Exhibit 99.1
Cornerstone Bancshares, Inc. Announces 3rd Quarter 2010 Financial Results
CHATTANOOGA, Tenn.--(BUSINESS WIRE)--October 27, 2010--Cornerstone Bancshares, Inc. (OTC Bulletin Board: CSBQ) today announced the following:
Cornerstone Bancshares, Inc. (“Cornerstone”) reported positive net income of $214,000 for the third quarter of 2010, compared to a loss of $(1.7) million for the same quarter of 2009. This brings Cornerstone’s net income for the year to $576,000 or $0.09 per diluted share, an increase of 111 percent compared to the loss of $(5.2) million or $(0.80) per share during the first nine months of 2009.
Cornerstone saw a 3.2 percent increase in its net interest income for the three months ended September 30, 2010, driven by the reduction of interest expense. Past-due loans decreased to $1.5 million at the end of the third quarter 2010, the lowest level in more than two years, which is a leading indicator of asset quality improvement. Net charge-offs were $1.4 million for the third quarter of 2010, compared to $3.4 million for the third quarter of 2009. Cornerstone’s allowance for loan losses was $6.3 million or 2.2 percent of total loans as of September 30, 2010, compared to $5.9 million or 1.75 percent as of December 31, 2009. Nonperforming assets were $23.7 million or 4.9 percent of total assets at September 30, 2010, compared to $17.9 million or 3.4 percent at December 31, 2009. Since the end of the third quarter, Cornerstone Community Bank (“the Bank”) has sold, with no loss, $1.3 million in other real estate owned. The Bank is aggressively acting to originate loans, in order to support its strategic plan of reducing its risk profile and improving its loan stratification. These steps place the Bank in a positive position to move forward as the capital campaign progresses.
Cornerstone launched a Preferred Stock Offering in the amount of $15 million in the third quarter of 2010. The security features a 10 percent coupon, is convertible into common stock and has a cumulative dividend. The preferred stock will not be converted until five years and a 50 percent increase in common stock value over the preferred stock’s strike price.
“I’m pleased with the progress we’ve made this year, given the aggressive steps we’ve taken to improve asset quality and clean up the balance sheet,” said Cornerstone’s Miller Welborn, who took the helm as Chairman of the Board in November of 2009. “If two quarters make a trend, then a third straight quarter of positive earnings certainly suggests we’re making strides in the right direction.”
Cornerstone is a single-bank holding company, with $480 million in assets, serving the Chattanooga, Tennessee MSA, with five branches throughout Chattanooga and one loan production office in Dalton, Georgia. Locally owned and locally operated, Cornerstone specializes in providing a comprehensive range of customized financial solutions for businesses and individuals.
Certain of the statements made in this release may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements, including statements regarding the intent, belief or current expectations of Cornerstone and its management regarding the company’s strategic directions, prospects and future results, involve certain risks and uncertainties. Certain factors may cause actual results to differ materially from those contained in the forward-looking statements, including economic and other conditions in the markets in which Cornerstone operates, governmental regulations, the company’s competitive environment, cyclical and seasonal fluctuations in its operating results, and other risks discussed in Cornerstone’s Form 10-K and other filings with the Securities and Exchange Commission.
