)   Non-performing assets includes non-accrual loans and other real estate owned.  
(3)   Amount is computed on pre-tax, pre-provision earnings before preferred dividends  
     
     
     
Birmingham Bloomfield Bancshares, Inc.  
Financial Summary and Selected Ratios (Unaudited)  
(Dollars in thousands except per share data)  
   
        Quarter Ended  
        September 30,   June 30,   March 31,   December 31,   September 30,  
        2013   2013   2013   2012   2012  
INCOME STATEMENT                                
      Interest Income   $ 1,998   $ 1,860   $ 1,792   $ 1,771   $ 1,746  
      Interest Expense     246     222     215     227     239  
    Net Interest Income     1,752     1,638     1,577     1,544     1,507  
      Provision for loan loss     180     90     10     70     330  
      Non-interest income     210     215     185     348     300  
      Non-interest expense     1,358     1,394     1,302     1,296     1,248  
    Net Income before Income Taxes     425     369     450     526     228  
      Income tax expense     145     125     152     177     79  
    Net Income     279     244     298     348     150  
      Dividend on preferred stock     12     12     12     12     12  
    Net Income applicable to common shareholders   $ 268   $ 232   $ 287   $ 337   $ 138  
                                     
    Income per share - basic & diluted   $ 0.15   $ 0.13   $ 0.16   $ 0.18   $ 0.08  
                                     
BALANCE SHEET DATA                                
    Total assets     182,693     164,588     156,985     152,773     148,497  
    Average Assets     175,007     160,953     154,282     154,452     146,057  
    Total loans     151,524     138,017     129,638     128,277     118,440  
    Allowance for loan loss (ALLL)     1,989     2,144     2,054     2,044     1,974  
    Total deposits     163,836     146,171     138,992     134,902     131,147  
    Other borrowings     -     -     -     -     -  
    Shareholders' equity     17,809     17,546     17,281     17,004     16,682  
    Average Equity     17,682     17,399     17,139     16,822     16,728  
                                     
ASSET QUALITY                                
    Other real estate owned (OREO)     -     -     -     -     -  
    Net charge-offs     336     -     -     -     -  
    Non-accrual loans     316     732     732     764     708  
(2)   Non-performing assets (NPA)     316     732     732     764     708  
    Non-accrual loans / total loans     0.21 %   0.53 %   0.56 %   0.60 %   0.60 %
    Allowance for loan loss / total loans     1.31 %   1.55 %   1.58 %   1.59 %   1.67 %
                                     
PERFORMANCE MEASUREMENTS                                
    Net interest margin (tax equivalent)     4.36 %   4.50 %   4.56 %   4.59 %   4.65 %
(1)   Return on average assets (annualized)     0.63 %   0.61 %   0.78 %   0.90 %   0.41 %
(3)   Return on average assets (annualized)     1.37 %   1.14 %   1.21 %   1.53 %   1.52 %
(1)   Return on average common equity (annualized)     8.49 %   7.65 %   9.66 %   11.35 %   4.92 %
(3)   Return on average common equity (annualized)     18.37 %   14.39 %   14.89 %   19.42 %   18.35 %
    Efficiency ratio     69.2 %   75.2 %   73.9 %   68.5 %   69.1 %
    Total loans / Total deposits     92.5 %   94.4 %   93.3 %   95.1 %   90.3 %
    Tier 1 Leverage Ratio (Bank only)     8.71 %   9.21 %   9.36 %   9.03 %   9.20 %
    Equity / Assets     9.75 %   10.66 %   11.01 %   11.13 %   11.23 %
    Tangible common equity / Total assets     7.22 %   7.85 %   8.06 %   8.11 %   8.12 %
                                     
    Book value per share   $ 7.18   $ 7.04   $ 6.94   $ 6.79   $ 6.61  
    Stock price   $ 5.70   $ 4.30   $ 4.95   $ 4.60   $ 4.55  
    Stock price / book value (%)     79.4 %   61.1 %   71.3 %   67.8 %   68.8 %
    Income per share - basic & diluted   $ 0.15   $ 0.13   $ 0.16   $ 0.18   $ 0.08  
    Shares outstanding     1,836,662     1,836,662     1,824,662     1,824,662     1,824,662  
    Average shares outstanding     1,836,662     1,825,058     1,824,662     1,824,662     1,824,662  
 
(1)   Amount is computed on net income before preferred dividends.    
(2)   Non-performing assets includes non-accrual loans and other real estate owned.   
(3)   Amount is computed on pre-tax, pre-provision earnings before preferred dividends   

Contact Information

  • Contact:
    Robert M. Farr
    Chief Executive Officer
    Birmingham Bloomfield Bancshares, Inc.
    248-283-6430