Contacts:
Community Central Bank Corp. – Ray Colonius - P:586 783-4500
COMMUNITY CENTRAL BANK CORPORATION
ANNOUNCES Q2 RESULTS For Immediate Release
MOUNT CLEMENS, Mich., August 7, 2009 -- Community Central Bank Corporation (NasdaqGM:CCBD), the holding company for Community Central Bank, today reported results for the quarter and six months ended June 30, 2009. As of June 30, 2009, the Corporation and Bank were considered to be “Well Capitalized,” the highest regulatory capital level.
The Corporation reported a net loss of ($802,000) or ($0.24) per diluted common share for the second quarter ended June 30, 2009. This compares to net income of $275,000 or $0.07 per diluted common share for the second quarter ended June 30, 2008. The net loss for the six months ended June 30, 2009 was ($2,346,000) or ($0.67) per diluted common share. This compares to net income of $515,000 or $0.14 per diluted common share for the six months ended June 30, 2008.
David A. Widlak, President and CEO commented, “Our second quarter performance was impacted by a larger provision for loan losses as the weakness in the economy continues to affect parts of our loan portfolio. Fortunately, builder developer loans which required the largest write-offs in previous periods, now only comprise 3.1% of our total loan portfolio. Partially offsetting the higher provision were increases in net interest income and in mortgage banking revenue. We are focusing on strategies to preserve and increase capital, and grow segments of operations that are capital efficient, such as our mortgage banking operations, our branch deposit operations as well as our trust and wealth divisions. An ongoing effort to increase our core deposits has resulted in a reduction in our cost of funds. During the first six months of 2009, our deposits increased $12.2 million, with organic deposits increasing $32.4 million, as wholesale deposits decreased $20.2 million. We also replaced $10.5 million of Federal Home Loan Bank advances during the first six months with lower cost core deposit funding.”
Net interest income before the provision for loan losses for the second quarter of 2009 increased to $3.1 million, compared to $2.8 million for the second quarter of 2008. Net interest margin increased from 2.28% in the second quarter of 2008 to 2.41% in the second quarter of 2009. Net interest income before the provision for loan losses for the first six months of 2009 was $5.9 million, compared to $5.5 million for the first six months of 2008. Adversely affecting net interest income and net interest margin in the first quarter and first six months of 2009 was the reversal and non-recognition of interest income on nonaccrual loans which totaled approximately 53 basis points of total net interest margin for the second quarter of 2009 and 51 basis points for the first six months of 2009. The growth in net interest margin and net interest income was primarily attributable to the lowered cost of the Bank’s funds from the significant growth in non-interest bearing checking accounts, which increased $16.0 million from December 31, 2008.
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Community Central Bank Corp.
Q2-2009 Results
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We recorded a $2.7 million provision for loan losses in the second quarter of 2009 and $5.3 million for the first six months of 2009. The provision is based upon management’s review of the risks inherent in the loan portfolio and the level of our allowance for loan losses. In addition, net charge-offs for the first six months of 2009 totaled $2.8 million, or 1.31% of total average loans on an annualized basis. Total nonaccruing loans and loans past due 90 days or more and still accruing interest totaled $32.4 million, or 7.85% of total loans at June 30, 2009 compared to $17.6 million, or 4.32% at December 31, 2008. The allowance for loan losses at June 30, 2009 was $9.8 million, or 2.38% of total loans, versus $7.3 million, or 1.80% at December 31, 2008. In addition to the nonaccrual loans stated above, as of June 30, 2009, restructured loans, within the meaning of SFAS No. 15, “Accounting by Debtors and Creditors for Troubled Debt Restructurings,” increased to $10.2 million from $8.2 million at December 31, 2008.