Cornerstone Bancshares, Inc. and Subsidiary | |||||||||||
Third Quarter Financial Highlights | |||||||||||
September 30, 2010 and 2009 | |||||||||||
(Unaudited) | |||||||||||
(Amounts in thousands, except per share data) | 2010 | 2009 | % Change | ||||||||
Balance Sheet Data at September 30 | |||||||||||
Total assets | $ | 483,351 | $ | 509,499 | (5.1 | ) | |||||
Interest-earning assets | 459,720 | 483,843 | (5.0 | ) | |||||||
Loans | 292,046 | 349,050 | (16.3 | ) | |||||||
Foreclosed assets | 13,427 | 7,793 | 72.3 | ||||||||
Deposits | 351,367 | 386,088 | (9.0 | ) | |||||||
Interest-bearing liabilities | 98,947 | 90,486 | 9.3 | ||||||||
Shareholders' equity | 30,965 | 31,304 | (1.1 | ) | |||||||
Loan to deposit ratio | 83.12 | % | 90.41 | % | (8.1 | ) | |||||
Tier 1 Leverage Ratio (Bank) | 6.20 | % | 7.56 | % | (18.0 | ) | |||||
Total Risk-Based Capital Ratio (Bank) | 11.32 | % | 10.50 | % | 7.8 | ||||||
Outstanding shares (000s) | 6,500 | 6,500 | 0.0 | ||||||||
Book value per share | $ | 4.76 | $ | 4.82 | (1.1 | ) | |||||
Tangible book value per share | $ | 4.37 | $ | 4.42 | (1.3 | ) | |||||
Market value per share as of September 30 | $ | 1.55 | $ | 2.65 | (41.5 | ) | |||||
Loan Quality Data | |||||||||||
Nonaccruing loans | 10,491 | $ | 8,139 | 28.9 | |||||||
Loans past due 90 days – accruing | - | - | - | ||||||||
Net charge-offs YTD | 2,795 | 12,969 | (78.4 | ) | |||||||
Allowance for loan losses | 6,271 | 7,398 | (15.2 | ) | |||||||
Allowance for loan losses to total loans | 2.15 | % | 2.12 | % | |||||||
Nonperforming assets to total assets | 4.95 | % | 3.13 | % | |||||||
Performance Data for the First Nine Months | |||||||||||
Net income | 576 | (5,214 | ) | 111.0 | |||||||
Return on average assets | 0.15 | % | -1.47 | % | |||||||
Return on average equity | 2.61 | % | -20.14 | % | |||||||
Net interest margin | 3.45 | % | 3.44 | % | |||||||
Per share data: | |||||||||||
Net income – basic | $ | 0.09 | $ | (0.80 | ) | ||||||
Net income – diluted | $ | 0.09 | $ | (0.80 | ) | ||||||
Dividends | $ | - | $ | 0.10 | |||||||
Average shares (000s): | |||||||||||
Basic | 6,500 | 6,500 | |||||||||
Diluted | 6,500 | 6,500 |
Cornerstone Bancshares, Inc. and Subsidiary | ||||||||||||||||||||||||
Loan Loss Allowance and Asset Quality Review | ||||||||||||||||||||||||
2010 | 2009 | |||||||||||||||||||||||
Third | Second | First | Fourth | Third | Second | |||||||||||||||||||
(Amounts in thousands) | Quarter | Quarter | Quarter | Quarter | Quarter | Quarter | ||||||||||||||||||
Allowance for loan losses | ||||||||||||||||||||||||
Balance at beginning of period | $ | 6,967 | $ | 6,760 | $ | 5,905 | $ | 7,398 | $ | 7,383 | $ | 12,885 | ||||||||||||
Provision for loan losses | 681 | 1,465 | 1,015 | 4,150 | 3,390 | 1,634 | ||||||||||||||||||
Net charge-offs | $ | (1,377 | ) | $ | (1,258 | ) | $ | (160 | ) | $ | (5,643 | ) | $ | (3,375 | ) | $ | (7,136 | ) | ||||||
Balance at end of period | $ | 6,271 | $ | 6,967 | $ | 6,760 | $ | 5,905 | $ | 7,398 | $ | 7,383 | ||||||||||||
As a % of loans | 2.15 | % | 2.19 | % | 2.07 | % | 1.75 | % | 2.12 | % | 2.05 | % | ||||||||||||
As a % of nonperforming loans | 61.26 | % | 53.47 | % | 79.83 | % | 80.24 | % | 90.90 | % | 55.11 | % | ||||||||||||
As a % of nonperforming assets | 26.50 | % | 29.98 | % | 39.34 | % | 32.98 | % | 46.44 | % | 40.21 | % | ||||||||||||
Net charge-offs as a % of loans (a) | 1.89 | % | 1.58 | % | 0.20 | % | 6.70 | % | 3.87 | % | 7.92 | % | ||||||||||||
Risk element assets | ||||||||||||||||||||||||
Nonaccruing loans | $ | 10,237 | $ | 13,030 | $ | 8,468 | $ | 7,360 | $ | 8,139 | $ | 13,397 | ||||||||||||
Loans past due 90 days – accruing | - | - | - | - | - | - | ||||||||||||||||||
Total nonperforming loans | 10,237 | 13,030 | 8,468 | 7,360 | 8,139 | 13,397 | ||||||||||||||||||
Repossessed assets | 285 | 350 | 473 | 217 | 98 | 181 | ||||||||||||||||||
Other real estate owned (b)(c)(d) | 13,142 | 9,862 | 8,241 | 10,327 | 7,695 | 4,783 | ||||||||||||||||||
Total nonperforming assets | $ | 23,664 | $ | 23,242 | $ | 17,182 | $ | 17,904 | $ | 15,932 | $ | 18,361 | ||||||||||||
Loans past due 30-89 days | $ | 1,500 | $ | 6,655 | $ | 6,588 | $ | 5,027 | $ | 19,062 | $ | 9,636 | ||||||||||||
Nonperforming loans as a % of loans | 3.51 | % | 4.09 | % | 2.60 | % | 2.19 | % | 2.33 | % | 3.71 | % | ||||||||||||
Nonperforming assets as a % of loans and other real estate owned | 7.75 | % | 7.07 | % | 5.14 | % | 5.16 | % | 4.47 | % | 5.02 | % | ||||||||||||
Total Loans | 292,046 | 318,796 | 325,948 | 336,692 | 349,050 | 360,615 | ||||||||||||||||||
(a) Annualized | ||||||||||||||||||||||||
(b) Properties sold since quarter-end | $ | 1,250 | ||||||||||||||||||||||
(c) Properties rented | $ | 2,400 | ||||||||||||||||||||||
(d) Properties under contract to sell | $ | 1,300 |
Cornerstone Bancshares Inc. and Subsidiary | ||||||||||||||||||||||||||
Net Interest Margin Analysis | ||||||||||||||||||||||||||
Taxable Equivalent Basis | ||||||||||||||||||||||||||
Three months ended | ||||||||||||||||||||||||||
September 30 | ||||||||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
Assets | 2010 | 2009 | ||||||||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||||||||
Earning assets: | Balance | Expense | Rate | Balance | Expense | Rate | ||||||||||||||||||||
Loans, net of unearned income | $ | 305,743 | $ | 5,160 | 6.70 | % | 354,246 | $ | 6,018 | 6.74 | % | |||||||||||||||
Investment securities | 116,930 | 754 | 2.82 | % | 54,335 | 358 | 2.83 | % | ||||||||||||||||||
Other earning assets | 35,540 | 19 | 0.22 | % | 45,477 | 31 | 0.25 | % | ||||||||||||||||||
Total earning assets | 458,213 | $ | 5,933 | 5.20 | % | 454,058 | $ | 6,407 | 5.62 | % | ||||||||||||||||
Allowance for loan losses | (6,655 | ) | (6,703 | ) | ||||||||||||||||||||||
Cash and other assets | 37,213 | 41,515 | ||||||||||||||||||||||||
TOTAL ASSETS | $ | 488,771 | $ | 488,870 | ||||||||||||||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||||||||||||||
Interest bearing liabilities: | ||||||||||||||||||||||||||
Interest bearing demand deposits | $ | 31,858 | $ | 25 | 0.31 | % | $ | 25,236 | $ | 20 | 0.31 | % | ||||||||||||||
Savings deposits | 9,547 | 12 | 0.50 | % | 8,317 | 10 | 0.48 | % | ||||||||||||||||||
MMDA's | 22,961 | 56 | 0.97 | % | 23,246 | 56 | 0.96 | % | ||||||||||||||||||
Time deposits of $100,000 or more | 86,697 | 539 | 2.47 | % | 64,511 | 477 | 2.93 | % | ||||||||||||||||||
Time deposits of $100,000 or less | 183,507 | 847 | 1.83 | % | 207,530 | 1,408 | 2.69 | % | ||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 23,256 | 32 | 0.55 | % | 18,897 | 37 | 0.78 | % | ||||||||||||||||||