Noninterest income was $2.8 million for the second quarter of 2009, increasing $633,000, or 29.3%, from the second quarter of 2008. The increase was primarily related to an increase from the gains on the sale of residential mortgage loans which increased $860,000 over the respective period. Gains recorded from the change in fair market value of assets and liabilities as measured under Statement of Financial Accounting Standards (SFAS 159) during the second quarter of 2009 was similar to the amount recorded in the second quarter of 2008. The increases recorded during both quarterly periods have been largely attributable to the fair value of the subordinated debenture connected with the issuance of trust preferred securities. The net change in fair value associated with all instruments recorded under SFAS 159 totaled $1.1 million for the first six months of 2009, versus $3.0 million for the first six months of 2008. The widening of market credit spreads for subordinated debentures and trust preferred securities experienced has had a favorable impact on the relative fair value of this financial liability. Changes in credit spreads are not easily predictable and may cause adverse changes in the fair value of this instrument and a possible loss of income in the future. Fiduciary income was $82,000 for the second quarter of 2009, decreasing $16,000 or 16.3%, from the second quarter of 2008 as a result of market declines in assessable assets held under management. Deposit service charge income of $95,000 decreased $47,000, or 33.1%, from the second quarter of 2008 from lower overdraft activity. Mortgage banking income comprised primarily of gains on the sale of residential mortgages was $1.3 million for the second quarter of 2009. The increase of $860,000, or 200.0%, from the second quarter of 2008 was reflective of the sizeable growth in the secondary sales of government FHA and FNMA mortgages, spurred from low mortgage interest rates at the beginning of the second quarter of 2009. Net realized gains from the sale of securities was $228,000 for the second quarter of 2009 and was attributable to restructuring activities in the available for sale security portfolio.
Noninterest expense was $4.5 million for the second quarter of 2009, increasing $698,000 or 18.6% from the second quarter of 2008. The majority of the increase in total noninterest expense was recorded in other operating expense and was attributable
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Community Central Bank Corp.
Q2-2009 Results
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to a special FDIC insurance premium expensed in the second quarter of $250,000 and costs associated with write downs on other real estate owned and other repossessed collateral. Salaries, benefits and payroll taxes increased solely from expanded activity and related commissions in the Bank’s mortgage banking subsidiary.
At June 30, 2009, the Corporation’s assets totaled $555.3 million, relatively unchanged from December 31, 2008. Total loans of $412.1 million remained relatively unchanged, with net loans up $2.4 million or 0.6% from December 31, 2008. Total deposits of $369.6 million increased $12.2 million, or 3.4%, for the first six months of 2009. Increases in deposits for the quarter were entirely related to organic growth, as brokered time deposits decreased $20.2 million during the first six months of 2009. Noninterest bearing demand accounts totaled $50.2 million at June 30, 2009, an increase of $16.0 million during the quarter. Total stockholders’ equity of $32.5 million decreased $1.9 million from December 31, 2008 from the year to date loss of $2.3 million and the payment of the year to date preferred stock dividends of $156,000. These items were partially offset by increases of preferred stock of $500,000 and other comprehensive income of $59,000.
Community Central Bank Corporation is the holding company for Community Central Bank in Mount Clemens, Michigan. The Bank opened for business in October 1996 and serves businesses and consumers across Macomb, Oakland, Wayne and St. Clair counties with a full range of lending, deposit, trust, wealth management, and Internet banking services. The Bank operates four full service facilities, in Mount Clemens, Rochester Hills, Grosse Pointe Farms and Grosse Pointe Woods, Michigan. Community Central Mortgage Company, LLC, a subsidiary of the Bank, operates locations servicing the Detroit metropolitan area and northwest and central Indiana. River Place Trust and Community Central Wealth Management are divisions of Community Central Bank. Community Central Insurance Agency, LLC is a wholly owned subsidiary of Community Central Bank.
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 included in Community Central Bank Corporation's filings with the Securities and Exchange Commission, available free via EDGAR. The Corporation assumes no responsibility to update forward-looking statements.