Other borrowings | 62,612 | 665 | 4.21 | % | 72,350 | 758 | 4.16 | % | ||||||||||||||||||
Total interest bearing liabilities | 420,438 | 2,176 | 2.05 | % | 420,087 | 2,766 | 2.61 | % | ||||||||||||||||||
Net interest spread | $ | 3,757 | 3.15 | % | $ | 3,641 | 3.01 | % | ||||||||||||||||||
Noninterest bearing demand deposits | 36,875 | 39,490 | ||||||||||||||||||||||||
Accrued expenses and other liabilities | 1,103 | (3,544 | ) | |||||||||||||||||||||||
Shareholders' equity | 30,355 | 32,838 | ||||||||||||||||||||||||
TOTAL LIABILITIES AND | ||||||||||||||||||||||||||
SHAREHOLDERS' EQUITY | $ | 488,771 | $ | 488,871 | ||||||||||||||||||||||
Net yield on earning assets | 3.36 | % | 3.21 | % | ||||||||||||||||||||||
Taxable equivalent adjustment: | ||||||||||||||||||||||||||
Loans | 0 | 0 | ||||||||||||||||||||||||
Investment securities | 77 | 29 | ||||||||||||||||||||||||
Total adjustment | 77 | 29 |
Cornerstone Bancshares, Inc. and Subsidiary | ||||||||||||||||||||||||||
Net Interest Margin Analysis | ||||||||||||||||||||||||||
Taxable Equivalent Basis | ||||||||||||||||||||||||||
Nine months ended | ||||||||||||||||||||||||||
September 30 | ||||||||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||||||||
Assets | 2010 | 2009 | ||||||||||||||||||||||||
Average | Income/ | Yield/ | Average | Income/ | Yield/ | |||||||||||||||||||||
Earning assets: | Balance | Expense | Rate | Balance | Expense | Rate | ||||||||||||||||||||
Loans, net of unearned income | $ | 318,985 | $ | 16,602 | 6.96 | % | $ | 369,394 | $ | 18,496 | 6.69 | % | ||||||||||||||
Investment securities | 134,262 | 3,099 | 3.09 | % | 54,757 | 1,158 | 3.02 | % | ||||||||||||||||||
Other earning assets | 39,634 | 65 | 0.22 | % | 17,169 | 45 | 0.27 | % | ||||||||||||||||||
Total earning assets | 492,881 | $ | 19,766 | 5.42 | % | 441,320 | $ | 19,699 | 5.99 | % | ||||||||||||||||
Allowance for loan losses | (6,484 | ) | (8,379 | ) | ||||||||||||||||||||||
Cash and other assets | 31,015 | 39,984 | ||||||||||||||||||||||||
TOTAL ASSETS | $ | 517,412 | $ | 472,925 | ||||||||||||||||||||||
Liabilities and Shareholders' Equity | ||||||||||||||||||||||||||
Interest bearing liabilities: | ||||||||||||||||||||||||||
Interest bearing demand deposits | $ | 34,125 | $ | 91 | 0.36 | % | $ | 28,574 | $ | 77 | 0.36 | % | ||||||||||||||
Savings deposits | 9,124 | 35 | 0.51 | % | 8,080 | 31 | 0.51 | % | ||||||||||||||||||
MMDA's | 22,875 | 164 | 0.96 | % | 28,316 | 205 | 0.97 | % | ||||||||||||||||||
Time deposits of $100,000 or more | 85,378 | 1,673 | 2.62 | % | 60,565 | 1,534 | 3.39 | % | ||||||||||||||||||
Time deposits of $100,000 or less | 206,806 | 3,016 | 1.95 | % | 179,614 | 4,214 | 3.14 | % | ||||||||||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 23,565 | 99 | 0.56 | % | 21,955 | 135 | 0.82 | % | ||||||||||||||||||
Other borrowings | 68,215 | 2,205 | 4.32 | % | 72,082 | 2,232 | 4.14 | % | ||||||||||||||||||
Total interest bearing liabilities | 450,088 | 7,283 | 2.16 | % | 399,186 | 8,428 | 2.82 | % | ||||||||||||||||||
Net interest spread | $ | 12,483 | 3.26 | % | $ | 11,271 | 3.17 | % | ||||||||||||||||||
Noninterest bearing demand deposits | 41,341 | 41,756 | ||||||||||||||||||||||||
Accrued expenses and other liabilities | (3,399 | ) | (2,539 | ) | ||||||||||||||||||||||
Shareholders' equity | 29,382 | 34,522 | ||||||||||||||||||||||||
TOTAL LIABILITIES AND | ||||||||||||||||||||||||||
SHAREHOLDERS' EQUITY | $ | 517,412 | $ | 472,925 | ||||||||||||||||||||||
Net yield on earning assets | 3.45 | % | 3.44 | % | ||||||||||||||||||||||
Taxable equivalent adjustment: | ||||||||||||||||||||||||||
Loans | 0 | 0 | ||||||||||||||||||||||||
Investment securities | 232 | 80 | ||||||||||||||||||||||||
Total adjustment | 232 | 80 |
Cornerstone Bancshares Inc. and Subsidiary | |||||||||||||||||||||||
Quarterly Earnings Summary | |||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
2010 | 2009 | Q3-10 / | |||||||||||||||||||||
Third | Second | First | Fourth | Third | Q3-09 | ||||||||||||||||||
(Amounts in thousands) | Quarter | Quarter | Quarter | Quarter | Quarter | % Chg | |||||||||||||||||
Interest Income | |||||||||||||||||||||||
Loans, including fees | $ | 5,160 | $ | 5,494 | $ | 5,948 | $ | 5,907 | $ | 6,018 | (14.3 | ) | |||||||||||
Investment securities | 754 | 1,216 | 1,129 | 683 | 358 | 110.7 | |||||||||||||||||
Other earning assets | 19 | 22 | 24 | 20 | 31 | (37.8 | ) | ||||||||||||||||
Total interest income | 5,933 | 6,732 | 7,101 | 6,610 | 6,407 | (7.4 | ) | ||||||||||||||||
Interest expense | |||||||||||||||||||||||
Deposits | 1,478 | 1,719 | 1,782 | 1,948 | 1,971 | (25.0 | ) | ||||||||||||||||
Short-term borrowings | 32 | 32 | 35 | 31 | 37 | (14.6 | ) | ||||||||||||||||
FHLB advances and other borrowings | 666 | 760 | 779 | 783 | 758 | (12.1 | ) | ||||||||||||||||
Total interest expense | 2,176 | 2,511 | 2,596 | 2,762 | 2,766 | (21.3 | ) | ||||||||||||||||
Net interest income | 3,757 | 4,221 | 4,505 | 3,848 | 3,641 | 3.2 | |||||||||||||||||
Provision for loan losses | 681 | 1,465 | 1,015 | 4,150 | 3,390 | (79.9 | ) | ||||||||||||||||
Net interest income after the provision for loan losses | 3,076 | 2,756 | 3,490 | (302 | ) | 251 | 1,124.9 | ||||||||||||||||
Noninterest income | |||||||||||||||||||||||
Customer Service Fees | 309 | 342 | 342 | 370 | 417 | (26.0 | ) | ||||||||||||||||
Other non-interest income | 34 | 29 | 31 | 29 | 29 | 15.6 | |||||||||||||||||
Gain / (Loss) on sale of assets | 544 | 439 | (53 | ) | (1,035 | ) | (262 | ) | (307.8 | ) | |||||||||||||
Total noninterest income | 887 | 810 | 320 | (636 | ) | 184 | 381.3 | ||||||||||||||||
Noninterest expense | |||||||||||||||||||||||
Salaries and employee benefits | 1,525 | 1,521 | 1,633 | 1,642 | 1,623 | (6.0 | ) | ||||||||||||||||
Net Occupancy and equipment | 397 | 369 | 355 | 371 | 383 | 3.7 | |||||||||||||||||
Depository Insurance | 386 | 237 | 247 | 606 | 159 | (100.0 | ) | ||||||||||||||||
Other operating expense | 1,372 | 1,476 | 1,081 | 1,312 | 1,114 | 23.2 | |||||||||||||||||
Total noninterest expense | 3,680 | 3,603 | 3,316 | 3,931 | 3,279 | 12.2 | |||||||||||||||||
Income (loss) before income taxes | 283 | (37 | ) | 494 | (4,869 | ) | (2,844 | ) | NM | ||||||||||||||
Income tax (benefit) expense | 69 | (55 | ) | 150 | (1,904 | ) | (1,144 | ) | NM | ||||||||||||||
Net income (loss) | $ | 214 | $ | 18 | $ | 344 | $ | (2,965 | ) | $ | (1,700 | ) | NM | ||||||||||