(financial schedules follow)
Community Central Bank Corporation (NasdaqGM:CCBD)
Summary of Selected Financial Data
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | Unaudited | | | Unaudited | | | Unaudited | | | Unaudited | |
| | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
| | | (in thousands) | | | (in thousands) | |
| OPERATIONS | | | | | | | | | | | | |
| Interest Income | | | | | | | | | | | | |
| Loans | | $ | 6,653 | | | $ | 6,373 | | | $ | 12,913 | | | $ | 12,864 | |
| Taxable Securities | | | 721 | | | | 942 | | | | 1,659 | | | | 1,768 | |
| Tax-exempt Securities | | | 84 | | | | 147 | | | | 198 | | | | 376 | |
| Federal Funds Sold | | | 7 | | | | 54 | | | | 13 | | | | 309 | |
| Total Interest Income | | | 7,465 | | | | 7,516 | | | | 14,783 | | | | 15,317 | |
| | | | | | | | | | | | | | | | | |
| Interest Expense | | | | | | | | | | | | | | | | |
| Deposits | | | 2,603 | | | | 2,965 | | | | 5,356 | | | | 6,346 | |
| Rep Agreement and Fed Funds | | | 315 | | | | 289 | | | | 632 | | | | 519 | |
| FHLB Advances | | | 1,133 | | | | 1,248 | | | | 2,271 | | | | 2,474 | |
| ESOP Loan Interest | | | - | | | | 1 | | | | - | | | | 1 | |
| Subordinated Debentures | | | 311 | | | | 216 | | | | 613 | | | | 507 | |
| Total Interest Expense | | | 4,362 | | | | 4,719 | | | | 8,872 | | | | 9,847 | |
| | | | | | | | | | | | | | | | | |
| Net Interest Income | | | 3,103 | | | | 2,797 | | | | 5,911 | | | | 5,470 | |
| | | | | | | | | | | | | | | | | |
| Provision for Credit Losses | | | 2,700 | | | | 884 | | | | 5,250 | | | | 2,984 | |
| Net Interest Income after Provision | | | 403 | | | | 1,913 | | | | 661 | | | | 2,486 | |
| | | | | | | | | | | | | | | | | |
| Non-Interest Income | | | | | | | | | | | | | | | | |
| Fiduciary Income | | | 82 | | | | 98 | | | | 165 | | | | 206 | |
| Deposit Service Charges | | | 95 | | | | 142 | | | | 190 | | | | 274 | |
| Net Realized Security Gains | | | 228 | | | | 49 | | | | 356 | | | | 110 | |
| Mortgage Banking Income | | | 1,290 | | | | 430 | | | | 1,761 | | | | 880 | |
| Change in Fair Value of Assets/Liabilities | | | 838 | | | | 872 | | | | 1,070 | | | | 3,011 | |
| Other Income | | | 259 | | | | 568 | | | | 464 | | | | 878 | |
| | | | | | | | | | | | | | | | | |
| Total Non-Interest Income | | | 2,792 | | | | 2,159 | | | | 4,006 | | | | 5,359 | |
| | | | | | | | | | | | | | | | | |
| Non-Interest Expense | | | | | | | | | | | | | | | | |
| Salaries, Benefits and Payroll Taxes | | | 2,249 | | | | 1,835 | | | | 4,181 | | | | 3,667 | |
| Occupancy Expense | | | 417 | | | | 452 | | | | 880 | | | | 913 | |
| Other Operating Expense | | | 1,790 | | | | 1,471 | | | | 3,269 | | | | 2,735 | |
| | | | | | | | | | | | | | | | | |
| Total Non-Interest Expense | | | 4,456 | | | | 3,758 | | | | 8,330 | | | | 7,315 | |
| | | | | | | | | | | | | | | | | |
| Income (loss) Before Taxes | | | (1,261 | ) | | | 314 | | | | (3,663 | ) | | | 530 | |
| Provision for (benefit from) Income Taxes | | | (459 | ) | | | 39 | | | | (1,317 | ) | | | 15 | |
| | | | | | | | | | | | | | | | | |
| Net Income (loss) | | | (802 | ) | | | 275 | | | | (2,346 | ) | | | 515 | |
| | | | | | | | | | | | | | | | | |
| Dividends declared on preferred shares | | | 106 | | | | - | | | | 156 | | | | - | |
| | | | | | | | | | | | | | | | | |
| Net income (loss) available to | | | | | | | | | | | | | | | | |
| common shares | | | (908 | ) | | | 275 | | | | (2,502 | ) | | | 515 | |
Community Central Bank Corporation (NasdaqGM:CCBD)
Summary of Selected Financial Data – continued