Net income (loss) per share: | |||||||||||||||||||||||
Basic | $ | 0.03 | $ | - | $ | 0.05 | $ | (0.46 | ) | $ | (0.26 | ) | NM | ||||||||||
Diluted | $ | 0.03 | $ | - | $ | 0.05 | $ | (0.46 | ) | $ | (0.26 | ) | NM | ||||||||||
Average basic shares (000s) (1) | 6,500 | 6,500 | 6,500 | 6,500 | 6,500 | NM | |||||||||||||||||
Average diluted shares (000s) (1) | 6,500 | 6,500 | 6,500 | 6,500 | 6,500 | NM | |||||||||||||||||
Performance Ratios | |||||||||||||||||||||||
Return on average equity | 2.81 | % | 0.25 | % | 4.80 | % | -38.13 | % | -20.70 | % | NM | ||||||||||||
Return on average assets | 0.17 | % | 0.01 | % | 0.26 | % | -2.28 | % | -1.39 | % | NM | ||||||||||||
Net interest margin | 3.36 | % | 3.41 | % | 3.64 | % | 3.24 | % | 3.18 | % | NM | ||||||||||||
Average equity | 30,355 | 29,105 | 28,668 | 31,104 | 32,838 | (7.6 | ) | ||||||||||||||||
Average assets | 488,771 | 529,655 | 534,312 | 519,520 | 488,870 | (0.0 | ) | ||||||||||||||||
Average interest-earning assets | 458,213 | 506,631 | 510,386 | 499,047 | 454,058 | 0.9 | |||||||||||||||||
NM=Not Material | |||||||||||||||||||||||
(1) The 2009 average number of common shares outstanding have been retroactively adjusted to reflect two stock dividends that occurred during 2009. |
Cornerstone Bancshares, Inc. and Subsidiary | |||||||||||||
Loan Stratification | |||||||||||||
2010 | 2009 | ||||||||||||
(Amounts in thousands) | Third | % of | Third | % of | % Dollar | ||||||||
Quarter | Total | Quarter | Total | Change | |||||||||
Non-residential real estate | |||||||||||||
Owner occupied | $ | 68,998 | 23.6 | $ | 78,895 | 22.6 | (12.5 | ) | |||||
Non-owner occupied | 65,091 | 22.3 | 76,883 | 22.0 | (15.3 | ) | |||||||
Multi-family real estate | 12,871 | 4.4 | 12,839 | 3.7 | 0.2 | ||||||||
1-4 family construction | 4,320 | 1.5 | 7,203 | 2.1 | (40.0 | ) | |||||||
Commercial land and lot development | 22,162 | 7.6 | 49,264 | 14.1 | (55.0 | ) | |||||||
Total non-residential real estate | 173,442 | 59.4 | 225,084 | 64.5 | (22.9 | ) | |||||||
Residential real estate | |||||||||||||
First Mortgage – 1-4 family | 41,753 | 14.3 | 43,123 | 12.4 | (3.2 | ) | |||||||
Second Mortgage - 1-4 family | 4,709 | 1.6 | 3,302 | 0.9 | 42.6 | ||||||||
Home equity lines | 10,113 | 3.5 | 11,469 | 3.3 | (11.8 | ) | |||||||
Total residential real estate | 56,575 | 19.4 | 57,894 | 16.6 | (2.3 | ) | |||||||
Total real estate loans | 230,017 | 78.8 | 282,978 | 81.1 | (18.7 | ) | |||||||
Commercial | 50,127 | 17.2 | 59,293 | 17.0 | (15.5 | ) | |||||||
Agricultural & other | 8,581 | 2.9 | 2,447 | 0.7 | 250.7 | ||||||||
Consumer | 3,321 | 1.1 | 4,332 | 1.2 | (23.3 | ) | |||||||
Total loans, net of unearned fees | $ | 292,046 | 100.0 | $ | 349,050 | 100.0 | (16.3 | ) |
Cornerstone Bancshares, Inc. and Subsidiary | ||||||||
Consolidated Balance Sheets | ||||||||
Unaudited | ||||||||
September 30, | December 31, | |||||||
ASSETS | 2010 | 2009 | ||||||
Cash and due from banks | $ | 53,220,651 | $ | 38,202,205 | ||||
| ||||||||
Securities available for sale | 108,790,555 | 124,415,318 | ||||||
Securities held to maturity | 101,340 | 135,246 | ||||||
Federal Home Loan Bank stock, at cost | 2,322,900 | 2,229,200 | ||||||
Loans, net of allowance for loan losses of $6,271,114 at September 30, 2010 and $5,905,054 at December 31, 2009 | 285,774,624 | 330,787,382 | ||||||
Bank premises and equipment, net | 8,235,095 | 8,098,059 | ||||||
Accrued interest receivable | 1,456,314 | 1,520,699 | ||||||
Goodwill and amortizable intangibles | 2,582,994 | 2,579,211 | ||||||
Foreclosed assets | 13,427,436 | 10,327,297 | ||||||
Other assets | 7,439,529 | 14,109,769 | ||||||
Total Assets | $ | 483,351,438 | $ | 532,404,386 | ||||
| ||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Deposits: | ||||||||
Noninterest-bearing demand deposits | $ | 38,609,397 | $ | 41,971,956 | ||||
Interest-bearing demand deposits | 25,102,235 | 26,533,329 | ||||||
Savings deposits and money market accounts | 32,158,476 | 31,029,587 | ||||||
Time deposits of $100,000 or more | 105,575,691 | 91,064,094 | ||||||
Time deposits of less than $100,000 | 149,921,029 | 214,143,147 | ||||||
Total deposits | 351,366,828 | 404,742,113 | ||||||
Federal funds purchased and securities sold under agreements to repurchase | 37,181,597 | 26,321,885 | ||||||
Federal Home Loan Bank advances and other borrowing | 61,765,000 | 72,350,000 | ||||||
Accrued interest payable | 370,922 | 351,360 | ||||||
Other liabilities | 1,702,461 | 801,549 | ||||||
Total Liabilities | 452,386,808 | 504,566,907 | ||||||
Stockholders' Equity | ||||||||
Preferred stock - no par value; 2,000,000 shares authorized; 61,740 shares issued and outstanding in 2010 | 1,424,173 | - | ||||||
Common stock - $l.00 par value; 20,000,000 shares authorized; 6,709,199 issued in 2010 and 2009; 6,500,396 outstanding in 2010 and 2009 | 6,500,396 | 6,500,396 | ||||||
Additional paid-in capital | 21,218,645 | 21,162,686 | ||||||
Retained earnings | 1,000,461 | 424,854 | ||||||
Accumulated other comprehensive income | 820,955 | (250,457 | ) | |||||
Total Stockholders' Equity | 30,964,630 | 27,837,479 | ||||||
Total Liabilities and Stockholders' Equity | $ | 483,351,438 | $ | 532,404,386 |
Cornerstone Bancshares, Inc. and Subsidiary | ||||||||||||||
Consolidated Statements of Income | ||||||||||||||
Unaudited | Unaudited | |||||||||||||
Three months ended | Nine months ended | |||||||||||||
September 30 | September 30 | |||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||
INTEREST INCOME | ||||||||||||||
Loans, including fees | $ | 5,159,963 | $ | 6,018,409 | $ | 16,602,155 | $ | 18,495,619 | ||||||
Investment securities | 753,783 | 357,677 | 3,099,362 | 1,157,803 | ||||||||||
Federal funds sold & other earning assets | 19,289 | 30,439 | 64,682 | 45,085 | ||||||||||
Total interest income | 5,933,035 | 6,406,525 | 19,766,199 | 19,698,507 | ||||||||||
INTEREST EXPENSE | ||||||||||||||
Time deposits $100,000 or more | 538,963 | 476,611 | 1,673,303 | 1,534,269 | ||||||||||
Other deposits | 939,412 | 1,494,434 | 3,305,671 | 4,526,554 | ||||||||||
Federal funds purchased and securities sold under agreements to repurchase | 31,649 | 37,227 | 99,206 | 135,157 | ||||||||||
FHLB advances and other borrowing | 665,961 | 757,682 | 2,204,961 | 2,231,717 | ||||||||||
Total interest expense | 2,175,985 | 2,765,954 | 7,283,141 | 8,427,697 | ||||||||||
Net interest income before provision for loan losses | 3,757,050 | 3,640,571 | 12,483,058 | 11,270,810 | ||||||||||