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
| | | (in thousands) | | | (in thousands) | |
| | | | | | | | | | | | | |
| PER SHARE DATA | | | | | | | | | | | | |
| Basic Earnings per Share | | $ | (0.24 | ) | | $ | 0.07 | | | $ | (0.67 | ) | | $ | 0.14 | |
| Diluted Earnings per Share | | $ | (0.24 | ) | | $ | 0.07 | | | $ | (0.67 | ) | | $ | 0.14 | |
| Book Value per Share | | $ | 7.74 | | | $ | 8.89 | | | $ | 7.74 | | | $ | 8.89 | |
| Basic Average Shares Outstanding (000's) | | | 3,736 | | | | 3,731 | | | | 3,735 | | | | 3,729 | |
| Diluted Average Shares Outstanding (000's) | | | 3,736 | | | | 3,735 | | | | 3,735 | | | | 3,731 | |
| Actual Shares Outstanding (000's) | | | 3,737 | | | | 3,732 | | | | 3,737 | | | | 3,732 | |
| | | | | | | | | | | | | | | | | |
| Net Interest Margin (Fully Tax-Equivalent) | | | 2.41 | % | | | 2.28 | % | | | 2.31 | % | | | 2.23 | % |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Condensed Balance Sheet | | | | | | | | |
| | | Unaudited | | | Audited | |
| | | June 30, | | | December 31, | |
| | | | 2009 | | | | 2008 | |
| | | (in thousands) | |
| | | | | | | | | |
| Assets | | | | | | | | |
| Cash and Equivalents | | $ | 34,980 | | | $ | 16,162 | |
| Investments | | | 73,124 | | | | 101,407 | |
| Residential Mortgage Loans Held for Sale | | | 9,509 | | | | 3,302 | |
| Loans | | | 412,055 | | | | 407,117 | |
| Allowance for Loan Losses | | | (9,809 | ) | | | (7,315 | ) |
| Other Assets | | | 35,490 | | | | 36,277 | |
| Total Assets | | $ | 555,349 | | | $ | 556,950 | |
| | | | | | | | | |
| Liabilities and Stockholders' Equity | | | | | | | | |
| Deposits | | $ | 369,553 | | | $ | 357,376 | |
| Repurchase Agreements | | | 40,420 | | | | 39,394 | |
| Federal Home Loan Bank Advances | | | 97,700 | | | | 108,200 | |
| Other Liabilities | | | 4,029 | | | | 4,829 | |
| Subordinated Debentures | | | 11,155 | | | | 12,757 | |
| Stockholders' Equity | | | 32,492 | | | | 34,394 | |
| Total Liabilities and Stockholders' Equity | | $ | 555,349 | | | $ | 556,950 | |
| | | | | | | | | |
| Condensed balance sheet data contains adjustments for fair valule option SFAS 159. |
| | | June 30, | | | December 31, | |
| | | 2009 | | | 2008 | |
| | | (in thousands) | |
| | | | | | | |
| OTHER DATA - dollars in thousands | | | | | | |
| Capital Adequacy | | | | | | |
| Equity to Total Assets | | | 5.85 | % | | | 6.18 | % |
| Tier 1 Leverage Ratio | | | 7.21 | % | | | 8.21 | % |
| Tier 1 Capital to Risk-Weighted Assets | | | 9.70 | % | | | 10.41 | % |
| Total Capital to Risk-Weighted Assets | | | 12.88 | % | | | 13.22 | % |
| Total Capital to Risk-Weighted Assets (Bank) | | | 10.99 | % | | | 10.54 | % |
| | | | | | | | | |
| Credit Quality | | | | | | | | |
| Nonaccrual Loans | | $ | 32,351 | | | $ | 17,584 | |
| Loans past due 90 days and still accruing | | | 3 | | | | 44 | |
| Total nonperforming loans | | $ | 32,354 | | | $ | 17,628 | |
| | | | | | | | | |
| | | | | | | | | |
| Troubled Debt Restructuring - Current | | $ | 9,668 | | | $ | 4,970 | |
| Troubled Debt Restructuring - Past Due 30-89 days | | $ | 495 | | | $ | 3,192 | |
| | | | | | | | | |
| Other Real Estate Owned | | $ | 4,896 | | | $ | 2,913 | |
| Other Repossessed Collateral | | $ | 541 | | | $ | 976 | |
| | | | | | | | | |
| Allowance for Loan Losses to Total Loans | | | 2.38 | % | | | 1.80 | % |
| Allowance for Loan Losses to Non-Performing Loans | | | 32.98 | % | | | 41.50 | % |
| Non-performing Loans to Total Loans | | | 7.85 | % | | | 4.33 | % |
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