Provision for loan losses | 681,000 | 3,390,000 | 3,161,000 | 10,748,898 | ||||||||||
Net interest income after the provision for loan losses | 3,076,050 | 250,571 | 9,322,058 | 521,912 | ||||||||||
NONINTEREST INCOME | ||||||||||||||
Customer service fee | 308,579 | 416,908 | 992,619 | 1,259,646 | ||||||||||
Other noninterest income | 33,931 | 29,343 | 94,126 | 170,314 | ||||||||||
Net gains / (losses) from sale of loans and other assets | 544,318 | (262,019 | ) | 930,513 | (252,323 | ) | ||||||||
Total noninterest income | 886,828 | 184,232 | 2,017,258 | 1,177,637 | ||||||||||
NONINTEREST EXPENSE | ||||||||||||||
Salaries and employee benefits | 1,525,311 | 1,622,766 | 4,679,871 | 5,331,916 | ||||||||||
Net occupancy and equipment expense | 397,461 | 382,601 | 1,121,150 | 1,176,735 | ||||||||||
Depository insurance * | 385,722 | 182,459 | 915,365 | 570,191 | ||||||||||
Other operating expense | 1,371,409 | 1,091,130 | 3,883,420 | 3,266,214 | ||||||||||
Total noninterest expense | 3,679,903 | 3,278,956 | 10,599,806 | 10,345,056 | ||||||||||
Income / (loss) before provision for income taxes | 282,975 | (2,844,153 | ) | 739,510 | (8,645,507 | ) | ||||||||
Provision / (benefit) for income taxes | 69,301 | (1,144,617 | ) | 163,903 | (3,431,673 | ) | ||||||||
NET INCOME / (LOSS) | $ | 213,674 | $ | (1,699,536 | ) | $ | 575,607 | $ | (5,213,834 | ) | ||||
EARNINGS / (LOSS) PER COMMON SHARE | ||||||||||||||
Basic net income / ( loss) per common share | $ | 0.03 | $ | (0.26 | ) | $ | 0.09 | $ | (0.80 | ) | ||||
Diluted net income / (loss) per common share | $ | 0.03 | $ | (0.26 | ) | $ | 0.09 | $ | (0.80 | ) | ||||
DIVIDENDS DECLARED PER COMMON SHARE | $ | - | $ | - | $ | - | $ | 0.10 | ||||||
* Includes Special one time Assessment on June 30, 2009 in the amount of $213,151 |
Cornerstone Bancshares, Inc. and Subsidiary | ||||||||||||||||||||||
Consolidated Statement of Changes in Stockholders' Equity - Unaudited | ||||||||||||||||||||||
For the nine months ended September 30, 2010 | ||||||||||||||||||||||
Additional | Other | Total | ||||||||||||||||||||
Comprehensive | Preferred | Common | Paid-in | Retained | Comprehensive | Stockholders' | ||||||||||||||||
Income | Stock | Stock | Capital | Earnings | Income | Equity | ||||||||||||||||
BALANCE, December 31, 2009 | $ | - | $ | 6,500,396 | $ | 21,162,686 | $ | 424,854 | $ | (250,457 | ) | $ | 27,837,479 | |||||||||
Employee compensation stock option expense | - | 55,959 | - | - | 55,959 | |||||||||||||||||
Issuance of Series A Convertible Preferred Stock | 1,424,173 | - | - | - | 1,424,173 | |||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||
Net income | $ | 575,607 | - | - | - | 575,607 | - | 575,607 | ||||||||||||||
Other comprehensive income, net of tax: | ||||||||||||||||||||||
Unrealized holding gains on securities available for sale, net of reclassification adjustment | 1,071,412 | - | - | - | - | 1,071,412 | 1,071,412 | |||||||||||||||
Total comprehensive income | $ | 1,647,019 | ||||||||||||||||||||
BALANCE, September 30, 2010 | $ | 1,424,173 | $ | 6,500,396 | $ | 21,218,645 | $ | 1,000,461 | $ | 820,955 | $ | 30,964,630 | ||||||||||
Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=6485721&lang=en
CONTACT:
Cornerstone Bancshares, Inc.
Frank Hughes, President and CEO, 423-385-3009